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<PAGE> 1
                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                  FORM 10-KSB

  [x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

     For the fiscal year ended       December 31, 2003
                                     -----------------
  [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

     For the transition period from ________ to __________

            Commission File Number          0-25873
                                            ----------
                         POWERBALL INTERNATIONAL, INC.
                         -----------------------------
        (Exact name of registrant as specified in charter)

           Utah                                  84-1431425
------------------------------             -------------------------
State or other jurisdiction of             (I.R.S. Employer I.D. No.)
incorporation or organization

2095 West 2200 South, West Valley City, Utah                84119
--------------------------------------------              ----------
(Address of principal executive offices)                   (Zip Code)

Issuer's telephone number, including area code (801) 974-9120
                                               ---------------
Securities registered pursuant to section 12(b) of the Act:

Title of each class       Name of each exchange on which registered
        None                                  N/A
------------------        -----------------------------------------

Securities registered pursuant to section 12(g) of the Act:
                      Common Stock, $.001 par value
                      -----------------------------
                             (Title of class)

  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. (1) Yes [X]
No [ ]  (2)  Yes [X]  No  [ ]

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

  State issuer's revenues for its most recent fiscal year:  $ 0
                                                            --------

<PAGE>
<PAGE> 2

State the aggregate market value of the voting stock held by nonaffiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of a specified date within the past 60
days:

Based on the average bid and asked prices of the common stock at March 24,
2004, of $0.47 per share, the market value of shares held by nonaffiliates
would be $1,403,101.

As of March 24, 2004, we had 4,853,781 shares of common stock issued and
outstanding.

                     DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the
part of the form 10-KSB (e.g., part I, part II, etc.) into which the document
is incorporated:  (1) Any annual report to security holders; (2) Any proxy or
other information statement; and (3) Any prospectus filed pursuant to rule
424(b) or (c) under the Securities Act of 1933:  NONE






<PAGE>
<PAGE> 3
                                    PART I.

                       ITEM 1. DESCRIPTION OF BUSINESS

Business in General
-------------------
History and Organization
------------------------
Powerball International, Inc. was incorporated on July 9, 1997 under the laws
of the State of Utah for the purpose of raising capital to invest in a joint
venture with Powerball Industries, Inc., a Utah corporation ("PIC"). PIC was
the licensee of certain Hydrogen Generation System and Fuel Pellet technology
relating to the production of hydrogen (the "Technology"). In December 1997,
the Company and PIC formed a joint venture named Powerball Technologies, LLC
("PT"). During the beginning of the second quarter ended June 30, 2000, our
shareholders approved an Agreement and Plan of Merger wherein we acquired of
all the issued and outstanding shares of PIC in exchange for 1,500,000 shares
of our common stock.  In connection with the acquisition, new directors were
elected and our name was changed to Powerball International, Inc.  The merger
also consolidated ownership of PT, with PT becoming our wholly owned
subsidiary.  As a result of the merger, we now own the Technology.

Sodium Production
-----------------
An important aspect of our initial plan has been the development of a
demonstration plant (the "Plant") to recover metallic sodium from sodium
hydroxide on what our management believes may be a commercially viable basis
for resale to industrial and commercial users.  The Plant is designed to
demonstrate the effectiveness of our patented sodium production process.  The
Plant is completed and the testing process for sodium production is
essentially complete.  The pilot plant has successfully produced sodium metal
from sodium hydroxide on a continuous basis.

Use of Hydrogen and the Technology in General
---------------------------------------------
Currently hydrogen is mainly utilized as a chemical component for industrial
uses.  However, the market for hydrogen gas as a fuel source has increased as
a result of many factors, including concerns related to cost and environmental
concerns surrounding the use of fossil fuels, increased research and
development of alternative fuel sources in general, and the development of
hydrogen fuel cells. The Technology, as it has currently been developed, and
continues to be developed, is an attempt to provide an efficient, cost
effective and safe method of producing hydrogen gas for commercial and
industrial use.

Our approach to supplying hydrogen to users is to eliminate the costs and
risks of transporting and storing a bulk supply of hydrogen in either a
compressed gas or liquid form by producing hydrogen on site as needed. Our
fuel pellets are able to safely store an energy dense form of hydrogen as a
solid material, at room temperature and normal atmospheric pressure. We
believe we can demonstrate that the Technology can produce hydrogen gas on an
as needed basis by the user (i.e., "Hydrogen On Demand") in a manner that is
safer and more cost effective than existing methods.

<PAGE>
<PAGE> 4

The Hydrogen Generation System
------------------------------
Our Technology also relates to the production of hydrogen gas in a Hydrogen
Generation System.  The Hydrogen Generation System is designed to produce
hydrogen gas as needed to be used for whatever purpose it was intended.  The
hydrogen is produced in the Hydrogen Generation System through a chemical
reaction of sodium hydride with water.  Key components of the Hydrogen
Generation System include a tank called a Hydrogen on Demand Generator (the
"Tank") and fuel pellets which are made of sodium hydride (the "powerballs").
Each powerball is a sodium hydride sphere, which is approximately 1.2 inches
in diameter, covered by a polyethylene cover.

The Hydrogen Generation System generally works as follows:  ordinary water and
powerballs are deposited into the Tank.  After being deposited into the Tank,
the powerballs remain inert or inactive and do not produce hydrogen until
needed.  Another key component of the Hydrogen Generation System is a cutting
device which, when activated, cuts the powerball, exposing it to the water
contained in the Tank.  When the application requires hydrogen, the powerball
is inserted into the cutting device and cut or opened.  After being opened,
the sodium hydride core of the powerball is exposed directly to the water and
reacts with the water to produce hydrogen gas. The Tank's metering system can
detect when additional hydrogen is required, and when required, another
powerball moves in to the cutting device, and the process of creating hydrogen
is repeated.

The Hydrogen Generation System is completely operational.  It contains an
electronic control system and automatically produces hydrogen by slicing
pellets inside the Tank.

Supplies
--------
The sodium that is used in the manufacturing of the powerballs has been
readily available as a commercial chemical, and it is anticipated that it will
continue to be readily available.  When the sodium technology is fully
commercialized, it could provide all the necessary sodium for the manufacture
of the powerballs as well as commercial quantities of sodium.

The polyethylene used to coat the powerballs is readily available from a
variety of sources at negligible cost, and the components of the hydrogen
tanks are standard off-the-shelf parts also available from numerous suppliers.

Because of the ready availability of all the supplies and components, we have
not restricted ourselves to any particular suppliers, although we may seek to
establish such relationships if production demands increase substantially.

Our management believes that the economics of producing hydrogen through the
Technology will be dependent upon many factors including the purchase price of
key raw materials such as sodium hydroxide and natural gas (methane) and the
relative competitive price of other forms of hydrogen as supplied by
alternative suppliers.

Potential Products
------------------
If we are able to demonstrate that the Technology will permit the cost
effective and safe production of hydrogen, we intend to manufacture, or have
manufactured, and ultimately market, the following products:

<PAGE>
<PAGE> 5

Sodium - The Plant is designed to produce sodium from sodium hydroxide, an
industrial and manufacturing waste product. Current production of metallic
sodium exceeds 100 million pounds per year.  Sodium is currently used as a
component in chemical manufacturing to produce sodium derivative compounds
such as sodium borohydride and sodium methylate, and as an ingredient to
produce or process nylon synthetic fibers, rubber compounds, insecticides,
dyes, fragrances, and flavors.  In pharmaceutical manufacture it is used in
the production of vitamins A and C, ibuprophen, sulfa methoxizane, and certain
barbiturates.  In metals manufacture and refining, sodium is used to process
tantalum, titanium, potassium, silicon, lead, silver, zinc, aluminum alloys
and de-scaling of steel.

