UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549

                                   Form 10-QSB

--------------------------------------------------------------------------------
(Mark one)
  XX      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
------    ACT OF 1934


              For the quarterly period ended March 31, 2000

          TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
------     OF 1934

         For the transition period from ______________ to _____________

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


                         Commission File Number: 0-29582
                                                 -------

                         United Community Holdings, Inc.
        (Exact name of small business issuer as specified in its charter)

       Nevada                                                75-2300997
----------------------------                          ------------------------
(State of incorporation)                              (IRS Employer ID Number)

                   3935 Interstate 55 South, Jackson, MS 39212
                   -------------------------------------------
                    (Address of principal executive offices)

                                 (601) 371-0009
                                 --------------
                           (Issuer's telephone number)


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

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 NO X

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: May 9, 2000: 8,000,818
                                                       ---------

Transitional Small Business Disclosure Format (check one):    YES     NO X
                                                                 ---    ---



<PAGE>



                         United Community Holdings, Inc.

                Form 10-QSB for the Quarter ended March 31, 2000

                                Table of Contents

                                                                            Page

Part I - Financial Information

  Item 1   Financial Statements                                               3

  Item 2   Management's Discussion and Analysis or Plan of Operation          16


Part II - Other Information

  Item 1   Legal Proceedings                                                  18

  Item 2   Changes in Securities                                              18

  Item 3   Defaults Upon Senior Securities                                    19

  Item 4   Submission of Matters to a Vote of Security Holders                19

  Item 5   Other Information                                                  19

  Item 6   Exhibits and Reports on Form 8-K                                   19


Signatures                                                                    20




                                                                               2


<PAGE>


S. W. HATFIELD, CPA
certified public accountants

Member:    American Institute of Certified Public Accountants
               SEC Practice Section
               Information Technology Section

           Texas Society of Certified Public Accountants

Part 1 - Item 1 - Financial Statements

                                                     ACCOUNTANT'S REVIEW REPORT

Board of Directors and Shareholders
United Community Holdings, Inc.

We  have  reviewed  the  accompanying  consolidated  balance  sheets  of  United
Community  Holdings,  Inc. (a Nevada corporation) and Subsidiary as of March 31,
2000 and 1999 and the  accompanying  consolidated  statements of operations  and
comprehensive  income and  consolidated  statements  of cash flows for the three
months ended March 31, 2000 and 1999. These financial statements are prepared in
accordance  with  the  instructions  for Form  10-QSB,  as  issued  by the U. S.
Securities  and  Exchange  Commission,  and are the sole  responsibility  of the
company's management.

We conducted our review in accordance with standards established by the American
Institute  of  Certified  Public  Accountants.  A review  of  interim  financial
information consists principally of applying analytical  procedures to financial
data and making  inquiries of persons  responsible  for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with  generally  accepted  auditing  standards,  the  objective  of which is the
expression on an opinion  regarding the financial  statements  taken as a whole.
Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material  modifications that should
be made to the accompanying  consolidated financial statements for them to be in
conformity with generally accepted accounting principles.



                                                    /S/  S. W. HATFIELD, CPA
                                                         --------------------
                                                         S. W. HATFIELD, CPA

Dallas, Texas
May 9, 2000



P. O. Box 820395                               9002 Green Oaks Circle, 2nd Floor
Dallas, Texas  75382-0395                               Dallas, Texas 75243-7212
214-342-9635 (voice)                                          (fax) 214-342-9601
800-244-0639                          3                           SWHCPA@aol.com





<PAGE>

<TABLE>

<CAPTION>


                 United Community Holdings, Inc. and Subsidiary
                           Consolidated Balance Sheets
                             March 31, 2000 and 1999


                                   (Unaudited)

                                                       March 31,        March 31,
                                                         2000             1999
                                                       ---------------------------
<S>                                                    <C>            <C>

                                     ASSETS

Current assets

   Cash on hand and in bank                            $     1,471    $     2,218
   Restricted cash                                         105,043         45,751
   Accounts receivable-at need, net of allowance
     for doubtful accounts of $12,500, respectively          4,316         21,570
   Other current assets                                      4,143          3,863
                                                       -----------    -----------

     Total current assets                                  114,973         73,402
                                                       -----------    -----------


Property and equipment - at cost

   Buildings                                             2,354,061      2,354,061
   Roads, common cemetery areas and landscaping            338,504        327,890
   Vehicles, equipment and office furnishings              253,072        192,252
                                                       -----------    -----------
                                                         2,945,637      2,874,203
   Accumulated depreciation                               (412,124)      (244,993)
                                                       -----------    -----------
                                                         2,533,513      2,629,210
   Land                                                    107,580        107,580
                                                       -----------    -----------

     Net property and equipment                          2,641,093      2,736,790
                                                       -----------    -----------


Other assets

   Cemetery property - at cost                           1,110,045      1,081,015
   Prearranged funeral contracts                         1,419,994      1,313,502
   Long-term receivables for cemetery property sales       336,977        364,963
   Other                                                    13,587         17,963
                                                       -----------    -----------

     Total other assets                                  2,880,603      2,777,443
                                                       -----------    -----------

     TOTAL ASSETS                                      $ 5,636,669    $ 5,587,635
                                                       ===========    ===========

</TABLE>

                                  - Continued -

See Accountant's Review Report
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.

