Exhibit 99.2

BC FORM 51-901F

QUARTERLY REPORT

Incorporated as part of:	Schedules B & C

ISSUER DETAILS:



|Name of Issuer           | IMAGIS TECHNOLOGIES INC.                                           
|------------------------ | -------------------------------------------------------------------
|For Quarter Ended        | September 30, 2001                                                 
|Date of Report           | November 14, 2001                                                  
|Issuer Address           | 1300 - 1075 West Georgia Street
Vancouver, British Columbia
V6E 3C9
|Issuer Fax Number        | (604) 684-4601                                                     
|Issuer Telephone Number  | (604) 684-4691                                                     
|Contact Name             | Sandra Buschau                                                     
|Contact Position         | Secretary                                                          
|Contact Telephone Number | (604) 684-4691                                                     
|Contact Email Address    | sandy@imagistechnologies.com                                       
|Web Site Address         | www.imagistechnologies.com                                         

CERTIFICATE

THE THREE SCHEDULES REQUIRED TO COMPLETE THIS REPORT ARE
ATTACHED AND THE DISCLOSURE CONTAINED THEREIN HAS BEEN APPROVED BY THE BOARD OF
DIRECTORS.  A COPY OF THIS REPORT WILL BE PROVIDED TO ANY SHAREHOLDER WHO
REQUESTS IT.



|Iain Drummond
Name of Director | "Iain Drummond"

Sign (typed) | 01/11/14
Date Signed (YY/MM/DD)   
|------------------------------ | ----------------------------- | ----------------------------------
|                               |                               |                                   
|Rory Godinho
Name of Director  | "Rory Godinho"

Sign (typed)  | 01/11/14/01
Date Signed (YY/MM/DD)

---

SCHEDULE B:     SUPPLEMENTARY
INFORMATION

1.     Analysis of expenses:

a)     Cost of materials



|Services | 37,689    
|-------- | ----------
|Supplies | 74,524    
|Total    | $  112,213

(b)     Administration expenses



|Bank charges and interest, net               | 3,598     
|-------------------------------------------- | ----------
|Consulting fees                              | 33,580    
|Foreign exchange                             | 222       
|Office and rent                              | 286,822   
|Management fees                              | 40,000    
|Salaries and benefits                        | 101,880   
|Professional fees                            | 59,460    
|Shareholder relations and regulatory filings | 73,822    
|Travel and entertainment                     | 158,639   
|Total                                        | $  758,023

2.     Related party
transactions:



|Wages and benefits for two officers               | 172,916   
|------------------------------------------------- | ----------
|Management fees for one director and two
officers | 58,000    
|Total                                             | $  230,916

3.     Summary of securities
issued and options granted during the period ended September 30, 2001

a)     Summary of securities issued
during the period:



|Date
of
Issue | Type
of
Security | Type
of
Issue     | Number
or
Amount | Price | Total
Proceeds
|------------- | ---------------- | ----------------- | ---------------- | ----- | --------------
|08/15/01      | Common           | Private placement | 110,000          | $1.00 | 110,000       
|09/19/01      | Common           | Option exercise   | 5,000            | $1.00 | 5,000         
|09/21/01      | Common           | Warrant exercise  | 25,000           | $1.10 | 27,500        
|09/28/01      | Common           | Warrant exercise  | 100,000          | $1.10 | 110,000       
|09/28/01      | Common           | Option exercise   | 16,667           | $1.00 | 16,667        

b)     Options/warrants granted
during the period:



|Date of
Grant | Type
of
Issue | Number  | Name                  | Exercise
Price | Expiry
Date
|------------- | ------------- | ------- | --------------------- | -------------- | -----------
|08/30/01      | Option        | 160,000 | Andrew Amanovich      | $1.00          | 08/30/06   
|08/30/01      | Option        | 5,000   | Evlyn Anderson        | $1.00          | 08/30/06   
|08/30/01      | Option        | 60,000  | Sandra Buschau        | $1.00          | 08/30/06   
|08/30/01      | Option        | 50,000  | Frederick Clarke      | $1.00          | 08/30/06   
|08/30/01      | Option        | 100,000 | Iain Drummond         | $1.00          | 08/30/06   
|08/30/01      | Option        | 50,000  | Rory Godinho          | $1.00          | 08/30/06   
|08/30/01      | Option        | 15,000  | Timothy Holl          | $1.00          | 08/30/06   
|08/30/01      | Option        | 70,000  | Altaf Nazerali        | $1.00          | 08/30/06   
|08/30/01      | Option        | 50,000  | Shafiq Nazerali-Walji | $1.00          | 08/30/06   
|08/30/01      | Option        | 30,000  | Linda Robertson       | $1.00          | 08/30/06   
|08/30/01      | Option        | 60,000  | Ross Wilmot           | $1.00          | 08/30/06   
|              |               |         |                       |                |            