Sodium is currently produced using a method called a "Down's Cell" that
electrolyzes molten sodium chloride (salt) and is reliant on large quantities
of electricity and an effective method of dealing with or reselling chlorine.
Our process is energy source flexible.  Any economical and locally available
source of heat can be used to produce sodium from sodium hydroxide.  These
potential heat sources include natural gas, solar concentrators, geothermal,
#6 heating oil, or coal.  Our management believes that the powerball plant
could also be an effective means of capturing the wasted or unmarketable
natural gas energy that is currently considered a "stranded resource" or is
burned at the well head because of an absence of a pipeline infrastructure.

Splitting Mechanisms   These are the mechanisms installed in the Tanks, which
are used to split the powerballs one at a time as needed to generate hydrogen.

Tanks    The Tank is a stand alone hydrogen generator where the hydrogen is
actually produced.  The Tank is constructed of lightweight and strong Kevlar
composite material.  Steel, stainless steel and other materials can also be
used to construct the Tank.  The end caps are mounted securely using stainless
steel tie rods.  High-density polyethylene is used for the end cap material
along with special strengthening ribs. The pneumatic/hydraulic combination
cylinder used to power the splitting mechanism is precision machined from
honed cylinder material and is rated for 5 million cycles.  The blade is made
of a special stainless alloy designed to resist corrosion and remain sharp for
millions of cycles. Pressure sensing mechanisms, valves, fittings, and static
pressure refill ports are made of stainless steel or specially coated brass
designed to resist corrosion. Each has been equipped with a pressure gauge,
pressure relief valve and a regulator, which converts pressure.

If we are successful in obtaining market acceptance of the Technology and the
products derived from the Technology, we intend to market Tanks to various
users including original equipment manufacturers ("OEM's"), such as
electronics manufacturers, experimental fuel cell vehicle manufacturers and
power plants.  Inasmuch as the Tanks have not been manufactured on a mass
basis, the cost of manufacturing the Tanks and the willingness of users to pay
a particular price for the Tanks has not been determined with certainty at
this time.

Powerballs   The powerballs are polyethylene coated pellets of sodium hydride.
Powerballs are stored directly in water. They can remain in water for months
with little or no change to the coatings. When a powerball is cut underwater,
the sodium hydride inside reacts with the water to produce hydrogen.  A
powerball will react to completion in less than 5 seconds.  The components of
the powerballs are readily available from a variety of sources. Initially, we
do not intend to market powerballs as a separate product, but will use
powerballs in connection with the generation of hydrogen to be sold to
purchasers of hydrogen gas.  If initial marketing efforts are successful, we
will attempt to market the powerballs with our Tanks.

<PAGE>
<PAGE> 6

Potential Customers
-------------------
We plan to direct our sodium marketing efforts to chemical companies and metal
refineries and processors.  Initial discussions with potential customers have
been taking place but have not yielded any agreements to date due to existing
manufacturing capacity for sodium in excess of current demand.

The Hydrogen on Demand Technology is not expected to be competitive as an
alternative to hydrogen produced from on-site reformation or as a by-product
from chemical plants.  Our business plan is to attempt to demonstrate that our
Technology is a viable commercial alternative for either the bulk shipment of
liquid hydrogen or the bulk shipment of compressed hydrogen gas.

Our long-term business plan is to manufacture and market hydrogen generation
products (i.e., Tanks, powerballs and Plants).  However, to date, we have not
successfully identified any purchasers for these products or potential
development partners.

As of this date no specific marketing plan for users has been developed.  We
anticipate developing a long-term marketing plan when there has been
sufficient acceptance of the Technology and the economics of the Technology,
in the marketplace.

Competition for Sodium Market
-----------------------------
We will face significant competition from DuPont, which currently dominates
the domestic sodium market.  There is also foreign sodium production in
France, China and other countries.  If demand for sodium does increase, we
anticipate eventually achieving a lower product cost due mainly to lower
energy and labor costs in the manufacturing process.

Competition for Hydrogen Generation Market
------------------------------------------
We intend to engage in the business of providing hydrogen generation products
to end users and OEM's.  Initially, we expect to compete with other companies
supplying hydrogen to industrial and commercial users, such as Air Products,
Praxair, and Air Liquide.  Generally, such competitors supply their customers
with compressed hydrogen gas or liquid hydrogen.  We will also compete with
any other companies that may offer technologies and products for hydrogen on
demand production.

We are aware of specific competitors working on hydrogen generating equipment,
including the Arthur D. Little Corporation, Epyx Corporation, Los Alamos
National Laboratory, and Analytic Power Systems.  H Power is working on a
hydride-water system and Dais Corporation is working on some form of pellets
that dissolve in water (according to their web page).  Millenium Cell is
working on a sodium borohydride system that reacts with a ruthenium catalyst
to produce hydrogen.  Thermo Power Corporation is working on a slurry of
lithium hydride material in oil that reacts with water to produce hydrogen.

Nationally, there is significant research and development being conducted in
the area of hydrogen fuel generation.  We believe that most of our current
competitors and future competitors will most likely have significantly greater
assets, resources, experience, research and development talent and managerial
capabilities than we do. Although our management believes that the Technology
has competitive advantages over other technologies, there can be no assurance
that we will be able to fund the further development and marketing of
Technology and related products, that the Technology will be accepted in the
market place or that the Technology will be commercially successful.

<PAGE>
<PAGE> 7

Intellectual Property Rights
----------------------------
We hold 5 patents for three primary inventions:  (i) a Hydrogen Generation
System; (ii) a Hydrogen Generation Pelletized Fuel (e.g., the Powerball);
(iii) a proprietary method of producing elemental metallic sodium from waste
sodium hydroxide.

We have been granted 4 patents in the United States and 1 patent in Canada.
We intend to file at least 3 additional technology patents in the United
States and other selected foreign countries.  There can be no assurance than
any additional patents will ever issue.  The failure to obtain patent
protection in foreign countries will have an adverse effect on our prospects
in those foreign countries where patent protection has not been received.  The
possibility exists that without patent protection, numerous competitors could
use the technology in competing products and ventures.  The possibility exists
that such competitors would have the financial resources necessary to bring
products using the technology to market earlier than we will.

Government Regulation
---------------------
Shipment of Sodium is regulated by the United States Department of
Transportation.  Sodium has a DOT Hazard Classification 4.3 (Dangerous when
wet material).  Safe handling procedures have been in place for many decades.

Research and Development
------------------------
During fiscal 2003, research and development expenses were $263,130.  Our
management anticipates that no further research and development will take
place in fiscal 2004 unless funds are available.

Personnel
---------
At the date of this filing, we have 1 full time employee.  All employees are
at-will and all of the employment arrangements are oral.  We may elect to put
written employment agreements in place for certain employees in the future.

                      ITEM 2. DESCRIPTION OF PROPERTIES
Facilities
----------
Our executive office and our technical operations are established in a 5,000
sq. foot facility located at 2095 West 2200 South, Salt Lake City, Utah.  The
facility was subject to two short-term leases at a monthly rate of $2,274,
which expired February 28, 2003.  We are now on a month-to-month arrangement.
Rent expense was $25,556 and $29,176 for the years ended December 31, 2003 and
2002, respectively.  We expect to be able to continue to occupy the premises
on a month-to-month basis.  These facilities will be leased until such time as
additional facilities may be required.

                            ITEM 3. LEGAL PROCEEDINGS

None.
        ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS

None.
<PAGE>
<PAGE> 8
                                  PART II

     ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The following table sets forth, for the respective periods indicated, the
prices of our Common Stock in the over the counter market as reported by a
market maker on the NASD'S OTC Bulletin Board.  Such over the counter market
quotations are based on inter-dealer bid prices, without markup, markdown or
commission, and may not necessarily represent actual transactions.