                                                                               4


<PAGE>

<TABLE>

<CAPTION>


                 United Community Holdings, Inc. and Subsidiary
                     Consolidated Balance Sheets - Continued
                             March 31, 2000 and 1999

                                   (Unaudited)

                                                                    March 31,        March 31,
                                                                      2000              1999
                                                                  ----------------------------
<S>                                                                <C>            <C>

                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities

   Notes payable                                                   $   300,000    $   400,000
   Current maturities of long-term debt                                 68,451         46,203
   Accounts payable and other accrued liabilities                       91,645         85,735
                                                                   -----------    -----------

     Total current liabilities                                         460,096        531,938
                                                                   -----------    -----------


Long-term liabilities

   Long-term debt, net of current maturities                         2,121,116      2,145,529
   Deferred prearranged funeral contract revenues                    1,956,067      1,690,215
   Deferred cemetery property sale revenues                            408,763        331,080
   Shareholder loan                                                    159,958           --
                                                                   -----------    -----------

     Total liabilities                                               5,106,000      4,698,762
                                                                   -----------    -----------


Commitments and contingencies

Shareholders' Equity
   Preferred stock - $0.00001 par value
     10,000,000 shares authorized
     None issued and outstanding                                          --             --
   Common stock - $0.00001 par value
     50,000,000 shares authorized
     8,000,818 shares issued and outstanding                                80             80
   Additional paid-in capital                                        2,954,705      2,777,070
   Accumulated deficit                                              (2,424,116)    (1,888,277)
                                                                   -----------    -----------

     Total shareholders' equity                                        530,669        888,873
                                                                   -----------    -----------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                         $ 5,636,669    $ 5,587,635
                                                                   ===========    ===========
</TABLE>



See Accountant's Review Report
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.

                                                                               5


<PAGE>


<TABLE>

<CAPTION>


                 United Community Holdings, Inc. and Subsidiary
         Consolidated Statements of Operations and Comprehensive Income
                   Three months ended March 31, 2000 and 1999

                                   (Unaudited)

                                                       Three months   Three months
                                                          ended          ended
                                                         March 31,      March 31,
                                                           2000           1999
                                                       ---------------------------
<S>                                                    <C>            <C>

Revenues

   Funeral revenues                                    $    39,461    $    77,295
   Cemetery sales                                           21,357         (4,510)
   Finance charge and related revenues                       5,504         43,391
                                                       -----------    -----------
     Total revenues                                         66,322        116,176
                                                       -----------    -----------

Cost of sales and direct expenses

   Allocated cost of cemetery spaces and crypts              4,071          9,132
   Cost of cemetery merchandise and funeral services        14,485         18,062
   Sales commissions                                         7,552         13,685
                                                       -----------    -----------
     Total cost of sales and direct expenses                26,108         40,879
                                                       -----------    -----------

Gross profit                                                40,214         75,297
                                                       -----------    -----------

Operating expenses

   General and administrative expenses                      71,472         46,634
   Interest expense                                         58,592         51,004
   Depreciation and amortization                            42,133         39,749
                                                       -----------    -----------
     Total operating expenses                              172,197        137,387
                                                       -----------    -----------

Loss from operations                                      (131,983)       (62,090)

Other income (expense)

   Interest and other income                                 1,094             66
                                                       -----------    -----------

Loss before income taxes                                  (130,889)       (62,024)

Income taxes                                                  --             --
                                                       -----------    -----------

Net Loss                                                  (130,889)       (62,024)

Other comprehensive income                                    --             --
                                                       -----------    -----------

Comprehensive Loss                                     $  (130,889)   $   (62,024)
                                                       ===========    ===========

Net loss per weighted-average share
   of common stock outstanding,
   calculated on Net Loss - Basic                           $(0.02)        $(0.01)
                                                            ======         ======

Weighted-average number of shares
   of common stock outstanding - Basic                   8,000,818      8,000,818
                                                       ===========    ===========
</TABLE>


See Accountant's Review Report
The accompanying notes are an integral part of these consolidated financial
statements.

                                                                               6


<PAGE>

<TABLE>

<CAPTION>


                 United Community Holdings, Inc. and Subsidiary
                      Consolidated Statements of Cash Flows
                   Three months ended March 31, 2000 and 1999

                                   (Unaudited)

                                                                       Three months   Three months
                                                                           ended         ended
                                                                          March 31,    March 31,
                                                                            2000         1999
                                                                       --------------------------
<S>                                                                      <C>          <C>

Cash flows from operating activities

   Net loss for the year                                                 $(130,889)   $ (62,024)
   Adjustments to reconcile net loss to net
     cash provided by operating activities
       Depreciation and amortization                                        43,143       40,423
       Allocated cost of cemetery spaces and crypts                          4,071        9,132
       (Increase) Decrease in:
         Accounts receivable                                                    43       (9,954)
         Other assets                                                        4,966        8,858
       Increase (Decrease) in:
         Accounts payable and other accrued liabilities                      3,191      (24,335)
         Deferred revenues                                                 (20,850)     (76,046)
                                                                         ---------    ---------
Net cash used in operating activities                                      (96,325)    (113,946)
                                                                         ---------    ---------

Cash flows from investing activities

   Transfers (to)/from trust funds and restricted cash                     (46,123)       7,044
   Capital expenditures for property, equipment and cemetery property       (6,576)      (5,070)
   Cash collected on prearranged funeral contract receivables               59,551       50,067
   Cash collected on long-term receivables for cemetery property sales      37,332       34,625
                                                                         ---------    ---------
Net cash used in investing activities                                       44,184       86,666
                                                                         ---------    ---------

Cash flows from financing activities

   Net activity on bank line of credit                                    (100,000)      35,000
   Principal (paid) received on long-term note payable                     (13,571)      (6,829)
   Principal repayments on long-term lease payables                         (1,358)        --
   Net increase in shareholder loan                                        159,958         --
                                                                         ---------    ---------
Net cash provided by financing activities                                   45,029       28,171
                                                                         ---------    ---------

