FORM 10-QSB


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


     [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
          EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

               for the quarterly period ending: September 30, 1998


                      Innovest Capital Sources Corporation

                       formerly Telco Communications, Inc.

                        formerly Cody Capital Corporation


   Colorado                                33-1933 3-D               84-1073083
(Incorporation)                         (Commission Number)         (IRS Number)


4 Normandy Drive, Kenner LA              (504) 466-7004                   70065
(Address of principal                    Telephone number             (Zip Code)
 executive offices)                                            

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: None


Yes[_] No[x]  (Indicate by check mark whether the  Registrant  (1) has filed all
reports  required to be filed by Section 13 or 15(d) of the Securities  Exchange
Act of 1934 during the preceding 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.)

Not[X]  (Indicate  by check mark  whether if  disclosure  of  delinquent  filers
(ss.229.405)  is not and  will  not to the  best of  Registrant's  knowledge  be
contained  herein,  in definitive proxy or information  statements  incorporated
herein by reference or any amendment hereto.)

As of September 30, 1998, the aggregate number of shares held by  non-affiliates
was approximately  2,930,726  shares.  Due to the limited market for the Company
securities,  no estimate is being supplied herewith of the market value for such
securities.

As of September 30, 1998, the number of shares  outstanding of the  Registrant's
Common Stock was 50,000,000.


Innovest Capital Sources Corporation September 30, 1998 Form 10-QSB       Page 1

<PAGE>


                          PART I: FINANCIAL INFORMATION
--------------------------------------------------------------------------------

                          Item 1. Financial Statements

     As of September 30, 1998,  Management reports the financial information per
attachment hereto.

                  Item 2. Management's Discussion and Analysis
                 or Plan of Operation and Results of Operations

     The Issuer has no current  business,  and has had no operations in the last
two fiscal  years.  The Issuer has no capital  resource  and no  liquidity.  The
Company has been in the  development  stage since April 12,  1996,  the date the
Trustee of the  Bankruptcy  estate  sold the  corporate  shell.  The company has
seeking   new   business   opportunities,   including   business   combinations,
associations,  joint ventures,  merger and /or  acquisition  programs to achieve
profitability  for the  shareholders.  Theses  factors  raise  issues  about the
company's  ability to  continue  as a going  concern.  The issuer  will  require
additional   funds  or  forbearance   from   consultants  to  satisfy  its  cash
requirements  for the  beyond  the  next  twelve  months.  As  reflected  in the
comparison of the Issuer's financial statements for the years ended December 31,
1997,  with those of year end 1996,  the  shareholders  equity has deceased from
zero to a negative 168,675,  by reason of an accumulated deficit which increased
in the  last  fiscal  year.  As of the  end of this  Quarter,  the  deficit  had
increased  to  $211,288,  and is now  $211,616  as of the  date of this  Report.
Current expenses consist of professional  fees, there being no other operational
expenses.

--------------------------------------------------------------------------------
                           PART II: OTHER INFORMATION
--------------------------------------------------------------------------------

                            Item 1. Legal Proceedings

                                      None

                          Item 2. Change in Securities

                                      None

                     Item 3. Defaults Upon Senior Securities

                                      None

            Item 4. Submission of Matters to Vote of Security Holders

                                      None

                            Item 5. Other Information

     During the  Quarter  covered by this  Report,  the  Company  had and has no
current business,  and has had no operations since its emergence from Bankruptcy
in 1996.  During the period from April 1996 until the end of the current quarter
Management has been engaged in the search for new business opportunities without
material  results.  The Issuer  continues  to seek new  business  opportunities,
including  business  combinations,  associations,  joint venture,  merger and/or
acquisition programs to achieve  profitability for shareholders.  The Issuer has
changed  its name to Innovest  Capital  Sources  Corporation  and  amending  its
articles to change the par value to "no par".

                    Item 6. Exhibits and Reports on Form 8-K

     No  reports  on Form  8-K were  made  during  the  period  covered  by this
Quarterly Report.


Innovest Capital Sources Corporation September 30, 1998 Form 10-QSB       Page 2

<PAGE>




                                   SIGNATURES


     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
Form 10-QSB  Report for the Quarter ended  September  30, 1998,  has been signed
below by the following  person on behalf of the  Registrant  and in the capacity
and on the date indicated.