                                                   Bid Quotation
                                                   -------------
Fiscal Year 2003                          High Bid              Low Bid
----------------                          --------              -------
Quarter ended 12/30/03                    $ 0.79                $ 0.39
Quarter ended 9/30/03                     $ 0.90                $ 0.42
Quarter ended 6/30/03                     $ 1.05                $ 0.65
Quarter ended 3/31/03                     $ 2.58                $ 0.80

Fiscal Year 2002                          High Bid              Low Bid
----------------                          --------              -------
Quarter ended 12/30/02                    $ 2.75                $ 2.00
Quarter ended 9/30/02                     $ 3.10                $ 2.00
Quarter ended 6/30/02                     $ 3.45                $ 1.95
Quarter ended 3/31/02                     $ 3.95                $ 1.80


Fiscal Year 2001                          High Bid              Low Bid
----------------                          --------              -------
Quarter ended 12/31/01                    $ 4.95                $ 1.50
Quarter ended 9/30/01                     $ 4.09                $ 1.70
Quarter ended 6/30/01                     $ 5.75                $ 3.40
Quarter ended 3/31/01                     $ 7.00                $ 5.13


We had approximately 100 shareholders of record as of March 24, 2004.

We have not paid any cash dividends to date and do not anticipate paying
dividends in the foreseeable future.

We did not issue any shares in the quarter ended December 31, 2003.


<PAGE>
<PAGE> 9

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Cautionary Statement Regarding Forward-looking Statements
---------------------------------------------------------
This report may contain "forward-looking" statements.  Examples of forward-
looking statements include, but are not limited to: (a) projections of
revenues, capital expenditures, growth, prospects, dividends, capital
structure and other financial matters; (b) statements of plans and objectives
of our management or Board of Directors; (c) statements of our future economic
performance; (d) statements of assumptions underlying other statements and
statements about us and our business relating to the future; and (e) any
statements using the words "anticipate," "expect," "may," "project," "intend"
or similar expressions.

We have completed the construction of our pilot sodium plant in Salt Lake
City, Utah.  The pilot plant has successfully produced small quantities of
metallic sodium. Plans for demonstration projects for our Hydrogen On Demand
generators are on hold pending funding.  We are engaged in discussions with a
fuel cell manufacturer regarding a possible joint venture arrangement but such
discussions having been in process for some time with no results to date due
to funding problems and no agreements have been reached.  We are considering
looking for alternative business combinations with entities who may not be
involved in related industries but have not identified any prospects to date.

Results of Operations
---------------------
Year ended December 31, 2003 compared to year ended December 31, 2002
---------------------------------------------------------------------
Revenues.  We expect that our initial revenues will be generated primarily by
the production of sodium.  Additional revenues may be derived from the
licensing of the Technology and/or manufacturing and sale of hydrogen
generation systems. We had no revenues for the years ended December 31, 2003
and 2002, respectively, and have had no revenues since July 9, 1997
("Inception").

Operating Expenses.  Our operating expenses decreased to $438,239 in 2003 from
$928,489 2002.  The decrease in operating expenses in 2003 is attributable to
significant decreases in general and administrative expenses and professional
fees, and a substantial decrease in research and development expenses due to
the completion of our planned research and development activities.  Total
operating expenses from inception through December 31, 2003 have been
$3,184,654.  Effective in September 2003, we have reduced operating expenses
to a minimum in order to preserve assets and maintain the company until a
project develops and funding is available.  We anticipate that we may be
required to further reduce operating expenses over the remainder of fiscal
2004 unless additional funding is obtained.

We experienced a net loss of $437,644 in 2003, with a loss per share of $0.10,
compared to a 2002 net loss of $922,380, with a loss per share of $0.21. The
net loss since inception has been $3,183,497, with a $1.25 loss per share.

<PAGE>
PAGE> 10

Liquidity and Capital Resources
-------------------------------
Our working capital has come mainly through the sale of our securities.
Proceeds generated from the sale of our securities have funded the our
operations, including continued research and development activities.

In August 2003, we issued 100,000 shares of common stock valued at $46,000 to
our president, Robert K. Ipson, and 50,000 shares of common stock valued at
$23,000 to our secretary/treasurer, Phillip McStotts.

At December 31, 2003, we had current assets of $43,559, and current
liabilities of $15,599, for working capital of $27,960.  At December 31, 2003,
we had property and equipment, net of depreciation, of $5,210, and other
assets of $38,595, consisting of patents and assigned technology, net of
amortization, of $12,608.

Our cash used in operations for the year ended December 31, 2003 was $309,008
compared to $611,156 for the same period ended December 31, 2002.  We have
continued to issue stock for services to certain officers.  Since inception,
our operations have been funded primarily by cash received from capital
contributions and the issuance of common stock for cash.

Our investing activities for the year ended December 31, 2003 consisted of
$11,500 for additional patent costs. Our cash used in investing activities
during the year ended December 31, 2002, was $16,360, for the purchase of
equipment and leasehold improvements and additional patent costs.

Cash flows from financing activities during the year ended December 31, 2003
totaled $309,000, all from the sale of common stock.

Because no definitive agreements to utilize our technology have been reached,
management is considering all options for developing revenues, including joint
ventures, licensing arrangements and business combinations, although no
potential business partners have been identified to date.

We expect that during the next year our primary expenditures will be for
maintaining existing operations and for exploring projects and possibilities
for the commercialization of our hydrogen generation equipment and powerball
production, as well as expenses and professional and related fees associated
with our ongoing reporting obligations.  We hope to raise additional capital
in fiscal 2004 through a private placement of our securities and/or through a
licensing of our technology to an industrial partner.  However, at this filing
date we do not have any agreements for funding through such a private
placement or any immediate prospects for a licensing agreement.

Impact of Inflation
-------------------
We do not anticipate that inflation will have a material impact on our current
or proposed operations.


<PAGE>
<PAGE> 11

Seasonality
-----------
We do not know of any seasonal aspects relating to the nature of our business
operations that have had or might have a material effect on our financial
condition or results of operation.

                        ITEM 7.  FINANCIAL STATEMENTS

     The financial statements of Powerball are set forth immediately following
the signature page to this form 10-KSB.

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

We have had no disagreements with our certified public accountants with
respect to accounting practices or procedures or financial disclosure.

                   ITEM 8A. CONTROLS AND PROCEDURES

Our principal executive and financial officer has participated with management
in the evaluation of effectiveness of the controls and procedures required by
paragraph (b) of Rule 13a-15 or Rule 15d-15 under the Exchange Act as of the
end of the period covered by this report.  Based on that evaluation, our
principal executive and financial officer believes that our disclosure
controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) under
the Exchange Act) are effective as of the end of the period covered by the
report.  There have been no changes in our internal controls that have
materially affected, or are reasonably likely to materially affect, our
internal controls over financial reporting during the period covered by this
report.


                             PART III

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

     The names and ages of our executive officers and directors and the
positions held by each of them are set forth below:

  Name                  Age   Position                  Dates Served
  ----                  ---   --------                  ------------
  Robert K. Ipson       64    C.E.O., director          July 1997 to date
  Matthew Fisher        28    Vice-president, director  December 2001 to date
  Phillip L. McStotts   46    Secretary/Treasurer,      July 1997 to date
                                director

It is expected that all of our directors will hold office until the next
Annual Meeting of Shareholders and until their successors have been elected
and qualified.  The term of office for each Officer is one year and until a
successor is elected at the annual meeting of the Board of Directors and is
qualified, subject to removal by the Board of Directors.  We will reimburse
our Directors for their expenses associated with attending Directors'
meetings.  However, Directors have not, nor is it anticipated they will,
receive any additional compensation for attending Directors' meetings.