Increase (Decrease) in cash                                                 (7,112)         891

Cash at beginning of year                                                    8,583        1,327
                                                                         ---------    ---------

Cash at end of year                                                      $   1,471    $   2,218
                                                                         =========    =========

Supplemental disclosure of interest and income taxes paid

     Interest paid for the year                                          $  57,582    $  50,330
                                                                         =========    =========
     Income taxes paid for the year                                      $    --      $    --
                                                                         =========    =========
</TABLE>


See Accountant's Review Report

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

                                                                               7


<PAGE>



                 United Community Holdings, Inc. and Subsidiary

                   Notes to Consolidated Financial Statements

Note A - Organization and Description of Business

United Community  Holdings,  Inc. (Company) was incorporated under the corporate
name of Professionalistics, Inc. on May 31, 1989, under the laws of the State of
Delaware,  as  a  wholly-owned  subsidiary  of  Halter  Venture  Corporation,  a
publicly-owned corporation.  The Company changed its name to Pacific Great China
Co.,  Ltd.  on May 8, 1996 as a result of an  action by the  Company's  Board of
Directors  in  anticipation  of a business  acquisition  or merger  transaction.
Subsequently,  this anticipated  business  acquisition or merger transaction was
mutually canceled by both parties.

On December  17,  1998,  the Company  changed  its state of  Incorporation  from
Delaware  to  Nevada  by means of a  merger  with and into a Nevada  corporation
formed solely for the purpose of effecting the reincorporation.  The Articles of
Incorporation  and  Bylaws  of  the  Nevada  corporation  are  the  Articles  of
Incorporation  and  Bylaws  of  the  surviving  corporation.  Such  Articles  of
Incorporation did not change the capital structure of the Company. The effect of
this action also changed the Company's name to United Community Holdings, Inc.

On November 19, 1998,  the Company's  then majority  shareholder  sold 7,200,000
shares of the  7,750,129  shares  held by the then  majority  shareholder  to an
unrelated  third party in  anticipation  of a business  combination  transaction
whereby the Company would merge with and into a privately held operating company
during the first quarter of 1999.

On February 28, 1999,  effective  as of January 1, 1999,  the Company  exchanged
1,000  shares of  restricted,  unregistered  common  stock with its then current
majority  shareholder for 100.0% of the issued and outstanding stock of Rosemont
Gardens Funeral Chapel-Cemetery, Inc. (a Mississippi corporation) (Rosemont). At
closing, Rosemont became a wholly-owned subsidiary of the Company

The  acquisition of Rosemont by the Company was accounted in accordance with the
provisions of  Interpretation  #39 of Accounting  Principles  Board Opinion #16,
whereby the combination of entities under common control are accounted for on an
"as-if-pooled"  basis with the Company  being the parent  company  and  Rosemont
being a wholly-owned subsidiary.  These consolidated entities are referred to as
Company.  Accordingly,  the consolidated financial statements of the Company and
Rosemont represent the historical  consolidated  financial  statements as of the
first day of the first period presented.

Rosemont  Gardens Funeral  Chapel-Cemetery,  Inc.  (Company) was incorporated on
March  4,  1994  under  the  laws of the  State of  Mississippi.  The  Company's
operations  consist  of a  funeral  home  and  cemetery  operation  in  Jackson,
Mississippi.  Company  personnel  at the funeral  service  location  provide all
professional  services  related  to  funerals,  including  the  use  of  funeral
facilities  and  motor  vehicles.  Funeral  related  merchandise  is sold at the
funeral service location. The Company sells prearranged funeral services whereby
a customer contractually agrees to the terms,  conditions and price of a funeral
to be performed at an unknown  future date at the time the contract is executed.
The Company's cemetery provides cemetery  interment rights (including  mausoleum
crypts and lawn  spaces)  and  certain  merchandise  including  stone and bronze
memorials and burial vaults.  These items may be sold on either a pre-need or an
at-need basis. Company personnel at the cemetery site perform interment services
and provide management and maintenance of the cemetery grounds.



                                                                               8


<PAGE>



                 United Community Holdings, Inc. and Subsidiary

             Notes to Consolidated Financial Statements - Continued

Note A - Organization and Description of Business - Continued

During interim periods, the Company follows the accounting policies set forth in
its Annual Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act
of 1934 on Form 10-KSB filed with the U. S. Securities and Exchange  Commission.
The information  presented  herein may not include all  disclosures  required by
generally accepted accounting  principles and the users of financial information
provided for interim  periods should refer to the annual  financial  information
and footnotes  contained in its Annual Report Pursuant to Section 13 or 15(d) of
The  Securities  Exchange Act of 1934 on Form 10-KSB when  reviewing the interim
financial results presented herein.

In the opinion of management,  the accompanying  interim  financial  statements,
prepared in accordance with the instructions for Form 10-QSB,  are unaudited and
contain  all  material   adjustments,   consisting  only  of  normal   recurring
adjustments  necessary to present  fairly the  financial  condition,  results of
operations  and cash flows of the Company  for the  respective  interim  periods
presented.  The  current  period  results  of  operations  are  not  necessarily
indicative of results which ultimately will be reported for the full fiscal year
ending December 31, 2000.

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

Note B - Summary of Significant Accounting Policies

1.   Cash and cash equivalents
     -------------------------

     The  Company  considers  all cash on hand  and in  banks,  certificates  of
     deposit and other highly-liquid investments with maturities of three months
     or less, when purchased, to be cash and cash equivalents.

     Cash  overdraft  positions may occur from time to time due to the timing of
     making bank deposits and releasing checks, in accordance with the Company's
     cash management policies.