Dated: September 30, 1998


                           Telco Communications, Inc.

                        formerly Cody Capital Corporation


                                       by





/s/ Miller L. Mays III                            /s/ Karl E. Rodriguez 
------------------------------------              ------------------------------
Miller L. Mays III                                Karl E. Rodriguez 
PRESIDENT/DIRECTOR                                SECRETARY/TREASURER        


Innovest Capital Sources Corporation September 30, 1998 Form 10-QSB       Page 3

<PAGE>




                                   Attachment

                         UN-AUDITED FINANCIAL STATEMENTS

                               September 30, 1998




Innovest Capital Sources Corporation September 30, 1998 Form 10-QSB       Page 4

<PAGE>


                      INNOVEST CAPITAL SOURCES CORPORATION
                          (A DEVELOPMENT STAGE COMPANY)
                                  BALANCE SHEET
                               SEPTEMBER 30, 1998




                                                                   September 30,
                                                                       1998
                                                                    ----------
                            ASSETS

Intangible asset - value in excess of amounts
     alocable to identifiable assets                                $   1,000
Impairment of intangible asset                                         (1,000)
Deferred tax asset                                                       --
                                                                    ---------

           Total assets                                             $    --
                                                                    =========


              LIABILITIES AND STOCKHOLDERS' EQUITY


Accrued professional fees                                           $  74,638
Accrued intrest expense                                                 2,568
Note payable                                                          134,410
                                                                    ---------

           Total liabilities                                          211,616
                                                                    ---------

Common stock, no par, 50,000,000 shares authorized,
     issued and outstanding                                             1,000
Deficit accumulated during the development stage                     (212,616)
                                                                    ---------

           Total shareholders' equity                                (211,616)
                                                                    ---------

           Total liabilities and shareholders' equity               $    --
                                                                    =========


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

<PAGE>


                      INNOVEST CAPITAL SOURCES CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)
                            STATEMENT OF OPERATIONS
                    FOR THE PERIOD ENDED SEPTEMBER 30, 1998
                          AND CUMULATIVE TOTALS SINCE
                               DATE OF INCEPTION


                                                                    Cumulative
                                                                      Totals 
                                                                       Since 
                                                September 30,         Date of 
                                                    1998             Inception
                                                ------------       ------------

Revenues                                        $        -0-       $        -0-
                                                ------------       ------------

Expense
  Interest expense                                       -0-             (2,240)
  Professional fees                                  (45,181)          (211,616)
  Impairment of intangible asset                         -0-             (1,000)
                                                ------------       ------------

Income before income taxes                               -0-           (214,856)

Income taxes                                             -0-               --
                                                ------------       ------------

Net Loss                                        $    (45,181)      $   (214,856)
                                                ============       ============

Net loss per share                              $    (.00090)      $    (.00430)
                                                ============       ============

Weighted average number of
common shares outstanding                         50,000,000         50,000,000
                                                ============       ============

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

<PAGE>


                      INNOVEST CAPITAL SOURCES CORPORATION
                          (A DEVELOPMENT STAGE COMPANY)
                        STATEMENT OF SHAREHOLDERS' EQUITY
                         FROM INCEPTION (APRIL 12, 1996)
                              TO SEPTEMBER 30, 1998

                                                                       Deficit
                                                                     Accumulated
                                                Common Stock          During the
                                           -----------------------   Development
                                             Shares       Amount       Stage
                                           ----------   ----------   ----------
Stock issued and outstanding
      on April 12, 1996, the date
      the corporate shell was separated
      from the bankruptcy estate           50,000,000   $    1,000         --

Net loss                                         --           --     $   (1,000)
                                           ----------   ----------   ----------

Balances at December 31, 1996              50,000,000        1,000       (1,000)

Net loss                                         --           --       (166,435)
                                           ----------   ----------   ----------

Balances at December 31, 1997              50,000,000        1,000     (167,435)

Net loss                                         --           --        (45,181)
                                           ----------   ----------   ----------

Balances at September 30, 1998             50,000,000        1,000     (212,616)
                                           ==========   ==========   ==========


