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

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

                                   FORM 10-QSB


(Mark One)

   /X/   Quarterly report under Section 13 or 15(d) of the Securities Exchange
         Act of 1934

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2002

                                       or

   / /   Transition report under Section 13 or 15(d) of the Exchange Act

               For the transition period from ________ to ________


                        Commission file number 000-17001



                                   CECS CORP.
        -----------------------------------------------------------------
        (Exact Name of Small Business Issuer as Specified in Its Charter)


           Delaware                                          52-1529536
(State or Other Jurisdiction of                           (I.R.S. Employer
Incorporation or Organization)                           Identification No.)

                         391 Cosgrove Avenue NW
                     Bainbridge Island, Washington        98110
               (Address of Principal Executive Offices) (Zip Code)


                 Issuer's Telephone Number, Including Area Code
                                  206-842-6948


              ----------------------------------------------------
              (Former Name, Former Address and Former Fiscal Year,
                          if changed since last report)



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


State the number of shares outstanding of the issuer's Common Stock, as of
March 31, 2002:                    47,970,875

Transitional Small Business Disclosure Format (check one):  Yes / /    No /X/

================================================================================
<PAGE>

                          INDEX TO FINANCIAL STATEMENTS




                                                                           Page
                                                                           ----
PART I--FINANCIAL INFORMATION

Item 1. Financial Statements

        Balance Sheets ....................................................  1
        Statements of Operations (unaudited) ..............................  2
        Statements of Comprehensive Loss (unaudited) ......................  3
        Statement of Stockholders' Deficiency (unaudited) .................  4
        Statements of Cash Flows (unaudited) ..............................  5
        Notes to Financial Statements .....................................  7


Item 2. Management's Discussion and Analysis of Financial Condition and
        Results of Operations ............................................. 14




PART II--OTHER INFORMATION

Item 6. Exhibits Index .................................................... 16







                                        i
<PAGE>
                          PART I. FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS


                                   CECS CORP.
                          (A Development Stage Company)
                                 BALANCE SHEETS



<TABLE><CAPTION>
                                                                  MARCH 31,        DECEMBER 31,
                                                                    2002               2001
                                                                ------------       ------------
                                                                 (Unaudited)
<S>                                                             <C>                <C>
ASSETS


PROPERTY AND EQUIPMENT, net of accumulated
  depreciation of $8,826 and $7,565 respectively                $     18,400       $     19,661
                                                                ------------       ------------
TOTAL ASSETS                                                    $     18,400       $     19,661
                                                                ============       ============

LIABILITIES AND SHAREHOLDERS' DEFICIENCY

CURRENT LIABILITIES
  Accounts payable and accrued expenses                         $    104,990       $     93,023
  Lawsuit settlement payable                                          30,000             30,000
  Due to related parties                                              40,000             40,000
  Notes payable                                                      310,000            310,000
                                                                ------------       ------------
TOTAL LIABILITIES                                                    484,990            473,023
                                                                ------------       ------------

COMMITMENTS AND CONTINGENCIES                                             --                 --

SHAREHOLDERS' (DEFICIENCY)
  Preferred stock, par value $0.01 per share,
     convertible to common stock, authorized
     50,000,000 shares, 11.416 and 17.741 shares
     issued and outstanding, respectively                               0.12               0.12
  Common stock, par value $0.01 per share,
     authorized 200,000,000 shares, 47,970,875
     shares issued and outstanding                                   479,709            479,709
  Additional paid-in capital                                      22,079,371         22,079,371
  Accumulated deficit                                            (22,386,912)       (22,386,912)
  Deficit accumulated during the development stage                  (638,758)          (625,530)
                                                                ------------       ------------
TOTAL SHAREHOLDERS' DEFICIENCY                                      (466,590)          (453,362)
                                                                ------------       ------------

TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIENCY                  $     18,400       $     19,661
                                                                ============       ============
</TABLE>

The accompanying notes are an integral part of these financial statements.