2.   Accounts receivable
     -------------------

     In the normal course of business,  the Company extends  unsecured credit to
     its  at-need  customers  which are  regionally  concentrated  in and around
     Jackson,  Mississippi.  Because of the credit risk involved, management has
     provided an allowance for doubtful  accounts  which reflects its opinion of
     amounts  which  will  eventually  become  uncollectible.  In the  event  of
     complete  non-performance,  the  maximum  exposure  to the  Company  is the
     recorded amount of trade accounts  receivable shown on the balance sheet at
     the date of non- performance.

3.   Inventory
     ---------

     Inventory  consists  of  funeral  merchandise  and  cemetery  property  and
     merchandise  and are  stated  at the  lower of cost or  market,  using  the
     first-in, first-out method.



                                                                               9


<PAGE>



                 United Community Holdings, Inc. and Subsidiary

             Notes to Consolidated Financial Statements - Continued

Note B - Summary of Significant Accounting Policies - Continued

4.   Property, plant and equipment
     -----------------------------

     Property and  equipment are recorded at  historical  cost.  These costs are
     depreciated  over the  estimated  useful  lives of the  individual  assets,
     generally  three (3) to  twenty-five  (25) years,  using the  straight-line
     method.

     Maintenance and repairs are charged to expense  whereas  renewals and major
     replacements are capitalized. Gains and losses from disposition of property
     and equipment are recognized as incurred and are included in operations.

     For the three months ended March 31, 2000 and 1999, depreciation expense of
     approximately $42,133 and $39,542, respectively, was charged to operations.

5.   Funeral operations
     ------------------

     Funeral revenue is recognized  when the funeral  service is performed.  The
     Company's trade  receivables,  when recorded,  will consist  principally of
     funeral services already performed. An allowance for doubtful accounts will
     be  provided  based on  historical  experience.  In the  event of  complete
     non-performance, the maximum exposure to the Company is the recorded amount
     of trade  accounts  receivable  shown on the  balance  sheet at the date of
     non-performance.

     The Company sells prearranged funeral services and funeral merchandise that
     provide for the delivery of price  guaranteed  services and  merchandise at
     prices prevailing when the agreement is signed.  Revenues and related costs
     associated  with sales of  prearranged  funeral  contracts are deferred and
     later   recognized  when  the  funeral   service  is  actually   performed.
     Prearranged  funeral services and merchandise are generally financed either
     through  trust  funds or escrow  accounts,  depending  on State  Regulatory
     requirements,  established by the Company or through  insurance.  Principal
     amounts  deposited in trust funds or escrow  accounts are  available to the
     Company as funeral  services are  performed and  merchandise  is delivered.
     These amounts may be refundable to the customer in those  situations  where
     state law provides for the return of those  amounts  under the  purchaser's
     option  to  cancel  the  contract.   Certain   jurisdictions   provide  for
     non-refundable  trust funds or escrow  accounts where the Company  receives
     such amounts upon cancellation by the customer.

     The Company  recognizes  as revenue on a current  basis all  dividends  and
     interest earned, and net capital gains realized, by all prearranged funeral
     trust  funds or escrow  accounts,  except in those  states  where  earnings
     revert  to  the  customer  if a  prearranged  funeral  service  or  funeral
     merchandise contract is canceled. Principal and earnings are withdrawn only
     as  funeral  services  and  merchandise  are  delivered  or  contracts  are
     canceled,  except in  jurisdictions  that permit  earnings to be  withdrawn
     currently and in unregulated jurisdictions where escrow accounts are used.

     Commissions   and  other  related  direct   marketing   costs  relating  to
     prearranged  funeral services and prearranged funeral merchandise sales are
     expensed as paid,  subject to a nominal  percentage  which is withheld  and
     paid at the time the service is performed.  Other indirect costs, including
     telemarketing  and  advertising  costs,  are  expensed  in the period  when
     incurred.

     Funeral  services sold at the time of need are recorded as funeral  revenue
     in the period performed.

                                                                              10


<PAGE>



                 United Community Holdings, Inc. and Subsidiary

             Notes to Consolidated Financial Statements - Continued

Note B - Summary of Significant Accounting Policies - Continued

6.   Cemetery operations
     -------------------

     Cemetery  revenue  is  accounted  for in  accordance  with  the  principles
     prescribed  for  accounting  for  sales of real  estate.  Those  principles
     require,  among other things,  the receipt of a certain portion  (generally
     25%) of an  installment  sale price prior to  recognition of any revenue or
     cost  on  a  contract.   The  Company   recognizes  income  currently  from
     unconstructed mausoleum crypts sold to the extent the Company has available
     inventory.

     Costs  related to the sales of cemetery  mausoleum  or lawn crypts  include
     property and other costs related to cemetery  development  activities which
     are  charged  to  operations  using  the  specific  identification  method.
     Allowances  for  customer  cancellations  are  provided at the date of sale
     based upon historical experience. Costs related to merchandise are based on
     actual costs  incurred or  estimates of future costs  necessary to purchase
     the merchandise, including provisions for inflation when required.

     Pursuant to  applicable  state law, all or a portion of the  proceeds  from
     each sale of  cemetery  merchandise  may also be  required  to be paid into
     trust  funds until such  merchandise  is  purchased  by the Company for the
     customer. The Company recognizes realized trust income on these merchandise
     trusts in current  cemetery  revenues  as trust  earnings  accrue to defray
     inflation costs recognized related to the unpurchased cemetery merchandise.