---

4.     Summary of securities as at
September 30, 2001

a)     Authorized share capital:
  100,000,000 common shares without par value

b)     Number and recorded value for
shares issued and outstanding:

|Issued and outstanding
Balance, September 30, 2001 | No. of shares
14,719,965 | Amount
$7,997,880
|-------------------------------------------------- | ------------------------ | -----------------

c)     Description of options,
warrants and convertible securities outstanding:

Options

|Number of common shares
issuable | Exercise Price | Date of Expiry              
|-------------------------------- | -------------- | ----------------------------
|                                 |                |                             
|230,000                          | $0.30          | July 6, 2003                
|1,256,498                        | $1.00          | Various to August 30, 2006  
|580,000                          | $1.50 to $2.90 | Various to December 30, 2005
|2,066,498                        |                |                             

Warrants

|Number of common shares
issuable | Exercise Price | Date of Expiry        
|-------------------------------- | -------------- | ----------------------
|                                 |                |                       
|266,666                          | $1.25          | February 23, 2002     
|133,334                          | $1.25          | February 23, 2003     
|50,000                           | $4.00          | June 16, 2002         
|1,476,000                        | $1.10          | Various to May 6, 2003
|1,926,000                        |                |                       

Convertible Securities

Nil

d)     Total Number of Shares in
Escrow

270,670 shares are being held in escrow.  These shares will
be released on February 23, 2002.

5.     List of directors and
officers as of November 14, 2001:

Oliver "Buck" Revell - Chairman and a Director
Iain Drummond - President, Chief Executive Officer and a Director
Ross Wilmot - Vice President, Finance and Chief Financial Officer
Sandra Buschau - Secretary 
Altaf Nazerali - Director
Robert Gordon - Director
Rory Godinho - Director
Frederick Clarke - Director
Andy Amanovich - Chief Technology Officer

---

SCHEDULE C:     MANAGEMENT
DISCUSSION

DESCRIPTION OF BUSINESS

Forward Looking Statements:

Statements in this Quarterly Report on Form 10-QSB, including
those concerning Imagis Technologies Inc.'s (the "Company" or
"Imagis") expectations of results of the Company's operations in
future periods, the amount and timing of revenues and earnings in future
periods, future sales, gross profits, sales and marketing expenses, technical
services expenses, technology development expenses, administration expenses,
product introductions and cash requirements include certain forward-looking
statements within the meaning of Section 21E of the Securities Exchange Act of
1934, as amended.  As such, the Company's actual results may vary materially
from expectations as a result of certain factors including, but not limited to,
the failure of the market for the Company's products to grow as anticipated;
product pricing or other initiatives of the Company's competitors; the
possibility that the Company's other customers defer purchasing decisions due to
economic or other conditions or will purchase products offered by the Company's
competitors; product development, product pricing or other initiatives of the
Company's competitors; variations in the level of orders which can be affected
by general economic conditions and in the markets served by the Company's
customers; international economic and political climates; difficulties or delays
in the functionality or performance of the Company's products; the Company's
timing of future product releases or improvements; the Company's failure to
respond adequately to either changes in technology or customer preferences;
changes in our pricing; the Company's ability to manage growth; risk of
nonpayment of accounts receivable; changes in budgeted costs and the factors
listed on Exhibit 99.1 to this Quarterly Report, which are hereby incorporated
by reference in this Quarterly Report.

In some cases, you can identify forward-looking statements
by the Company's use of words such as "may," "will,"
"should," "could," "expect," "plan,"
"intend," "anticipate," "believe,"
"estimate," "predict," "potential" or
"continue" or the negative or other variations of these words, or
other comparable words or phrases.

Although the Company believes the expectations reflected in
its forward-looking statements are reasonable, it cannot guarantee future
results, levels of activity, performance or achievements or other future
events. The Company is under no duty to update any of our forward-looking
statements after the date of this filing.  You should not place undue reliance
on forward-looking statements.

Unless otherwise indicated, all references herein are to
Canadian Dollars.

