U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-QSB

                             Quarterly Report Under
                       the Securities Exchange Act of 1934

                        For Quarter Ended: March 31, 2001

                         Commission File Number: 0-28053



                           INVESTMENT ASSOCIATES, INC.
        (Exact name of small business issuer as specified in its charter)


                                     Nevada
         (State or other jurisdiction of incorporation or organization)


                                   98-0204280
                        (IRS Employer Identification No.)


                              104-1456 St. Paul St.
                        Kelowna, British Columbia, Canada
                    (Address of principal executive offices)

                                     V1Y 2E6
                                   (Zip Code)

                                 (250) 868-8177
                           (Issuer's Telephone Number)


              (Former name, former address and former fiscal year,
                          if changed since last report)


Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for such shorter  period that the registrant was required to file such reports),
and (2) has been subject to such filing  requirements  for the past 90 days:
Yes __X__ No ____.

The number of shares of the  registrant's  only class of common stock issued and
outstanding, as of May 4, 2001, was 1,000,000 shares.



<PAGE>



                                     PART I

ITEM 1.           FINANCIAL STATEMENTS.

     The unaudited financial statements for the six month period ended March 31,
2001 are attached hereto.

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

     The following  discussion  should be read in conjunction with the Company's
unaudited financial  statements and notes thereto included herein. In connection
with, and because it desires to take advantage of, the "safe harbor"  provisions
of the Private  Securities  Litigation  Reform Act of 1995, the Company cautions
readers regarding certain forward looking statements in the following discussion
and  elsewhere  in this  report  and in any other  statement  made by, or on the
behalf of the Company,  whether or not in future filings with the Securities and
Exchange  Commission.  Forward  looking  statements  are statements not based on
historical  information  and  which  relate to  future  operations,  strategies,
financial  results  or  other  developments.   Forward  looking  statements  are
necessarily based upon estimates and assumptions that are inherently  subject to
significant business,  economic and competitive uncertainties and contingencies,
many of which are beyond the Company's  control and many of which,  with respect
to future business  decisions,  are subject to change.  These  uncertainties and
contingencies can affect actual results and could cause actual results to differ
materially from those expressed in any forward looking statements made by, or on
behalf of, the Company.  The Company  disclaims any obligation to update forward
looking statements.

Plan of Operation

     Investment Associates, Inc. ("we," "our," or "the Company") intends to seek
to  acquire  assets or shares of an entity  actively  engaged  in  business,  in
exchange for its securities.  As of the date of this report,  our management has
had preliminary discussions with potential merger or acquisition candidates, but
there is no definitive  agreement with any third party relevant thereto.  In the
event we do enter  into an  agreement  with  such a third  party,  our  Board of
Directors  intends to obtain  certain  assurances  of value of the target entity
assets prior to consummating such a transaction, with further assurances that an
audited financial statement would be provided within sixty days after closing of
such  a   transaction.   Closing   documents   relative   thereto  will  include
representations  that the  value  of the  assets  conveyed  to or  otherwise  so
transferred will not materially differ from the representations included in such
closing documents, or the transaction will be voidable.


                                        2

<PAGE>



     We have no full time employees.  Our President and Secretary have agreed to
allocate a portion of their time to our business,  without  compensation.  These
officers  anticipate that our business plan can be implemented by their devoting
approximately  20 hours per month to our  business  affairs  and,  consequently,
conflicts of interest may arise with respect to the limited time  commitment  by
such officers.

     Because we presently  have  nominal  overhead or other  material  financial
obligations,  we believe that our short term cash  requirements can be satisfied
by our management  injecting  whatever amounts of cash to cover these incidental
expenses.  There are no assurances  whatsoever  that any additional cash will be
made available to us through any means.

Liquidity and Capital Resources

     We  presently  have nominal  cash or cash  equivalents.  Because we are not
required to pay rent or salaries to any of our officers or directors, we believe
that we have  sufficient  funds to continue  operations  through the foreseeable
future.

     Our securities are currently not liquid.  There are no market makers in our
securities  and it is not  anticipated  that  any  market  will  develop  in our
securities  until such time as we  successfully  implement  our business plan of
engaging in a business  opportunity,  either by merger or acquisition of assets.
We presently  have no liquid  financial  resources to offer such a candidate and
must  rely  upon  an  exchange  of  our  stock  to  complete  such a  merger  or
acquisition.