                                       -1-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                      STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE><CAPTION>
                                                                               CUMULATIVE FROM
                                                                                  INCEPTION
                                                                                (JANUARY 16,
                                               THREE MONTHS ENDED MARCH 31,       2000) TO
                                               ---------------------------        MARCH 31,
                                                  2002             2001             2002
                                               ----------       ----------       ----------
<S>                                            <C>              <C>               <C>
REVENUE                                        $       --       $       --       $       --
                                               ----------       ----------       ----------

OPERATING EXPENSES
  General and administrative expenses                  --           19,345          289,344
  Professional and consulting fees                     --           64,229          235,249
  Depreciation expense                              1,261            1,261            8,826
                                               ----------       ----------       ----------

TOTAL OPERATING EXPENSES                           (1,261)          84,835          533,419
                                               ----------       ----------       ----------

LOSS FROM OPERATIONS                               (1,261)         (84,835)        (533,419)
                                               ----------       ----------       ----------

OTHER INCOME (EXPENSES)
  Impairment expense                                   --               --          (75,000)
  Bad debt expense - notes receivable                  --               --         (142,000)
  Gain on sale of certain contract rights              --               --          203,095
  Interest expense                                (11,967)          (9,289)         (78,427)
  Lawsuit settlement                                   --               --          (30,000)
  Loss on sale of marketable securities                --         (140,820)          16,993
                                               ----------       ----------       ----------

TOTAL OTHER INCOME (EXPENSE)                      (11,967)        (150,109)        (105,339)
                                               ----------       ----------       ----------

NET LOSS                                       $  (13,228)      $ (234,944)      $ (638,758)
                                               ==========       ==========       ==========


NET LOSS PER SHARE OF COMMON STOCK
BASIC/DILUTED LOSS PER SHARE:                  $    (0.00)      $    (0.00)
                                               ==========       ==========
</TABLE>






The accompanying notes are an integral part of these financial statements.

                                       -2-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                  STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED)





<TABLE><CAPTION>
                                                                               CUMULATIVE FROM
                                                                                  INCEPTION
                                                                                (JANUARY 16,
                                               THREE MONTHS ENDED MARCH 31,       2000) TO
                                               ---------------------------        MARCH 31,
                                                  2002             2001             2002
                                               ----------       ----------       ----------
<S>                                            <C>              <C>               <C>
COMPREHENSIVE LOSS

  Net loss                                     $  (13,228)      $ (234,944)      $ (638,758)


  Unrealized loss on investment                        --           (2,408)              --

                                               ----------       ----------       ----------

COMPREHENSIVE LOSS                             $  (13,228)      $ (237,352)      $ (638,758)
                                               ==========       ==========       ==========

</TABLE>


























The accompanying notes are an integral part of these financial statements.

                                       -3-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                 STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIENCY)


<TABLE><CAPTION>
                                                                                                   DEFICIT
                                                                                                 ACCUMULATED  ACCUMULATED
                          PREFERRED STOCK         COMMON STOCK        ADDITIONAL                  DURING THE    OTHER
                       --------------------   --------------------     PAID-IN      ACCUMULATED  DEVELOPMENT COMPREHENSIVE
                         SHARES     AMOUNT      SHARES     AMOUNT      CAPITAL        DEFICIT       STAGE       INCOME      TOTAL
                       ----------  --------   ----------  --------   -----------   ------------   ---------   ---------   ---------
<S>                    <C>         <C>        <C>         <C>        <C>           <C>            <C>         <C>         <C>
Balance at
  December 31, 2000    $   17.741      0.18   47,717,875  $477,179   $22,081,901   $(22,386,912)    (61,157)  $  57,763   $ 168,774

Issuance of common
  stock in exchange
  on conversion of
  preferred stock          (6.325)   (0.060)     253,000  $  2,530        (2,530)            --          --          --          --

Net loss for the
  year ended
  December 31, 2001            --        --           --        --            --             --    (564,373)         --    (564,373)

Other comprehensive
  loss                         --        --           --        --            --             --          --     (57,763)    (57,763)


Balance at
  December 31, 2001        11.416  $   0.12   47,970,875  $479,709   $22,079,371   $(22,386,912)  $(625,530)  $      --   $(453,362)


Net loss (unaudited)           --        --           --        --            --             --     (13,228)         --     (13,228)

Balance at
  March 31, 2002
 (unaudited)               11.416  $   0.12   47,970,875  $479,709   $22,079,371   $(22,386,912)   (638,758)  $      --   $(466,590)
</TABLE>





The accompanying notes are an integral part of these financial statements.