<PAGE>
<PAGE> 12

Biographical Information
------------------------
Set forth below is certain biographical information for each of Powerball's
Officers and Directors and other key personnel.

Robert K. Ipson.  Mr. Ipson is, and has been since 1973, president of M.S.J. &
Associates, Inc., a family-held company.  M.S.J. & Associates was the operator
of the Bonneville Raceway in Salt Lake City, Utah until 1986.  Since that date
it has managed its own investments.

Matthew Fisher has been one of our important employees since 1997.  He was
instrumental in the design and manufacture of our On-Demand Hydrogen
Generation system and has been the manager and technology implementation
specialist on our pilot elemental sodium facility in West Valley City, Utah.
Mr. Fisher has expertise in a variety of chemical, mechanical, and computer
programming disciplines and is largely responsible for the achievement of the
recent key milestones in the pilot sodium facility.

Phillip L. McStotts is a founder of ZEVEX International, Inc. (a publicly
traded company) and has served as ZEVEX' CFO, Secretary, and Treasurer, and as
a director since its inception.  He also serves as a director of ZEVEX' wholly
owned subsidiary, as CFO, Secretary and Treasurer of ZEVEX Inc.  Mr. McStotts
was a practicing CPA running his own professional corporation, Phillip L.
McStotts, CPA P.C., from 1986 to 1992.  Prior to starting his own firm, Mr.
McStotts was employed from 1985 to 1986 as an accountant with the Salt Lake
City firm of Chachas & Associates, where he was a tax manager.  He has also
worked in the tax departments of the regional accounting firms of Pearson, Del
Prete & Company, and Petersen, Sorensen & Brough.  Mr. McStotts received a
Bachelor of Science Degree in Accounting from Westminster College in May 1980,
and received a Master of Business Administration Degree in Taxation from
Golden Gate University in May 1982.

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
-------------------------------------------------
Our Common Stock is registered pursuant to Section 12(g) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in connection
therewith, directors, officers, and beneficial owners of more than 10% of our
Common Stock are required to file on a timely basis certain reports under
Section 16 of the Exchange Act as to their beneficial ownership of our Common
Stock.  Other than those items listed below, we believe to the best of our
knowledge that under the SEC's rules for reporting of securities transactions
by directors and executive officers, all required reports for the fiscal year
ended December 31, 2003 have been timely filed.

Robert Ipson filed a late Form 4 on March 25, 2004 reporting his acquisition
of 100,000 shares from the Company in August 2003 for services valued at
$46,000.

Phillip McStotts filed a late Form 4 on March 25, 2004 reporting his
acquisition of 50,000 shares from the Company in August 2003 for services
valued at $23,000.
<PAGE>
<PAGE> 13

                     ITEM 10.  EXECUTIVE COMPENSATION

The following tables set forth certain summary information concerning the
compensation paid or accrued for each of our last three completed fiscal years
to our chief executive officer and each of our other executive officers that
received compensation in excess of $100,000 during such period (as determined
at December 31, 2003, the end of our last completed fiscal year):

<TABLE>
<CAPTION>
                                                         Long Term Compensation
                                                        ----------------------

                     Annual Compensation               Awards       Payouts
                                            Other      Restricted
Name and                                    Annual      Stock     Options  LTIP     All other
Principal Position Year  Salary   Bonus($) Compensation Awards   /SARs    Payout  Compensation
------------------ ----  ------   -------- ------------ ------   -------  ------  ------------
<S>              <C>     <C>     <C>      <C>          <C>      <C>      <C>     <C>
Robert K. Ipson     2003  $ -0-     -0-      46,000(1)    -0-      -0-      -0-       -0-
C.E.O.              2002  $ -0-     -0-     100,000(2)    -0-      -0-      -0-       -0-
                    2001  $ -0-     -0-     150,000(3)    -0-      -0-      -0-       -0-

(1)In 2003, Mr. Ipson was issued 100,000 shares of our common stock valued at $46,000.
(2)In 2002, Mr. Ipson was credited with the exercise price of $50,000 towards the exercise of
outstanding warrants for the purchase of 50,000 shares of our common stock, and $50,000 towards
the exercise price of options for the purchase of 50,000 shares of our common stock, all at $1.00
per share.
(3)In 2001, Mr. Ipson was issued 100,000 shares of our common stock valued at $150,000.
</TABLE>

Bonuses and Deferred Compensation
---------------------------------
None.

Employment Agreements
---------------------
Matthew Fisher has been receiving salary at a rate of $65,000 per year.  The
employment arrangement with Mr. Fisher is oral.

Compensation Pursuant to Plans
------------------------------
None.

Pension Table
-------------
Not Applicable.

Other Compensation
------------------
None.

Compensation of Directors
-------------------------
None.


<PAGE>
<PAGE> 14

Disclosure Regarding the Company's Equity Compensation Plans
------------------------------------------------------------
The Company has a 2000 Stock Option and Award Plan (the "2000 Plan")
authorized by the board and approved by shareholders in May 2000.  Options for
the purchase of a total of 150,000 shares of common stock were authorized
under the 2000 Plan.  The 2000 Plan has been filed with the SEC as an exhibit
to the Company's Definitive Information Statement dated April 25, 2000. The
board has granted stock options to certain employees under the 2000 Plan.  The
Company has a 2003 Stock Option and Award Plan (the "2003 Plan") authorized by
the board and not submitted to shareholders.  Options for the purchase of a
total of 350,000 shares were authorized under the 2003 Plan. The 2003 Plan has
been filed with the SEC as an exhibit to the Company's Registration Statement
on Form S-8 dated April 21, 2003. The board has granted stock options to a
consultant under the 2003 Plan. The following table summarizes information
about equity awards that are outstanding as of December 31, 2003.
<TABLE>
<CAPTION>
                         Number of Shares of                       Number of Shares of
                         Common stock to be       Weighted Avg        Common Stock
                         issued upon exercise    Exercise Price    Available for Future
                           Of Outstanding        Of Outstanding     Issuance (excluding
Plan Category                 Options*              Options         shares reflected in *)
-------------            --------------------    --------------    ----------------------
<S>                   <C>                     <C>               <C>
Equity compensation
Plans approved by
Security holders                 25,000               $2.10                125,000

Equity compensation
plans not approved by
security holders                 15,875               $2.00                334,125
</TABLE>
The above stock options were granted as follows:
- Under the 2000 Plan, 10,000 qualified employee stock options were granted to
Matthew Fisher in 2000, with an exercise price of $3.00 per share, vesting
annually in three equal installments over a 3 year period beginning January 1,
2003, exercisable until January 1, 2006.
- Under the 2000 Plan, 15,000 qualified employee stock options were granted to
Matthew Fisher in 2002, with an exercise price of $1.50 per share, vested
immediately and exercisable until October 5, 2004.
- Under the 2003 Plan, 15,875 options were granted to an outside business
consultant in 2003 in connection with strategic planning consulting services,
with an exercise price of $2.00, vested immediately and exercisable until
December 31, 2006.

The Company's Board of Directors has the sole authority to determine the terms
of awards and other terms, conditions and restrictions of the options.

Termination of Employment and Change of Control Arrangement
-----------------------------------------------------------
None.

Audit Committee
---------------
The Company has not yet established an audit committee.  The board of
directors acts as the audit committee.

Code of Ethics
--------------
The Company has not adopted a Code of Ethics for its executive officers and
employees but is in the process of examining and considering one.