                           PART II. OTHER INFORMATION

ITEM 1.           LEGAL PROCEEDINGS - NONE

ITEM 2.           CHANGES IN SECURITIES - NONE

ITEM 3.           DEFAULTS UPON SENIOR SECURITIES - NONE

ITEM 4.           SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS -

                  NONE.

ITEM 5.           OTHER INFORMATION - NONE.

ITEM 6.           EXHIBITS AND REPORTS ON FORM 8-K -

                  (a)      Exhibits - none

                  (b)      Reports on Form 8-K - none.

                                        3

<PAGE>


                                   SIGNATURES


     Pursuant to the  requirements  of Section 12 of the Securities and Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                        INVESTMENT ASSOCIATES, INC.
                                        (Registrant)

                                        Dated:  May 4, 2001



                                        By:  s/Robert Hemmerling
                                           --------------------------------
                                        Its:  Secretary
                                            -------------------------------




                                        4

<PAGE>


                           INVESTMENT ASSOCIATES, INC.
                          (A Development Stage Company)

                             CONDENSED BALANCE SHEET
                                   (Unaudited)

                                 March 31, 2001

                                  ASSETS

                                                       TOTAL ASSETS  $        -
                                                                     ==========


                     LIABILITIES AND SHAREHOLDERS' (DEFICIT)

LIABILITIES:
      Accounts payable and accrued liabilities.......................$      500
                                                                     ----------

                                                  TOTAL LIABILITIES         500
                                                                     ----------


SHAREHOLDERS' (DEFICIT) (Note D):
      Preferred stock................................................         -
      Common stock...................................................     1,000
      Additional paid-in capital.....................................    17,409
      Deficit accumulated during the development stage...............   (18,909)
                                                                     ----------

                                       TOTAL SHAREHOLDERS' (DEFICIT)       (500)
                                                                     ----------

                                                                     $        -
                                                                     ==========

            See accompanying notes to condensed financial statements

                                       5

<PAGE>

<TABLE>

                           INVESTMENT ASSOCIATES, INC.
                          (A Development Stage Company)

                       CONDENSED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<CAPTION>
                                                                                     July 18, 1997
                                          Three Months Ended     Six Months Ended     (inception)
                                         --------------------  ---------------------    Through
                                          March 31, March 31,  March 31,   March 31,    March 31,
                                            2001      2000       2001        2000         2001
                                         ---------  ---------  ---------  ---------  -------------
<S>                                      <C>        <C>        <C>        <C>        <C>
COSTS AND EXPENSES
    Legal fees...........................$     934  $     104  $   1,704  $  10,104  $      12,894
    Accounting fees......................      250        250        500      2,231          4,480
    Licenses and fees.....................       -          -          -          -            535
    Stock-based compensation for
         organizational costs (Note B)...        -          -          -          -          1,000
                                         ---------  ---------  ---------  ---------  -------------

                    LOSS FROM OPERATIONS     1,184        354      2,204     12,335         18,909
                                         ---------  ---------  ---------  ---------  -------------

INCOME TAXES (Note C)....................        -          -          -          -              -
                                         ---------  ---------  ---------  ---------  -------------

                                NET LOSS $   1,184  $     354  $   2,204  $  12,335  $      18,909
                                         =========  =========  =========  =========  =============

BASIC AND DILUTED
    LOSS PER COMMON SHARE................$       *  $       *  $       *  $    0.01
                                         =========  =========  =========  =========

BASIC WEIGHTED AVERAGE COMMON
    SHARES OUTSTANDING...................1,000,000  1,000,000  1,000,000  1,000,000
                                         =========  =========  =========  =========



      *  Less than .01 per share
</TABLE>

            See accompanying notes to condensed financial statements

                                       6
<PAGE>

<TABLE>

                           INVESTMENT ASSOCIATES, INC.
                          (A Development Stage Company)

                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<CAPTION>
                                                                      July 18, 1997
                                                   Six Months Ended    (inception)
                                                       March 31,         Through
                                                  ------------------     March 31,
                                                     2001     2000         2001
                                                  --------  --------  -------------
<S>                                               <C>       <C>       <C>
Net cash used in operating activities.............$ (3,204) $(12,420) $     (17,409)
                                                  --------  --------  -------------

