U.S. SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB


(Mark One)
 [X]      ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                    For Fiscal Year Ended: December 31, 2003

                                       or

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

For the transition period from                    To
                              -------------------    ---------------------------


Commission file number        000-29549
                       ---------------------------------------------------------

                         Northeast Mortgage Corporation
                 (Name of small business issuer in its charter)

          Nevada                                                86-0972558
------------------------------                              --------------------
State or other jurisdiction of                                (I.R.S. Employer
incorporation or organization                                Identification No.)


               800 Main Street South, Southbury, Connecticut 06488
--------------------------------------------------------------------------------
               (Address of principal executive offices) (zip code)


Issuer's telephone number                               (203) 262-6110
                                                       ---------------


Securities registered under Section 12(b) of the Act: NONE Securities registered
under Section 12(g) of the Act:

                          Common Stock Par Value $0.001
                                (Title of class)


<PAGE>



         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

                                                                 Total pages: 15
                                                                            ----
                                                          Exhibit Index Page: 12
                                                                            ----

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

         State issuer's revenues for its most recent fiscal year. $12,764,749


         As of March 19, 2004,  there were  4,000,000 (1 vote per share) Common,
4,600,000 Series A Preferred,  for a total of 8,600,000 votes. All shares have a
par value of $0.001. The aggregate market value of the Registrant's voting stock
held by non-affiliates of the Registrant was approximately  $200 computed at the
par value of the stock.


                             DOCUMENTS INCORPORATED BY REFERENCE

         If the following  documents  are  incorporated  by  reference,  briefly
describe them and identify the part of the Form 10-KSB  (e.g.,  Part I, Part II,
etc.) into which the document is incorporated: (1) any annual report to security
holders;  (2) any proxy or information  statement;  and (3) any prospectus filed
pursuant to Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act"):
NONE

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
















                                        2

<PAGE>





                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
Item Number and Caption                                                                                       Page
PART I

<S>         <C>                                                                                               <C>
Item 1.     Description of Business                                                                               4

Item 2.     Description of Property                                                                               4

Item 3.     Legal Proceedings                                                                                     5

Item 4.     Submission of Matters to a Vote of Security Holders                                                   5


PART II

Item 5.     Market for Common Equity and Related Stockholder Matters                                              5

Item 6.     Management's Discussion and Analysis or Plan of Operations                                            6

Item 7.      Financial Statements                                                                                 8

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

PART III

Item 9.     Directors, Executive Officers, Promoters and Control Persons;
                Compliance with Section 16(a) of the Exchange Act                                                 8

Item 10.   Executive Compensation                                                                                10

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

Item 12.   Certain Relationships and Related Transactions                                                        12

Item 13.   Exhibits and Reports on Form 8-K                                                                      12

Item 14.   Controls and Procedures                                                                               13

Item 15.  Principal Accountant Fees and Services                                                                 14
</TABLE>

                                        3


<PAGE>

                                     PART I



                         ITEM 1 DESCRIPTION OF BUSINESS


General

         The Company is engaged primarily in the mortgage banking business.  Its
principal  activity is the origination  and sale of mortgage loans.  The Company
does not retain the right to service any of the mortgage loans sold to permanent
investors.  The Company,  as a non  supervised  mortgagee,  also  originates FHA
insured Title II mortgages which are sold to permanent investors.

History

         The Company was  incorporated  under the laws of the State of Nevada on
July 25, 1997.  The Company  ceased all operating  activities  during the period
from July 25, 1997 to October 20, 1999 and was considered dormant.  From October
20,  1999 to March 26,  2002,  the  Company  was in the  development  stage.  On
February  25,  2002,  the  Company  changed  its  name  to  Northeast   Mortgage
Corporation  in  anticipation  of its  acquisition  of the  assets of  Northeast
Mortgage,  LLC, a Connecticut  limited liability company. On March 27, 2002, the
Company  completed  the  acquisition  of the assets of Northeast  Mortgage,  LLC
pursuant to a Contribution  Agreement dated October 30, 2001. The Company,  with
offices in Southbury,  Connecticut; Easton, Massachusetts;  Scottsdale, Arizona:
and Philadelphia, PA, is a mortgage lender.



                         ITEM 2 DESCRIPTION OF PROPERTY


         We  operate  out  of  four  leased   offices   located  in   Southburg,
Connecticut,  Phoenix,  Arizona,  Mesa, Arizona and Easton,  Massachusetts.  The
information for each location is contained in the table below:

    Location               Size (sq. ft.)    Monthly Rent        Lease Term

800 Main Street South          10,795           $12,011        Five year lease
Southbury, CT  06488                                           Commencing 2/1/99

4725 N. Scottsdale Road         4,382            $9,312        Five year lease,
Scottsdale, AZ 85251                                           extended one
                                                               additional year
                                                               Commencing 6/1/99

                                        4

<PAGE>




45 Bristol Drive                  650            $1,240           Month to month
Suite 101
Easton, MA  02375



                            ITEM 3 LEGAL PROCEEDINGS


         The Company is involved in various legal actions  arising in the normal
course of business. The Company is a party in the following pending matters:

         In Luciano et al v. Northeast Mortgage,  LLC, the Plaintiff is suing as
a result of an alleged breach of a commitment to lend $180,000, as well as other
tort related claims.  The Plaintiff does not have an attorney and  consequently,
the nature and basis of the claims are difficult to determine from the pleadings
that have been filed to date.  The  Company  intends to  vigorously  defend this
action and has joined co-defendant IndyMac Mortgage Holdings,  Inc. in retaining
legal counsel to represent its  interests.  A Motion to Dismiss the  Plaintiff's
claims has been granted and the Plaintiff has filed several motions to reinstate
the claims.  Due to the fact that the litigation has never  progressed  past the
initial  stages,  the  Company  is  unable  to  evaluate  the  likelihood  of an
unfavorable  outcome or estimate the amount, if any, of any potential losses. No
provision has been made in the financial statements related to this claim.



                        ITEM 4 SUBMISSION OF MATTERS TO A
                            VOTE OF SECURITY HOLDERS


         There were no matters submitted to a vote of shareholders.


                                     PART II


                       ITEM 5 MARKET FOR COMMON EQUITY AND
                           RELATED STOCKHOLDER MATTERS


         Our common stock is not listed or quoted at the present time, and there
is no public market for our common stock. There are currently 29 shareholders of
our common stock and 3 holders of our preferred stock. There can be no assurance
that a public market for our common stock will ever

                                        5

<PAGE>



develop.  We intend to qualify our common  stock for trading on the OTC Bulletin
Board or other public market after the Registration Statement becomes effective.

         We have  no  options  or  warrants  outstanding  at the  current  time.
However,  we do have 1,000,000  shares that are subject to our 2001 Stock Option
Plan. We also have 4,600,000 shares of Series A Preferred Stock outstanding each
of which is  convertible  by the  holders,  at their  option,  into one share of
common stock.

