SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 20-F
(Mark One)

[ ]  REGISTRATION  STATEMENT  PURSUANT  TO  SECTION  12(b)  OR  12(g)  OF THE
     SECURITIES EXCHANGE ACT OF 1934 [Fee Required]

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

                   For the Fiscal Year Ended December 31, 2000

[ ]  TRANSITION  REPORT  PURSUANT  TO SECTION  13 OR 15(d) OF THE  SECURITIES
     EXCHANGE ACT OF 1934 [No Fee Required]

        For the transition period from ______________ to _______________.

                           Commission File No. 0-25108

                               IWI HOLDING LIMITED
              ----------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)

                             British Virgin Islands
                 ----------------------------------------------
                 (Jurisdiction of Incorporation or Organization)

   P.O. Box 3340, Dawson Building, Road Town, Tortola, British Virgin Islands
                     Address of Principal Executive Offices

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

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

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

                           Common Stock, no par value
                           --------------------------
                                (Title of Class)

     Securities  for which there is a reporting  obligation  pursuant to Section
15(d) of the Act:

                                      None
                                 ---------------
                                (Title of Class)

As of April 16, 2001, the Registrant had outstanding  2,554,700 shares of Common
Stock and 3,644,880 shares of Preferred Stock.

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

Indicate by check mark which financial statement item the registrant has elected
to follow.

     Item 17 [ ] Item 18|X|

                                       1
<PAGE>

                                TABLE OF CONTENTS

PART I
                                                                            Page
                                                                            ----

ITEM 1.     DESCRIPTION OF BUSINESS                                            3
ITEM 2.     DESCRIPTION OF PROPERTY                                            5
ITEM 3.     LEGAL PROCEEDINGS                                                  5
ITEM 4.     CONTROL OF REGISTRANT                                              5
ITEM 5.     NATURE OF TRADING MARKET                                           6
ITEM 6.     EXCHANGE CONTROLS AND OTHER LIMITATIONS
            AFFECTING SECURITY HOLDERS                                         6
ITEM 7.     TAXATION                                                           6
ITEM 8.     SELECTED CONSOLIDATED FINANCIAL DATA                               7
ITEM 9.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS                      8
ITEM 10.    DIRECTORS AND OFFICERS OF REGISTRANT                              11
ITEM 11.    COMPENSATION OF DIRECTORS AND OFFICERS                            12
ITEM 12.    OPTIONS TO PURCHASE SECURITIES FROM
            REGISTRANT OR SUBSIDIARIES                                        13
ITEM 13.    INTEREST OF MANAGEMENT IN CERTAIN TRANSACTIONS                    13


PART II

ITEM 14.    DESCRIPTION OF SECURITIES TO BE REGISTERED                        13


PART III

ITEM 15.    DEFAULTS UPON SENIOR SECURITIES                                   13
ITEM 16.    CHANGES IN SECURITIES AND CHANGES IN
            SECURITY FOR REGISTERED SECURITIES                                13
PART IV

ITEM 17.    FINANCIAL STATEMENTS                                              13
ITEM 18.    FINANCIAL STATEMENTS                                              13
ITEM 19.    FINANCIAL STATEMENTS AND EXHIBITS                                 14


SIGNATURES                                                                    15

                                       2
<PAGE>
                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

         This report contains  forward-looking  statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of Securities Exchange
Act of 1934.  Actual results could differ materially from those projected in the
forward-looking  statements  as a result of the risks which the  Company  cannot
foresee.  Such  risks  include,  but are not  limited to an  economic  turndown,
changes in government  policies,  financial  difficulty  with or loss of a major
customer or interruption in supplies.

General

         The Company, through its wholly-owned subsidiary,  Imperial World, Inc.
("Imperial"),  is engaged in the design,  assembly,  merchandising and wholesale
distribution  of  jewelry.  The Company  provides a broad  range of  fashionable
jewelry targeted at consumers who seek fine jewelry at moderate prices for every
day wear. These customers are likely to purchase  jewelry at frequent  intervals
as fashions and styles  change.  The majority of the  Company's  U.S.  sales are
under the trade name of "World  Pacific  Jewelry".  Customers of the Company are
principally large retail  establishments with jewelry departments and mass media
marketers.

Products and Pricing

         The Company's  principal products are fine jewelry of rings,  earrings,
pendants,  bracelets  and  necklaces,  made of 10, 14, 18 karat  gold,  set with
diamonds,  precious or semi-precious stones. In addition,  the Company is also a
major  supplier of pearl  products in the industry.  The Company's  products are
currently sold in over 7,000 retail outlets.  For the majority of products,  the
average  wholesale  price is  approximately  $65 with the  prices  ranging  from
approximately $20 to $500.

Purchasing

         The Company  imports most of its jewelry from the People's  Republic of
China  ("PRC"),  Hong Kong and  India.  Approximately  35-40%  of the  Company's
products are sourced in the U.S.  Fresh water and  cultured  pearls are imported
from the PRC,  Japan and Hong Kong.  The  imported  pearls are  assembled by the
Company into various pearl jewelry products.  The Company purchases jewelry from
a number of suppliers based on quality, pricing and available quantities.

         Although  purchases of material are made from a relatively small number
of suppliers,  the Company believes there are numerous  alternative  sources for
all materials,  and that the failure of any principal  supplier would not have a
material adverse effect on operations or the Company's financial condition.  The
Company  believes it has good relations  with its  suppliers,  most of whom have
supplied  the  Company  for many years.  The  Company  has not  experienced  any
difficulty in securing product.

Manufacturing and Assembly

Since the  Company  imports  most of its  jewelry  in an  assembled  state  from
suppliers in the PRC, Hong Kong and India, manufacturing and assembly operations
conducted by the Company are primarily limited to designing jewelry and assembly
of pearl products. Upon completing a design, the Company provides such design to
its  suppliers,  who will purchase the raw  materials,  such as diamonds,  other
precious stones, gold and silver, and manufacture the product or subcontract for
its  manufacture.  The use of third party  manufacturers  enables the Company to
shift the risk and capital cost of manufacturing.

                                       3
<PAGE>

The Company maintains a light manufacturing and assembly operation in the United
States for the stringing of pearls.  This enables the Company to assemble pearls
specifically  to customer order and to provide  shipment  within two days of the
order date.

Marketing

The primary  marketing efforts are product design and customer support services.
The Company  markets its  proprietary  products  and product  designs  through a
selling team that includes company  management,  internal account executives and
independent sales representative. Each major account has thorough involvement of
internal  sales  management,  to insure that quality of sales meet or exceed the
company requirement.

Customers

The Company's  customers consist of jewelry retail stores,  mass  merchandisers,
such as Wal-Mart Stores,  Inc.,  department stores, such as J.C. Penney Company,
Inc.,  national jewelry chains,  catalog showrooms and various specialty markets
including The Home Shopping Network,  Inc. The Company derived approximately 34%
and 17% of its net sales from two  customers  during  2000.  The  Company has no
long-term contracts with any customers,  however,  the core of each of its large
volume  purchasers  have been  customers for at least five years.  The following
table sets forth the  approximate  percentage  of net sales for the major market
segments for the periods indicated.

                                                Year Ended December 31,
                                             1998       1999          2000
                                             -----------------------------
         Jewelry retail stores                9.9%       5.8  %        5.2%
         Specialty markets                    4.6       11.2          20.9
         Mass merchandisers                  21.3        4.0           8.0
         Department stores                   55.1       57.5          49.8
         National Jewelry Chains              7.9       20.7          14.9
         Catalog showrooms                    1.2        0.8           1.2
                                           -------    --------      -------
                      Total                 100.0%     100.0  %      100.0%
                                           =======    ========      =======
Competition

The jewelry  industry  in the United  States is highly  fragmented,  with little
significant brand name recognition or consumer loyalty. Selection is generally a
function  of design  appeal,  perceived  high value and  quality in  relation to
price.

Jewelry stores alone account for an estimated $25 billion in annual sales in the
United  States.  Retail jewelry sales have  historically  increased at a rate in
excess of the inflation rate.  This increase is principally  attributable to the
growth in the number of dual working  households which in turn has increased the
amount of disposable income for women, the largest group of jewelry  purchasers.
The  rise in  number  of  women  in the  workforce  as well as  strong  economic
conditions  have  increased the demand for women's  business  attire,  including
jewelry.

While  many  competitors  may have a wider  selection  of  products  or  greater
financial  resources,  the Company believes its competitive position is enhanced
by its  information  system,  performance  and its close  relationship  with its
customers  and vendors.  Therefore,  although the  competition  is intense,  the
Company believes it is well positioned in the jewelry industry.

                                       4
<PAGE>

Employees

As of March 1,  2001,  the  Company  had 49  employees,  including  2  executive
officers, 5 persons in sales and merchandising, 32 persons in operations, and 10
persons in  administrative  and  support  functions.  None of the  employees  is
governed by a collective  bargaining  agreement  and the Company  considers  its
relations with its employees to be satisfactory.