                                       -4-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                      STATEMENTS OF CASH FLOWS (UNAUDITED)

<TABLE><CAPTION>
                                                                                          CUMULATIVE FROM
                                                                                          JANUARY 16, 2000
                                                             THREE MONTH ENDED MARCH 31,   (INCEPTION) TO
                                                             --------------------------       MARCH 31,
                                                                2002            2001            2002
                                                             ----------      ----------      ----------
<S>                                                          <C>             <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                                     $  (13,228)     $ (234,944)     $ (638,758)

Adjustments to reconcile net loss to net cash used in
 operating activities:
   Depreciation and amortization                                  1,261           1,261           8,826
   Issuance of stock in exchange for services                        --              --          10,000
   Realized loss (gain) on sale of marketable securities             --         140,820        (220,088)
   Impairment expense                                                --              --          75,000
   Bad debt expense - notes receivable                               --              --         142,000
Change in assets and liabilities:                                    --              --
   Decrease in due from brokers                                      --          39,242              --
   Decrease in prepaid rent                                          --              --             619
   Increase/(decrease) in accounts payable and accrued
     expenses                                                    11,967         (59,089)       (163,271)
   Increase in lawsuit payable                                       --              --          30,000
   Decrease in due to related parties                                --              --        (190,000)
                                                             ----------      ----------      ----------
NET CASH USED IN OPERATING ACTIVITIES                                --        (112,710)       (945,672)
                                                             ----------      ----------      ----------

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of marketable securities                          --         243,955         948,104
Acquisition of furniture and fixtures                                --            (533)        (27,226)
Acquisition of non-marketable securities                             --              --         (75,000)
Acquisition of marketable securities and rights                      --              --        (605,700)
Issuance of notes receivable                                         --         (72,000)       (142,000)
                                                             ----------      ----------      ----------
NET CASH PROVIDED BY (USED) IN INVESTING ACTIVITIES                  --         171,422          98,178
                                                             ----------      ----------      ----------


CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable                                          --              --         686,500
Repayment of notes payable                                           --         (10,000)       (381,500)

Proceeds from issuance of preferred stock                            --              --         523,000
                                                             ----------      ----------      ----------
NET CASH (USED) IN PROVIDED BY FINANCING ACTIVITIES                  --         (10,000)        828,000
                                                             ----------      ----------      ----------

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS                 --          48,712         (19,494)

CASH AND CASH EQUIVALENTS - beginning                                --          23,966          19,494
                                                             ----------      ----------      ----------
CASH AND CASH EQUIVALENTS - ending                           $       --      $   72,678      $       --
                                                             ==========      ==========      ==========
</TABLE>

The accompanying notes are an integral part of these financial statements.

                                       -5-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                STATEMENTS OF CASH FLOWS (UNAUDITED) (CONTINUED)




<TABLE><CAPTION>
                                                                                          CUMULATIVE FROM
                                                                                          JANUARY 16, 2000
                                                             THREE MONTH ENDED MARCH 31,   (INCEPTION) TO
                                                             --------------------------       MARCH 31,
                                                                2002            2001            2002
                                                             ----------      ----------      ----------
<S>                                                          <C>             <C>             <C>

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

CASH PAID DURING THE PERIOD:
        Interest                                             $       --      $       --      $   27,188
                                                             ==========      ==========      ==========
        Tax                                                  $       --      $       --      $       --
                                                             ==========      ==========      ==========
</TABLE>







The accompanying notes are an integral part of these financial statements.

                                       -6-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2002


NOTE 1    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          Basis of Presentation and Nature of Operations
          ----------------------------------------------
          The accompanying financial statements have been prepared in accordance
          with accounting principles generally accepted in the United States of
          America for interim financial information and with the instructions to
          Form 10-QSB and Regulation S-B. Accordingly, they do not include all
          of the information and footnotes required by accounting principles
          generally accepted in the United States of America for complete
          financial statements. In the opinion of management, all adjustments
          (consisting only of normal recurring adjustments) considered necessary
          for a fair presentation have been included

          For further information, refer to the financial statements and
          footnotes included in Form 10-KSB for the year ended December 31,
          2001.