         On March 25, 2004, Daniel L. Hodges, a shareholder of record of 9.3% of
our combined common and preferred stock outstanding,  resigned from his position
as a director with the Company.


                       ITEM 6 MANAGEMENT'S DISCUSSION AND
                         ANALYSIS OR PLAN OF OPERATIONS


PLAN OF OPERATION

         During the fiscal year ended December 31, 2003,  Northeast  focused its
resources in further  establishing a presence in the financial services industry
as a regional mortgage banker.  Its primary goals were to increase the number of
loans originated while controlling and then reducing salaries and other expenses
required to facilitate the closing of the mortgage  transaction.  In addition to
taking the necessary steps to increase production we eliminated and consolidated
a number of salary positions while also  restructuring the compensation plans of
all salespeople in an effort to improve earnings.

2003 as  Compared  to 2002  Results of  Operations  and  Analysis  of  Financial
Condition

         Revenues increased 14% from $11,239,309 for the year ended December 31,
2002 to  $12,764,749  for the year ended  December  31, 2003.  This  increase in
revenues  was due to an  increase  in the  loans  originated  and  funded  loans
amounts.  General and administrative  expenses increased 18% from $9,762,644 for
the year ended December 31, 2002 to $11,567,392  for the year ended December 31,
2003. This increase in expenses was due in part to the increase in activity, and
in majority to an increase in salaries and wages, especially to officers for the
purpose of the debt reduction requirement of the officers from those liabilities
that the officers  assumed  personally at the  acquisition in 2002. Net loss was
$(273,489) in 2003 compared to net income of $172,095 for 2002.  The decrease in
net  income  was  mainly  the  result  of the  fore  mentioned  salary  and wage
increases,  sales and  marketing  cost  increases  and  interest  expense of the
Company from 2002 compared to 2003.  Northeast Mortgage,  LLC. had no income tax
expense  for 2001 and part of 2002  because  the  income  passed  through to the
individual members who paid income tax on that income. We expect our advertising
expenses  to  drop  since  the  majority  of  our  ongoing  expense  related  to
advertising is budgeted through our internal telemarketing department. We do not
foresee any material increases in costs in the near future.

         We originated  2433 loans in 2003 for a total of $408,482,770 in funded
loan amounts

                                        6

<PAGE>



resulting  in an increase of 21% in units  closed and 27% in funded loan amounts
as compared to the same period in 2002.

Seasonality

         The mortgage banking industry is generally  subject to seasonal trends.
We are subject to this  seasonality.  Production  tends to  decrease  during the
summer and increase during the fall, winter, and spring.

Market Risk

         Interest   rates  are  the  primary  market  risk  the  Company  faces.
Increasing  interest rates tend to decrease the number of loans  originated.  We
compensate  for interest rate  increases by offering  variable  rate  mortgages,
sub-prime  loans,  and equity  loans,  which tend to gain in  popularity  during
periods of increased interest rates. In periods of decreasing  interest increase
the number of loans originated during the decreasing rate trend.  Investors whom
the  Company  sells its loans  compete  for its  business  therefore  decreasing
interest  rate  environment  has  only  a  positive  effect  on its  results  of
operations effect only.

Liquidity and Capital Resources

         We expect that we will be able to satisfy our cash requirements for the
next twelve  months from our existing cash flow.  Unlike many mortgage  bankers,
Northeast's  loss  experience due to defaulted  mortgages is nil due to the fact
that most of the loans are already sold to buyers prior to  placement.  However,
the  mortgage  payables  and  receivables  levels at the end of any given fiscal
period  fluctuate  tremendously  since the Company may or may not sell its short
term portfolio  that is being  seasoned  depending on the market for such loans.
Internally, our main source of liquidity is chiefly from operations and not from
investment or sale of equity.

         We fund our mortgage banking financing activities in large part through
our banking lines of credit, sometimes also referred to as "warehouse lines". We
had  available   committed  and  uncommitted   credit   facilities   aggregating
approximately  $42.5 million as of December 31, 2003. We have a $7,500,000  line
of credit with Peoples Bank and a $35,000,000 line of credit with Horizons Bank.
As of December 31, 2003 there was $2,614,419  outstanding  with Peoples Bank and
$12,449,645  outstanding  with Horizons  Bank. As of December 31, 2002 there was
$7,383,061  outstanding  with  Peoples  Bank and  $28,630,208  outstanding  with
Horizons  Bank.  The  decrease in the  outstanding  lines of credit was due to a
decrease  in loan  activity  at year end due to a rise in  interest  rates.  The
Peoples  Bank line of credit is at the Federal  Discount  Rate plus  2.75%.  Our
Horizons  Bank line of credit is scaled and for  conforming  loans is Prime Rate
minus .25% for the first 30 days,  Prime Rate for 31 to 60 days, Prime Rate plus
1% from 61 to 90 days  and  Prime  Rate  plus 3%  over 90  days.  The  rate  for
sub-prime  loans is Prime Rate plus 2% for the first 90 days and Prime Rate plus
3% over 90 days. Our ability to continue to originate and fund mortgage loans is
dependent on continued  access to capital on acceptable  terms. Our credit lines
require us to repay the amount we borrow to fund a loan  generally  within 30 to
90 days after the loan is closed or when we receive payment from the sale of the
funded loan, whichever occurs first. These borrowings are

                                        7

<PAGE>



repaid with the proceeds received by us from the sale of our originated loans to
institutional investors.  Until the loan is sold to an investor and repayment of
the loan is made  under the credit  lines,  the credit  line  provides  that the
funded loan is pledged to secure our outstanding borrowings. The lines of credit
contain certain covenants  limiting  indebtedness,  liens,  mergers,  changes in
control and sales of assets and  requires  us to maintain  minimum net worth and
other financial ratios.

Employees

         We do not expect any material change in the number of employees.



                           ITEM 7 FINANCIAL STATEMENTS


         The  financial  statements  of the Company and  supplementary  data are
included beginning  immediately following the signature page to this report. See
Item 13 for a list of the financial statements and financial statement schedules
included.



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


         There are not and have not been any  disagreements  between the Company
and its  accountants  on any  matter  of  accounting  principles,  practices  or
financial statements disclosure.


                                    PART III


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


Executive Officers and Directors

         The  following  table sets forth the names,  positions  and ages of the
individuals who will serve as our directors and executive officers following the
combination.  All directors are elected at each annual meeting and serve for one
year and until their successors are elected and qualify. Officers are elected by
the Board of Directors,  and their terms of office are at the  discretion of the
Board.  Mr.  Daniel L. Hodges  resigned  from his  position as a Director of the
Company effective March 25, 2004.