ITEM 2. DESCRIPTION OF PROPERTY

The Company  maintains  its  registered  offices in the BVI; the Company  leases
approximately  13,000 square feet of space for  operations and pearl assembly in
Westmont,  Illinois.  Under the 10 year lease which commenced in November, 1993,
and modified in November  1998,  future minimum annual lease payments range from
approximately  $125,000 to $133,000. At the expiration of the lease, the Company
has the  option to renew for an  additional  five  years.  The  facility,  which
provides  state of the art security,  was designed to maximize the efficiency of
the Company's  current  operations and to provide for the Company's  anticipated
growth.

ITEM 3. LEGAL PROCEEDINGS

In September  1996,  Robert J. Rosen filed a class action lawsuit in the Supreme
Court in the state of New York alleging claims of fraudulent  misrepresentations
by IWI Holding  Limited and some Company  officers,  accountants  and lawyers in
connection with the Company's  initial public offering on December 16, 1994, and
in connection with the dissemination of financial data thereafter. The Plaintiff
claims damages on behalf of the class in excess of $11,000,000,  which allegedly
resulted from a decline of the market value of the Company's  common stock after
the initial public offering.

The  parties  reached  an  agreement  in  principal  to  settle  the claim for a
significantly  lesser  amount,  which was accrued as of December 31,  1999.  The
settlement agreement is subject to court approval and the Company may decline to
proceed with the agreement if a significant number of class members "opt out" of
the settlement.

ITEM 4. CONTROL OF REGISTRANT

The  following  table is furnished as of April 2, 2001,  to indicate  beneficial
ownership of shares of the  Company's  Common Stock and  Preferred  Stock by (1)
each  shareholder  of the Company who is known by the Company to be a beneficial
owner of more than 10% of the Company's  Common Stock or Preferred Stock and (2)
all officers and  directors of the Company as a group.  The  information  in the
following table was provided by such persons.
<TABLE>

Name and Address               Amount and Nature of       Title of   Percent of     Percent of
of Beneficial Owner           Beneficial Ownership (1)     Class       Class       Voting Power
--------------------         -------------------------   ----------- -----------  --------------
<S>                          <C>                         <C>         <C>          <C>

Bamberg Company Ltd.                  918,750              Common       35.96%        20.99%
Bamberg Company Ltd.                3,644,880              Preferred   100.00%        41.64%
Joseph K. Lau                          15,000              Common        0.59%         0.34%
Richard J. Mick                        30,000              Common        1.17%         0.69%
Joseph A. Benjamin                     10,000              Common        0.39%         0.23%
All executive officers
and directors
      As a group (3 persons)           55,000              Common        2.15%         1.26%
</TABLE>

                                       5
<PAGE>

ITEM 5. NATURE OF TRADING MARKET

         There  is no  non-U.S.  trading  market  for the  Common  Stock  of the
Company.  Within the United States,  the Company's Common Stock is traded in the
over-the-counter market. The Company's Common Stock is quoted on the OTCBB under
the symbol "JEWLF".


         The following table sets forth the high and low bid price per share for
the Company's Common Stock for each quarterly period for the past two years.

                                     2000                  1999
                                    ------                -------
                                High       Low        High       Low
              First Quarter   $.4380   $ .0800      $.1100    $.0300
              Second Quarter   .4000     .2810       .0700     .0500
              Third Quarter    .3130     .2800       .0600     .0300
              Fourth Quarter   .2800     .0900       .1200     .0400

         The quotations reflect  inter-dealer prices without mark-up,  mark-down
or commission and may not represent actual transactions.

         At April 16, 2001, the bid price at the Common Stock was $.06.

         As of April 16, 2001, there were approximately 1,470 beneficial holders
of the Common  Stock of the  Company,  nearly all of which are believed to be in
the United States.

ITEM 6. EXCHANGE CONTROLS AND OTHER LIMITATIONS AFFECTING SECURITY-HOLDERS

         The  Company  is not  subject  to any  governmental  laws,  decrees  or
regulations in the BVI which restrict the export or import of capital, including
any foreign  exchange  controls,  or which affect the  remittance  of dividends,
interest  or other  payments to  non-resident  holders of the  Company's  Common
Stock.

         Additionally,  neither  the laws of the BVI nor the  Company's  Charter
impose any  limitations on the right of  non-resident  foreign owners to hold or
vote the Common Stock of the Company.

ITEM 7. TAXATION

         The BVI imposes no  withholding  taxes and holders of Common  Stock who
are not  resident  in the BVI will not be  subject  to BVI tax on any  dividends
received from the Company or on gains realized from a sale or other  disposition
of the Common Stock. The United States does not have a tax treaty with the BVI.

                                       6
<PAGE>

ITEM. 8 SELECTED CONSOLIDATED FINANCIAL DATA
<TABLE>

(In thousands, except share data)
                                                        Year Ended December 31,
                                         1996         1997          1998         1999         2000
                                        ------       -------      -------      --------     --------
<S>                                     <C>          <C>          <C>          <C>          <C>
Statement of Income Data:

Net Sales                               $30,840      $25,523       $16,337      $16,800      $19,028
Cost of sales                            25,809       24,018        12,650       11,549       13,999
                                        --------     --------      --------     --------     --------
Gross profit                              5,031        1,505         3,687        5,251        5,029
Operating expenses                       10,221       10,821         6,033        4,969        4,612
                                        --------     --------      --------     --------      -------
Income (loss) from operations            (5,190)      (9,316)       (2,346)        (282)         417
Other income (expense) - net             (1,053)        (832)         (430)        (225)        (305)
                                        ---------    --------      --------     --------      -------
Income (loss) before income taxes        (6,243)     (10,148)       (2,776)          57          112
Income data:
   Income taxes (benefit)                  (307)         (14)          (67)           -            -
                                        ---------    ---------     --------     --------      -------
   Net income (loss)                    $(5,936)    $(10,134)     $ (2,709)     $    57      $   112
                                        =========    =========     ========     ========      =======
   Net income (loss) per common share   $ (2.25)    $  (3.96)     $ (1.06)$         .02      $   .04
                                        =========    =========     ========     ========      =======
Cash distributions per common share     $     -     $      -      $     -       $     -      $     -
                                        =========    =========     ========     ========      =======
Weighted average number of common
    shares outstanding                2,625,873    2,558,217     2,554,700    2,554,700    2,554,700
                                      ===========  ===========  ===========   ==========   ==========
</TABLE>


                                             Year Ended December 31,
                                 1996      1997      1998      1999     2000
                                -------   -------   -------   ------- --------
Balance Sheet Data:

Working capital               $ 12,038    $ 2,926     $ 470     $ 584    $ 915
Total assets                    29,768     11,155     6,569     8,713   10,670
Long-term debt                     204          0         0         0        0
Shareholders' equity            14,287      4,124     1,415     1,472    1,584

                                       7
<PAGE>

ITEM 9. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

Results of Operations

         The  following  table sets forth,  for the periods  indicated,  certain
information  derived from the Consolidated  Statements of Income of the Company.
All dollar and share amounts are set forth in thousands, except per share data.
<TABLE>

                                       1998                    1999                       2000
                                     ---------               ---------                 ----------
                                       %        %                %       %                %       %
                            Amount   Sales   Change    Amount  Sales  Change    Amount  Sales  Change
                            ------   -----   ------    ------  -----  ------    ------  -----  ------
<S>                         <C>      <C>     <C>       <C>     <C>    <C>       <C>     <C>    <C>

Net sales                  $16,337   100.0   (36.0)   $16,800  100.0    2.8    $19,028  100.0   13.3
Gross Profit                 3,687    22.6   144.0      5,251   31.3   42.4      5,029   26.4   (4.2)
Operating expenses           6,033    37.4   (44.2)     4,969   29.6  (17.6)     4,612   24.2   (7.2)
Income (loss) from
operations                  (2,346)  (31.1)   74.8        282   31.7    n/a        417    2.2   47.9
Income (loss) before
income taxes                (2,776)  (34.3)   72.6         57    0.3    n/a        112    0.6   96.5
Income taxes (benefit)         (67)    0.3    78.6          -      -    n/a          -      -    n/a
Net income (loss)           (2,709)  (34.6)   73.3         57    0.3    n/a        112    0.6   96.5
Net income (loss) per
common share                $(1.06)                     $ .02                   $  .04
                            =======                    =======                  =======
Weighted average
number of shares
outstanding                  2,555                      2,555                    2,555
                            =======                    =======                  =======
</TABLE>

The Company's sales are generated through the wholesaling of jewelry products to
the following groups:

                             1996      1997      1998       1999       2000
                            ------    ------    ------     ------     ------
Jewelry retail stores         8.2 %    12.0 %     9.8 %      5.8 %      5.2 %
Specialty markets            13.6       7.1       4.6       11.2       20.9
Mass merchandisers           25.7       6.2      21.3        4.0        8.0
Department stores            35.9      64.6      55.1       57.5       49.8
National Jewelry Chains       7.0      10.6       7.9       20.7       14.9
Catalog showrooms             9.6      (0.5)      1.2        0.8        1.2
                            -------   -------   -------   --------    -------
Total                       100.0 %   100.0 %   100.0 %    100.0 %    100.0 %
                            =======   =======   =======   ========    =======

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

         Net  Sales.  Net sales  increased  by $2.2  million,  or 13.3% to $19.0
million in 2000,  from $16.8 million in 1999. This increase  primarily  reflects
increased  sales  to our  base  customers.  While a  broadening  of our  overall
customer base continued in 2000, the impact was not significant.