          CECS Corp. (the "Company") was incorporated under the laws of the
          State of Maryland on July 11, 1985, as PPV Enterprises, Inc. ("PPV").
          On August 18, 1987, the Company changed its name to DataVend, Inc.
          ("Datavend") and reincorporated under the laws of the State of
          Delaware. On March 14, 1990, the Company changed its name to Choices
          Entertainment Corporation ("Choices"). On June 16, 1997, the Company
          sold substantially all of its assets and business to West Coast
          Entertainment Corporation ("Westcoast").

          On August 30, 1999, the Company entered into an agreement the effect
          of which would have been to change the Company to a hotel properties
          holding and operating company. On January 16, 2000, the Company's
          Board of Directors adopted a plan to change the business of the
          Company to that of a technology holding company and terminated the
          plan to become a hotel company effective as of December 30, 1999. On
          May 26, 2000, the Company's shareholders approved the change of the
          name of the corporation to CECS CORP.

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

          Cash and Cash Equivalents
          -------------------------
          The Company considers all highly liquid investments purchased with
          original maturities of three months or less to be cash equivalents.

          Concentration of Credit Risk
          ----------------------------
          The Company places its cash in what it believes to be credit-worthy
          financial institutions. However, cash balances may have exceeded FDIC
          insured levels at various times during the year. The Company has not
          experienced any losses in such accounts and believes it is not exposed
          to any significant credit risk on cash and cash equivalents.

                                       -7-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2002


NOTE 1    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          Property and Equipment
          ----------------------
          Property and equipment are recorded at cost. Depreciation is computed
          using the straight-line method based upon the estimated useful lives
          of the various classes of assets. Maintenance and repairs are charged
          to expense as incurred.

          Income Taxes
          ------------
          Income taxes are provided for based on the asset and liability method
          of accounting pursuant to Statement of Financial Accounting Standards
          ("SFAS") No. 109, "Accounting for Income Taxes". The asset and
          liability method requires the recognition of deferred tax assets and
          liabilities for the expected future tax consequences of temporary
          differences between the reported amount of assets and liabilities and
          their tax basis.

          Fair Value of Financial Instruments
          -----------------------------------
          The carrying value of the Company's financial instruments as of March
          31, 2002, which include accounts payable and accrued expenses, and
          notes payable approximate their values due to their short maturities.

          Loss Per Share
          --------------
          SFAS No. 128, "Earnings Per Share" requires presentation of basic loss
          per share ("Basic LPS") and diluted loss per share ("Diluted LPS").
          The computation of basic loss per share is computed by dividing loss
          available to common stockholders by the weighted-average number of
          outstanding common shares during the period. Diluted LPS gives effect
          to all dilutive potential common shares outstanding and all shares
          held in treasury during the period. The computation of diluted LPS
          does not assume conversion, exercise or contingent exercise of
          securities that would have an anti-dilutive effect on losses.

          The shares used in the computation of loss per share were as follows:

                                              MARCH 31,
                                       ------------------------
                                          2002          2001
                                       ----------    ----------
          Basic and diluted            47,970,875    47,942,764
                                       ==========    ==========





                                       -8-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2002


NOTE 1    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          Comprehensive Income
          --------------------
          SFAS No. 130, "Reporting Comprehensive Income", establishes standards
          for the reporting and display of comprehensive income and its
          components in the financial statements. As of March 31, 2001, the
          Company had items that represent comprehensive income; therefore, has
          included a schedule of comprehensive income in the financial
          statements.

          Segment Disclosure
          ------------------
          SFAS No. 131, "Disclosure about Segments of an Enterprise and Related
          Information" changes the way public companies report information about
          segments. SFAS No. 131, which is based on the selected segment
          information, requires quarterly and entity-wide disclosures about
          products and services, major customers, and the material countries in
          which the entity holds assets and reports revenues. The Company is not
          organized by multiple operating segments for the purpose of making
          operating decisions or assessing performance. Accordingly, the Company
          operates in one operating segment and does not report entity-wide
          disclosures.

          Recent Accounting Pronouncements
          --------------------------------
          On June 29, 2001, Statement of Financial Accounting Standards ("SFAS")
          No. 141, "Business Combinations", was approved by the Financial
          Accounting Standards Board ("FASB"). SFAS 141 requires that the
          purchase method of accounting be used for all business combinations
          initiated after June 30, 2001. Goodwill and certain intangible assets
          will remain on the balance sheet and not be amortized. On an annual
          basis, and when there is reason to suspect that their values have been
          diminished or impaired, these assets must be tested for impairment,
          and write-downs may be necessary. The Company implemented SFAS No. 141
          on January 1, 2002.