                                        8

<PAGE>

       Name of Director/Officer        Age      Position(s) With Company

       Brian Rogerson                   39      Chairman and President
       Sean Rogerson                    37      Director, Vice President and COO
       Anthony Gabriele                 39      Director and Secretary

Brian Rogerson

         Mr.  Rogerson  formed  Northeast  Mortgage LLC in October 1996 with his
brother  Sean  Rogerson  and his  associate  Anthony  Gabriele.  From 1991 until
October  1996 he was vice  president  of Retail  Lending at  Fairfield  Mortgage
Corporation. Prior to Fairfield he was a Senior Loan Officer at United Financial
Funding and a loan officer and account executive with Family Financial Services,
Inc.  Mr.  Rogerson  earned a B.S. in  Management  and Finance from Sacred Heart
University in May 1986.

Sean Rogerson

         Mr.  Rogerson  formed  Northeast  Mortgage LLC in October 1996 with his
brother  Brian  Rogerson and his  associate  Anthony  Gabriele.  From 1992 until
October  1996, he was a Senior Loan Officer at Fairfield  Mortgage  Corporation.
Prior to Fairfield Mr.  Rogerson was with Gateway Bank where he upgraded  branch
computer networks and trained employees in the automated  functions and programs
used by the bank.  He was also a specialist  in IRA and SEP accounts at Bankmart
and a Charge Back Supervisor at the Bank and New England.

Anthony Gabriele

         Mr. Gabriele formed Northeast Mortgage LLC in October 1996 with Messrs.
Brian and Sean Rogerson.  From 1995 until the formation of Northeast Mortgage in
1996, Mr. Gabriele was a Loan Officer at Fairfield Mortgage  Corporation.  Prior
to joining  Fairfield,  he was a Sales Manager for Comtek  International and was
responsible for the organization  and development of international  trade events
in Russia,  Romania and Germany.  In May 1986 Mr.  Gabriele  earned a Bachelor's
degree in Business Economics from Southern Connecticut State University.

Audit Committee Financial Expert

         The  Company's  board of  directors  does not have an "audit  committee
financial   expert,"  within  the  meaning  of  such  phrase  under   applicable
regulations  of the  Securities  and Exchange  Commission,  serving on its audit
committee.  The  board of  directors  believes  that all  members  of its  audit
committee are financially literate and experienced in business matters, and that
one or more  members of the audit  committee  are  capable of (i)  understanding
generally accepted accounting principles ("GAAP") and financial statements, (ii)
assessing the general  application  of GAAP  principles  in connection  with our
accounting for estimates,  accruals and reserves, (iii) analyzing and evaluating
our  financial   statements,   (iv)  understanding  our  internal  controls  and
procedures for

                                        9

<PAGE>



financial  reporting;  and (v) understanding audit committee  functions,  all of
which are attributes of an audit committee financial expert.  However, the board
of  directors  believes  that  there is not any audit  committee  member who has
obtained  these  attributes  through  the  experience  specified  in  the  SEC's
definition  of "audit  committee  financial  expert."  Further,  like many small
companies,  it is difficult  for the Company to attract and retain board members
who qualify as "audit  committee  financial  experts," and competition for these
individuals is significant.  The board believes that its current audit committee
is able to  fulfill  its  role  under  SEC  regulations  despite  not  having  a
designated "audit committee financial expert."



                         ITEM 10 EXECUTIVE COMPENSATION


         The following table sets forth all compensation paid by us to the chief
executive officer and the four most highly  compensated  executive  officers for
services rendered during the last three completed fiscal years.
<TABLE>
<CAPTION>
                                            Summary Compensation Table

                                                                Long-Term
                                                           Compensation Awards
                                                           -------------------
                                      Annual          Restricted     Securities          All Other
Name and                         Compensation (1)        Stock       Underlying         Compensation
Principal Position    Year      Salary($)  Bonus($)    Awards($)     Options/SARs           (1)
-------------------   -----    ---------- ---------  ------------  ---------------     ------------
<S>                   <C>        <C>        <C>        <C>               <C>                 <C>
Brian Rogerson        2003       905,387       -            -            -                26,000
President             2002       645,877       -            -            -                26,750
                      2001       230,000       -            -            -                29,000

Sean Rogerson         2003       627,798       -            -            -                17,000
Vice President        2002       408,127       -            -            -                16,852
                      2001       164,000       -            -            -                14,000

Anthony Gabriele      2003       517,278       -            -            -                15,000
Secretary             2002       353,500       -            -            -                15,505
                      2001        156,000      -            -            -                14,000
</TABLE>

(1) Amounts paid for automobiles and insurance therefore.

Director Compensation

         Directors  currently receive no cash compensation for their services in
that capacity.  Reasonable out-of-pocket expenses may be reimbursed to directors
in connection with attendance at meetings.

                                       10

<PAGE>



                 ITEM 11 SECURITY OWNERSHIP OF BENEFICIAL OWNERS
                                 AND MANAGEMENT


Principal Shareholders

         The table  below sets forth  information  as to each  person  owning of
record or who was known by the Company to own  beneficially  more than 5% of the
8,600,000 votes as of March 19, 2004,  including options to acquire stock of the
Company that are currently  exercisable  or will be within the next 60 days, and
information as to the ownership of the Company's  Stock by each of its directors
and executive  officers and by the directors and executive  officers as a group.
Except as otherwise  indicated,  all shares are owned directly,  and the persons
named in the table have sole voting and investment  power with respect to shares
shown as beneficially owned by them.

Principal Stockholders and Stockholdings of Management

     Name and Address of          Shares Beneficially              Percent of
     Beneficial Owner (1)        Owned After Acquisition       Common Stock (2)
     --------------------        -----------------------       ----------------
     Brian Rogerson (3)                     4,180,000                48.6%
     Sean Rogerson (4)                      1,900,000                22.1%
     Anthony Garbriele (5)                  1,520,000                17.7%
     Daniel L. Hodges                         800,000                9.30%

All Officers and Directors as a group       7,600,000                88.4%

(1)      The address of record for Messrs.  Rogerson's  and Gabriele is 800 Main
         Street South, Southbury, CT 06488.

(2)      Applicable ownership  percentages were based on 4,000,000 common shares
         issued and  outstanding  as of March 19,  2004,  together  with  shares
         issuable upon  conversion of Series A Preferred Stock to the applicable
         stockholder.  Shares  of  common  stock  issuable  upon  conversion  of
         securities  within 60 days after March 19, 2004 are deemed  outstanding
         for  computing   percentage   ownership  of  the  person  holding  such
         convertible security,  but are not deemed outstanding for computing the
         percentage of any other person.

(3)      Includes  2,530,000  shares of common stock issuable upon conversion of
         Series A Preferred Stock held by Mr. Rogerson.

(4)      Includes  1,150,000  shares of common stock issuable upon conversion of
         Series A Preferred Stock held by Mr. Rogerson.

(5)      Includes  920,000  shares of common stock  issuable upon  conversion of
         Series A Preferred Stock held by Mr. Gabriele.