<PAGE>
<PAGE> 15

  ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of March 24, 2004 the name and address and
the number of shares of our Common Stock, par value $0.001 per share, held of
record or beneficially by each person who held of record, or was known by us
to own beneficially, more than 5% of the 4,853,781 shares of our Common Stock
issued and outstanding, and the name and shareholdings of each director and of
all officers and directors as a group.  The information on share numbers and
percentage ownership listed assumes:

(a) the exercise of options and warrants by the beneficial owner (all included
warrants and options are currently exercisable); and
(b) a corresponding increase in the number of shares issued and outstanding.

Security Ownership of Certain Beneficial Owners
-----------------------------------------------
Title of Class    Name and Address            Number of Shares     % of Class
--------------    ----------------            ----------------     ----------
Common Stock      Robert K. Ipson                      902,600(1)      19.69
                  2433 Los Patos Drive
                  Palm Springs, CA 92264

Common Stock      Linda Lou Ipson                      902,600(2)      19.69
                  2433 Los Patos Drive
                  Palm Springs, CA 92264

Common Stock      Shorland Hunsaker                    335,000          6.90
                  2751 East Rubidoux Road
                  Salt Lake City, UT  84093

Common Stock      Jed Checketts                        788,000         16.23
                  616 Amador Avenue
                  Ontario, CA 91764

Common Stock      Greg Foster                          495,000(3)       9.97
                  27327 Bronco Drive
                  Canyon Country, CA 91387

Securities Ownership of Management
----------------------------------
Common Stock      Robert K. Ipson, C.E.O., director        -See above -

Common Stock      Matthew Fisher, V.P., director        42,026(4)       0.86
                  2095 West 2200 South
                  Salt Lake City, UT 84119

Common Stock      Phillip L. McStotts                  142,500          2.94
                  Secretary/Treasurer, director
                  1292 Sophia Circle
                  Murray, UT 84123

Common Stock      Officers and Directors
                  As a Group (3 persons)             1,087,126(5)      22.37
----------------------                               =========        ======

[Notes on the above table appear on the following page]

<PAGE>
<PAGE> 16

In the preceding table:

 (1) Mr. Ipson's shares include 27,600 shares held in IRA accounts and 105,500
shares held by his spouse.  See note 2 below.

 (2) Linda L. Ipson is the spouse of Robert K. Ipson; shares held of record by
Linda Lou Ipson may be deemed to be beneficially owned by Robert K. Ipson, and
shares held of record by Robert Ipson may likewise be deemed to be
beneficially owned by Linda Lou Ipson. Ms. Ipson holds of record 105,500
shares.  See note 1 above.

 (3) Mr. Foster's numbers include 385,000 shares and warrants to acquire
110,000 shares exercisable at $2.50 through February 18, 2005.

 (4) Mr. Fisher's numbers include 20,360 shares, options to acquire 15,000
shares exercisable at $1.50 per share through October 5, 2004, and options to
acquire 6,666 shares exercisable at $3.00 per share through January 1, 2006.

 (5) The amount of securities held by our officers and directors as a group
assumes the exercise of all of their respective options and warrants.


<PAGE>
<PAGE> 17
             ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In 1997, in connection our organization, we issued a total of 200,000 shares
of our common stock to our founding shareholders for $40,000 cash and issued
an option to purchase an additional 100,000 shares of common stock at a price
of $1.00 per share to Robert K. Ipson, our C.E.O. and one of our founding
shareholders.

Until December 2000, we used the residence of Robert K. Ipson, as our office
at no cost to us.

In March and April 1999, we completed a private placement of 400,000 Units
consisting of one share and one warrant exercisable at $1.00 per share, at a
price of $0.50 per Unit, for aggregate proceeds of $200,000.  Of these Units,
officers and directors purchased a total of 210,000, including 70,000
purchased by Shorland Hunsaker, 120,000 purchased by Robert Ipson and his
spouse Linda, and 20,000 purchased by Phillip McStotts.  Of the 100,000
exercised as of December 31, 1999, 70,000 were exercised by Shorland Hunsaker.

In June 1999, we issued shares and warrants to Robert Ipson in connection with
our employment agreement with him for total annual compensation of $75,000 for
the period January 1, 1999 to December 31, 1999.  This compensation was paid
as 150,000 Units valued at $0.50 per Unit, each Unit consisting of one share
of our Common Stock and one Warrant to purchase one share of Common Stock at
an exercise price of $1.00 per share.

In October 1999, we issued 15,000 shares valued at $3.00 per share to Jed
Checketts for compensation of $45,000 in connection with royalty payments due
to him from the JV for license fees for the Technology.

In December 1999, we completed a private placement of 120,000 Units consisting
of one share of our common stock and one warrant to purchase one share of our
common stock at an exercise price of $1.00, at a price of $1.00 per Unit, to
two officers and directors, in the amounts of 100,000 Units to Shorland
Hunsaker and 20,000 Units to Phillip McStotts.

During the beginning of the second quarter ended June 30, 2000, our
shareholders approved an Agreement and Plan of Merger in with which we
acquired of all of the issued and outstanding shares of Powerball Industries,
Inc. ("PIC"), a privately held Utah corporation.  Under the Agreement and Plan
of Merger, we acquired all the issued and outstanding stock of PIC in exchange
for the issuance of 1,500,000 shares of our common stock.  Of the 1,500,000
shares issued, 1,078,000 shares were issued to Jed Checketts, the principal
shareholder of PIC, who was appointed as officer and director as a condition
of the merger.

During the period ended September 30, 2000, we issued 167,000 shares to
existing shareholders pursuant to the exercise of outstanding warrants at
$1.00 per share for aggregate proceeds of $167,500.  As an inducement for the
exercise, we agreed to issue warrants for additional shares at the current
market price of $5.00 per share to the shareholders exercising their
outstanding warrants.  Accordingly, we issued 167,500 replacement warrants to
purchase shares of our common stock at a price of $5.00 per share, exercisable
beginning June 26, 2000 for a period of two years.  Of the 167,500 replacement
warrants issued, a total of 107,500 were issued to officers and directors.

<PAGE>
<PAGE> 18

In July 2000, we completed a private placement of 100,000 Units consisting of
one share and one warrant to purchase one share of common stock exercisable at
$6.00, at a price of $4.00 per Unit, to an individual investor, for aggregate
proceeds of $400,000.  In connection therewith, we issued an additional 10,000
Units issued to a finder.

In January 2001, we completed a private placement offering of 165,000 Units
(each Unit consisting of one share of common stock and one common stock
purchase warrant exercisable at $6.00 per share) for aggregate proceeds of
$600,000, payable in installments through July 31, 2001. In June 2001, we
canceled the subscription for nonpayment of the balance of $550,000 due on the
installment payments.  A total of $50,000 was received prior to the
cancellation for which 13,750 Units were issued, including 1,250 Units to a
finder.

In August 2001, we initiated a private placement of our restricted common
stock to certain existing shareholders.  The original private placement was
intended to raise a maximum of $200,000 through the sale of 80,000 shares at a
price of $2.50 per share.  However, prior to our acceptance of subscriptions
for the shares being sold in the private placement, due to market conditions
and the need for additional capital, in October 2001, our Board of Directors
amended the subscription terms of the private placement, to permit the sale of
up to 400,000 shares at a price of $1.00 per share.  A total of 356,000 shares
were issued for aggregate proceeds of $356,000.

In October 2001, we issued 100,000 shares valued at $1.50 per share for a
value of $150,000 to Robert Ipson, our Chief Executive Officer, as
compensation for services.  Also in October 2001, we credited $20,000 as
compensation to Phillip McStotts, an officer and director, towards the
exercise of an outstanding warrant to purchase 20,000 shares of our common
stock at $1.00 per share.  Also in October 2001, we issued options to acquire
shares of our common stock under our 2000 Stock Option and Award Plan to
Matthew Fisher, an officer and director (15,000) and Brett Maylett, an
employee (10,000).  These options are exercisable through October 5, 2004 at
an exercise price of $1.50 per share.