          On June 29, 2001, SFAS No. 142, "Goodwill and Other Intangible
          Assets", was approved by the FASB. SFAS No. 142 changes the accounting
          for goodwill from an amortization method to an impairment-only
          approach. Amortization of goodwill, including goodwill recorded in
          past business combinations, will cease upon adoption of this
          statement. The Company implemented SFAS No. 142 on January 1, 2002.

          In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset
          Retirement Obligation." SFAS No. 143 is effective for fiscal years
          beginning after June 15, 2002, and will require companies to record a
          liability for asset retirement obligations in the period in which they
          are incurred, which typically could be upon completion or shortly
          thereafter. The FASB decided to limit the scope to legal obligation
          and the liability will be recorded at fair value. The effect of
          adoption of this standard on Company's results of operations and
          financial positions is being evaluated.



                                       -9-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2002



NOTE 1    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          Recent Accounting Pronouncements (continued)
          --------------------------------------------
          In August 2001, the FASB issued SFAS No. 144, "Accounting for the
          Impairment or Disposal of Long-Lived Assets." SFAS No. 144 is
          effective for fiscal years beginning after December 15, 2001. It
          provides a single accounting model for long-lived assets to be
          disposed of and replaces SFAS No. 121 "Accounting for the Impairment
          of Long-Lived Assets and Long-Lived Assets to Be Disposed Of." The
          Company implemented SFAS No. 144 on January 1, 2002.

          Reclassification and Restatement
          --------------------------------
          In order to facilitate the comparison of financial information,
          certain amounts in prior year comparative totals have been
          reclassified to conform with the current year presentation.


NOTE 2    GOING CONCERN

          The accompanying financial statements have been prepared in conformity
          with accounting principles generally accepted in the United States of
          America, which contemplate continuation of the Company as a going
          concern. However, the Company has no established source of revenue. As
          of March 31, 2002, the Company has an accumulated deficit of
          $23,025,670 and net losses approximately of $13,000 and $235,000 for
          the three months ended March 31, 2002 and 2001, respectively.

          As of March 31, 2002, the Company has no cash in the bank. The
          Company's viability for the foreseeable future is dependent upon its
          ability to find business opportunities and raise needed capital. The
          Company's viability in raising needed capital is seriously in
          question. In the event the Company is not successful in securing
          needed capital in the near term, as to which no assurance can be
          given, the Company does not believe that its viability as an ongoing
          business is assured.

          This matter raises substantial doubt about the Company's ability to
          continue as a going concern. These financial statement do not include
          any adjustments relating to the recoverability and classification of
          recorded asset amounts, or amounts and classification of liabilities
          that might result from this uncertainty.

          Management is exploring merging or acquiring a company with viable
          operations.



                                      -10-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2002




NOTE 3    PROPERTY AND EQUIPMENT

          Property and equipment at cost, consisted of the following:


                                              MARCH 31,    DECEMBER 31,
                                                2002          2001
                                              --------      --------
          Computer Equipment                  $  3,102      $  3,102
          Furniture and Fixture                 17,171        17,171
          Office Equipment                       6,953         6,953
                                              --------      --------
                                                27,226        27,226
          Less:  Accumulated Depreciation       (8,826)       (7,565)
                                              --------      --------
          Property and Equipment, net         $ 18,400      $ 19,661
                                              ========      ========

          For the three months ended March 31, 2002 and 2001, depreciation
          expense was $1,261.


NOTE 4    LAWSUIT SETTLEMENT PAYABLE

          The Company was a defendant to lawsuit from Dion Signs & Services
          ("Dion") vs. Choices Entertainment Corporation ("Choices"), Civil
          Action No. 91-6871. Dion alleged that it was owed approximately
          $33,000 plus interest, costs and reasonable attorney fees for the
          failure by Choices to pay for signage that was erected at various
          locations pursuant to a contract.

          The lawsuit was settled during May 2001, whereby the judgment totaling
          $30,000 was brought against the Company. As of March 31, 2002, no
          payments were made on this obligation.


NOTE 5    RELATED PARTY TRANSACTIONS

          As of March 31, 2002 and December 31, 2001, the Company had payable to
          related party totaling $40,000 for the consulting services.