                                       11

<PAGE>






             ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS


         There are none to report.



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


         (a) The following documents are filed as part of this report.

1. Financial Statements                                                     Page

Report of Robison, Hill & Co., Independent Certified Public Accountants......F-1
Balance Sheets
  December 31, 2003, and 2002................................................F-2
Statements of Income
  For the Years Ended December 31, 2003, and 2002............................F-4
Statement of Stockholders' Equity
  For the Years Ended December 31, 2003, and 2002............................F-5
Statements of Cash Flows
  For the Years Ended December 31, 2003, and 2002............................F-6
Notes to Financial Statements
  December 31, 2003, and 2002................................................F-7


2.     Financial Statement Schedules

         All  schedules  are  omitted  because  they are not  applicable  or the
required information is shown in the financial statements or notes thereto.

3.     Exhibits
                        The  following  exhibits  are  included  as part of this
report:
Exhibit
Number                     Title of Document


3.1      Articles of Incorporation(1)

3.2      Amended Articles of Incorporation(1)


                                       12

<PAGE>



3.3      Bylaws(1)

3.4      Amended Articles of Incorporation(2)

31.1     Certification  Pursuant  to Section  302 of the  Sarbanes-Oxley  Act of
         2002.

31.2     Certification  Pursuant  to Section  302 of the  Sarbanes-Oxley  Act of
         2002.

32.1     Certification  Pursuant  to Section  906 of the  Sarbanes-Oxley  Act of
         2002.

32.2     Certification  Pursuant  to Section  906 of the  Sarbanes-Oxley  Act of
         2002.


         (1)      Incorporated   herein  by  reference  from  Registrant's  Form
                  10SB12G, Registration Statement, dated February 16, 2000.

         (2)      Incorporated  herein by reference from  Registrant's Form 8-K,
                  dated April 11, 2002



                        ITEM 14. CONTROLS AND PROCEDURES


         The Company's Chief Executive  Officer and Chief Financial Officer have
concluded,  based on an evaluation  conducted within 90 days prior to the filing
date of this  annual  report  on Form 10- KSB,  that  the  Company's  disclosure
controls and  procedures  have  functioned  effectively  so as to provide  those
officers the information necessary whether:

         (i) this annual report on Form 10-KSB contains any untrue  statement of
         a material fact or omits to state a material fact necessary to make the
         statements  made,  in  light  of the  circumstances  under  which  such
         statements were made, not misleading with respect to the period covered
         by this annual report on Form 10-KSB, and

         (ii) the financial statements, and other financial information included
         in this annual  report on Form 10-KSB,  fairly  present in all material
         respects the financial condition,  results of operations and cash flows
         of the  Company as of, and for,  the periods  presented  in this annual
         report on Form 10-KSB.

         There  have  been no  significant  changes  in the  Company's  internal
controls or in other factors since the date of the Chief Executive Officer's and
Chief  Financial  Officer's  evaluation  that could  significantly  affect these
internal controls,  including any corrective actions with regards to significant
deficiencies and material weaknesses.



                                       13

<PAGE>





                  ITEM 15. PRINCIPAL ACCOUNTANT FEES & SERVICES


         The following is a summary of the fees billed to us by Robison,  Hill &
Company for professional services rendered for the years ended December 31, 2003
and 2002:


           Service                             2003                   2002
------------------------------        ------------------     ------------------
Audit Fees                            $           31,795     $           22,646
Audit-Related Fees                                     -                      -
Tax Fees                                           1,418                      -
All Other Fees                                         -                      -
                                      ------------------     ------------------
Total                                 $           33,213     $           22,646
                                      ==================     ==================

Audit Fees.  Consists of fees billed for professional  services rendered for the
audits  of  our  consolidated  financial  statements,  reviews  of  our  interim
consolidated  financial  statements  included  in  quarterly  reports,  services
performed in connection  with filings with the Securities & Exchange  Commission
and related  comfort  letters and other  services that are normally  provided by
Robison,  Hill & Company in connection with statutory and regulatory  filings or
engagements.

Tax Fees. Consists of fees billed for professional  services for tax compliance,
tax  advice  and tax  planning.  These  services  include  assistance  regarding
federal,  state and local tax compliance  and  consultation  in connection  with
various transactions and acquisitions.

Audit  Committee  Pre-Approval of Audit and  Permissible  Non-Audit  Services of
Independent Auditors

         The Audit Committee, is to pre-approve all audit and non-audit services
provided by the independent auditors. These services may include audit services,
audit-related  services,  tax services  and other  services as allowed by law or
regulation.  Pre-approval  is  generally  provided  for up to one  year  and any
pre-approval  is detailed as to the  particular  service or category of services
and is generally  subject to a specifically  approved  amount.  The  independent
auditors  and  management  are  required  to  periodically  report  to the Audit
Committee regarding the extent of services provided by the independent  auditors
in accordance  with this  pre-approval  and the fees incurred to date. The Audit
Committee may also pre-approve particular services on a case-by-case basis.

         The Audit Committee pre-approved 100% of the Company's 2003 audit fees,
audit-related  fees,  tax fees,  and all other fees to the  extent the  services
occurred  after May 6, 2003,  the effective  date of the Securities and Exchange
Commission's final pre-approval rules.






                                       14

<PAGE>





                                   SIGNATURES


         Pursuant to the  requirements  of section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended,  the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

                                          NORTHEAST MORTGAGE CORPORATION

Dated: April 13, 2004                     By  /S/     Brian Rogerson
                                          --------------------------------------
                                          Brian Rogerson
                                          President, Principal Executive Officer

         Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the Registrant and in the capacities indicated on this 13th day of April, 2004.

Signatures                               Title

/S/     Brian Rogerson
Brian Rogerson                       President, Principal Executive Officer


/S/     Sean Rogerson
Sean Rogerson                        Vice-President, Principal Financial Officer


/S/     Anthony Gabriele
Anthony Gabriele                     Secretary















                                       15

<PAGE>

                         NORTHEAST MORTGAGE CORPORATION

                                      - : -

                          INDEPENDENT AUDITOR'S REPORT

                           DECEMBER 31, 2003 and 2002



<PAGE>




                                    CONTENTS
<TABLE>
<CAPTION>
<S>                                                                                                             <C>
Independent Auditor's Report....................................................................................F-1

Financial Statements:

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

         Statements of Income
         Years Ended December 31, 2003 and 2002.................................................................F-4

         Statements of Stockholders Equity
         Years Ended December 31, 2003 and 2002.................................................................F-5

         Statements of Cash Flows
         Years Ended December 31, 2003 and 2002.................................................................F-6

Notes to Financial Statements
         December 31, 2003 and 2002.............................................................................F-7
</TABLE>




                                        1

<PAGE>


                          INDEPENDENT AUDITOR'S REPORT



Northeast Mortgage Corporation

         We have audited the accompanying  balance sheets of Northeast  Mortgage
Corporation  as of  December  31, 2003 and 2002 and the  related  statements  of
income,  stockholders  equity,  and cash flows for the years then  ended.  These
financial   statements  are  the   responsibility  of  the  Northeast   Mortgage
Corporation  management.  Our  responsibility  is to express an opinion on these
financial statements based on our audits.