                                       8
<PAGE>

         Gross  Profit.  Gross profit  decreased  $.2  million,  or 4.2% to $5.0
million in 2000 and reflects the impact in both customer and product mix and was
partially  offset by reduced  sales costs.  In addition,  provisions  for future
liquidations  of excess  inventory  were  recorded  during 2000 in the amount of
$244,000.

         Income from Operations.  Income from operations  increased by $135,000,
or 96.5% to $417,000 in 2000 from $282,000 in 1999 and reflects  reduced general
and administrative costs as well as certain sales related costs.

         Net Income. The net income for 2000 of $112,000 reflects an increase of
$55,000  from the 1999 net income of  $57,000.  This  increase in net income for
2000 was  primarily  attributable  to the  increase in sales  combined  with the
decrease in operating costs.  Interest expense  increased by $80,000  reflecting
increased financing requirements associated with the increase in sales volume.

Year Ended December 31, 1999 Compared to Year Ended December 31,1998

Net Sales. Net sales increased by $.5 million, or 2.8% to $16.8 million in 1999,
from $16.3 million in 1998.  Included in the 1998 sales levels were $4.8 million
from the Company's Canadian  Subsidiary,  which was sold on August 31, 1998. Net
sales from  continuing  operations  for 1999  increased $5.3 million or 46.1% to
$16.8 million compared to $11.5 million a year ago. This increase  reflects both
increased  sales to our base  customers  as well as  broadening  of our  overall
customer base.

Gross Profit. Gross profit increased $2.4 million to $5.3 million in 1999. Gross
profit from  continuing  operations  increased  $3.5 million and  reflects  both
improved margins and increased volume.

         Income from  Operations.  The income from operations  increased by $2.6
million  from a loss of $2.3  million in 1998 to income of $.3  million in 1999.
The improvement in operating  income of $2.5 million from continuing  operations
reflects   improved   gross  profit   levels  as  well  as  lower   general  and
administrative  costs reflecting cost reductions  implemented during 1998. Sales
costs increased due to volume.

Net  Income.  The net  income  for 1999 of  $57,000  compared  to a loss of $2.7
million in 1998 reflects an  improvement  of $2.8 million.  This increase in net
income for 1999 was  primarily  attributable  to the increase in sales  combined
with the increase in gross profit  margins and decrease in operating  costs.  In
addition,  interest  expense  decreased  $.2 million,  of which $15,000 was from
continuing operations.

Analysis of Financial Position, Liquidity and Capital Resources

The  Company's  primary  liquidity  needs are to fund  accounts  receivable  and
inventories.   The  Company  has  historically   financed  its  working  capital
requirements  through a combination  of internally  generated  cash,  short-term
borrowings under bank lines of credit. The Company's working capital at December
31, 2000 was $.9 million as compared to $.6 million at December 31, 1999.

On May 19, 1999 the Company executed a financing  agreement  effective as of May
24, 1999 with Business  Alliance Capital Corp., an asset base lender.  Under the
terms of this  agreement,  the  Company  is  authorized  to borrow a maximum  of
$2,500,000 against certain assets, including eligible inventory and receivables.
The Company  used a portion of these  proceeds to pay off it's former  lender so
that  Business  Alliance  Capital Corp.  is now the  Company's  sole lender.  On
November 9, 2000 this  agreement  was amended to increase the maximum  borrowing
limit to $3,500,000.

The following table summarizes cash provided by (used in) the Company's business
activities for the past three years (dollar amounts are in thousands):

                                       9
<PAGE>
                                             1998         1999          2000
                                             ----         ----          ----
         Operating activities                $928        $(797)        $(574)
         Investing activities                 494         (240)          (19)
         Financing activities              (1,378)       1,037           652
         Increase (decrease) in cash           44            -            59

Operating  Activities.  The net use of cash in 2000 was  principally  due to the
increase in accounts receivable of $1.1 million and inventories of $1.3 million.
These increases  reflect the increased  sales levels  particularly in the fourth
quarter and the  stocking of  inventory  levels to support the  increased  sales
volume.

Investing Activities.  Cash uses in 2000 were minimal and reflect the upgrade of
computer and related systems and minor building renovations.

Financing Activities. During 2000, the Company increased the amounts outstanding
under its line of credit by $.7 million to $2.9  million at December  31,  2000.
Notes payable to employees increased by $100,000.

Seasonality

The jewelry business is highly seasonal, with the fourth calendar quarter, which
includes the Christmas  shopping season,  historically  contributing the highest
sales of any  quarter  during  the year.  Net sales in the  third  quarter  1998
include the results from DACO through  August 31,  1998.  The fourth  quarter of
1998 does not reflect any results of operations of DACO.  Seasonality  cannot be
predicted  or  counted  upon,  and the  results  of any  interim  period are not
necessarily  indicative  of the  results  that might be  expected  during a full
fiscal year.

The following table sets forth the Company's unaudited net sales for the periods
indicated (dollar amounts are in thousands):

                                      Year Ended December 31,

                         1998                   1999                  2000
                        ------                 ------                ------
                    Amount     %          Amount     %          Amount     %
                    ------   -----        ------   -----        ------   -----
First Quarter      $ 4,687   28.7        $ 2,819   16.8        $ 4,711  24.7
Second Quarter       5,242   32.1          2,886   17.2          4,031  21.2
Third Quarter        3,234   19.8          3,413   20.3          2,827  14.9
Fourth Quarter       3,174   19.4          7,682   45.7          7,459  39.2
                   -------  -----        -------  -----        ------- -----
Total              $16,337  100.0        $16,800  100.0        $19,028 100.0
                   =======  =====        =======  =====        ======= =====

Inflation

Inflation  has   historically  not  had  a  material  effect  on  the  Company's
operations. When the price of gold or precious stones has increased, these costs
historically  have been  passed on to the  customer.  Furthermore,  because  the
Company does not have either long-term  supply contracts or long-term  contracts
with  customers,   prices  are  quoted  based  on  the  prevailing   prices  for
semi-precious  gemstones  or metals.  Accordingly,  the Company does not believe
inflation will have a material effect on its future operations.

                                       10
<PAGE>
ITEM 10. DIRECTORS AND OFFICERS OF REGISTRANT

Directors and Executive Officers

The following  table sets forth certain  information  as of the date hereof with
respect to the directors and executive officers of the Company.

Name                   Age    Position
-----                 -----   ---------
Joseph K. Lau          52     Chairman of the Board of Directors: President of
                              IWI Holding Limited, Principal Financial Officer
Richard J. Mick        60     Vice President - Sales and Director
Norman S.W. Chui       29     Director
Connie S. Yui          50     Inventory Manager and Director
Joseph A. Benjamin     58     Director
Samuel H. Lou          47     Director

Each  director  is serving a one-year  term that  expires  after the next annual
meeting of the Company's shareholders, or until their successors are elected and
qualified.  Executive  officers  of the Company are elected by, and serve at the
discretion of, the Board of Directors.

     Joseph K. Lau and Connie Yui are brother  and sister.  Norman S. W. Chui is
the nephew of Joseph K. Lau.

     Joseph K. Lau joined the Company in November,  1982 and was elected  Senior
Vice  President,  Chief Operating  Officer,  Secretary and Director in February,
1986 and Chairman of the Board, President and Chief Executive Officer in August,
1998.  For the 11 years  prior to  joining  the  Company,  he held a  management
position in the restaurant industry and owned a trading company in Hong Kong.

     Richard J. Mick joined the Company in  February,  1996 as Vice  President -
Sales and Director. For 6 years prior to joining the Company he was President of
a sales and marketing firm selling jewelry and related products.  Prior thereto,
Mr. Mick was employed by J.C. Penney Company, Inc. for 26 years.

     Norman  S.  W.  Chui  joined  the  Company  in  December,  1997  as  Senior
Manager/Secretary  and  Director.  Prior to joining the Company,  Mr. Chui was a
consultant with Eclipse  Information  Systems of Darien, IL and prior to thereto
was a consultant for Arthur Andersen & Co., which he joined following graduation
from the  University of Illinois in 1994.  Mr. Chui resigned from the Company in
January,  2000 but remains as an active  Director and is now a  consultant  with
Trading Technologies Consulting.