In October 2001, we entered into an investor research contract with
TheInvestorOnline, a third party vendor, for services to be performed over a
one-year period.  Upon signing the contract, we paid $35,000 cash and issued
100,000 shares of our restricted common stock valued at $1.90 per share for
total consideration of $225,000.

In November 2001, we issued a total of 161,000 shares of our restricted common
stock in a private placement to accredited investors $2.50 per share for
aggregate proceeds of $402,500.

In December 2001, we issued 10,000 shares of our restricted common stock
valued at $3.30 per share for a value of $33,000, and warrants to acquire
65,000 shares of our common stock exercisable for five years at an exercise
price of $4.50 per share, to William Freise, our president and Chief Operating
Officer pursuant to his employment agreement.

During the year ended December 31, 2001, a total of 100,000 previously
outstanding warrants exercisable at $1.00 per share were exercised by the
holders for aggregate proceeds of $100,000.

<PAGE>
<PAGE> 19


During the year ended December 31, 2001, a receivable of $6,294 due on a
short-term non-interest bearing advance to Jed Checketts, a former officer and
director, was written off and expensed.

During the year ended December 31, 2002, previously outstanding warrants for a
total of 130,000 shares of common stock exercisable at $1.00 per share were
exercised by the holders for aggregate proceeds of $130,000.

In March 2002, the Board of Directors credited Robert Ipson, CEO, with $50,000
toward the exercise of his outstanding $1.00 options for purchase of our
common stock.  The Board also credited Phillip McStotts, Secretary/Treasurer,
with $12,500 toward the exercise of his outstanding $1.00 warrants for
purchase of our common stock.

In June 2002, the Board of Directors credited Robert Ipson, CEO, with $50,000
toward the exercise of his outstanding $1.00 warrants for purchase of our
common stock.

In June 2002, the Board of Directors agreed to modify William Freise's
employment agreement dated May 30, 2001, and approve the issuance of an option
for the purchase of 75,000 shares of its restricted common stock in lieu of
the issuance of the 10,000 shares and 65,000 warrants called for in his
employment agreement.  The options were issued at an exercise price of $2.45,
exercisable for a period of three years pursuant to our 2000 Stock Option and
Award Plan.

In August 2003, we issued 100,000 shares of common stock valued at $46,000 to
our president, Robert K. Ipson.  Also, during August 2003, we issued 50,000
shares of common stock valued at $23,000 to our secretary/treasurer, Phillip
McStotts.  The 150,000 shares were issued for services rendered to the
Company.  The shares were issued at a fair market value of $0.46 per share for
a total compensation of $69,000.

All of our securities issued in the foregoing transactions were issued in
reliance on the exemption from registration and prospectus delivery
requirements of the Act set forth in Section 3(b) and/or Section 4(2) of the
Securities Act and the regulations promulgated thereunder.

                ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

  (a)(1)FINANCIAL STATEMENTS.  The following financial statements are included
in this report:

Title of Document                                                        Page
-----------------                                                        ----
Independent Auditors' Report                                               21
Consolidated Balance Sheets as of December 31, 2003 and 2002               22
Consolidated Statements of Operations for the years ended December 31,
 2003 and 2002 and from inception on July 9, 1997 through December 31,
 2003                                                                      23
Consolidated Statement of Stockholders' Equity                             24
Consolidated Statements of Cash Flows for the years ended December 31,
 2003 and 2002 and from inception on July 9, 1997 through December 31,
 2003                                                                      28
Notes to Consolidated Financial Statements                                 29

<PAGE>
<PAGE> 20

 (a)(2)FINANCIAL STATEMENT SCHEDULES.  The following financial statement
schedules are included as part of this report:     None.

 (a)(3)EXHIBITS.  The following exhibits are included as part of this report:

Exhibit No.     Description
-----------     -----------
   31           Certification of Principal Executive and Financial Officer
                per Section 302 of the Sarbanes-Oxley Act of 2002

   32           Certification of Principal Executive and Financial Officer
                per Section 906 of the Sarbanes-Oxley Act of 2002

 (b) Reports on Form 8-K.

No reports Form 8-K were filed in the fourth quarter ended December 31, 2003.

                   ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
                  Information required by Item 9(c) of Schedule 14A

  1) Audit Fees - The aggregate fees billed us for each of the last two fiscal
years for professional services rendered by our principal accountant for the
audit of our annual financial statements and review of our quarterly financial
statements is $730 and $0, respectively.  The aggregate fees billed us for
each of the last two fiscal years for professional services rendered by our
former accountant to the audit of our annual financial statements and review
of our quarterly financial statements is $9,840 and $990, respectively.

  2) Audit-Related Fees - None.

  3) Tax Fees. None.

  4) All Other Fees. None.

  5) Not applicable.

  6) Not Applicable.

                                  SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
                                POWERBALL INTERNATIONAL, INC.

Date: April 2, 2004             By /S/Robert K. Ipson, C.E.O., Principal
                                      Executive and Financial Officer

In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates stated.

Date: April 2, 2004             By /S/Robert K. Ipson, Director
Date: April 2, 2004             By /S/Phillip McStotts, Director


<PAGE>
<PAGE> 21

Independent Auditors' Report

Board of Directors
Powerball International Inc. and Subsidiary
Salt Lake City, Utah

We have audited the accompanying consolidated balance sheets of Powerball
International, Inc., and Subsidiary (Development Stage Companies) as of
December 31, 2003 and 2002 and the related consolidated statements of
operations, stockholders' equity and cash flows for the years then ended and
from January 1, 1999 to December 31, 2003.  These financial statements are the
responsibility of the Company's management.  Our responsibility is to express
an opinion on the financial statements based on our audits.

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

In our opinion the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
Powerball International, Inc. and Subsidiary (Development Stage Companies) as
of December 31, 2003 and 2002 and the consolidated results of its operations
and cash flows for the years then ended and from January 1, 1999 to December
31, 2003 in conformity with accounting principals generally accepted in the
United States of America.

As discussed in Note 10, the Company has been in the development stage since
its inception on July 9, 1997.  Realization of a major portion of the assets
is dependent upon the Company's ability to meet its future financing
requirements, and the success of its future operations and that of its wholly
owned subsidiary in which it has loaned or invested most of the capital it has
raised.  The Company at December 31, 2003 had a deficit accumulated during its
development stage of $3,183,497.  These factors raise substantial doubt as to
the Company's ability to continue as a going concern.  The financial
statements do not include any adjustments relating to the recoverability and
classification of recorded assets, or the amounts and classification of
liabilities that might be necessary in the event the Company cannot continue
in existence.