     Additionally,  pursuant to perpetual  care  contracts  and laws, a portion,
     generally 15.0%, of the total sales price of cemetery property is deposited
     into perpetual care trust funds or escrow accounts.  In addition,  in those
     jurisdictions  where trust or escrow  arrangements are neither  statutorily
     nor  contractually  required,  the Company typically on a voluntary basis a
     portion,  generally  15.0%,  of the sale price into  escrow  accounts.  The
     income from these funds,  which have been established in most jurisdictions
     in which the Company operates cemeteries,  is used for maintenance of these
     cemeteries,  but principal,  including in some jurisdictions,  net realized
     capital gains, must generally be held in perpetuity. Accordingly, the trust
     fund  corpus is not  reflected  in the  financial  statements,  except  for
     voluntary escrow funds established by the Company.  The Company  recognizes
     and withdraws  currently all dividend and interest income earned and, where
     permitted, capital gains realized by perpetual care funds.

     A portion of the sales of cemetery  property and  merchandise is made under
     installment  contracts  bearing  interest  at 9.75%.  Finance  charges  are
     recognized  as a component  of  cemetery  revenue  under the  straight-line
     method over the terms of the related installment receivables.

     Commissions  and other related direct  marketing costs relating to cemetery
     spaces or  mausoleum  crypts  are  expensed  as paid,  subject to a nominal
     percentage  which  is  withheld  and paid at the  time  the  related  sales
     contract  service  is  paid  in  full.  Other  indirect  costs,   including
     telemarketing  and  advertising  costs,  are  expensed  in the period  when
     incurred.

7.   Organization costs
     ------------------

     Costs related to the formation  and  organization  of the Company have been
     capitalized  and are being  amortized  over a five year  period,  using the
     straight-line method.

                                                                              11


<PAGE>



                 United Community Holdings, Inc. and Subsidiary

             Notes to Consolidated Financial Statements - Continued

Note B - Summary of Significant Accounting Policies - Continued

8.   Income taxes
     ------------

     The Company filed a separate  corporate  federal  income tax return through
     December 31,  1998.  Due to the change in control  occurring  in 1998,  the
     Company  has  no net  operating  loss  carryforwards  available  to  offset
     financial statement or tax return taxable income in future periods.

     Rosemont,  with the consent if its former sole  shareholder,  elected under
     the Internal  Revenue Code to be taxed as an  "Subchapter  S  corporation",
     through  December  31,  1998.  In  lieu  of  corporate  income  taxes,  the
     shareholder  of a  "Subchapter  S  corporation"  is taxed  directly  on the
     Company's taxable income. Accordingly,  no provision,  benefit or liability
     for income taxes is included in the accompanying financial statements.

     The Company uses the asset and liability  method of  accounting  for income
     taxes. At March 31, 2000 and 1999, respectively, the deferred tax asset and
     deferred tax liability accounts, as recorded when material to the financial
     statements,  are entirely the result of  temporary  differences.  Temporary
     differences   represent  differences  in  the  recognition  of  assets  and
     liabilities for tax and financial reporting purposes, primarily accumulated
     depreciation and amortization, allowance for doubtful accounts and vacation
     accruals.

     As of March 31, 2000 and 1999,  the  Company's  deferred tax asset is fully
     reserved.

9.   Income (Loss) per share
     -----------------------

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss) by the weighted-average  number of shares of common stock and common
     stock  equivalents  (primarily  outstanding  options and warrants).  Common
     stock equivalents  represent the dilutive effect of the assumed exercise of
     the  outstanding  stock  options and  warrants,  using the  treasury  stock
     method.  The calculation of fully diluted earnings (loss) per share assumes
     the dilutive effect of the exercise of outstanding  options and warrants at
     either the  beginning  of the  respective  period  presented or the date of
     issuance,  whichever is later.  As of March 31, 2000 and 1999,  the Company
     had no  warrants  and  options  outstanding  which  could be  deemed  to be
     dilutive.

10.  Accounting standards to be adopted
     ----------------------------------

     Upon  the  adoption  of a  formal  stock  compensation  plan,  the  Company
     anticipates   using  the  "fair  value  based  method"  of  accounting  for
     compensation  based  stock  options  pursuant  to  Statement  of  Financial
     Accounting  Standards No. 123,  "Accounting for Stock-Based  Compensation".
     Under the fair value based  method,  compensation  cost will be measured at
     the grant date of the respective option based on the value of the award and
     will be recognized as a charge to operations over the service period, which
     will usually be the respective vesting period of the granted option(s).




                                                                              12


<PAGE>

<TABLE>

<CAPTION>


                 United Community Holdings, Inc. and Subsidiary

             Notes to Consolidated Financial Statements - Continued

Note C - Long-Term Receivables

As of  December  31,  1999,  the  Company's  long-term  receivables  related  to
prearranged funeral contracts and cemetery sales are anticipated to be collected
pursuant to contractually scheduled payments as follows:

<S>                                                                         <C>                     <C>

                                                                             Year ending
                                                                             December 31            Principal due
                                                                             -----------            -------------
                                                                                2000                 $  323,610
                                                                                2001                    254,629
                                                                                2002                    336,210
                                                                                2003                    184,017
                                                                                2004                    153,144
                                                                             Thereafter                 376,794
                                                                                                     ----------

                                                                                Total                $1,628,404
                                                                                                      =========

Note D - Cemetery Property

Cemetery  property  consists  of the  following  at March  31,  2000  and  1999,
respectively:

                                                                                       2000             1999
                                                                                   ----------       ----------
   Developed cemetery gardens, net of
     spaces sold with revenue recognition                                          $   81,284       $   91,130
   Cemetery gardens in development                                                     27,390           26,942
   Mausoleum crypts, net of crypts sold                                               343,897          305,469
   Undeveloped                                                                        657,474          657,474
                                                                                   ----------       ----------

     Total                                                                         $1,110,045       $1,081,015
                                                                                    =========        =========