About Imagis

Imagis is a developer and marketer of software applications,
and of advanced biometric facial recognition software in a software development
toolkit.  These software applications provide a range of security solutions for
various industry sectors including airports, law enforcement, customs,
immigration and other government agencies.  Imagis currently has over 130
national and international installations with in excess of a thousand users of
its biometric facial recognition technology, including at Toronto's Pearson
International Airport, the world's sixteenth busiest airport and at Oakland
International Airport, which serves more than 10 million travelers per year.
Imagis markets its products through a network of business partners, located in
North America, Asia, Europe and Latin America. Imagis' Chairman is Oliver
"Buck" Revell, who served for over 30 years in the FBI, and during his
career advanced to the number two-career post of Associate Deputy Director.

About ID-2000

Imagis' ID-2000 uses more than 200 facial descriptors,
generated from its sophisticated image analysis algorithm, to capture, compare
and display an individual's face against a database quickly and efficiently.
ID-2000 allows an individual to be identified in seconds, using only an image or
photograph as the primary search criterion.  Extensive links enable the database
to be mined further to display details of aliases, associates, vehicles, as well
as images of other distinguishing features such as marks, scars and tattoos.

ID-2000 is available as an option within any of Imagis'
existing image software products, including CABS-Computerized Arrest and Booking
System, Secure-ID, and Envisage.  ID-2000 can also be embedded into existing
access control applications or other secure databases combined with encryption
protocols or other biometrics, by means of Imagis' ID-2000 SDK Toolkit.   This
multi-layered approach, allows users to enhance existing security solutions or
create new applications in response to today's global security issues.

---

ID-2000

- Allows the user to search databases containing 1 million
records in under 5 seconds;
- Permits use of any image source - direct digital input, scanned photographs,
direct analog or digital camera input or any other source image with a minimum
of 200 pixels;
- Interfaces on a secure basis with local, regional, national and
international databases; and
- Provides an open architecture to allow ID-2000 to be easily integrated into
existing windows-based applications.

The Company believes that there is a growing interest in
biometric facial recognition products and other similar security products due to
the perceived need for increased security in certain venues worldwide, including
airports.  The Company believes that its commercially available ID-2000 product
group, including both custom applications of ID-2000 and an SDK format made
available this year, is well-suited for these demanding security applications.
As part of the Company's progressing research and development, the Company has
increased its technology development staff count and continues to search for
qualified people to assist with further enhancement and increased performance
under adverse conditions, principally poor lighting, motion and non-frontal
images, and plans to introduce a significant upgrade in the fourth quarter of
this year.  There can be no assurance, however, that the Company's
products will compete successfully with alternative products and technologies or
that the market for sophisticated security products will continue to grow as
expected in the future.

Comparison of Results of Operations for the three months ended September
30, 2001 and 2000:

Revenues:

The Company's revenues for the quarter ended September 30,
2001 were $261,583, compared to $151,757 for the quarter ended September 30,
2000, which represents an increase of approximately 72%.  Sales of the Company's
software increased approximately 342% to $136,000 for the quarter ended
September 30, 2001, compared to only $30,750 for the quarter ended September 30,
2000.  The increase reflects increased sales of the Company's biometric ID-2000
product in the current year.  The Company's biometric ID-2000 was introduced in
2000 and sales were minimal in that year.  Support and services revenues were
$125,583 for the quarter ended September 30, 2001, which is slightly better when
compared to $121,007 for the quarter ended September 30, 2000.

Operating expenses:

The Company's operating expenses for the quarter ended
September 30, 2001 were $910,339, compared to $966,027 for the quarter ended
September 30, 2000, which represents an decrease of approximately 6%, primarily
due to lower sales and marketing costs.  Operating expenses include cost of
materials and services, sales and marketing, technical services, technology
development, administration, amortization and interest.

Cost of materials and services:

The Company's materials and service costs in conjunction with
the support services that it provides to customers for the quarter ended
September 30, 2001 were $42,746, compared to $47,309 for the quarter ended
September 30, 2000, which represents an decrease of approximately 10%. These
costs represent materials purchased in the quarter related to the Alameda
installation.

Sales and marketing:

The Company's sales and marketing costs for the quarter ended
September 30, 2001 were $180,021, compared to $257,936 for the quarter ended
September 30, 2000, which represents a decrease of approximately 30%. This
decrease resulted primarily from lower travel, tradeshow exhibit and marketing
material costs.   The Company expects that costs will increase somewhat in the
fourth quarter as a result of completion of a financing on November 9, 2001.