/s/Chisholm Bierwolf & Nilson
Chisholm Bierwolf & Nilson, LLC
Bountiful, Utah
January 29, 2004


<PAGE>
<PAGE> 22
POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)
CONSOLIDATED BALANCE SHEETS
                                                  December 31,  December 31,
                                                     2003          2002
                                                  -----------   -----------
ASSETS
CURRENT ASSETS
 Cash in bank                                    $     43,559  $     55,067
 Prepaid expenses                                           -         1,807
 Officer receivable                                         -         7,200
 Subscription receivable                                    -        40,000
 Refund receivable                                          -           289
                                                  -----------   -----------
   Total Current Assets                                43,559       104,363
                                                  -----------   -----------
PROPERTY AND EQUIPMENT
 Equipment                                             11,359        11,359
 Leasehold improvements                                23,923        23,923
                                                  -----------   -----------
                                                       35,282        35,282
 Less accumulated depreciation                        (30,072)      (27,675)
                                                  -----------   -----------
                                                        5,210         7,607
                                                  -----------   -----------
OTHER ASSETS
 Assets held for resale - net of
  valuation allowance                                       -         4,000
 Patents and assigned technology, net of
  amortization of $12,608 and $11,049                  38,595        30,673
                                                  -----------   -----------
   Total Other Assets                                  38,595        34,673
                                                  -----------   -----------
TOTAL ASSETS                                     $     87,364  $    146,643
                                                  ===========   ===========
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
 Accounts payable                                $     13,904  $     10,532
 Accounts payable - stockholder                             -           370
 Accrued and deferred liabilities                       1,695         4,331
                                                  -----------   -----------
   Total Current Liabilities                           15,599        15,233
                                                  -----------   -----------
STOCKHOLDERS' EQUITY
 Common stock; $.001 par value, 25,000,000 shares
  authorized, 4,853,781, and 4,393,781 shares
  issued and outstanding respectively                   4,854         4,394
 Capital in excess of par value                     3,250,408     2,872,868
 Earnings (deficit) accumulated during the
  development stage                                (3,183,497)   (2,745,852)
                                                  -----------   -----------
   Total Stockholders' Equity                          71,765       131,410
                                                  -----------   -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY       $     87,364  $    146,643
                                                  ===========   ===========

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

<PAGE>
<PAGE> 23
POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                       For the         For the    (Deficit)
                                                        Year            Year      Accumulated
                                                        Ended          Ended      During the
                                                       December       December    Development
                                                       31, 2003       31, 2002       Stage
                                                      -----------   -----------   -----------
<S>                                                <C>           <C>           <C>
REVENUE                                              $          -  $          -  $          -
                                                      -----------   -----------   -----------
EXPENSES
     Equity in loss from limited liability company              -             -       446,549
     General and administrative                            50,070       255,557       725,978
     Professional fees                                    115,064       237,104       786,001
     Depreciation and amortization expense                  9,975         9,606        41,895
     Research and development                             263,130       426,222     1,184,231
                                                      -----------   -----------   -----------
                                                          438,239       928,489     3,184,654
                                                      -----------   -----------   -----------
OPERATING LOSS                                           (438,239)     (928,489)   (3,184,654)

OTHER INCOME AND EXPENSE
     Interest and other income                                717         6,209        19,499
     Asset writedown                                            -             -        (3,497)
     Limited sales of tanks, net of direct
      production costs of $1,046                                -             -        13,003
                                                      -----------   -----------   -----------
INCOME (LOSS) BEFORE INCOME TAXES                        (437,522)     (922,280)   (3,155,649)
     Minimum State franchise tax                              122           100           622
                                                      -----------   -----------   -----------
NET INCOME (LOSS) BEFORE CUMULATIVE
EFFECT OF ACCOUNTING CHANGE                              (437,644)     (922,380)   (3,156,271)

Cumulative effect of accounting change for
organization costs                                              -             -       (27,226)
                                                      -----------   -----------   -----------
NET INCOME (LOSS)                                    $   (437,644) $   (922,380) $ (3,183,497)
                                                      ===========   ===========   ===========
EARNINGS (LOSS) PER SHARE BEFORE
ACCOUNTING CHANGE                                    $      (0.10) $      (0.21) $      (1.24)
                                                      ===========   ===========   ===========
CUMULATIVE EFFECT OF ACCOUNTING CHANGE               $      (0.00) $      (0.00) $      (0.01)
                                                      ===========   ===========   ===========
EARNINGS (LOSS) PER SHARE                            $      (0.10) $      (0.21) $      (1.25)
                                                      ===========   ===========   ===========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES                4,595,726     4,324,297     2,537,645
                                                      ===========   ===========   ===========
</TABLE>


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


<PAGE>
<PAGE> 24

POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>

                                                                                                     (Deficit)
                                                                                     Common         Accumulated
                                                                     Capital in       Stock         During the
                                               Common Stock          Excess of     Subscription     Development
                                          Shares           Amount    Par Value      Receivable        Stage
                                        ------------   ------------  ------------   -----------    ------------
<S>                                     <C>            <C>           <C>           <C>            <C>
BALANCE, July 9, 1997 (Inception)                  -   $          -  $          -   $         -    $          -

Shares issued to initial stockholders
 for cash, July 9, 1997 at $.20 per share    200,000            200        39,800             -               -

Shares issued pursuant to a public
 offering, December 5, 1997 at $1.00
 per share                                   400,000            400       399,600             -               -

Direct costs of public offering                    -              -       (40,000)            -               -

Net income(loss) from July 9, 1997
 (inception) to December 31, 1997                  -              -             -             -         (26,035)
                                        ------------   ------------  ------------   -----------    ------------
BALANCE, December 31, 1997                   600,000            600       399,400                       (26,035)

Net income (loss) for the year ended
  December 31, 1998                                -              -             -             -         (72,866)
                                        ------------   ------------  ------------   -----------    ------------

BALANCE, December 31, 1998                   600,000            600       399,400             -         (98,901)

Shares issued pursuant to a private
 placement at $.50 per share, March
 and April 1999                              400,000            400       199,600             -               -

Direct costs of stock offering                     -              -        (1,638)            -               -

Shares issued to vendor for services
 June 1999 at $4.00 per share                 10,000             10        39,990             -               -

Shares issued to officer and director
 for services, June 1999 at $.50
 per share                                   150,000            150        74,850             -               -

Shares issued upon exercise of
 warrants, July and September 1999 at
 $1.00 per share                             100,000            100        99,900             -               -

Shares issued to pay royalty for joint
 venture partner, October 1999 at
 $3.00 per share                              15,000             15        44,985             -               -
                                        ------------   ------------  ------------   -----------    ------------
Balance, October 31, 1999 - subtotal       1,275,000   $      1,275  $    857,087   $         -    $    (98,901)
                                        ============   ============  ============   ===========    ============
</TABLE>



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

<PAGE>
<PAGE> 25
POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Continued)
<TABLE>
<CAPTION>

                                                                                                     (Deficit)
                                                                                      Common        Accumulated
                                                                     Capital in        Stock         During the
                                               Common Stock          Excess of      Subscription    Development
                                          Shares           Amount    Par Value       Receivable         Stage
                                        ------------   ------------  ------------   -----------   -------------
<S>                                     <C>            <C>           <C>           <C>           <C>
Balance, October 31, 1999 - subtotal       1,275,000   $      1,275  $    857,087   $         -    $    (98,901)

Shares issued to vendor for services,
 December 1999 at $3.00 per share              4,000              4        11,996             -               -

Shares issued to officers and directors
 pursuant to a private placement at
 $1.00 per share, December 1999              120,000            120       119,880             -               -

Net income (loss) for the year ended
 December 31, 1999                                 -              -             -             -        (441,243)
                                           ---------   ------------  ------------   -----------   -------------
BALANCE, December 31, 1999                 1,399,000          1,399       988,963             -        (540,144)

Issuance of common stock to acquire
 remaining 50% interest in joint venture
 at par and discounted value on April
 15, 2000                                  1,500,000          1,500      (369,158)            -               -

Shares issued to individuals pursuant
 to a private placement of common stock
 and warrants at $4.00 per Unit,
 August 2000                                 110,000            110       439,890             -               -

Direct costs of private placement                  -              -       (42,030)            -               -

Shares issued on exercise of warrants,
 February to November 2000 at $1.00
 per share                                   267,500            267       267,233             -               -

Direct costs of exercise of warrants               -              -          (880)            -               -

Net income (loss) for the year ended
 December 31, 2000                                 -              -             -             -        (435,095)
                                        ------------   ------------  ------------   -----------   -------------
BALANCE, December 31, 2000                 3,276,500          3,276     1,284,018             -        (975,239)