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

         In our opinion,  the  financial  statements  referred to above  present
fairly, in all material  respects,  the financial position of Northeast Mortgage
Corporation  as of December 31, 2003 and 2002, and the results of its operations
and its cash  flows for the  years  then  ended in  conformity  with  accounting
principles generally accepted in the United States of America.


                                                  Respectfully submitted,


                                                  /s/ Robison, Hill & Co.
                                                  Certified Public Accountants

Salt Lake City, Utah
March 31, 2004

                                       F-1

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                                 BALANCE SHEETS
<TABLE>
<CAPTION>


                                                                                          December 31,
ASSETS:                                                                             2003                2002
                                                                             ------------------  ------------------
Current Assets:
<S>                                                                          <C>                 <C>
     Cash                                                                    $                -  $          481,576
     Mortgages Receivable                                                            15,537,517          36,753,559
     Accounts Receivable-Net of Allowance for Doubtful Account                          437,585             577,767
     Employee Advances                                                                  170,223             146,328
                                                                             ------------------  ------------------

          Total Current Assets                                                       16,145,325          37,959,230
                                                                             ------------------  ------------------

Fixed Assets - Net                                                                      138,753             218,547
                                                                             ------------------  ------------------

Other Assets:
     Deposits                                                                           221,835             182,573
     Investment in Real Estate                                                          101,456                   -
     Notes Receivable - Second Mortgages                                                 52,800              52,800
     Other Receivable                                                                    78,837                   -
     Customer Lists - Net                                                               173,850             277,172
     Deferred Tax Assets                                                                143,864              32,674
                                                                             ------------------  ------------------

          Total Other Assets                                                            772,642             545,219
                                                                             ------------------  ------------------

          Total Assets                                                       $       17,056,720  $       38,722,996
                                                                             ==================  ==================
</TABLE>








                                       F-2

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                                 BALANCE SHEETS
                                   (Continued)
<TABLE>
<CAPTION>



                                                                                          December 31,
LIABILITIES & STOCKHOLDERS' EQUITY                                                  2003                2002
                                                                             ------------------  ------------------
Current Liabilities:
<S>                                                                          <C>                 <C>
     Checks Written in Excess of Cash                                        $           60,095  $                -
     Note Payable - Bank                                                                 67,600              67,600
     Warehouse Line of Credit                                                        15,064,064          36,013,269
     Accounts Payable and Accrued Expenses                                              306,391             680,728
     Capital Lease Obligation - Current                                                  19,016              24,458
     Income Taxes Payable                                                               133,625             165,274
                                                                             ------------------  ------------------

          Total Current Liabilities                                                  15,650,791          36,951,329
                                                                             ------------------  ------------------

Long Term Liabilities:
     Notes Payable-Bank                                                                 415,989             489,222
     Capital Lease Obligation - Long Term                                                     -              19,016
                                                                             ------------------  ------------------

          Total Long Term Liabilities                                                   415,989             508,238
                                                                             ------------------  ------------------

          Total Liabilities                                                          16,066,780          37,459,567
                                                                             ------------------  ------------------

Stockholders' Equity
     Preferred Stock, par value $.001, 10,000,000 shares
          Authorized, 4,600,000 shares issued at December 31, 2003
          and 2002                                                                        4,600               4,600
     Common Stock, par value $.001, 100,000,000 shares
          Authorized, 4,000,000 shares issued at December 31, 2003
          and 2002                                                                        4,000               4,000
     Additional Paid-In Capital                                                       1,082,734           1,082,734
     Retained Earnings (Deficit)                                                       (101,394)            172,095
                                                                             ------------------  ------------------

          Total Stockholders' Equity                                                    989,940           1,263,429
                                                                             ------------------  ------------------

          Total Liabilities and Stockholders' Equity                         $       17,056,720  $       38,722,996
                                                                             ==================  ==================
</TABLE>



   The accompanying notes are an integral part of these financial statements

                                       F-3

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                            STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                                                          December 31,
                                                                                    2003                2002
                                                                             ------------------  ------------------

<S>                                                                          <C>                 <C>
Revenues                                                                     $       12,764,749  $       11,239,309
                                                                             ------------------  ------------------

Operating Expenses:
     Sales and Marketing                                                              1,028,156             698,574
     Salaries and Wages                                                               8,788,388           7,134,797
     Interest Expense                                                                 1,357,228             854,982
     General and Administrative                                                       2,779,004           2,627,847
                                                                             ------------------  ------------------

      Total Operating Expenses                                                       13,952,776          11,316,200
                                                                             ------------------  ------------------

Net Operating (Loss)                                                                 (1,188,027)            (76,891)

Other Income (Expense):
  Interest Income                                                                       812,313             381,586
                                                                             ------------------  ------------------

Net Income (Loss) Before Income Taxes                                                  (375,714)            304,695
                                                                             ------------------  ------------------


Income Tax (Expense) Benefit
  Current Federal Tax                                                                         -            (128,818)
  Current State Tax                                                                      (8,965)            (36,456)
  Deferred Income Tax                                                                   111,190              32,674
                                                                             ------------------  ------------------

     Total Income Tax (Expense) Benefit                                                 102,225            (132,600)
                                                                             ------------------  ------------------

Net Income (Loss)                                                            $         (273,489) $          172,095
                                                                             ==================  ==================

Basic & Diluted Income (Loss) Per Share                                      $           (0.04)  $           0.03
                                                                             ==================  ==================

Weighted Average Shares                                                               6,825,257           6,825,257
                                                                             ==================  ==================
</TABLE>










   The accompanying notes are an integral part of these financial statements

                                       F-4

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                       STATEMENTS OF STOCKHOLDERS' EQUITY
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
<TABLE>
<CAPTION>
                                                                                                         Additional
                                                      Preferred Stock             Common Stock             Paid-in        Retained
                                                    Shares        Amount       Shares        Amount        Capital        Earnings
                                                 -----------   -----------   -----------   -----------   -----------    -----------
<S>                                              <C>           <C>           <C>           <C>           <C>            <C>
Balance at January 1, 2002 ...................          --     $      --       1,000,000   $     1,000   $ 1,090,334    $      --

Issued stock in a asset acquisition
  agreement ..................................     4,600,000         4,600     3,000,000         3,000        (7,600)          --

Net Income ...................................          --            --            --            --            --          172,095
                                                 -----------   -----------   -----------   -----------   -----------    -----------

Balance, December 31, 2002 ...................     4,600,000         4,600     4,000,000         4,000     1,082,734        172,095