Technical services:

The Company's technical services costs for the quarter ended
September 30, 2001 were $156,920, compared to $159,805 for the quarter ended
September 30, 2000, representing a 2% reduction this quarter.  The technical
services group oversees and assists the Company's strategic partners with the
installation of Imagis' products and also provides users any technical support
they may require under annual support contracts. Technical services costs
include salaries, facilities and travel.

---

Technology Development:

The Company's technology development costs for the quarter
ended September 30, 2001 were $294,245, compared to $223,482 for the quarter
ended September 30, 2000, which represents an increase of approximately 32%.
This increase over the prior period reflects costs associated with several
additions to staff over the prior period and higher infrastructure costs
incurred for additional space and equipment for these new staff members.  During
the current year, the Company completed the conversion of its core technology
into a software development kit (SDK) format that permits a far broader range of
applications of this facial recognition software. In addition, the group is
developing greater functionality in the ID-2000 product for release in the
fourth quarter of this year.

Administration:

The Company's administration costs for the quarter ended
September 30, 2001 were $229,585, which is 10% lower than the costs of $255,327
incurred in the quarter ended September 30, 2000. Administrative costs include
staff salaries, professional fees, facility and support costs, and shareholder
and regulatory costs. The reduction is primarily the result of lower consulting
and travel costs in 2001. All other costs were essentially in line with the
prior year period.

Amortization:

The Company's amortization costs for the quarter ended
September 30, 2001 were $5,214, compared to $22,168 for the quarter ended
September 30, 2000. This decrease in amortization expense reflects a strategy,
following the acquisition of Imagis-Cascade, to lease all new equipment. The
Company's existing fixed assets are almost fully depreciated at this time.

Interest:

The Company's interest costs for the quarter ended September
30, 2001 were $1,608, compared to no such costs for the quarter ended September
30, 2000.   The interest costs are related to advances from related parties.

Net Loss for the Period:

The Company's net loss for the quarter ended September 30,
2001 was $648,756, or $0.04 per share, compared to $814,270, or $0.07 per share,
for the quarter ended September 30, 2000.

Comparison of Results of Operations for the nine-month periods ended
September 30, 2001 and 2000:

Revenues:

The Company's revenues for the nine-month period ended
September 30, 2001 were $1,359,044, compared to $605,538 for the nine-month
period ended September 30, 2000, which represents an increase of approximately
124%.  Sales of the Company's software increased approximately 236% to $985,092
for the nine-month period ended September 30, 2001, compared to $292,513 for the
nine-month period ended September 30, 2000.  As noted in the commentary for the
three-month period, the increase reflects increased sales of the Company's
biometric ID-2000 product in the current year.  ID-2000 was introduced in 2000
and sales were minimal in that year.  Support and services increased
approximately 19% to $373,952 for the nine-month period ended September 30,
2001, compared to $313,025 for the nine-month period ended September 30, 2000,
due to increased annual support revenues from the Company's growing customer
base.

Operating expenses:

The Company's operating expenses increased for the nine-month
period ended September 30, 2001 to $2,935,574, compared to $2,874,882 for the
nine-month period ended September 30, 2000, which represents an increase of
approximately 2%, essentially attributable to significantly higher technology
development expenditures.

Cost of materials and services:

The Company's materials and service costs in conjunction with
the support services that it provides to customers for the nine-month period
ended September 30, 2001 were $112,213, compared to $101,908 for the nine-month
period ended September 30, 2000. These

---

costs are incurred primarily for outside
services in conjunction with the support provided to users. As noted above, the
costs for the nine months in 2001 include approximately $40,000 for purchases
related to the Alameda.

Sales and marketing:

The Company's sales and marketing costs for the nine-month
period ended September 30, 2001 were $635,456, compared to $868,125 for the
nine-month period ended September 30, 2000, which represents a decrease of
approximately 27%. This decrease resulted primarily from lower travel, tradeshow
exhibit and marketing material costs.   The Company completed a financing on
November 9, 2001 to raise additional working capital to significantly expand its
sales and marketing efforts and also the development of its technology.

Technical services:

The Company's technical services costs for the nine-month
period ended September 30, 2001 were $549,351, compared to $462,260 for the
nine-month period ended September 30, 2000, which represents an increase of
approximately 19%.  The higher costs during the current period reflect the
travel costs incurred in support of the installation of the Company's Alameda
County sale.

Technology Development:

The Company's technology development costs for the nine-month
period ended September 30, 2001 were $823,767, compared to $607,636 for the
nine-month period ended September 30, 2000, which represents an increase of
approximately 36%. This increase in the current year reflects costs for several
additions to staff and higher infrastructure costs incurred for additional space
and equipment.