     Connie S. Yui  joined  the  Company  in March,  1985 and has  served as the
Product  Development  Manager and is responsible for inventory control and pearl
assembly.

     Joseph A Benjamin has served as a Director of the Company  since  December,
1997.  Mr.  Benjamin  is a CPA  and  is  the  Managing  Partner  of  Benjamin  &
Birkenstein, P.C., a business and tax consulting firm in Chicago, Illinois.

                                       11
<PAGE>

     Samuel H. Lou has served as a Director of the Company since December, 1997.
Mr. Lou is a business consultant with his own firm in Chicago, Illinois.

Employment Contracts

The Company  has an  employment  contract  with Joseph K. Lau who is employed by
Imperial pursuant to a contract expiring July, 2001. The contract provides for a
base salary of $250,000 per year, and bonuses as determined by the  Compensation
Committee of the Board of Directors.

ITEM 11. COMPENSATION OF DIRECTORS AND OFFICERS

The  aggregate  cash  compensation  paid by the  Company  to all  directors  and
officers as a group during 2000 was approximately $480,000.

Certain  officers  of the Company  will be entitled to bonuses  from the Company
based on performance criteria to be established by the Compensation Committee of
the Board of Directors  of the Company.  Additionally,  in December,  1993,  the
Company  adopted a Stock Option Plan (the  "Option  Plan") to assist the Company
and its subsidiaries in retaining the service of current  employees,  motivating
selected key  management  personnel,  and attracting new management by providing
the  opportunity  for such  personnel to acquire a  proprietary  interest in the
Company and thereby share in its growth and success. Participation in the Option
Plan  and the  granting  of  options  under  the  Option  Plan  are  made by the
Compensation Committee of the Board of Directors, subject to ratification by the
Board.  Pursuant to the Option Plan,  a total of 150,000  shares of Common Stock
are reserved for issuance.  The Option Plan requires that the exercise  price of
the option be the fair market  value of the  Company's  stock on the date of the
grant of the option but not less than $8.50 per share. The fair market value for
purposes  of the  Option  Plan is for so long as  Common  Stock is quoted on the
OTCBB,  the final  closing  sales price per share on the date of the grant.  The
exercise  price with respect to any option must be paid in cash.  As of the date
hereof,  there are no options to  purchase  shares of Common  Stock  outstanding
under the Option Plan.

The Company,  during 1995, also adopted a  Non-Qualified  Stock Option Plan (the
"Non-Qualified Plan"). A total of 600,000 shares are reserved for issuance under
the  Non-Qualified  Plan. The  Non-Qualified  Stock Option Plan provides for the
granting of options and stock appreciation rights to non-employee directors, key
management  employees and consultants  and is  administered by the  Compensation
Committee.  The terms of any options  and/or stock  appreciation  rights granted
under the Non-Qualified  Plan shall be determined by the Compensation  Committee
provided  that options may not be  exercisable  for a term longer than ten years
and may not be  exercisable  at a price less than the stated value of the Common
Stock.  No  options or stock  appreciation  rights  had been  granted  under the
Non-Qualified Stock Option Plan as of December 31, 2000.

         In addition,  the Company  maintains a defined  contribution plan which
has both a profit  sharing  feature and a 401(k)  savings  feature (the "Plan").
Under  the  profit  sharing  portion  of the Plan,  contributions  are an amount
determined by the Company's Board of Directors.  Subject to certain  limitations
required by law, the Company's contribution is allocated to each participant who
is employed by the  Company at the end of the Plan year in the  proportion  that
the total  compensation  paid by the  Company to each  participant  bears to the
aggregate  compensation paid by the Company to all participants during such Plan
year. Under the 401(k) savings feature, eligible employees may elect, subject to
certain  limitations  required  by law,  to defer  payment of up to 15% of their
compensation.  The Plan provides that if an employee defers payment, the Company
will contribute 50% of the first 6% of compensation  deferred,  by making a cash
payment to the Plan on behalf of such participant.  Contributions by the Company
to the profit sharing feature of the plan, and earnings  thereon,  vest based on
the participant's years of service with the Company,  vesting 20% per year after
one year of service and being fully vested after six years of service.  Employee
contributions are always 100% vested. Contributions by the Company to the 401(k)
savings feature vest on the employees first day of employment. All contributions
vest,  regardless of years of service,  upon termination of employment by reason
of death,  of disability,  attainment of age 62 or the  termination of the Plan.
After  termination  of  employment,  an  employee  is  entitled  to receive  the
distribution  of his or her entire vested interest in the Plan in a lump sum, in
installments  for a specific period of time, or an annuity for life. The amounts
held  under  the  Plan  are  invested  according  to  the  instructions  of  the
participant  in  investment  funds  designated  by the plan  administrator.  The
Company  made  contributions  to the Plan  during  2000 and 1999 of $47,000  and
$36,000, respectively.

                                       12
<PAGE>

ITEM 12. OPTIONS TO PURCHASE SECURITIES FROM REGISTRANT OR SUBSIDIARIES

The Company presently has no outstanding incentive stock options.

ITEM 13. INTEREST OF MANAGEMENT IN CERTAIN TRANSACTIONS

All  transactions  between  the  Company,  its  officers,  directors,  principal
shareholder or affiliates, whether presently existing are, or in the future will
be, in the belief of management,  on terms no less favorable to the Company than
may be obtained from unaffiliated third parties.

Rhine Jewellery  Limited (Rhine),  located in Hong Kong and one of the Company's
principal  suppliers  through 1997, is a subsidiary of Rhine Holding Limited,  a
former controlling  stockholder of the Company. For the years ended December 31,
1999,  1998,  and 1997,  the  Company's  purchases  of products  from Rhine were
approximately  $0,  $900,000 and  $4,200,000  respectively.  During 1998,  Rhine
Holding  Limited  filed for  bankruptcy  in Hong Kong and  purchases  from Rhine
ceased.

Since 1998, some of the Company's products were purchased from a manufacturer in
Hong Kong, which is managed by a relative of an officer of the Company.  For the
years ended December 31, 2000, 1999 and 1998, the Company's  purchases from this
manufacturer   were   approximately   $6,205,000,    $5,000,000   and   $700,000
respectively.

                                     PART II

ITEM 14. DESCRIPTION OF SECURITIES TO BE REGISTERED

     Not applicable.

                                    PART III

ITEM 15. DEFAULTS UPON SENIOR SECURITIES

     None reportable.

ITEM 16. CHANGES IN SECURITIES AND CHANGES IN SECURITY FOR REGISTERED SECURITIES

     None reportable.

                                       13
<PAGE>

                                     PART IV

ITEM 17. FINANCIAL STATEMENTS

     Not applicable.

ITEM 18. FINANCIAL STATEMENTS

     Reference is made to the index to Consolidated  Financial Statements of the
Company,  and notes thereto,  appearing  under Item 19 below,  together with the
report of Blackman Kallick Bartelstein, LLP thereon.

ITEM 19. FINANCIAL STATEMENTS AND EXHIBITS

     (a)  Financial Statements Page

   Report of Independent Auditors                                           17
   Consolidated Balance Sheets as of  December 31, 2000 and 1999            18
   Consolidated Statements of Operations of Each of the Years
       in the Three-Year Period Ended December 31, 2000                     19
   Consolidated Statements of Shareholders' Equity for Each of the
       Years in the Three-Year Period Ended December 31, 2000               20
   Consolidated Statements of Cash Flows for Each of the Years in
        the Three-Year Period Ended December 31, 2000                       21
   Notes to Consolidated Financial Statements                            22-32

   Financial Statement Schedules (1)

   I - Condensed Financial Information of Registrant                        33
   II - Valuation and Qualifying Accounts                                   34

(1)  All other  schedules  are omitted  since the  required  information  is not
     present or is not present in amounts  sufficient  to require  submission of
     the schedule.

   (b)      Exhibits
            --------

   Exhibit
   Number                                  Description
   --------                              ---------------

     2.1* Bill of Sale  dated  February  4,  1995 re:  acquisition  of assets of
          Ullenberg Corporation (1)
     2.2* Stock Purchase Agreement relating to DACO Manufacturing Ltd. (3)
     3.1* Amended  and  Restated  Memorandum  of  Association  and  Articles  of
          Association of IWI Holding Limited (2)
     4.1* Specimen Form of Common Stock certificate (2)
     10.1*Lease Agreement  between  Imperial World,  Inc. and American  National
          Bank and Trust  Company of Chicago dated October 15, 1993 for the site
          in Westmont, Illinois (2)
     10.2* Stock Option Plan (2)
     10.3*Amended and Restated  Credit  Agreement dated June, 1996 between Rhode
          Island Hospital Trust National Bank and Imperial World, Inc. (2)
     10.4* Indemnity Agreement (2)

                                       14
<PAGE>

     10.5* Profit Sharing Plan (2)
     10.6* Territorial Agreement (2)
     10.8* IWI Holding Limited 1995 Non-Qualified Stock Option Plan (4)

     10.10* Employment Contract with Joseph K. Lau
     10.11* Financing Agreement with Business Alliance Capital Corp.
     10.12* Settlement Agreement with Richard W. Sigman
     10.13* Settlement Agreement with Bruce W. Anderson
     10.14* Amended Lease Agreement 10.15* DACO Sales Agreement

     (1)  Incorporated by reference to the Company's  Report on Form 6-K for the
          month of February, 1995.
     (2)  Incorporated by reference to the Company's  Registration  Statement on
          Form F-1 (File No. 33-78904) declared effective December 13, 1994).
     (3)  Incorporated by reference to the Company's  Report on Form 6-K for the
          month of August,  1995. (4) Incorporated by reference to the Company's
          Form 20-F for the year-ended December 31, 1995.