Net Income(Loss) .............................          --            --            --            --            --         (273,489)
                                                 -----------   -----------   -----------   -----------   -----------    -----------

Balance, December 31, 2003 ...................     4,600,000   $     4,600     4,000,000   $     4,000   $ 1,082,734    $  (101,394)
                                                 ===========   ===========   ===========   ===========   ===========    ===========
</TABLE>







   The accompanying notes are an integral part of these financial statements

                                       F-5

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                                          December 31,
                                                                                    2003                2002
                                                                             ------------------  ------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                          <C>                 <C>
Net Income (Loss)                                                            $         (273,489) $          172,095
Adjustments to reconcile net loss to net cash
Provided by operating activities
Depreciation and Amortization                                                           183,116             244,738
(Increase) Decrease in Deferred Tax Asset                                              (111,190)            (32,674)
(Increase) Decrease in Accounts Receivable                                              140,182              61,389
(Increase) Decrease in Employee Advances                                                (23,895)            (73,572)
(Increase) Decrease in Prepaid Expenses                                                       -              10,000
(Increase) Decrease in Other Receivable                                                 (78,837)                  -
(Increase) Decrease in Mortgages Receivable                                          21,216,042          (9,924,369)
Net Borrowing under Line of Credit Arrangements                                     (20,949,205)          9,602,527
(Decrease) Increase in Accounts Payable and Accrued Expenses                           (374,337)            363,055
(Decrease) Increase in Income Taxes Payable                                             (31,649)            165,274
                                                                             ------------------  ------------------
      Net Cash Provided by Operating Activities                                        (303,262)            588,463
                                                                             ------------------  ------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of Equipment                                                                         -             (97,526)
Investment in Real Estate                                                              (101,456)                  -
(Increase) Decrease in Deposits                                                         (39,262)            (29,732)
                                                                             ------------------  ------------------
      Net Cash Used in Investing Activities                                            (140,718)           (127,258)
                                                                             ------------------  ------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Payments Under Bank Loan Agreement                                                      (73,233)            (67,314)
Payments on Shareholder Payables                                                              -             (61,819)
Payments on Capital Lease Obligation                                                    (24,458)                  -
Borrowing on Capital Lease Obligation                                                         -              43,474
Checks Written in Excess of Cash                                                         60,095                   -
                                                                             ------------------  ------------------
      Net Cash Used in Financing Activities                                             (37,596)            (85,659)
                                                                             ------------------  ------------------

Net (Decrease) Increase in Cash and Cash Equivalents                                   (481,576)            375,546
Cash and Cash Equivalents at Beginning of Period                                        481,576             106,030
                                                                             ------------------  ------------------
Cash and Cash Equivalents at End of Period                                   $                -  $          481,576
                                                                             ==================  ==================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
-------------------------------------------------
Cash paid during the year for:
  Interest                                                                   $        1,370,165  $          854,995
  Franchise and income taxes                                                 $           40,614  $                -
</TABLE>

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES: None

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

                                       F-6

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         This summary of accounting policies for Northeast Mortgage  Corporation
is presented to assist in understanding the Company's financial statements.  The
accounting policies conform to generally accepted accounting principles and have
been consistently applied in the preparation of the financial statements.

Organization and Basis of Presentation

         The Company was  incorporated  under the laws of the State of Nevada on
July 25, 1997.  The Company  ceased all operating  activities  during the period
from July 25, 1997 to October 20, 1999 and was considered dormant.  From October
20,  1999 to March 26,  2002,  the  Company  was in the  development  stage.  On
February  25,  2002,  the  Company  changed  its  name  to  Northeast   Mortgage
Corporation  in  anticipation  of its  acquisition  of the  assets of  Northeast
Mortgage,  LLC, a Connecticut  limited liability company. On March 27, 2002, the
Company  completed  the  acquisition  of the assets of Northeast  Mortgage,  LLC
pursuant to a Contribution  Agreement dated October 30, 2001. The Company,  with
offices in Southbury,  Connecticut; Easton, Massachusetts;  Scottsdale, Arizona:
and Philadelphia, PA, is a mortgage lender.

         Since the former members of Northeast Mortgage,  LLC control 88% of the
Company  after  the  acquisition,   the  transaction  has  been  recorded  as  a
recapitalization of Northeast Mortgage,  LLC. The equity of the Company has been
restated  retroactively  to  reflect  the  recapitalization  on these  financial
statements.

Nature of Business

         The Company is engaged primarily in the mortgage banking business.  Its
principal  activity is the origination  and sale of mortgage loans.  The Company
does not retain the right to service any of the mortgage loans sold to permanent
investors.  The Company,  as a non  supervised  mortgagee,  also  originates FHA
insured Title II mortgages which are sold to permanent investors.

Cash and Cash Equivalents

         For purposes of the statement of cash flows, the Company  considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.




                                       F-7

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Pervasiveness of Estimates

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  required  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  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

Fixed Assets

         Fixed assets are recorded at cost.  Major renewals and improvements are
capitalized,  while  maintenance  and repairs are expensed when incurred.  As of
December 31, 2003, depreciation is computed as follows:
<TABLE>
<CAPTION>
                                                                                Accumulated
                               Cost              Method           Life         Depreciation             Net
                         -----------------  ----------------  ------------  -------------------  ------------------
<S>                      <C>                <C>               <C>           <C>                  <C>
Furniture and
Fixtures                 $         288,518    Accelerated       7 Years     $           226,962  $           61,556
Office Equipment                   512,605    Accelerated       5 Years                 435,408              77,197
                         -----------------                                  -------------------
                         $         801,123                                  $           662,370  $          138,753
                         =================                                  ===================  ==================
</TABLE>

         As of December 31, 2002, depreciation is computed as follows:
<TABLE>
<CAPTION>

                                                                                Accumulated
                               Cost              Method           Life         Depreciation             Net
                         -----------------  ----------------  ------------  -------------------  ------------------
<S>                      <C>                <C>               <C>           <C>                  <C>
Furniture and
Fixtures                 $         288,518    Accelerated       7 Years     $           202,885  $           85,633
Office Equipment                   512,605    Accelerated       5 Years                 379,691             132,914
                         -----------------                                  -------------------
                         $         801,123                                  $           582,576  $          218,547
                         =================                                  ===================  ==================
</TABLE>
Total  depreciation  expense for the years ended  December 31, 2003 and 2002 was
$79,794 and $90,791.

                                       F-8

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Earnings per Share

         Basic earnings per share has been computed by dividing the earnings for
the period applicable to the common  stockholders by the weighted average number
of common  shares  outstanding  during the years.  The total number of shares at
December 31, 2003 and 2002, includes 4,000,000 common shares that are issued and
outstanding and 4,600,000  shares of Series A Convertible  Preferred  Stock. The
Series A shares are convertible to one share of common stock.