Note E - Notes payable

Notes payable consist of the following at March 31, 2000 and 1999, respectively:

                                                                                    2000              1999
                                                                                   -------          -------
$400,000  revolving  line of credit  payable to a bank.  Interest  at the Bank's
   prime rate (8.50% at March 31, 2000). Interest payable monthly. Principal and
   unpaid  interest  due at maturity in March  2000.  Secured by land,  accounts
   receivable from  prearranged  funeral  contracts and cemetery  property sales
   contracts and

   the personal guarantee of the Company's shareholder.                           $300,000          $400,000
                                                                                   -------           -------

     Total notes payable                                                          $300,000          $400,000
                                                                                   =======           =======

</TABLE>


                                                                              13


<PAGE>

<TABLE>

<CAPTION>


                 United Community Holdings, Inc. and Subsidiary

             Notes to Consolidated Financial Statements - Continued

Note F - Long-Term Debt

Long-term debt consists of the following at March 31, 2000 and 1999:

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

$2,220,000 note payable to a bank.  Interest at 8.00%.
   Payable in monthly installments of approximately
   $18,569, including interest.  Any unpaid principal
   and interest is due at maturity in June 2003.  Secured
   by land, accounts receivable from prearranged funeral
   contracts and cemetery property sales contracts and
   the personal guarantee of the Company's shareholder.                           $2,145,202       $2,191,732

$21,082 installment note payable to a bank.  Interest at
   7.25%.  Payable in monthly installments of approximately
   $655, including interest.  Final maturity in August 2002.
   Secured by a vehicle.                                                              17,043             --

$23,500 capital lease payable to a finance company.
   Interest at 15.6%.  Payable in monthly installments of
   approximately $539, including interest.  Final maturity
   in December 2003.  Secured by furniture and equipment.                             18,571             --

$14,850 capital lease payable to a finance company.
   Interest at 18.9%.  Payable in monthly installments of
   approximately $530, including interest.  Final maturity
   in December 2001.  Secured by furniture and equipment                               8,751             --
                                                                                  ------------     ----------

     Total long-term debt                                                          2,189,567        2,191,732

     Less current maturities                                                         (68,451)         (46,203)
                                                                                  ----------       ----------

     Long-term portion                                                            $2,121,116       $2,145,529
                                                                                   =========        =========

Future maturities of long-term debt are as follows:                              Year ending
                                                                                December 31,      Principal due
                                                                                ------------      -------------
                                                                                   2000             $  68,451
                                                                                   2001                71,133
                                                                                   2002                69,036
                                                                                   2003             1,995,876
                                                                                                    ---------

                                                                                   Total           $2,204,496
                                                                                                    =========

</TABLE>

                                                                              14


<PAGE>

<TABLE>

<CAPTION>


                 United Community Holdings, Inc. and Subsidiary

             Notes to Consolidated Financial Statements - Continued

Note G - Trust Funds and Restricted Cash

Pursuant to State law or Company policy,  certain portions of contracts  related
to the  sales of  prearranged  funeral  services  and  funeral  merchandise  and
cemetery spaces,  mausoleum crypts and related  merchandise are deposited into a
common  trust,  as of  December  31,  1999 and  1998 to  provide  funds  for the
fulfillment of the underlying  contracts  and/or  perpetual care of the cemetery
property.  Separate  trusts  for  funeral  contracts,   cemetery  contracts  and
perpetual care were maintained through December 31, 1997.

The Company  recognizes as revenue on a current basis all dividends and interest
earned, and net capital gains realized,  by all prearranged  funeral trust funds
or escrow accounts, except in those states where earnings revert to the customer
if a prearranged  funeral service or funeral  merchandise  contract is canceled.
The Company  recognizes  realized  trust income on these  merchandise  trusts in
current  cemetery  revenues as trust earnings  accrue to defray  inflation costs
recognized  related  to  the  unpurchased  cemetery  merchandise.   The  Company
recognizes and withdraws  currently all dividend and interest income earned and,
where permitted, capital gains realized by perpetual care funds.

As of March 31, 2000 and 1999,  the trust funds and  resultant  restricted  cash
consist of the following components:

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

       Trust cash                                                                 $   1,338        $ 13,735
       Marketable securities, at fair market value                                   63,700          78,250
         Unrealized (gains) losses on marketable securities                         105,680          41,029
       Amounts due to trust funds from future contract collections                  (65,675)        (87,263)
                                                                                    -------          ------

       Restricted cash                                                            $ 105,043        $ 45,751
                                                                                    =======          ======

Marketable securities are considered available-for-sale. All unrealized gains or
losses are excluded from earnings  until such time that such gains or losses are
realized  upon the sale of the  underlying  security.  For purposes of computing
realized gains and losses, the specific identification method is used.

As of March 31, 2000 and 1999, the marketable securities held in the trust funds
consist entirely of equity securities and are summarized as follows:

                                                                                     2000            1999
                                                                                  ---------        --------

     Aggregate fair value                                                         $  63,700        $ 78,250
     Gross unrealized holding gains                                               $    --          $    --
     Gross unrealized holding losses                                              $ 105,680        $ 41,029
     Amortized cost basis                                                         $ 169,380        $119,279

</TABLE>





               (Remainder of this page left blank intentionally.)