                                   SIGNATURES

Pursuant to the  requirements  of Section 12 of the  Securities  Exchange Act of
1934, the registrant  certifies that it meets all of the requirements for filing
on Form 20-F and has duly caused  this annual  report to be signed on its behalf
by the undersigned, thereunto duly authorized.


                                        IWI HOLDING LIMITED


                                    By:   /s/ Joseph K. Lau
                                        ------------------------------------
                                        Joseph K. Lau
                                        Chairman, President and Director



                                    By:  /s/ Richard J. Mick
                                        ------------------------------------
                                        Richard J. Mick
                                        Vice President - Sales and Director



                                    By:  /s/ Norman S. W. Chui
                                        ------------------------------------
                                        Norman S. W. Chui
                                        Director



                                    By:   /s/ Connie S. Yui
                                         -----------------------------------
                                         Connie S. Yui
                                         Inventory Manager and Director



                                    By:   /s/ Joseph A. Benjamin
                                         -----------------------------------
                                         Joseph A. Benjamin
                                         Director


                                       15
<PAGE>

                                    By:   /s/ Samuel H. Lou
                                         -----------------------------------
                                         Samuel H. Lou
                                         Director

Dated: May 7, 2001


                                       16
<PAGE>

                               IWI HOLDING LIMITED

                      CONSOLIDATED FINANCIAL STATEMENTS AND
                          INDEPENDENT AUDITOR'S REPORT

                  YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998


                          Independent Auditor's Report

The Board of Directors
IWI Holding Limited
Westmont, Illinois

We have  audited the  accompanying  consolidated  balance  sheets of IWI Holding
Limited  as of  December  31,  2000  and  1999,  and  the  related  consolidated
statements of  operations,  stockholders'  equity and cash flows for each of the
three years in the period ended  December 31, 2000. Our audits also included the
financial statement schedules listed in the index at item 19(a). These financial
statements and schedules are the responsibility of the Company's management. Our
responsibility  is to  express  an opinion  on these  financial  statements  and
schedules based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,  the  consolidated  financial  position  of IWI Holding
Limited as of December 31, 2000 and 1999,  and the  consolidated  results of its
operations  and its cash flows for each of the three  years in the period  ended
December 31, 2000, in conformity with generally accepted accounting  principles.
In addition,  the information set forth in schedules listed in the index at item
19(a)  is  fairly  stated,  in  all  material  respects,   in  relation  to  the
consolidated financial statements from which it has been derived.


s/Blackman Kallick Bartelstein, LLP
Chicago, Illinois
January 30, 2001

                                       17
<PAGE>



                                                                       Exhibit A
                               IWI Holding Limited
                           Consolidated Balance Sheets
                        (In thousands, except share data)

                     Years Ended December 31, 2000 and 1999

                         Assets
                                                           2000        1999
                                                         ---------   --------
Current Assets
     Cash                                                $   141     $    82
     Accounts receivable, less
       allowance for doubtful accounts of
       $550 in 2000 and $625 in 1999                       3,670       2,839
     Inventories                                           6,065       4,800
     Prepaid expenses                                        125         104
                                                         --------     --------
Total Current Assets                                      10,001       7,825
                                                         --------     --------


Property and Equipment                                     2,881       2,862
     Less accumulated depreciation                        (2,212)     (1,974)
                                                         --------     --------
                  Property and Equipment, Net                669         888
                                                         --------     --------

Total Assets                                             $10,670      $8,713
                                                         ========     ========

            Liabilities and Stockholders' Equity

Current Liabilities
     Lines of credit                                     $ 2,871      $2,319
     Notes payable                                           160          60
     Accounts payable - Trade                              2,340       1,858
     Accounts payable to affiliated companies              2,414       1,786
     Accrued advertising                                     462         373
     Accrued liabilities                                     839         845
                                                         --------    ---------
Total Current Liabilities                                  9,086       7,241
                                                         --------    ---------

Stockholders' Equity (Deficit)
     Preferred stock - $1 par value; authorized
     5,000,000 shares; issued and outstanding
     3,644,880 shares                                      3,645       3,645
     Common stock  No par value; authorized  10,000,000
       shares; issued and outstanding  2,554,700 shares        -
     Additional paid-in capital                           12,446      12,446
     Accumulated deficit                                 (14,507)    (14,619)
                                                         --------    ---------
                  Total Stockholders' Equity               1,584       1,472
                                                         --------    ---------

Total Liabilities & Stockholders' Equity                 $10,670      $8,713
                                                         ========    =========


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

                                       18
<PAGE>

                                                                       Exhibit B
                               IWI Holding Limited
                      Consolidated Statements of Operations
                        (In thousands, except share data)

                  Years Ended December 31, 2000, 1999 and 1998

                                         2000           1999           1998
                                        ------         ------         -------


Net Sales                            $  19,028      $  16,800      $   16,337

Cost of Sales                           13,999         11,549          12,650

Gross Profit                             5,029          5,251           3,687

Selling, General and Administrative
Expenses                                 4,612          4,969           6,143

Gain on Assets Held for Disposal             -              -            (110)

Income (Loss) from Operations              417            282          (2,346)

Interest Expense                          (305)          (225)           (430)

Income (Loss) Before Income Taxes          112             57          (2,776)

Income Tax Benefit                           -              -             (67)

Net Income (Loss)                    $     112        $    57       $  (2,709)
                                     ===========      =========      =========

Net Income (Loss) per Common Share   $    0.04        $  0.02       $   (1.06)
                                     ===========      =========      ==========

Weighted-Average Number of Common
  Shares Outstanding                 2,554,700        2,554,700      2,554,700
                                     ===========      =========      ==========


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

                                       19
<PAGE>


                                                                       Exhibit C

                               IWI Holding Limited
                 Consolidated Statements of Stockholder's Equity
                        (In thousands, except share data)

                  Years Ended December 31, 2000, 1999 and 1998

<TABLE>

                                Preferred Stock        Common Stock
                                                                            Additional
                                Number                 Number                Paid-in       Accumulated
                               of Shares   Amount     of Shares   Amount     Capital    Deficit    Total
                               ---------   ------     ---------   ------     -------    -------    -----
<S>                            <C>         <C>        <C>         <C>        <C>        <C>        <C>

Balance, January 1, 1998       3,644,880   $3,645     2,554,700   $   -    $12,446  $(11,967)   $4,124

Net Loss                               -        -             -       -          -    (2,709)   (2,709)
                               ---------  --------    ---------    ------  --------  ---------  --------
Balance, December 31, 1998     3,644,880    3,645     2,554,700       -     12,446   (14,676)    1,415

Net Income                             -        -             -       -          -        57        57
                               ---------  --------    ---------    ------  --------  ---------  --------
Balance, December 31, 1999     3,644,880    3,645     2,554,700       -     12,446   (14,619)    1,472

Net Income                             -        -             -       -          -       112       112
                               ---------  --------    ---------    ------  --------  ---------  --------
Balance, December 31, 2000     3,644,880   $3,645     2,554,700   $   -    $12,446  $(14,507)   $1,584
</TABLE>


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

                                       20
<PAGE>

                                                                       Exhibit D
                               IWI Holding Limited
                      Consolidated Statements of Cash Flows
                                 (In thousands)

                  Years Ended December 31, 2000, 1999 and 1998
<TABLE>

                                                              2000        1999       1998
                                                             -------    --------    -------
<S>                                                          <C>        <C>         <C>
Cash Flows from Operating Activities
     Net income (loss)                                       $   112    $    57   $  (2,709)
     Adjustments to reconcile net income (loss) to
       net cash (used in ) provided by operating activities
         Depreciation and amortization                           238        297         252
         Loss on sales of assets                                   -          -           7
         Provision for doubtful accounts                         244        125         177
         (Gain) on assets held for disposal                        -          -        (110)
         (Increase) decrease in
              Accounts receivable                             (1,075)    (1,215)      1,432
              Inventories                                     (1,265)    (1,114)      2,340
              Prepaid expenses                                   (21)         3          38
         Increase (decrease) in
              Accounts payable - Trade                           482        203        (512)
              Accounts payable to affiliated companies           628        363         187
              Accrued liabilities                                 83        484        (174)