NOTE 6    NOTES PAYABLE

          As of March 31, 2002 and December 31, 2001, the Company had notes
          payable outstanding totaling $310,000. The notes are evidenced in
          writing and are held by 5 individuals who are stockholders in the
          Company. The notes bear interest at 12% per annum with interest and
          principal due between October through December of 2000. The Company
          incurred interest expense of approximately $9,300 and $9,200 for the
          three months ended March 31, 2002 and 2001, respectively. As of March
          31, 2002, the notes were still outstanding and in default.


                                      -11-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2002



NOTE 7    STOCKHOLDERS' DEFICIENCY

          Convertible Preferred Shares
          ----------------------------
          The aggregate number of shares of convertible preferred stock that the
          Company has authority to issue is 50,000,000 shares at a par value of
          $0.01. The Company, as of March 31, 2002 and December 31, 2002, had
          issued 11.416 shares of its redeemable convertible preferred stock,
          respectively.

          The Convertible Preferred Shares are the Company's only authorized and
          outstanding series or class of preferred shares. The Convertible
          Preferred Shares have no liquidation preference. Upon liquidation,
          dissolution or winding up of the Company, the holders of Convertible
          Preferred Shares will receive an amount equal to the amount, if any,
          received by holders of the Common Stock.

          Dividends on the Convertible Preferred Shares are non-cumulative and
          will only be paid when, as and if declared by the Board of Directors
          of the Company, in its sole discretion, in an amount per share equal
          to the amount of the dividend declared on the Common Stock, if any.

          Convertible Preferred Shares are convertible, in whole or in part, at
          any time, at the option of the holder, into Common Stock at a ratio of
          40,000 shares of the Company's Common Stock for each Convertible
          Preferred Share. Holders of the Convertible Preferred Shares are not
          entitled to any distributions unless declared by the Board of
          Directors as described above.

          The holders of Convertible Preferred Shares have voting rights
          equivalent to the rights of holders of the Common Stock. Each
          Convertible Preferred Share bears 40,000 votes on any matter brought
          before the stockholders such as the election of Directors and are
          entitled to notice of annual or special stockholder meetings. The
          Board of Directors of the Company is not prohibited from adopting and
          submitting to the Company's voting stockholders any proposed amendment
          to the Certificate of Incorporation of the Company or a Certificate of
          Designation which would create a class of preferred shares ranking
          senior to the Convertible Preferred Shares as to dividends and
          liquidation preference.

          Convertible Preferred Shares are not redeemable by the Company.

          During the year ending December 31, 2001, 6.325 convertible preferred
          shares were converted into 253,000 shares of the Company's common
          stock.

          Common Stock
          ------------
          The aggregate number of shares of common stock that the Company has
          authority to issue is 200,000,000 shares at a par value of $0.01. As
          of March 31, 2002 and December 31, 2001, 47,970,875 shares were issues
          and outstanding, respectively. The Company's common stock is currently
          traded in the over-the-counter market on the OTC-Bulletin Board.

                                      -12-
<PAGE>
                                   CECS CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2002



 NOTE 7   STOCKHOLDERS' DEFICIENCY (Continued)

          Common stock (continued)
          ------------------------
          The holders of outstanding shares of Common Stock are entitled to
          receive dividends out of assets legally available therefore at such
          times and in such amounts as the board may from time to time
          determine. The shares of Common Stock are neither redeemable nor
          convertible, and the holders thereof have no preemptive or
          subscription rights to purchase any securities of the Company. Upon
          liquidation, dissolution or winding up of the company, the holders of
          Common Stock are entitled to receive the assets of the company which
          are legally available for distribution, after payment of all debts,
          other liabilities and any liquidation preference of any outstanding
          preferred stock. Each outstanding share of Common Stock is entitled to
          one vote on all matters submitted to a vote of stockholders. There is
          no cumulative voting and no preemptive right.

          The Company has not declared or paid any dividends on its preferred or
          common stock. The Board of Directors does not contemplate the payment
          of dividends in the foreseeable future.


NOTE 8    COMMITMENTS AND CONTINGENCIES

          For the three month ended March 31, 2001, the Company leased office
          facilities in Seattle, Washington under a non-cancelable operating
          lease that expires December 31, 2001. The rent expense was $14,159 for
          the three months ended March 31, 2001.