Administration:

The Company's administration costs for the nine-month period
ended September 30, 2001 were $758,023, compared to $777,896 for the nine-month
period ended September 30, 2000. Costs for travel were significantly higher in
2001, however, the increase was offset by lower consulting costs and
professional fees.  All other costs were essentially in line with the prior year
period.

Amortization:

The Company's amortization costs for the nine-month period
ended September 30, 2001 were $13,524, compared to $57,057 for the nine-month
period ended September 30, 2000. This decrease reflects the Company's use of
operating leases for virtually all of its equipment needs. The Company's
existing fixed assets are substantially depreciated at this time.

Interest:

The Company's interest costs for the nine-month period ended
September 30, 2001 were $43,240, compared to no such costs for the nine-month
period ended September 30, 2000.

Net Loss for the Period:

The Company's net loss for the nine-month period ended
September 30, 2001 was $1,576,530, or $0.11 per share, compared to $2,269,344,
or $0.20 per share, for the nine-month period ended September 30, 2000.

Comparison of Results of Operations for the three months ended June 30,
2001 and 2000:

Revenues:

The Company's revenues for the quarter ended June 30, 2001
were $743,625, compared to $258,646 for the quarter ended June 30, 2000, which
represents an increase of approximately 188%.  Sales of the Company's software
increased approximately 288% to $656,047 for the quarter ended June 30, 2001,
compared to $169,021 for the quarter ended June 30, 2000.  Support and services
were $87,578 and were virtually unchanged for the quarter ended June 30, 2001
when compared to $89,625 for the quarter ended June 30, 2001, even though 2001
revenues from support contracts actually rose by approximately $20,000 as a
result of the overall increased number of installations.  This gain, however,
was offset by lower revenues from other sources.

---

Operating Costs:

The Company's operating costs decreased for the quarter ended
June 30, 2001 to $1,023,511, compared to $1,087,811 for the quarter ended June
30, 2000, which represents an decrease of approximately 6%.  Operating costs
include cost of materials and services, sales and marketing, technical services,
technology development, administration, amortization and interest.

Cost of materials and services:

The Company's materials and service costs in conjunction with
the support services that it provides to customers for the quarter ended June
30, 2001 were $35,619, compared to $27,574 for the quarter ended June 30, 2000,
which represents an increase of approximately 29%.

Sales and marketing:

The Company's sales and marketing costs for the quarter ended
June 30, 2001 were $195,013, compared to $386,295 for the quarter ended June 30,
2000, which represents an decrease of approximately 50%. This decrease resulted
primarily from lower travel, tradeshow exhibit and marketing material costs.

Technical services:

The Company's technical services costs for the quarter ended
June 30, 2001 were $217,413, compared to $152,507 for the quarter ended June 30,
2000, which represents an increase of approximately 43%.  The technical services
group oversees and assists the Company's strategic partners with the
installation of Imagis' products and also provides users any technical support
they may require under annual support contracts. Costs include salaries,
facilities and travel. The increase during the current period reflects the
travel costs incurred in support of the installation of the Company's Alameda
County sale.

Technology Development:

The Company's technology development costs for the quarter
ended June 30, 2001 were $255,879, compared to $208,936 for the quarter ended
June 30, 2000, which represents an increase of approximately 22%. This increase
over the prior period reflects costs associated with several additions to staff
over the prior period and higher infrastructure costs incurred for additional
space and equipment for such new staff.  During the year, the Company completed
the conversion of its core technology into a software development kit (SDK)
format that permits a far broader range of applications of this facial
recognition software.

Administration:

The Company's administration costs for the quarter ended June
30, 2001 were $306,453, compared to $299,814 for the quarter ended June 30,
2000. Administrative costs include staff salaries, professional fees, facility
and support costs, and shareholder and regulatory costs. Costs for travel were
higher in the 2001 quarter, however, the increase was offset by lower consulting
costs. All other costs were essentially in line with the prior year period.

Amortization:

The Company's amortization costs for the quarter ended June
30, 2001 were $3,534, compared to $12,685 for the quarter ended June 30, 2000.
This decrease in amortization expenses reflects a strategy, following the
acquisition of Imagis-Cascade, to lease all new equipment. The Company's
existing fixed assets are almost fully depreciated at this time.

Interest:

The Company's interest costs for the quarter ended June 30,
2001 were $9,600, compared to no such costs for the quarter ended June 30, 2000.
The interest costs are related to the debt portion of the convertible loan.