Cash flows from financing activities:
      Third party expenses paid by affiliate on
         behalf of the company, recorded as
         additional-paid-in capital...............   3,204    12,420         17,409
                                                  --------  --------  -------------

Net cash provided by financing activities.........   3,204    12,420         17,409
                                                  --------  --------  -------------

                               Net change in cash        -         -              -
Cash, beginning of period.........................       -         -              -
                                                  --------  --------  -------------

                              Cash, end of period $      -  $      -  $           -
                                                  ========  ========  =============


Supplemental disclosure of cash flow information:
      Cash paid during the period for:
         Interest.................................$      -  $      -  $           -
                                                  ========  ========  =============
         Income taxes.............................$      -  $      -  $           -
                                                  ========  ========  =============

      Non-cash financing activities:
         1,000,000 shares common stock
            issued for services...................$      -  $      -  $       1,000
                                                  ========  ========  =============



            See accompanying notes to condensed financial statements
</TABLE>

                                       7
<PAGE>


                           INVESTMENT ASSOCIATES, INC.
                          (A Development Stage Company)

                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE A: BASIS OF PRESENTATION

The condensed  financial  statements  presented herein have been prepared by the
Company in  accordance  with the  accounting  policies in its audited  financial
statements for the year ended  September 30, 2000 as filed in its form 10-KSB on
January 12, 2001 and should be read in conjunction  with the notes thereto.  The
Company entered the development  stage in accordance with Statement of Financial
Accounting  Standard  ("SFAS")  No.  7 on July 18,  1997 and is a "blank  check"
company with the purpose to evaluate,  structure  and complete a merger with, or
acquisition of, a privately owned corporation.

In the  opinion  of  management,  all  adjustments  (consisting  only of  normal
recurring  adjustments)  which are necessary to provide a fair  presentation  of
operating  results for the interim period  presented have been made. The results
of operations for the periods  presented are not  necessarily  indicative of the
results to be expected for the year.

Interim financial data presented herein are unaudited.

NOTE B: RELATED PARTY TRANSACTIONS

The Company maintains a mailing address at an affiliate's address.  This address
is Suite 104, 1456 St. Paul Street, Kelowna, B.C., Canada V1Y 2E6. At this time,
the Company has no need for an office.

The Company  does not maintain a checking  account and all expenses  incurred by
the  Company  are paid by an  affiliate.  During the six months  ended March 31,
2001, the affiliate paid expenses totaling $3,204, which increased the Company's
additional  paid-in  capital from  $14,205 at  September  30, 2000 to $17,409 at
March 31, 2001.

During the six months ended March 31, 2001,  the Company  incurred legal expense
of $1,704 and  accounting  expense of $500.  The affiliate does not expect to be
repaid for the  expenses it pays on behalf of the Company.  Accordingly,  as the
expenses are paid, they are classified as additional paid-in capital.

NOTE C: INCOME TAXES

The Company  records its income taxes in accordance  with Statement of Financial
Accounting Standard No. 109, "Accounting for Income Taxes". The Company incurred
net  operating  losses  during  the  periods  shown on the  condensed  financial
statements  resulting  in a deferred  tax asset,  which was fully  allowed  for,
therefore the net benefit and expense result in $-0- income taxes.


                                        8
<PAGE>

                          INVESTMENT ASSOCIASTES, INC.
                          (A Development Stage Company)

                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE D: FORWARD STOCK SPLIT

Common Stock
------------

The Company initially  authorized 25,000 shares of no par value common stock. On
July 23, 1999 the Board of Directors  approved an increase in authorized  shares
to 50,000,000 and changed the par value to $.001.  On July 20, 1997, the Company
issued 1,000 shares of common stock for services  valued at $1.00 per share,  or
$1000.

On October 5, 1999 the Company filed  amended  articles with the state of Nevada
to change the authorized shares of common stock originally approved by the Board
of Directors to 50,000,000,  $.001 par and 25,000,000  shares of preferred stock
$.001 par.

On October 6, 1999, the Board of Directors  approved a 1,000 to 1 forward split.
This increased outstanding common shares from 1,000 to 1,000,000.  The financial
statements take into account this split.

























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