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

<PAGE>


                      INNOVEST CAPITAL SOURCES CORPORATION
                          (A DEVELOPMENT STAGE COMPANY)
                             STATEMENT OF CASH FLOWS
                     FOR THE PERIOD ENDED SEPTEMBER 30, 1998
                           AND CUMULATIVE TOTALS SINCE
                                DATE OF INCEPTION

                                                                      Cumulative
                                                                        Totals
                                                                        Since
                                                       September 30,   Date of 
                                                           1998       Inception
                                                       -------------  ---------
Cash flows provided by operating activities              $    --      $    --

Cash flows provided by investing activities                   --           --

Cash flows provided by financing activities                   --           --
                                                         ---------    ---------

Net increase in cash                                          --           --

Cash at beginning of period                              $    --      $    --
                                                         ---------    ---------

Cash at end of period                                    $    --      $    --
                                                         =========    =========


Reconciliation  of net  loss  to  net  cash  flows
 provided  by  operating
  activities:
      Net loss                                           $ (45,181)   $(214,856)
      Adjustments to reconcile net loss to cash
         provided by operating activities
             Accrued interest expense                         --          2,240
             Accrued rofessional fees                       45,181      211,616
             Impairment of intangible asset                   --          1,000
                                                         ---------    ---------

Cash flows provided by operating activities              $    --      $    --
                                                         =========    =========


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

<PAGE>


INNOVEST CAPITAL SOURCES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENT
PERIOD ENDED JUNE 30, 1997




1.   BASIS OF PRESENTATION

Innovest  Capital Sources  Corporation  ("the Company") was incorporated as Cody
Capital Corporation,  a Colorado  corporation,  on December 9, 1987. The Company
completed a public  offering in 1988.  In 1989,  Telco of Baton Rouge,  Inc. was
acquired and merged into Cody Capital  Corporation,  and the Company changed its
name to Telco Communications, Inc.

In 1994,  the Company  filed for  Chapter  11-bankruptcy  protection,  which was
subsequently  converted  to  Chapter  7 status  by the  Bankruptcy  Court  ("the
Court").  As a result a Trustee  was  placed in  control  of the  affairs of the
company.  On March 26, 1997, upon motion by the Trustee,  the Court ordered that
the corporate shell be sold to Miller L. Mays III ("Mays"). Prior to the sale to
Mays, three former  convertible  debenture  holders  converted their holdings to
common stock,  which resulted in the issuance of an additional  275,000  shares,
and brought the total number of outstanding shares to 2, 930,226.  Mays acquired
a majority  ownership interest in the Company by purchasing from the trustee all
the authorized but unissued common shares (47,069,774 shares) for $1,000.  Under
the  direction of the Court,  all assets,  liabilities  and business  operations
remained in the bankruptcy estate, and all prior shareholders of record remained
shareholders  subsequent to the sale. The corporate shell was separated from the
bankruptcy estate immediately following the sale. The sale occurred on April 12,
1996, which is the date of inception for the Company under audit.

On January 15, 1997, the corporate name was changed to Innovest  Capital Sources
Corporation.

The Company recognizes income and expenses on the accrual basis of accounting.

The Company  considers all highly liquid  investments  with  maturities of three
months or less to be cash equivalents.

The fair value of the Company's financial instruments which consist primarily of
accrued professional fees and a note payable approximate the carrying amounts as
reported in the balance sheet.  Management does not believe the carrying amounts
are impaired.

Management uses estimates and assumptions in preparing  financial  statements in
accordance with generally accepted  accounting  principles.  Those estimates and
assumptions  affect  the  reported  amounts  of  assets  and  liabilities,   the
disclosure of contingent  assets and  liabilities,  and the reported  amounts of
revenues and expenses.  Actual  results could vary from the estimates  that were
used.

The office of the  Company is located in Kenner,  Louisiana.  The Company has no
employees  or  facilities.  The records are  maintained  by the  President at no
expense to the Company.

The  Company  has not  generated  revenues  from  operations  nor is  there  any
assurance  of  significant  revenues in the  future.  Affiliated  entities  have
offered  to loan  the  company  the  necessary  funds to  cover  any  cash  flow
requirements  for the next  twelve  months.  The  Company is  actively  pursuing
various  other   funding   options,   including   equity   offerings,   business
combinations,  corporate alliances, or a combination of these methods. There can
be no assurance that the Company will successfully  complete the transition from
a development stage company to profitability.