                                                                              15


<PAGE>

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations


(1)  Caution Regarding Forward-Looking Information

This  quarterly   report  contains   certain   forward-looking   statements  and
information relating to the Company that are based on the beliefs of the Company
or management as well as assumptions made by and information currently available
to  the  Company  or  management.   When  used  in  this  document,   the  words
"anticipate,"   "believe,"   "estimate,"   "expect"  and  "intend"  and  similar
expressions,  as they relate to the Company or its  management,  are intended to
identify forward-looking statements. Such statements reflect the current view of
the  Company   regarding  future  events  and  are  subject  to  certain  risks,
uncertainties  and  assumptions,  including the risks and  uncertainties  noted.
Should  one or more of  these  risks or  uncertainties  materialize,  or  should
underlying assumptions prove incorrect,  actual results may vary materially from
those  described  herein  as  anticipated,   believed,  estimated,  expected  or
intended. In each instance,  forward-looking information should be considered in
light of the accompanying meaningful cautionary statements herein.

(2)  General Information

United Community  Holdings,  Inc. (Company) was incorporated under the corporate
name of Professionalistics, Inc. on May 31, 1989, under the laws of the State of
Delaware,  as  a  wholly-owned  subsidiary  of  Halter  Venture  Corporation,  a
publicly-owned corporation . The Company changed its name to Pacific Great China
Co.,  Ltd.  on May 8, 1996 as a result of an  action by the  Company's  Board of
Directors  in  anticipation  of a business  acquisition  or merger  transaction.
Subsequently,  this anticipated  business  acquisition or merger transaction was
mutually canceled by both parties.

On December  17,  1998,  the Company  changed  its state of  Incorporation  from
Delaware  to  Nevada  by means of a  merger  with and into a Nevada  corporation
formed solely for the purpose of effecting the reincorporation.  The Articles of
Incorporation  and  Bylaws  of  the  Nevada  corporation  are  the  Articles  of
Incorporation  and  Bylaws  of  the  surviving  corporation.  Such  Articles  of
Incorporation did not change the capital structure of the Company. The effect of
this action also changed the Company's name to United Community Holdings, Inc.

On November 19, 1998,  the Company's  then majority  shareholder  sold 7,200,000
shares of the  7,750,129  shares  held by the then  majority  shareholder  to an
unrelated  third party in  anticipation  of a business  combination  transaction
whereby the Company would merge with and into a privately held operating company
during the first quarter of 1999.

On February 28, 1999,  effective  as of January 1, 1999,  the Company  exchanged
1,000  shares of  restricted,  unregistered  common  stock with its then current
majority  shareholder for 100.0% of the issued and outstanding stock of Rosemont
Gardens Funeral Chapel-Cemetery, Inc. (a Mississippi corporation) (Rosemont). At
closing, Rosemont became a wholly-owned subsidiary of the Company

The  acquisition of Rosemont by the Company was accounted in accordance with the
provisions of  Interpretation  #39 of Accounting  Principles  Board Opinion #16,
whereby the combination of entities under common control are accounted for on an
"as-if-pooled"  basis with the Company  being the parent  company  and  Rosemont
being a wholly-owned subsidiary.  These consolidated entities are referred to as
Company.  Accordingly,  the consolidated financial statements of the Company and
Rosemont represent the historical  consolidated  financial  statements as of the
first day of the first period presented.

Rosemont  Gardens  Funeral  Chapel-Cemetery,   Inc.  (Rosemont)  was  originally
incorporated  on March 4,  1994  under  the  laws of the  State of  Mississippi.
Rosemont's  operations  consist  of a funeral  home and  cemetery  operation  in
Jackson, Mississippi. Rosemont personnel at the funeral service location provide
all  professional  services  related to funerals,  including  the use of funeral
facilities  and  motor  vehicles.  Funeral  related  merchandise  is sold at the
funeral service location.  Rosemont sells prearranged funeral services whereby a
customer contractually agrees to the terms, conditions and price of a funeral to
be  performed  at an unknown  future date at the time the  contract is executed.
Rosemont's  cemetery  provides cemetery  interment rights  (including  mausoleum
crypts and lawn  spaces)  and  certain  merchandise  including  stone and bronze
memorials and burial vaults.  These items may be sold on either a pre-need or an
at-need  basis.  Rosemont  personnel  at the  cemetery  site  perform  interment
services and provide management and maintenance of the cemetery grounds.

                                                                              16

<PAGE>

(3)  Results of Operations

Three months  ended March 31, 2000  compared to the three months ended March 31,
1999
--------------------------------------------------------------------------------

The  operations  for the three months ended March 31, 2000 compared to the three
months ended March 31, 2000 show a continued maturation and market acceptance of
the products and  operations of the Company's  Rosemont  subsidiary.  Recognized
revenues  for the  first  three  months of 2000 were  approximately  $66,322  as
compared  to  approximately  $116,000  for the  comparable  period of 1999.  The
Company  recognizes  revenues  upon the provision of funeral  services,  sale of
funeral,  cemetery or related merchandise or upon the receipt of at least 25% of
the initial sales price for cemetery  spaces  and/or  crypts.  Accordingly,  the
Company's  revenues and cash flows are dependent  upon the level of need for the
Company's services and receipts on long-term  contracts for the sale of cemetery
spaces/crypts.

The Company  incurred  cost of sales and  providing  services  of  approximately
$26,000 and $41,000, respectively, for the three months ended March 31, 2000 and
1999. Costs related to cemetery  merchandise and funeral services are recognized
at the time the service is  provided.  Sales  commissions,  for both at-need and
pre-need  funeral sales and sales of cemetery spaces and/or crypts,  are charged
to expense,  less a nominal  percentage,  in the month the  related  contract is
recorded.  The  allocated  cost of cemetery  spaces  and/or crypts is charged to
operations  at the  time  that at least  25% of the  initial  contract  price is
received by the Company in cash. Total commissions expense, principally incurred
on the sales of pre-need  contracts for funeral  services and/or cemetery spaces
or crypts was approximately $7,500 and $13,700,  respectively,  during the first
three months ended March 31, 2000 and 1999.