         There are no dilutive  outstanding common stock equivalents at December
31, 2003 and 2002.

Concentration of Credit Risk

         The Company's  financial  instruments that are exposed to concentration
of credit risk consist primarily of cash and mortgages  receivable.  The Company
places its cash investments with high credit quality institutions. At times such
investments  may be in  excess  of  the  FDIC  insurance  limit.  The  mortgages
receivable are secured by residential real estate.

Income Taxes

         The Company  accounts  for income  taxes under the  provisions  of SFAS
No.109,  "Accounting  for Income  Taxes." SFAS No.109  requires  recognition  of
deferred  income tax assets and  liabilities  for the expected future income tax
consequences,  based on enacted tax laws, of temporary  differences  between the
financial reporting and tax bases of assets and liabilities.

Comprehensive Income

         The Company does not have any accumulated  comprehensive  income items,
and therefore, is not required to report comprehensive income.

Advertising

         Advertising costs are expensed as incurred.

Revenue Recognition

         Revenue and related  costs are reflected in the accounts when earned or
incurred.

                                       F-9

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Recent Accounting Pronouncements

         In June 2001, the Financial  Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") 141, Business Combinations,
and SFAS 142,  Goodwill and  Intangible  Assets.  SFAS 141 is effective  for all
business  combinations  completed after June 30, 2001. SFAS 142 is effective for
fiscal years beginning after December 15, 2001;  however,  certain provisions of
this Statement apply to goodwill and other  intangible  assets acquired  between
July 1, 2001 and the  effective  date of SFAS  142.  Major  provisions  of these
Statements and their effective dates for the Company are as follows:

         (a)      All business  combinations  initiated after June 30, 2001 must
                  use  the  purchase  method  of  accounting.   The  pooling  of
                  interests  method  of  accounting  is  prohibited  except  for
                  transactions initiated before July 1, 2001.
         (b)      Intangible  assets acquired in a business  combination must be
                  recorded   separately   from   goodwill  if  they  arise  from
                  contractual  or other legal rights or are  separable  from the
                  acquired entity and can be sold, transferred, licensed, rented
                  or  exchanged,  either  individually  or as part of a  related
                  contract, asset or liability.
         (c)      Goodwill,  as well as intangible assets with indefinite lives,
                  acquired after June 30, 2001, will not be amortized.
         (d)      Effective January 1, 2002, all previously  recognized goodwill
                  and intangible  assets with indefinite lives will no longer be
                  subject to amortization.
         (e)      Effective January 1, 2002, goodwill and intangible assets with
                  indefinite  lives will be tested for  impairment  annually and
                  whenever there is an impairment indicator.
         (f)      Effective  January 1,  2002,  the  useful  life of  intangible
                  assets  with finite  lives will be  evaluated  each  reporting
                  period to determine whether events and circumstances warrant a
                  revision to the remaining period of amortization.
         (g)      All acquired  goodwill must be assigned to reporting units for
                  purposes of impairment testing and segment reporting.

         On January 1, 2002, the Company  adopted SFAS 142 and as required,  the
useful lives of the customer lists were evaluated and the remaining amortization
periods  adjusted  accordingly.  Prior to the  adoption of SFAS 142, the Company
amortized  the customer  lists over an estimated  useful life of fifteen  years.
Since the adoption of SFAS 142, the Company amortizes the customer lists over an
estimated useful life of five years.



                                      F-10

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Intangible Assets

         Intangible Assets consisted of the following at December 31, 2003:
<TABLE>
<CAPTION>
Intangible Asset                                                                Amortization Period

<S>                                             <C>                                   <C>
Customer Lists                                  $       516,609                       5 Years
Less accumulated amortization                          (342,759)
                                                ---------------
Total                                           $       173,850
                                                ===============

         Intangible Assets consisted of the following at December 31, 2002:


           Intangible Asset                                                     Amortization Period
Customer Lists                                  $       516,609                       5 Years
Less accumulated amortization                          (239,437)
                                                ---------------
Total                                           $       277,172
                                                ===============
</TABLE>

         Total  amortization  expense for the years ended  December 31, 2003 and
2002 was $103,322 and $153,947.

NOTE 2 - MORTGAGES RECEIVABLE

         Mortgages  Receivable consist principally of real estate mortgage loans
originated and held for sale to permanent  investors.  They are held at lower of
cost or market. Market value is determined by the permanent investor commitment.
Also included in Mortgages  Receivable are private real estate  mortgages,  with
terms of three and six months, that bear interest at 13.99% per annum. The notes
are secured by residential  real estate located in the states of Connecticut and
Arizona and are financed through the Company. The fair value for these mortgages
receivable  approximate  carrying  amounts due to the short  maturities of these
instruments.

         Losses are  recorded as  incurred.  The Company  has no  provision  for
losses because it has never had a  delinquency.  The  probability  for a loss is
immaterial,  due to the fact  that the  loans  are sold to  permanent  investors
before funding.

NOTE 3 - CUSTOMER LISTS

         The Company  acquired its customer lists through  direct  purchase from
various vendors.

                                      F-11

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
                                   (Continued)

NOTE 3 - CUSTOMER LISTS (Continued)

These are recorded at cost and  amortized  using the  straight  line method over
five years,  which is the  estimated  useful  life.  With the  formation  of the
Company's  telemarketing  department,  the customer lists are now a component of
the  Company's  data  base,  and  through  statistical  reports,  impairment  is
evaluated on an annual basis.

NOTE 4 - INCOME TAXES

         Deferred taxes result from temporary  differences in the recognition of
income and expenses for income tax reporting and financial  statement  reporting
purposes.  The Company had deferred tax benefits of $143,864 and $32,674 for the
years ended December 31, 2003 and 2002 respectively. These deferred tax benefits
are the result of differences between book and tax depreciation and amortization
of intangible assets.

         The  difference  between the effective  income tax rate and the federal
statutory  income tax rate on the loss from continuing  operations are presented
below:
<TABLE>
<CAPTION>
                                                                                          December 31,
                                                                                     2003               2002
                                                                              ------------------ ------------------

<S>                                                                           <C>                 <C>
Expense (Benefit) at the federal statutory rate of 34%                        $         (131,131) $          93,645
Nondeductible expenses                                                                     1,880              2,499
State Income Taxes                                                                        (1,634)            36,456
Depreciation/Amortization                                                                 26,603             32,674
Surtax Exemption                                                                               -             (6,256)
Other                                                                                    (12,979)           (25,815)
                                                                              ------------------ ------------------
Effective Tax Expense                                                         $         (117,261) $         133,203
                                                                              ================== ==================
</TABLE>

NOTE 5 - OPERATING LEASE COMMITMENTS

         The Company  leases  office space in  Southbury,  Connecticut;  Easton,
Massachusetts;   Scottsdale,   Arizona  and  Philadelphia,   Pennsylvania  under
agreements with terms of one to five years.  In addition to the base rents,  the
Company  is,  in  general,  responsible  for  paying  its pro rata  share of the
increases  in real  estate  taxes  and  operating  expenses  over the base  year
amounts.