NOTE 9    SUBSEQUENT EVENTS

          On May 2, 2002, the Company issued 5,000,000 shares of its common
          stock for $5,000.




                                      -13-
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

        The following is management's discussion and analysis of certain
significant factors that have affected the Company's financial condition,
changes in financial condition and results of operations. It also includes a
discussion of the Company's liquidity and capital resources at March 31, 2002,
and later dated information, where practicable. This discussion should be read
together with the Company's Financial Statements and the Notes thereto.


OVERVIEW

        The Board of Directors (the "Board") of Choices Entertainment
Corporation (the "Company" or "We") adopted a proposal on January 17, 2000 to
change the business of the Company to that of a technology holding company.
Since then we acquired, invested in, and incubated companies engaged in
Internet, computing and other technologies in various stages of development: all
of which have been written-off or sold. On May 26, 2000 at the Annual Meeting,
our stockholders' adopted a resolution proposed by the board of directors of the
Company changing the name of the Company from Choices Entertainment Corporation
to CECS CORP.


FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

        As of March 31, 2002, the Company had a net working capital deficit of
approximately $485,000 and approximate cash balances of zero (unaudited).

        The Company had no revenues for this period.

        We anticipate that the Company will not generate any significant
revenues until we accomplish our business objective of merging or acquiring
revenue producing assets. We presently have no liquid financial resources to
offer an acquisition candidate and must rely upon an exchange of our stock to
complete a merger or acquisition.

        The Company's viability for the foreseeable future is and will continue
to be dependent upon its ability to find other business opportunities and to
secure needed capital. No assurance can be given that the Company will be
successful in that regard. In the event the Company is not successful, it is
unlikely that there would be any amounts available for distribution to the
Company's stockholders.


MATERIAL CHANGES IN RESULTS OF OPERATIONS

MARCH 31, 2002 COMPARED TO MARCH 31, 2001:

Net Loss:

        The Company had a net loss of $13,228 and $234,944 for the quarters
ended March 31, 2002 and 2001, respectively. The substantial reduction in net
loss is attributable to a reduction in scope of operations to include only
seeking a merger candidate.

        This Quarterly Report on Form 10-QSB contains forward looking
information with respect to, among other things, plans future events or future
performance of the Company, the occurrence of which involve certain risks and
uncertainties that could cause actual results or future events to differ
materially from those expressed in any forward looking statements. These risks
and uncertainties include, but are not limited to, the ability to identify and
conclude alternative business opportunities, and those risks and uncertainties
detailed in the Company's filings with the Securities and Exchange Commission.
Where any forward-looking statement includes a statement of the assumption or
bases believed to be reasonable and are made in good faith, assumed facts or
bases almost always vary from actual result, and the differences between assumed
facts or bases and actual results can be material, depending upon the

                                      -14-
<PAGE>


circumstances. Where, in any forward looking statement, the Company expresses
and expectation or belief as to plans or future results or events, such
expectation or belief is expressed in good faith and believed to have a
reasonable basis, but there can be no assurance that the statement of
expectation or belief will result or be achieved or accomplished. The words
"believe", "expect" and "anticipate" and similar expressions identify
forward-looking statements.



