Net Loss for the Period:

The Company's net loss for the quarter ended June 30, 2001
was $279,886, or $0.02 per share, compared to $829,165, or $0.07 per share, for
the quarter ended June 30, 2000.

---

Comparison of Results of Operations for the six-month periods ended June
30, 2001 and 2000:

Revenues:

The Company's revenues for the six-month period ended June
30, 2001 were $1,097,461, compared to $453,781 for the six-month period ended
June 30, 2000, which represents an increase of approximately 142%.  Sales of the
Company's software increased approximately 224% to $849,092 for the six-month
period ended June 30, 2001, compared to $261,763 for the six-month period ended
June 30, 2000.  Support and services increased approximately 29% to $248,369 for
the six-month period ended June 30, 2001, compared to $192,018 for the six-month
period ended June 30, 2001.

Operating Costs:

The Company's operating costs increased for the six-month
period ended June 30, 2001 to $2,025,235, compared to $1,908,855 for the
six-month period ended June 30, 2000, which represents an increase of
approximately 6%.

Cost of materials and services:

The Company's materials and service costs in conjunction with
the support services that it provides to customers for the six-month period
ended June 30, 2001 were $69,467, compared to $54,599 for the six-month period
ended June 30, 2000. These costs are incurred primarily for outside services in
conjunction with the support provided to users. During the six-month period
ended June 30, 2000, costs included $35,750 for equipment purchases made on
behalf of, and resold to customers in conjunction with, installations. The
Company discontinued such purchases in 2000 and now relies on its business
partners to provide any requisite equipment required by customers.

Sales and marketing:

The Company's sales and marketing costs for the six-month
period ended June 30, 2001 were $455,435, compared to $610,189 for the six-month
period ended June 30, 2000, which represents an decrease of approximately 25%.
This decrease resulted primarily from lower travel, tradeshow exhibit and
marketing material costs.

Technical services:

The Company's technical services costs for the six-month
period ended June 30, 2001 were $392,431, compared to $302,455 for the six-month
period ended June 30, 2000, which represents an increase of approximately 30%.
The higher costs during the current period reflect the travel costs incurred in
support of the installation of the Company's Alameda County sale.

Technology Development:

The Company's technology development costs for the six-month
period ended June 30, 2001 were $529,522, compared to $384,154 for the six-month
period ended June 30, 2000, which represents an increase of approximately 38%.
This increase in the current year reflects costs for several additions to staff
and higher infrastructure costs incurred for additional space and equipment.

Administration:

The Company's administration costs for the six-month period
ended June 30, 2001 were $528,438, compared to $522,569 for the six-month period
ended June 30, 2000. Costs for travel were significantly higher in the 2001,
however, the increase was offset by lower consulting costs and professional
fees.  All other costs were essentially in line with the prior year period.

Amortization:

The Company's amortization costs for the six-month period
ended June 30, 2001 were $8,310, compared to $34,889 for the six-month period
ended June 30, 2000. This decrease reflects the Company's use of operating
leases for all its equipment needs. The Company's existing fixed assets are
almost fully depreciated at this time.

---

Interest:

The Company's interest costs for the six-month period ended
June 30, 2001 were $41,632, compared to no such costs for the six-month period
ended June 30, 2000.

Net Loss for the Period:

The Company's net loss for the six-month period ended June
30, 2001 was $927,774, or $0.07 per share, compared to $1,455,074, or $0.13 per
share, for the six-month period ended June 30, 2000.

Comparison of Results of Operations for the three months ended March 31,
2001 and March 31, 2000:

Revenues:

The Company's revenues for the quarter ended March 31, 2001
were $353,836, compared to $195,135 for the quarter ended March 31, 2000, which
represents an increase of approximately 81%. Sales of the Company's software
increased approximately 108% to $193,045 for the quarter ended March 31, 2001,
compared to $92,742 for the quarter ended March 31, 2000. Support and service
revenues increased approximately 57% to $160,791 for the quarter ended March 31,
2001, compared to $102,393 for the quarter ended March 31, 2000.

Operating Costs:

The Company's operating costs increased for the quarter ended
March 31, 2001 to $1,001,724, compared to $821,044 for the quarter ended March
31, 2000, which represents an increase of approximately 22%. Operating costs
include cost of materials and services, sales and marketing, technical services,
technology development, administration, amortization and interest.

Cost of Materials and Services:

The Company's materials and service costs in conjunction with
the support services that it provides to customers for the quarter ended March
31, 2001 were $33,848, compared to $27,025 for the quarter ended March 31, 2000,
which represents an increase of approximately 25%. This increase reflects costs
associated with the higher support revenues earned to date.