<PAGE>


Innovest Capital Sources Corporation
Notes to the Financial Statement
Period ended Semptember 30, 1998
page two

2.   INCOME TAXES

Deferred  income taxes are reported for temporary  differences  between items of
income or expense  reported in the financial  statements  and those reported for
income tax purposes.  The expense entitled "impairment of intangible asset" is a
permanent book/tax difference, and thus will not result in a current or deferred
tax benefit or asset.  At December  31,  1997,  the Company had  available a net
operating loss  carryforward  of  approximately  $168,675,  which will expire in
2013.  Any future  deferred  tax asset will be offset by a  valuation  allowance
until such time as the Company  demonstrates future  profitability.  At December
31, 1997, the principal component of the deferred tax asset is as follows:

         Net operating loss carryforward             $  57,350
         Valuation allowance                           (57,350)
                                                     ---------
         Net Deferred tax asset                      $    --

3.   COMMON STOCK

The Corporation is authorized to issue 50,000,000  shares of one class of common
stock. The Articles of Incorporation  were amended on August 31, 1997, to change
the par value from $.001 per share to no par. All references in the accompanying
financial  statements  and notes to the per share  amounts have been restated to
reflect the change in par value.

4.   SUBSEQUENT EVENTS AND RELATED PARTIES

In June 1996,  the Company  filed a Form 8-K with the  Securities  and  Exchange
Commission   relative  to  agreements   reached  with  mortgage  market,   Inc.,
Surgimetrics USA and Telco Holding Corporation.  Subsequently, a final agreement
among the parties could not be reached and the agreements were terminated.

On or about June 23, 1997, a written "offer to purchase" the Company was entered
into with Solar  Energy  Limited.  On or about  October  1,  1997,  a "letter of
intent" was entered into to effectuate an acquisition  and merger of the Company
and Solar Energy Limited. In February 1998,  management  determined that a final
agreement could not be reached and the agreement was terminated.

In  November  1997,  Intrepid  International  S.A.  ("Intrepid"),  a  Panamanian
corporation,  acquired  84.60%  of  the  outstanding  stock  of the  Company  by
acquiring 42,300,000 shares of the Company's outstanding common stock from Mays.
This resulted in a change of control of the company.

In 1997, the Company  retained  Intrepid for its investment  banking,  legal and
financial services.  The services to be performed include public and shareholder
relations,   audit   coordination,   certificate   and  transfer   coordination,
coordination  of  relationships  with  market  makers and broker  dealers in the
securities of the Company and various other consulting  services.  Additionally,
Intrepid will assist in the preparation and coordination of annual quarterly and
current  filings as may be required  pursuant to the Securities and Exchange Act
of 1934 and  Regulations of the Securities and Exchange  Commission  promulgated
pursuant to the 1934 Act. As of April 10,  1998,  the fees  incurred by Intrepid
totaled $164,366 for services rendered subsequent to June 19, 1997.


<PAGE>


Innovest Capital Sources Corporation
Notes to the Financial Statement
Period ended Semptember 30, 1998
page three

4.   SUBSEQUENT EVENTS AND RELATED PARTIES (continued)

On October 15, 1997, the Company issued a note in the amount of $134,410 with 8%
interest,  due October 15, 1998, to Intrepid for professional  services incurred
through  October 15,  1997.  The note is  convertible  into common  stock of the
Company at a conversion price of $0.0336 per share.

On October 15, 1998, the Company's shareholders  authorized a one for 75 reverse
split of its common shares.  The  shareholders  also authorized and approved the
issuance of additional  shares of common stock,  to be placed with  investors in
the following  amounts:  4,230,000  shares at $0.01 and 500,000  shares at $1.90
both pursuant to Regulation D, Rule 504; and 600,000 shares at $5.00 pursuant to
Rule 505 of the Securities Act of 1933.  These  issuances are expected to infuse
$3,992,300 of new capital into the Company.

Also on October 15, 1998, the Company's shareholders authorized and approved the
acquisition of all assets,  business and capital stock of Nifco Synergy, Ltd. in
exchange for 6,000,000 new investment  shares of common stock of the Company and
a name change wherein the Company would become Nifco Synergy, Ltd.