                                      -15-
<PAGE>
                           PART II--OTHER INFORMATION


ITEM 6. EXHIBITS


                                INDEX TO EXHIBITS

EXHIBIT
  NO.                         DESCRIPTION OF EXHIBIT *
-------     --------------------------------------------------------------------
   3(a)     Certificate of Incorporation, as amended(1)
    (b)     Certificate of Designations of Series C Preferred Stock, as
            amended(2)
    (c)     Amended and Restated By-Laws,(13)
   4        Form of certificate evidencing shares of Common Stock(14)
  10(a)     Stock Option and Appreciation Rights Plan of 1987 (4)
    (b)     Form of Long-Term Management Incentive Stock Option Agreement(5)
    (c)     Form of 1991 Management Option Agreement(5)
    (d)     Consulting Agreement between Registrant and Ronald W. Martignoni(6)
    (e)     Severance Benefits Agreement, as amended, between Registrant and
            Lorraine E. Cannon(7)
    (f)     Form of 1994 Management Option Agreement(7)
    (g)     Non-Employee Director Stock Option Agreement between Registrant and
            Fred E. Portner(8)
    (h)     Non-Employee Director Stock Option Agreement between Registrant and
            Fred E. Portner(9)
    (i)     Non-Employee Director Stock Option Agreement between Registrant and
            James D. Sink(9)
    (j)     Asset Purchase Agreement, dated December 16, 1996, as amended,
            between West Coast Entertainment Corporation and Registrant(10)
10.99(a)    Consulting Agreement between Registrant and Thomas Renna(11)
    (b)     Letter of Intent to Acquire Republic Hotel Investors, Inc.(12)
    (c)     Termination Contract with Republic Hotel Investors, Inc.(13)
    (d)     Sublease Agreement between Northwest Strategies, Inc. and CECS, Inc.
            [sic.] dated May 25, 2000 (14)
    (e)     Private Placement Subscription Agreement dated January 12, 2000 re:
            Photochannel Networks Inc. (14)
    (f)     Subscription Agreement re: Tridium Research, Inc. dated March 1,
            2000 (14)
    (g)(1)  Promissory Note--Speaklink Inc. dated October 19, 2000 (14)
    (h)(1)  Fastvoice Term Sheet--Third Party dated October 31, 2000 (14)
16.01       Letter of Withdrawal by Miller and Co. LLP (auditors) (15)
16.01(b)    Letter of Acquiesence in Form 8K dated September 28, 2001 (16)
   21       Subsidiaries of Registrant (14)

------------

(1)  Filed as an exhibit to Registrant's Registration Statement on Form S-8 File
     No. 33-87016).

                                      -16-
<PAGE>

(2)  Filed as an exhibit to Registrant's 1996 Annual Report on Form 10-KSB.
(3)  Filed as an exhibit to Registrant's 1992 Annual Report on Form 10-K.
(4)  Filed as an exhibit to Registrant's Registration Statement on Form S-1,
     inclusive of Post-Effective Amendment No. 1 thereto (File No.: 33-198983).
(5)  Filed as an exhibit to Registrant's Post-Effective Amendment No. 1 to Form
     S-1 Registration Statement (File No.: 33-32396).
(6)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-QSB, for
     the quarter ended September 30, 1997.
(7)  Filed as an exhibit to Registrant's 1993 Annual Report on Form 10-K.
(8)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-QSB for the
     quarter ended March 31, 1996.
(9)  Filed as an exhibit to Registrant's Quarterly Report on Form 10-QSB for the
     quarter ended March 31, 1997.
(10) Filed as an exhibit to Registrant's definitive Proxy Statement, dated
     February 11, 1997, with regard to a Special Meeting of Stockholders held on
     March 12, 1997, as further amended by Second and Third Amendments thereto
     filed as exhibits to Registrant's Forms 8-K, dated April 28, 1997, and May
     29, 1997.
(11) Filed as an exhibit to Registrant's Quarterly Report on Form 10-QSB, for
     the quarter ended June 30, 1999.
(12) Filed as an exhibit to Registrant's Current Report on Form 8-K dated August
     30, 1999.
(13) Filed as an exhibit to Registrant's Annual Report on Form 10-KSB, for the
     year ended December 31, 1999.
(14) Filed as an exhibit to Registrant's Annual Report on Form 10-KSB or the
     amendment thereto for the year ended December 31, 2000.
(15) Filed as an exhibit to Registrant's Current Report on Form 8-K dated
     September 28, 2001.
(16) Filed as an exhibit to Registrant's Current Report on Form 8-K/A dated
     October 2, 2001

--------------------------------------------------------------------------------
*    All exhibits listed above are herby incorporated by reference to this
     report to the fullest extent permitted by the rules and regulations of the
     Securities and Exchange Commission, and by other applicable law.


                                   SIGNATURES

    In accordance with the requirements of the Exchange Act, the registrant
caused this report on Form 10QSB for the period ended March 31, 2002 to be
signed on its behalf by the undersigned, thereunto duly authorized.

                                                    CECS CORP.
                                                    (Registrant)

June 3, 2002                                        By: /s/ TRACY M. SHIER
                                                        ------------------------
                                                        Tracy M. Shier,
                                                        DIRECTOR, PRESIDENT AND
                                                        CHIEF EXECUTIVE OFFICER

                                      -17-