Sales and Marketing:

The Company's sales and marketing costs for the quarter ended
March 31, 2001 were $260,422, compared to $223,894 for the quarter ended March
31, 2000, which represents an increase of approximately 16%. This increase is
attributable to higher salary costs reflecting additions to staff over the prior
year. Travel and trade show costs also rose slightly due to the increase in
staff over the prior year level.

Technical Services:

The Company's technology services costs for the quarter ended
March 31, 2001 were $175,018, compared to $149,948 for the quarter ended March
31, 2000, which represents an increase of 17%. This increase reflects staff
additions to the technical services group. The technical services group assists
the Company's strategic partners in the installation of its products and also
provides clients with all technical support they may require under the Company's
annual support contracts, and includes costs for salaries, facilities and
travel.

Technology Development:

The Company's technology development costs for the quarter
ended March 31, 2001 were $273,643, compared to $175,218 for the quarter ended
March 31, 2000, which represents an increase of 56%. This increase over the
prior period reflects several additions to staff that were necessary, primarily
to continue the development of ID-2000. Recently, the Company completed the
conversion of its core technology into a software development kit (SDK) format
which permits a far broader range of applications of this facial recognition
software. Staff salaries accounted for approximately 73% of the total costs of
this function with the remainder attributable to support facilities.

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Administration:

The Company's administration costs for the quarter ended
March 31, 2001 were $221,985, compared to $222,755 for the quarter ended March
31, 2000. Administrative costs include staff salaries, professional fees,
facility and support costs, shareholder and regulatory costs. Costs in each
category were generally consistent with the prior year period, except for
professional fees and travel costs which were higher in 2001. These increases,
however, were more than offset by a foreign exchange gain of $34,993 realized
in the quarter.

Amortization:

The Company's amortization costs for the quarter ended March
31, 2001 were $4,776, compared to $22,204 for the quarter ended March 31, 2000.
The decline in amortization costs reflects the Company's decision, following the
acquisition of Imagis Cascade, to initiate a lease-financing program for all
purchases of new equipment and, as a consequence, the Company's existing fixed
assets are almost fully depreciated at this time.

Interest:

The Company's interest costs for the quarter ended March 31,
2001 were $32,032, compared to no such costs for the quarter ended March 31,
2000. The interest costs are related to the debt portion of the convertible
loan.

SUBSEQUENT EVENTS

The Company has received an aggregate of $354,834 in respect
of 254,834 stock options that were exercised at various prices up to November 13,
2001.

The Company has received an aggregate of $1,094,500 in
respect of 995,000 warrants that were exercised at a price of $1.10 up to
November 13, 2001.

On October 12, 2001, the Company paid $51,150 to Valor Invest
Limited to retire the short-term loan that was outstanding on September 30,
2001, including an additional $28 in interest that was payable for the period
from October 1 to October 12.

On October 24, 2001 the Company announced that it has
arranged, subject to regulatory approval, a private placement of 1,612,903
Special Warrants at a price of $2.17 per Special Warrants for total proceeds of
$3,500,000.  The Special Warrants will be exercisable, for no additional
consideration, into one common share and one half of a non-transferable share
purchase warrant.  Each whole warrant will entitle the holder thereof to acquire
on additional common share in the capital of the Company at an exercise price of
$2.55 for a period of one year from the date the underlying shares are qualified
by a prospectus.

On October 31, 2001 the Company announced that it has
renegotiated the terms of the non-brokered portion of the private placement that
was announced on October 24, 2001.  The non-brokered portion of the private
placement has been increased to $497,650 and will now be for units rather than
Special Warrants at $2.17 per unit.  Each unit consists of one common share and
one half of a non-transferable share purchase warrant, with each whole warrant
entitling the holder thereof to acquire one additional common share in the
capital of the Company at an exercise price of $2.55 for a period of one year
from the date on which the warrants are issued.

On November 9, the Company completed its private placement
of Special Warrants, further to news releases dated October 24, 2001 and October
31, 2001.  Under the brokered portion of the private placement, Imagis has
issued 1,427,682 special warrants at a price of $2.17 per special warrant, with
each special warrant being convertible into one common share and one-half of a
non-transferable share purchase warrant.  Each whole warrant entitles the holder
thereof to acquire an additional common share for a period of one year from the
date the underlying shares are qualified for resale at a price of $2.55 per
share.  Imagis paid its agents a cash commission of the gross proceeds and has
issued Agents' Compensation Options entitling them to collectively purchase
142,768 common shares at a price of $2.17 per share for a period of one year
following the qualification date.  The non-brokered portion of the private
placement was for 229,332 units at a price of $2.17 per unit, with each unit
comprised of one common share and one-half of a warrant.  Each whole warrant
entitles the holders thereof to acquire an additional common share at a price of
$2.55 per share for a term expiring on November 9, 2002.