         The Company  leases office  equipment  under  agreements  with terms of
three years.

         The following  summarizes  the future  minimum lease payments under all
noncancellable operating lease obligations:

                                      F-12

<PAGE>



                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
                                   (Continued)

NOTE 5 - OPERATING LEASE COMMITMENTS (Continued)

                2004                                  236,888
                2005                                   50,367
                2006                                        -
                2007                                        -
                2008                                        -

         Total lease  expense for the year ended  December 31, 2003 and 2002 was
$321,943 and 302,216.

NOTE 6 - DEPOSITS

         Included in deposits  are amounts  paid to  permanent  investors  under
indemnification  agreements  for loans sold and now serviced by said  investors.
Management expects no future indemnifications,  nor do they expect to repurchase
any loan sold,  and  accordingly,  no provision  has been made in the  financial
statements.

NOTE 7 - PROFIT SHARING PLAN

         On June 1, 1997,  the Company  (employer)  established  a 401(k) Profit
Sharing Plan.  Any full time employee who has completed  three months of service
and has  attained  age 21 is eligible to  participate.  The  employer can make a
discretionary matching contribution based on the employee elective contribution.
The contribution, if any, is determined each year. For 2003 and 2002, there were
no matching contribution made.

NOTE 8 - LINE OF CREDIT
<TABLE>
<CAPTION>
                                                                                             December 31,
                                                                                       2003               2002
                                                                                 ----------------- ------------------
<C>                                                                              <C>               <C>
$35,000,000 Line of Credit -Horizon Bank                                         $      12,449,645 $       28,630,208
    Interest at Prime plus 1% per annum
    Security interest in all business assets and personal guarantee
    of officers and their spouses, Expires January 31, 2005

$7,500,000 Line of Credit - People's Bank                                                2,614,419          7,383,061
    Interest at Federal Discount Rate
    Security interest in all business assets and personal guarantee
    of officers and their spouses, Expires July 31, 2004

                                                                                 ----------------- ------------------
                  Total Lines Of Credit                                          $      15,064,064 $       36,013,269
                                                                                 ================= ==================
                                      F-13
<PAGE>

</TABLE>
                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
                                   (Continued)

NOTE 9 - NOTE PAYABLE - BANK

         On March 29, 2001, the Company  signed a credit  agreement with Newtown
Savings Bank (Bank).  The new agreement amends the Commercial Note and Revolving
Loan Agreement  dated December 4, 1997 wherein a revolving  credit  facility was
made  available to the Company by the Bank in the amount of one million  dollars
($1,000,000).

         The new  agreement,  with a  principal  sum of  $676,000  is payable in
fifty-nine (59) monthly principal payments of $5,633.33 plus interest commencing
April 29, 2001 with the final payment of the entire unpaid principal  balance of
$343,633.53 plus interest payable on March 29, 2006. Interest is calculated at a
variable  rate per  annum of two  percentage  points  above  the  Prime  Rate as
published by the Wall Street Journal.

NOTE 10 - RECAPITALIZATION

         On March 27, 2002,  the Company  consummated a transaction  in which it
acquired  substantially  all of the  assets of  Northeast  Mortgage,  LLC.  (the
"Acquisition").

         The  Company  had  1,000,000  shares of $.001 par  value  common  stock
outstanding prior to the acquisition. As a result of the acquisition, the former
members of Northeast Mortgage, LLC were issued 3,000,000 shares of the Company's
common stock and 4,600,000  shares of the Company's  Series A Preferred  Stock..
Following the acquisition,  the Company had 4,000,000 shares of common stock and
4,600,000 shares of Series A Preferred Stock issued and outstanding.

         The  former  principal  member  of  Northeast  Mortgage,  LLC  and  the
Company's current President, Brian P. Rogerson, became the principal stockholder
of the Company.  Mr. Rogerson now owns 1,650,000  shares of the common stock, or
approximately  41.25% of the  issued  and  outstanding  common  stock.  The only
significant  stockholder  of the  Company  other  than  the  former  members  of
Northeast  Mortgage,  LLC is Daniel L. Hodges,  who owns  800,000  shares of the
Company's  common  stock.  At the time of the  acquisition,  the  Company had no
assets or liabilities.

         Since the former members of Northeast Mortgage,  LLC control 88% of the
Company  after  the  acquisition,   the  transaction  has  been  recorded  as  a
recapitalization of Northeast Mortgage, LLC.

NOTE 11 - PREFERRED STOCK

         On  January  8,  2001,  the  Company  authorized  10,000,000  shares of
Preferred Stock,  designated as Series A and Series B Preferred Stock.  Series A
and Series B Preferred  Stock consist of 5,000,000  shares,  with a par value of
$.001  per  share.  On  January  18,  2002 the  Board of  Directors  approved  a
resolution that  designates the 5,000,000  shares of Series A shares as Series A
Convertible

                                      F-14

<PAGE>


                         NORTHEAST MORTGAGE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                  FOR THE YEAR ENDED DECEMBER 31, 2003 AND 2002
                                   (Continued)

NOTE 11 - PREFERRED STOCK (Continued)

Preferred  Stock,  with a par value of $.001 per share. The Stated Value of each
Series  A  Preferred  Share is $.10.  The  holders  of  shares  of the  Series A
Preferred Stock shall be entitled to receive  dividends when, if and as declared
by the Board of  Directors.  Each  share of Series A  Preferred  Stock  shall be
convertible, at the option of the holder, into one share of the Company's common
stock.

NOTE 12 - ACQUISITION

         On March 27, 2002 the Company  acquired  all of the assets of Northeast
Mortgage,  LLC  (NEM).  As a  result  of the  Acquisition,  the  Company  issued
3,000,000  shares of common  stock and  4,600,000  shares of Series A  Preferred
Stock to the  former  members of NEM and the  Acquisition  the  business  of NEM
became the Company's business.  On February 25, 2002, the Company filed Articles
of Amendment to amend and restate the  Articles of  Incorporation  to change the
name  from  Knight  Investment  Ltd.  to  Northeast   Mortgage   Corporation  in
anticipation of the Acquisition.

         The Company is engaged primarily in the mortgage banking business,  and
as such originate and sell mortgage  loans.  The mortgage loans are  principally
prime  credit  quality  first-lien   mortgage  loans  secured  by  single-family
residences   although  the  Company  also  offers  home  equity  loans  both  in
conjunction  with newly produced  prime credit quality first  mortgages and as a
separate  product.  In addition,  the Company  offers  sub-prime  credit quality
first-lien single-family mortgage loans.

         Before the  acquisition  of NEM,  the Company was an inactive  publicly
registered shell corporation and had no significant assets or operations.


                                      F-15