                  Net Cash (Used in) Provided by
                    Operating Activities                        (574)      (797)        928

Cash Flows from Investing Activities
     Purchases of property and equipment                         (19)      (240)        (11)
     Proceeds from sale of equipment                               -          -           5
     Proceeds from sale of assets held for disposal                -          -         500
                                                             ---------   ----------  ---------
         Net Cash (Used in) Provided by
           Investing Activities                                  (19)      (240)        494
                                                             ---------   ----------  ---------
Cash Flows from Financing Activities
     Borrowings from (payments on) notes payable
       to employees                                               100       (65)        125
     Borrowings from (payments on) lines of credit, net           552     1,102      (1,503)

                  Net Cash Provided by (Used in)
                    Financing Activities                          652     1,037      (1,378)

Net Increase in Cash                                               59         -          44

Cash, Beginning of Year                                            82        82          38

Cash, End of Year                                            $    141    $   82     $    82
                                                             =========   =======    =======
</TABLE>

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


                                       21
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998


Note 1 - Description of Business and Acquisitions

IWI Holding Limited  (Holding) was incorporated in the British Virgin Islands on
February 22,  1993.  Holding and its wholly owned  subsidiaries  (together,  the
Company) import, manufacture, and distribute wholesale fine jewelry. The Company
also imports pearls for assembly and resale through its wholly owned subsidiary,
Imperial World, Inc.  (Imperial).  Sales to Canada were discontinued during 1998
due to the sale of the Daco subsidiary. See Note 3.

Note 2 - Summary of Significant Accounting Policies

Consolidation
-------------
All significant intercompany transactions have been eliminated.

Inventories
-----------
Inventories,  primarily consisting of finished goods, are stated at the lower of
first-in, first-out (FIFO) cost or market.

Net sales  during 1998  continued  at a level much lower than  anticipated,  and
management initiated another inventory reduction plan. Approximately $673,000 of
additional  reserves were established  during 1998 for the further  reduction of
inventory under this plan. An inventory valuation reserve of $1,778,000 remained
as of  December  31,  1998.  This  inventory  reduction  plan was  substantially
completed as anticipated.

                                       22
<PAGE>

As of December 31, 1999, the inventory valuation reserve was $1,448,000.

As of December 31, 2000, the inventory  valuation  reserve was  $1,200,000.  The
Company  recorded  an expense of $244,000  during  2000 to adjust the  inventory
value to lower of cost or market and to provide for future liquidations.

Depreciation
------------
Property and equipment are stated at historical cost and  depreciated  primarily
on a straight-line  basis over their estimated useful lives.  Useful lives range
from three to ten years for machinery, equipment and leasehold improvements.

Income Taxes
------------
Deferred  tax assets and  liabilities  are  determined  based on the  difference
between the financial  reporting and tax bases of assets and  liabilities  using
the  enacted  tax rates in  effect  for the year in which  the  differences  are
expected to reverse.

                                       23
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998


Note 2 - Summary of Significant Accounting Policies (Continued)

Fair Value of Financial Instruments
-----------------------------------
The  Company's  financial  instruments  include  accounts  receivable,  accounts
payable, accrued liabilities and notes payable. The fair values of all financial
instruments were not materially different than their carrying values.

Accounting Estimates
--------------------
The preparation of financial  statements in conformity  with generally  accepted
accounting   principles  requires  Company  management  to  make  estimates  and
assumptions  that affect the amounts  reported in the financial  statements  and
accompanying notes. Actual results could differ from those estimates.

Stock-Based Compensation
------------------------
The Company has granted  stock options for a fixed number of shares to employees
with an  exercise  price  equal to the fair  value of the  shares at the date of
grant.  The Company  accounts for stock  option  grants in  accordance  with APB
Opinion No. 25,  "Accounting  for Stock Issued to Employees"  and,  accordingly,
recognizes no compensation expense for the stock option grants.

Advertising Costs
-----------------
The Company expenses all advertising  costs as incurred.  Advertising costs were
approximately  $617,000,   $672,000  and  $436,000  for  2000,  1999  and  1998,
respectively.

Foreign Currency
----------------
The functional currency of the Company is the U.S. dollar.  Transactions arising
in foreign  currencies  have been  translated at rates in effect at the dates of
the  transactions.  The  gains or losses  during  the  years  presented  are not
significant.

Income (Loss) Per Common Share
------------------------------
The Company has adopted the  provisions  of FASB No. 128,  "Earnings Per Share."
Income  (loss) per common share is computed by dividing net income (loss) by the
weighted-average  number of common shares  outstanding  during the period.  When
dilutive, stock options and warrants are included as share equivalents using the
treasury stock method in the  calculation of diluted  earnings per share.  Basic
and diluted net income  (loss) per common  share is the same for the years ended
December  2000  and  1999.   Common  stock   equivalents  of  the  Company  were
antidilutive for the year ended December 31, 1998 and not material for the years
ended December 31, 1999 and 2000.


                                       24
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998

Note 2 - Summary of Significant Accounting Policies (Continued)

Segment Information
-------------------
The Company has adopted  Statement of Financial  Accounting  Standards  No. 131,
"Disclosures  about  Segments of an Enterprise  and Related  Information."  This
statement  supercedes  Statement  of  Financial  Accounting  Standards  No.  14,
"Financial  Reporting  for  Segments of a Business  Enterprise,"  replacing  the
"industry  segment"  approach with the  "management"  approach.  The  management
approach designates the internal reporting that is used by management for making
operating  decisions  and assessing  performance  as the source of the Company's
reportable  segments.  This statement requires disclosure of certain information
by reportable segment, geographic area and major customer.

The Company  imports,  manufactures,  distributes  and wholesales  fine jewelry.
Substantially all the Company's sales are within the United States.  The Company
operates this product line as one operating  segment,  which is deemed to be one
reportable segment for purposes of this disclosure.

Comprehensive Income
--------------------
As of January 1, 1998,  the Company  adopted  Statement of Financial  Accounting
Standards (SFAS) No. 130,  "Reporting  Comprehensive  Income," which establishes
standards for the reporting and display of  comprehensive  income (loss) and its
components  in the financial  statements.  Components  of  comprehensive  income
(loss)  include  amounts  that,   under  SFAS  No.  130,  are  included  in  the
comprehensive  income (loss) but are excluded from net income (loss). There were
no significant  differences  between the Company's net income and  comprehensive
income.

New Accounting Pronouncements
-----------------------------
In June 1998,  the  Financial  Accounting  Standards  Board issued SFAS No. 133,
"Accounting for Derivative  Instrument and Hedging  Activities." SFAS No. 133 is
effective  for the fiscal  years  beginning  after June 15,  2000.  SFAS No. 133
requires  that all  derivative  instruments  be recorded on the balance sheet at
their fair market value.  Changes in the fair value of derivatives  are recorded
each  period  in the  current  earnings  or other  comprehensive  income  (loss)
depending  on whether a  derivative  is designed as part of a hedge  transaction
and, if so, the type of hedge transaction involved.  The Company does not expect
that  adoption of SFAS No. 133 will have a material  impact on its  consolidated
financial  position or results of  operation,  as the Company does not currently
hold any derivative financial instruments.

In December 1999,  the SEC issued Staff  Accounting  Bulletin No. 101,  "revenue
recognition in financial  statements"  subsequently  updated by SAB 101A and SAB
101B ("SAB  101").  SAB 101  summarizes  certain of the SEC's  views in applying
generally  accepted  accounting  principles to revenue  recognition in financial
statements.  The  Company is  required to adopt SAB 101 no later than the fourth
quarter of calendar  2000.  The Company  believes  that its revenue  recognition
practices are in compliance with SAB 101.

                                       25
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998

Note 3 - Loss on Assets Held for Disposal

In  connection  with  management's  plan  to  increase  liquidity,  the  Company
completed  the sale of its Daco  subsidiary  in August 1998.  As of December 31,
1997,  the  carrying  value of the net assets of Daco were reduced to fair value
(approximately $363,000) based on an estimate of the selling value less costs to
sell.  The selling value had been  determined  based on a written offer received
and  accepted  in  principle  by the  Company  on June  26,  1998.  The  Company
recognized a loss of $2,300,000 in 1997 from this sale.

During  1998,  the Company  recognized  a gain of $110,000  based upon the final
selling  value  less  costs to sell.  Daco had net sales of  approximately  $4.8
million and a net loss of $299,000 in 1998.