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FINANCINGS, PRINCIPAL PURPOSES AND MILESTONES

There were no financings completed during the three-month
period ended September 30, 2001.

LIQUIDITY AND SOLVENCY

The Company finances its operations and capital expenditures
with cash generated from operations and private placements of its securities.
The Company's cash position at the beginning of the year was $59,497.  Due to a
general weakening in financial markets in the first quarter of this fiscal year,
the completion of the Company's planned private placement was delayed. In the
interim, the Company arranged for a line of credit of up to $200,000 from
related parties and received $145,000 from this line during the first quarter.
As compensation for advancing funds by the related parties under this credit
arrangement, the Company issued 20,000 common shares at the then current market
price for a net value of $28,473.  This amount represents a non-cash cost to the
Company.

During the second quarter, the Company was successful in
completing its private placement with net proceeds to the Company of $1,300,752,
after subtracting the funds already advanced to the Company. The Company sold
1,391,000 units (the "Units") at a price per Unit of $1.00, with each
Unit consisting of one (1) common share of the Company and one (1)
non-transferable share purchase warrant of the Company exercisable at a price
per share of $1.10 for a period of one (1) year from the closing date.

In the third quarter, a small private placement was completed
for 100,000 common shares of the Company raising $110,000. In addition, cash was
received in the quarter from the exercise of 21,667 options at $1.00 and 125,000
warrants priced at $1.10 that added cash aggregating $159,167. For the nine month
period ended September 30, 2001, gross proceeds from common stock financing
totaled $1,501,000, and from the exercise of options and warrants, $229,500.

From these funds, the Company made partial payments totaling
$423,082 on various loans from related parties. Consequently, net cash inflows
from financing activities for the nine month period ended September 30, 2001
amounted to $1,164,944.

In regard to operating activities, while the Company's
operating loss for the nine months ended September 30, 2001 was $1,576,530, its
impact on cash resources was significantly reduced by adjustments for non-cash
working capital items.  These adjustments primarily consisted of an increase in
the Company's accounts receivable of $669,541, such that the net reduction in
cash from the Company's first nine months operating loss was lowered to
$1,074,327.

The Company's financing activities exceeded its operating
loss for the nine month period ended September 30, 2001 after adjustments, as
noted above, and as a result, Imagis' cash resources rose $85,622 in such nine
month period to $145,119 as of September 30, 2001.

On November 9, 2001, the Company completed a private
placement (the "Special Warrant Private Placement") of 1,656,914
special warrants (the "Special Warrants") at a purchase price of $2.17
per Special Warrant, with each Special Warrant consisting of one (1) Common
Share and one-half (1/2) of a non-transferable share purchase warrant, that
resulted in gross proceeds to the Company of $3,595,720.40.  Of the Special
Warrants, 1,427,682 were sold through placement agents (the "Brokered
Special Warrants").  As compensation for the sale of the Brokered Special
Warrants, the placement agents received (i) a cash commission of eight percent
(8%) of the gross proceeds received by the Company from the sale of the Brokered
Special Warrants and (ii) options entitling them to purchase up to an aggregate
of 142,768 Common Shares at a price per share of $2.17 for a period of one year
following the date on which the Brokered Special Warrants become qualified for
resale under applicable Canadian securities laws.

The Company intends to use the proceeds of the Special
Warrant Private Placement to expand its sales and marketing activities, to add
additional developers to its research and development department and to
accelerate its business opportunities in the law enforcement, airport and
security markets.  The Company believes that its projected revenues and proceeds
from the Special Warrant Private Placement will be sufficient to meet its
working capital requirements in fiscal 2002.

The Company believes that future cash flows, in addition to
funds on hand, will provide sufficient funds to meet the Company's cash
requirements for at least one (1) year on a going forward basis.  The Company
currently does not have any loans or lines of credit with third parties.  The
Company has no material additional capital expenditure commitments.  The Company
may look to obtain additional equity or debt financing to fund future growth,
which may or may not be available on attractive terms, or at all, and may be
dilutive to current or future shareholders.