The Company  realized gross profits of  approximately  $40,000  (60.63%) for the
first quarter of 2000 as compared to  approximately  $75,000  (64.81%) for first
quarter of 1999.  This change in gross profit  percentage is due to management's
value-based  product  pricing  policies  to provide  quality  funeral and burial
services  to the  general  public  and  the  direct  charge  to  operations  for
commissions  at the  inception  of a long-term  receivable  for either pre- need
funeral  services  or  cemetery  spaces/crypts.  Periods in which there are high
sales of new  long-term  contracts  without  either  the  provision  of  funeral
services  or the  receipt  of at  least  25% of the  initial  contract  price on
cemetery  spaces or crypts  will  cause  fluctuations  and  lower  gross  profit
percentages due to the Company's revenue recognition policies.

The  Company  continues  to  monitor  its  expenditures  for  general  operating
expenses,  principally  personnel costs and  professional  fees. The Company had
aggregate general and administrative  expenses of approximately  $71,000 for the
first quarter of 2000 as compared to  approximately  $47,000 for the first three
quarter of 1999.  Interest  expense was  relatively  constant  at  approximately
$58,000 for the first three months of 2000 as compared to approximately  $51,000
for the  first  three  months of 1999.  Depreciation  and  amortization  is also
relatively  constant at  approximately  $42,000 for the first quarter of 2000 as
compared to approximately $40,000 for the three quarter of 1999.

The principal  source of cash to support daily  operations is the  collection of
contractual  receivables for both prearranged  funeral services and the sales of
cemetery  spaces or crypts.  This area  continues  to  experience  growth in the
number and dollar amount of contracts placed in effect on a cumulative basis and
the related cash flows therefrom.

Earnings  per share for the  respective  quarters  ended March 31, 2000 and 1999
were $(0.02) and $(0.01).

                                                                              17


<PAGE>

(4)  Liquidity and capital resources

The Company is  principally  dependent upon cash flows related to the collection
of long-term contract  receivables  related to prearranged funeral contracts and
sales of cemetery spaces and/or crypts. The Company had negative cash flows from
operations of approximately  $(96,000) and $(114,000) for the three months ended
March 31, 2000 and 1999, respectively.  The operating cash deficits in excess of
cash collected on long-term  receivables  for funeral  services  and/or cemetery
spaces or crypts were supported through controlling  shareholder  advances.  The
Company  completed the  development  of the initial  cemetery  garden,  visitors
center and other funeral related  buildings  during 1998. The Company  continues
the process of  constructing  Phase II to its Mausoleum and the second and third
cemetery  gardens as internally  generated  funds and consumer  demand  permits.
Management  is of  the  opinion  that  it has  sufficient  cemetery  spaces  and
mausoleum  crypts to meet  current  demands and  construct  additional  capacity
within the parameters of existing cash flows.

During  the  third  quarter  of 1998,  the  Company  entered  into a  $2,220,000
long-term  note  payable  to a bank.  The note  bears  interest  at 8.00% and is
payable in monthly  installments of approximately  $18,569,  including interest.
Any unpaid  principal  and interest is due at the note's  maturity in June 2003.
The note is  secured  by land,  accounts  receivable  from  prearranged  funeral
contracts and cemetery  property sales  contracts and the personal  guarantee of
the Company's  controlling  shareholder.  The proceeds of this note were used to
refinance various short-term notes payable by the Company.

The Company has identified no significant  capital  requirements for the current
annual period.  Liquidity requirements mandated by future business expansions or
acquisitions,  if any are specifically identified or undertaken, are not readily
determinable  at this  time as no  substantive  plans  have been  formulated  by
management.

Additionally,  management is of the opinion that there is  additional  potential
availability  of incremental  mortgage debt and the  opportunity for the sale of
additional   common  stock  through  either  private   placements  or  secondary
offerings.

(5)  Year 2000 Considerations

The Year 2000 (Y2K) date change was believed to affect  virtually  all computers
and  organizations.   The  Company  undertook  a  comprehensive  review  of  its
information  systems,  including  personal  computers,  software and  peripheral
devices, and its general  communications systems during 1999. The Company has no
direct electronic links with any customer or supplier. Additionally, the Company
held discussions with certain of its software  suppliers with respect to the Y2K
date change.  The costs  associated with the Y2K date change  compliance did not
have a material  effect on the  Company's  financial  position or its results of
operations.

The Company continues to monitor its significant suppliers,  shippers, customers
and other external business  partners.  To date, the Company has not experienced
any  adverse  effect  from the  advent of Year  2000.  However,  there can be no
assurance that all of the Company's  systems,  and the systems of its suppliers,
shippers,  customers or other  external  business  partners will not  experience
unforseen problems during the Year 2000.

Part II - Other Information

Item 1 - Legal Proceedings

   None

Item 2 - Changes in Securities

   None

                                                                              18


<PAGE>



Item 3 - Defaults on Senior Securities

   None

Item 4 - Submission of Matters to a Vote of Security Holders

   The Company has held no regularly  scheduled,  called or special  meetings of
   shareholders during the reporting period.

Item 5 - Other Information

   None

Item 6 - Exhibits and Reports on Form 8-K

   None

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


                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                                United Community Holdings, Inc.

May    8   , 2000                           /s/ James F. Robinson.
    -------                         ------------------------------
                                                              James F. Robinson
                                                        Chairman and  President

May    8   , 2000                           /s/ Margaret R. Lauro
    -------                         -----------------------------
                                                              Margaret R. Lauro
                                                        Secretary/Treasurer and

                                                       Chief Accounting Officer

                                                                              19