Note 4 - Credit Arrangements

On May 19,  1999,  the  Company  entered  into  an  agreement  with a  financial
institution,  whereby  Imperial can borrow up to $2.5 million payable on demand.
The total credit facility is governed by a formula, as defined in the agreement,
based principally on accounts  receivable and inventory  levels.  This agreement
provides,  among other things,  that the credit facilities are collateralized by
substantially  all assets of Imperial.  Under this demand facility,  interest is
calculated  at 3% over prime.  The  agreement  contains  certain  reporting  and
financial  covenants,  which the Company is required to maintain.  The agreement
can be terminated by the Company with 60 days' written notice,  or by the lender
upon  certain  events as  specified  in the loan  agreement.  An  officer of the
Company  has  personally  guaranteed  up to  $1,000,000  of this  borrowing.  On
November 9, 2000 this  agreement was amended to increase the borrowing  limit up
to $3.5 million. As of December 31, 2000 and 1999,  borrowings under this credit
agreement were approximately $2,871,000 and $2,319,000, respectively.

During 1998,  the Company had an agreement  with a bank,  whereby they  borrowed
funds through a line of credit, which bore interest at 12.75% as of December 31,
1998.  The  borrowings  under this line of credit as of  December  31, 1998 were
approximately $1,217,000.

Note 5 - Stockholders' Equity

The 3,644,880  issued  preferred  shares are redeemable at the Company's  option
after March 21, 1997,  at an amount not to exceed 50% of net income in excess of
$15 million for the preceding year. If not redeemed,  the preferred  shares will
begin to accrue a 4% non-cumulative  dividend at that date. The preferred shares
have voting  rights  equivalent  to  one-half  vote per share and a $1 per share
liquidation preference.

The Company had granted an option to purchase  225,000 shares of common stock at
an exercise price of $8.50 to the underwriters as part of the company's  initial
public  offering in a prior year. This option was exercised on January 30, 1995,
with the Company  receiving  net  proceeds of  approximately  $1.6  million.  In
conjunction with the IPO, warrants to purchase an aggregate of 150,000 shares of
common stock at an exercise  price of $14.025 were issued to the  representative
of the  underwriters  of the IPO. The warrants were  exercisable for a period of
four years beginning December 16, 1995.

In February 1996, the Company's Board of Directors  authorized the repurchase of
up to 350,000 shares of its common stock. As of December 31, 2000, 89,050 common
shares had been repurchased and retired.

                                       26
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998

Note 6 - Stock Option Plans

The Company has 150,000 shares of common stock  reserved for options,  which may
be granted to directors,  officers and key  employees  under a stock option plan
adopted in 1994.  The exercise  price of the options  shall not be less than the
greater of $8.50 per share or the fair market value of the stock on the date the
option is granted.  The only  options  outstanding  as of December 31, 1999 were
20,000 shares,  at an exercise price of $8.50 per share granted in 1995.  During
2000 and 1998, options for 20,000 and 60,000 shares were cancelled respectively.
As of December 31, 2000 there were no options outstanding.

During 1995, the Company  adopted a  nonqualified  stock option plan under which
600,000  shares of common stock have been  reserved  for  options,  which may be
granted to key employees and  third-party  consultants  at an option price to be
determined by the Compensation  Committee of the Board of Directors.  No options
have been granted under this plan.

The Company has elected to follow  Accounting  Principles  Board Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB 25), and related interpretations
in accounting for its employee stock options  because,  as discussed  below, the
alternative  fair  value  accounting  provided  for under  Financial  Accounting
Standards  Board Statement No. 123,  "Accounting  for Stock-Based  Compensation"
(FASB 123),  requires use of option valuation models that were not developed for
use in valuing employee stock options.

Under APB 25, since the exercise  price of the Company's  employee  stock option
grants has equaled the estimated fair value of the underlying  stock on the date
of grant, no compensation expense is recognized. Pro forma information regarding
net  income  and  earnings  per share is  required  under  FASB 123 and has been
determined  as if the  Company  had  accounted  for its  stock  options  granted
subsequent  to December 31, 1994 under the fair value method of that  Statement.
The fair value for these  options was  estimated  at the date of grant using the
Black-Scholes   option   pricing  model  with  the  following   weighted-average
assumptions:  risk-free interest rate of 7.8%; a dividend yield of zero percent;
and a weighted-average  expected life of the options of five to seven years. The
volatility  factor of the expected market price of the Company's common stock is
1.2.

The Black-Scholes option valuation model was developed for use in estimating the
fair value of traded options,  which have no vesting  restrictions and are fully
transferable.  In addition,  option valuation models require the input of highly
subjective  input  assumptions  including the expected  stock price  volatility.
Because the Company's employee stock options have characteristics  significantly
different from those of traded  options,  and because  changes in the subjective
input assumptions can materially affect the fair value estimate, in management's
opinion,  the  existing  models do not  necessarily  provide a  reliable  single
measure of the fair value of its employee stock options.

For purposes of pro forma  disclosures,  the estimated fair value of the options
is amortized to expense over the vesting  period of the respective  option.  All
remaining  outstanding  stock  options  expired  during  fiscal  year 2000.  The
Company's pro forma net income (loss) and pro forma net income (loss) per share,
respectively,  for the years ended  December  31, 1999 and 1998 would be $13,000
and $.01; and ($2,752,000) and ($1.07), respectively.

The  weighted-average  exercise price of options  outstanding as of December 31,
1999 and 1998 was $8.50.

                                       27
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998

Note 7 - Related Party Transactions

Rhine Jewellery Limited (Rhine), a former principal supplier, is a subsidiary of
Rhine Holding Limited, a former major stockholder of the Company.  For the years
ended December 31, 2000, 1999 and 1998, the Company's  purchases from Rhine were
approximately $0, $0 and $900,000, respectively.

Since 1998, some of the Company's products were purchased from a manufacturer in
Hong Kong, which is managed by a relative of an officer of the Company.  For the
years ended December 31, 2000, 1999 and 1998, the Company's  purchases from this
manufacturer   were   approximately   $6,205,000,   $5,000,000   and   $700,000,
respectively.


                                       28
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998

Note 8 - Income Taxes

The following table summarizes income taxes (benefits):

(In Thousands)                                  Year Ended December 31
                                           2000        1999           1998
   Current
            U.S. federal                $     -       $      -       $      -
            U.S. state                        -              -              -
            Other                             -              -            (67)
                                        --------      ---------       --------

                                              -              -            (67)
                                        --------      ---------       --------
   Deferred
            U.S. federal                      -              -              -
            U.S. state                        -              -              -
            Other                             -              -              -
                                        --------      ----------      ---------

                                              -              -              -
                                        --------      ----------      ---------
   Income Taxes                               -              -            (67)
                                        ========      ==========      =========

   Income (loss) before income taxes
        United States                       112              57         (2,410)
        Other                                 -               -           (366)
                                        --------      ----------      ---------
                                        $   112        $     57       $ (2,776)
                                        ========      ==========      =========


The differences  between the U.S.  federal  statutory tax rate and the Company's
effective tax rate are as follows:

                                                    Year Ended December 31
                                                --------------------------------
                                                 2000       1999         1998
                                                ------     ------       --------

         U.S. federal statutory tax rate       (34.0)%    (34.0)%      (34.0)%
         Excess foreign income taxes (benefit)      -         -         (2.1)
         State income taxes (net of U.S.
           federal income tax benefit)              -         -            -
         Change in valuation allowance           34.0      34.0         34.6
         Other                                      -         -         (0.9)

         Consolidated Effective Tax Rate            -%        - %       (2.4)%
                                               ========   =======    ========


                                       29
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

Years Ended December 31, 2000, 1999 and 1998

Note 8 - Income Taxes (Continued)

The components of deferred income taxes are as follows as of December 31:

 (In Thousands)
                                                 2000             1999
                                               ---------        --------

         Deferred Tax Assets (Liabilities)
              Net operating and capital loss
                Carry forward                  $   3,289       $   3,317
              Accounts receivables                   215             217
              Inventories                            534             624
              Property and equipment                  51             (20)
              Other                                   29              25
                                               -----------     ------------

                                                   4,118           4,163
         Less:  Valuation allowance               (4,118)         (4,163)
                                               -----------     ------------

         Net Deferred Tax Liability            $       -       $       -
                                               ===========     ============

In  accordance  with the  provisions  of  Internal  Revenue  Code  Section  382,
utilization of the company's net operating loss  carryforward is estimated to be
limited to  approximately  $111,000  per year  because of a potential  change in
corporate ownership.  However, because some of the net operating losses incurred
during part of fiscal year 1998 when the Section 382  limitation  did not apply,
the company has  approximately  $5,927,000  of net operating  loss  carryforward
available for immediate use as of December 31, 2000.  Because of the Section 382
limitation,  the portion of the company's total net operating loss  carryforward
that may be utilized through  expiration is estimated to be  approximately  $7.3
million.  This net operating  loss carry  forward will expire  though 2013.  The
company also has a capital loss  carryforward  of  approximately  $2.3  million,
which expires in 2003. The utilization of the capital loss  carryforward is also
subject to Section 382 limitations.

Note 9 - Supplemental Cash Flow Information

(In Thousands)                             Year Ended December 31
                                        2000         1999          1998
                                       ------       ------        -------
    Cash paid for interest            $  286      $    207     $    477


                                       30
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998

Note 10 - Employee Benefit Plan

The company sponsors a defined-contribution  profit-sharing plan (Plan) covering
substantially  all  full-time  employees  who have  completed  one year service.
Company contributions to the Plan are discretionary,  determined by the Board of
Directors and fully vest to employees  upon  completion of six years of service.
The Plan has a voluntary 401(k) savings feature.  Participants may contribute up
to 15% of their  compensation  to the Plan. The Company matches 50% of the first
2% of  compensation  that a  participant  contributes.  As of July 1, 1998,  the
matching  portion was  increased to 50% of the first 6% of  compensation  that a
participant  contributes.  The matching is discretionary and decided annually by
the Board of Directors.  Participant and  employer-matched  contributions to the
Plan are 100% vested. Company contributions were approximately $47,000,  $36,000
and $31,000 in 2000, 1999 and 1998, respectively.

Note 11 - Significant Customers

The Company derived 34% and 17% of its net sales from two customers during 2000.
The  Company  derived  44%,  18% and 12% of its net sales from  three  customers
during  1999 and 33% from one  customer in 1998.  The  receivable  balances  for
significant customers were $3,123,000 and $2,376,000 as of December 31, 2000 and
1999, respectively.

Note 12 - Commitments and Contingency

Litigation
----------
The Company is a codefendant in a class action lawsuit  brought by a stockholder
in 1996 who alleges the Company misrepresented its financial position in interim
financial  statements.  The stockholder is seeking  damages of $11 million.  The
Company  disputes the  stockholder's  allegations  and believes  that they would
ultimately  prevail in the  litigation.  The  parties  reached an  agreement  in
principal  to settle  the claim for a  significantly  lesser  amount,  which was
accrued as of December 31, 1999.  The  settlement  agreement is subject to court
approval  and the  Company  may  decline  to  proceed  with the  agreement  if a
significant number of class members "opt out" of the settlement.

One of the company's  former  vendors filed for bankruptcy in Hong Kong in 1998.
As of December 31, 2000,  the company has recorded a liability to this vendor of
approximately  $1,236,000.  The company  has  offered and the former  vendor has
conditionally  accepted a settlement  of the matter for  $70,000.  The matter is
currently pending approval of the bankruptcy court in Hong Kong.

                                       31
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998

Note 12 - Commitments and Contingency  (Continued)

Operating Leases
----------------
Imperial  is  obligated  under a lease on its  operating  facility,  located  in
Westmont,  Illinois  for minimum  rentals as well as real estate taxes and other
operating  expenses  through October 2003, with an option for an additional five
years.  During  1999,  Imperial  consolidated  into a smaller  space  within the
premises.

The future minimum lease payments required under these leases as of December 31,
2000, approximated the following (in thousands):

                                 Year Ending December 31,
                                                   2001           $    129
                                                   2002                133
                                                   2003                125
                                                                    -------

                         Total Minimum Lease Payments             $   387
                                                                    =======

Rent expense included in the accompanying  statements of operations  amounted to
$179,000, $174,000 and $414,000 for 2000, 1999 and 1998, respectively.

Employment Agreements
---------------------
The Company has an  employment  agreement  with an officer  expiring on July 31,
2001. The agreement includes provisions for severance payments for the longer of
one  additional  year or any period for which the  employee is  required  not to
compete.

The future minimum annual compensation  payments as required under the agreement
as of December 31, 2000, approximated $146,000.

                                       32
<PAGE>

                               IWI Holding Limited
                   Notes to Consolidated Financial Statements

                  Years Ended December 31, 2000, 1999 and 1998

Note 13 - Geographic Segment Information

Financial  information as of and for the years ended December 31, 2000, 1999 and
1998, summarized by geographic area, is as follows (in thousands):

<TABLE>

                                            United
                                            States         Canada (1)    Eliminations      Consolidated
                                          -----------     -----------   --------------    ---------------
<S>                                       <C>             <C>           <C>               <C>

2000
    Total Revenues - Unaffiliated
      customers                           $  19,028       $     -         $     -            $ 19,028
                                          =========       ========        ========           ========

    Income from operations                $     417       $     -         $     -            $    417
                                          =========       ========        ========           ========

    Assets - Identifiable assets          $  10,670       $     -         $     -            $ 10,670
                                          =========       ========        ========           ========

1999
    Total Revenues - Unaffiliated
      customers                           $  16,800       $     -         $     -            $ 16,800
                                          =========       ========        ========           ========

    Income from operations                $     282       $     -         $     -            $    282
                                          =========       ========        ========           ========

    Assets - Identifiable assets          $   8,713       $     -         $     -            $  8,713
                                          =========       ========        ========           ========

1998
    Total Revenues - Unaffiliated
      customers                           $  11,507       $  4,830        $     -            $ 16,337
                                          =========       ========        ========           ========

    Income from operations                $  (2,170)      $   (176)       $     -            $ (2,346)
                                          ==========      =========       ========           =========

    Assets - Identifiable assets          $   6,569       $     -         $     -            $  6,569
                                          =========       ========        ========           ========
</TABLE>

(1)     Daco subsidiary sold in August 1998. See Note 3.




                                       33
<PAGE>

                                                                      Schedule l
                               IWI Holding Limited

                  Condensed Financial Information of Registrant
                                 Balance Sheets

                           December 31, 2000 and 1999

<TABLE>

                       Assets
                                                              2000           1999
                                                           -----------    ----------
<S>                                                        <C>            <C>

Cash                                                      $     1,000     $    1,000
Due from affiliate                                            500,000        500,000
Investments in wholly owned subsidiaries                    1,083,000        971,000
                                                           -----------     ----------

                  Total Assets                            $ 1,584,000     $1,472,000
                                                           ===========     ==========

                  Stockholders' Equity

Preferred stock - $1 par value;
   authorized - 5,000,000 shares;
   issued and outstanding - 3,644,880 shares              $3,644,880      $3,644,880

Common stock - No par value; authorized - 10,000,000
  shares; issued and outstanding - 2,544,700 shares                -               -

Additional paid-in capital                                12,446,120      12,446,120

Accumulated deficit                                      (14,507,000)    (14,619,000)
                                                         -------------   ------------

                                                         $ 1,584,000     $ 1,472,000
                                                         =============   ============
</TABLE>
<TABLE>

   Statements of Income and Accumulated Deficit
                                                             2000             1999
                                                            ---------         -------
<S>                                                     <C>              <C>

Equity in net income of subsidiaries                   $    112,000     $     57,000

Accumulated deficit, beginning of year                  (14,619,000)     (14,676,000)
                                                        -------------    ------------

Accumulated deficit, end of year                       $(14,507,000)    $(14,619,000)
                                                       ==============    ============
</TABLE>

Note 1 - Basis of Presentation

The Company's  share of net income of its  unconsolidated  subsidiaries,  all of
which are wholly  owned,  is  included  in net income  using the equity  method.
Parent-company-only  financial statements should be read in conjunction with the
Company's consolidated financial statements.

                                       34
<PAGE>
                                                                     Schedule ll

                               IWI Holding Limited
                        Valuation and Qualifying Accounts

                  Years Ended December 31, 2000, 1999 and 1998
<TABLE>

                                               Additions    Additions
                                 Balance at    Charged to   Charged to                        Balance
                                 Beginning     Costs and     Other                            at End
Description                      of Period     Expenses     Accounts       Deductions        of Period
------------                    ------------  -----------  ------------   ------------      -----------
<S>                             <C>           <C>          <C>            <C>               <C>

Year Ended December 31, 1998

    Allowance for
      Doubtful Accounts        $  5,780,000     177,000             -      5,677,000  (1) $      280,000

    Inventory Valuation
     Allowance                 $  1,800,000     673,000             -        695,000  (2) $    1,778,000

    Deferred Income Tax
    Valuation Allowance        $  4,425,000           -             -        290,000  (3) $    4,135,000


Year Ended December 31, 1999

    Allowance for
      Doubtful Accounts        $    280,000     125,000       220,000              -      $      625,000

    Inventory Valuation
     Allowance                 $  1,778,000           -             -        338,000  (2) $    1,440,000

    Deferred Income Tax
     Valuation Allowance       $  4,135,000      28,000             -              -  (3) $    4,163,000


Year Ended December 31, 2000

    Allowance for
      Doubtful Accounts        $    625,000     244,000             -        319,000  (1) $      550,000

    Inventory Valuation
     Allowance                 $  1,440,000     244,000             -        484,000  (2) $    1,200,000

    Deferred Income Tax
    Valuation Allowance        $  4,163,000           -             -         45,000  (3) $    4,118,000


(1)      Write-off of uncollectible accounts
(2)      Inventory losses realized
(3)      Decreases in deferred tax assets
</TABLE>