Shares issued upon exercise of warrants
 February 2001 at $1.00 per share             10,000             10         9,990             -               -
                                        ------------   ------------  ------------   -----------   -------------
BALANCE, February 28, 2001 - Subtotal      3,286,500   $      3,286  $  1,294,008   $         -        (975,239)
                                        ============   ============  ============   ===========   =============

</TABLE>



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

<PAGE>
<PAGE> 26

POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Continued)
<TABLE>
<CAPTION>

                                                                                                     (Deficit)
                                                                                      Common        Accumulated
                                                                     Capital in        Stock         During the
                                               Common Stock          Excess of      Subscription    Development
                                          Shares           Amount    Par Value       Receivable         Stage
                                        ------------   ------------  ------------   -----------   -------------
<S>                                     <C>            <C>           <C>           <C>           <C>
BALANCE, February 28, 2001                 3,286,500   $      3,286  $  1,294,008   $         -        (975,239)

Shares issued to an individual pursuant
 to a private placement of common stock
 and warrants at $4.00 per unit, March
 2001                                         12,500             13        49,987             -               -

Shares and warrants issued to an
 individual as finders fee at $4.00
 per unit, March 2001                          1,250              1         4,999             -               -

Direct costs of private placement,
 March 2001                                        -              -        (5,000)            -               -

Shares issued to individuals pursuant
 to a private placement of common stock
 at $1.00 per share, October 2001            356,000            356       355,644             -               -

Shares issued upon exercise of warrants
 October 2001 at $1.00 per share              20,000             20        19,980             -               -

Shares issued to officer and director
 for services, October 2001 at $1.50
 per share                                   100,000            100       149,900             -               -

Shares issued to vendor for services,
 October 2001 at $1.90 per share             100,000            100       189,900      (187,500)              -

Shares issued to individuals pursuant
 to a private placement of common
 stock at $2.50 per share, November
 2001                                        161,000            161       402,339             -               -

Direct costs of private placement,
 October and November 2001                         -              -        (6,512)            -               -

Shares issued upon exercise of
 warrants November 2001 at $1.00
 per share                                    80,000             80        79,920             -               -

Shares issued to officer for services,
 December 2001 at $3.30 per share             10,000             10        32,990             -               -

Net income (loss) for the year ended
 December 31, 2001                                 -              -             -             -        (848,233)
                                        ------------   ------------  ------------   -----------   -------------
BALANCE, December 31, 2001                 4,127,250   $      4,127  $  2,568,155   $  (187,500)  $  (1,823,472)
                                        ============   ============  ============   ===========   =============
</TABLE>


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

<PAGE>
<PAGE> 27

POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Continued)
<TABLE>
<CAPTION>

                                                                                                     (Deficit)
                                                                                      Common        Accumulated
                                                                     Capital in        Stock         During the
                                               Common Stock          Excess of      Subscription    Development
                                          Shares           Amount    Par Value       Receivable         Stage
                                        ------------   ------------  ------------   -----------   -------------
<S>                                     <C>            <C>           <C>           <C>           <C>
BALANCE, December 31, 2001                 4,127,250   $      4,127  $  2,568,155   $  (187,500)  $  (1,823,472)

Shares issued upon exercise of warrants
March and April 2002 at $1.00 per share       82,500             83        82,417             -              -

Shares issued upon exercise of options
March 2002 at $1.00 per share                 50,000             50        49,950             -              -

Shares issued upon exercise of warrants
June 2002 at $1.00 per share                 110,000            110       109,890             -              -

Services rendered during the period
January through October 2002 in
satisfaction of common stock
subscription receivable                            -              -             -       187,500              -

Shares issued to consultant for
services December 2002 at $2.60
per share                                     24,031             24        62,456             -              -

Net income (loss) for the year
ended December 31, 2002                            -              -             -             -       (922,380)
                                        ------------   ------------  ------------   -----------   ------------
BALANCE, December 31, 2002                 4,393,781          4,394     2,872,868             -     (2,745,852)

Shares issued for cash March 2003
at $1.90 per share                           110,000            110       208,890             -              -

Shares issued for services August
2003 at $.46 per share                       150,000            150        68,850             -              -

Shares issued for cash September
2003 at $.50 per share                       200,000            200        99,800             -              -

Net income (loss) for the year
ended December 31, 2003                            -              -             -             -       (437,644)
                                        ------------   ------------  ------------   -----------   ------------
BALANCE, December 31, 2003                 4,853,781   $      4,854  $  3,250,408   $         -   $ (3,183,497)
                                        ============   ============  ============   ===========   ============

</TABLE>








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

<PAGE>
<PAGE> 28
POWERBALL INTERNATIONAL, INC. AND SUBSIDIARY
(Development Stage Companies)
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                         For the         For the    (Deficit)
                                                          Year            Year      Accumulated
                                                          Ended          Ended      During the
                                                         December       December    Development
                                                         31, 2003       31, 2002       Stage
                                                       -----------   -----------   -----------
<S>                                                 <C>           <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES
 Net (loss)                                           $   (437,644) $   (922,380) $ (3,183,496)
 Adjustments to reconcile net (loss) to net cash
  provided by operating activities
  Cumulative change in accounting principle                      -             -        27,226
  Stock issued for services                                 69,000       362,480       711,980
  Expense stockholder loan                                       -             -         6,294
  Decrease in investment in limited liability company            -             -       446,548
  Depreciation and amortization                              9,975         9,610        45,396
 Changes in assets and liabilities
  Decrease in prepaid expense                                1,807        (1,807)            -
  Decrease in officer receivable                             7,200        (7,200)            -
  Decrease (increase) in subscription receivable            40,000       (40,000)            -
  Decrease in refund receivable                                289          (289)            -
  Increase in supplies                                           -             -           972
  Increase in organization costs                                 -             -       (28,465)
  Increase (Decrease) in accounts payable                    3,372       (13,876)       (8,014)
  Decrease in accounts payable - stockholder                  (370)          370             -
  Increase in accrued expenses                              (2,637)        1,936         1,505
                                                       -----------   -----------   -----------
   Net cash (used) by operating activities                (309,008)     (611,156)   (1,980,054)
                                                       -----------   -----------   -----------
CASH FLOWS FROM INVESTING ACTIVITIES
 Acquisition of joint venture partner - net of cash              -             -        17,016
 Related party loans                                             -             -      (509,000)
 Investment in limited liability company                         -             -      (250,000)
 Purchase of equipment and leasehold improvements                -        (3,589)      (16,656)
 Additional patent costs                                   (11,500)      (12,771)      (31,687)
                                                       -----------   -----------   -----------
   Net cash provided (used) by investing activities        (11,500)      (16,360)     (790,327)
                                                       -----------   -----------   -----------
CASH FLOWS FROM FINANCING ACTIVITIES
 Sale of common stock                                      309,000       130,000     2,865,000
 Direct costs of stock sale                                      -             -       (51,060)
                                                       -----------   -----------   -----------
   Net Cash Provided By Financing Activities               309,000       130,000     2,813,940
                                                       -----------   -----------   -----------
NET INCREASE (DECREASE) IN CASH                            (11,508)     (497,516)       43,559

CASH - BEGINNING OF PERIOD                                  55,067       552,583             -
                                                       -----------   -----------   -----------
CASH - END OF PERIOD                                  $     43,559  $     55,067  $     43,559
                                                       ===========   ===========   ===========
SUPPLEMENTAL INFORMATION
 Interest paid during the period                      $          -  $          -  $          -
                                                       ===========   ===========   ===========
 Income taxes paid during the period                  $        122  $        100  $      1,844
                                                       ===========   ===========   ===========
 Stock issued to pay royalties and expenses
  of related entity                                   $          -  $          -  $     97,000
                                                       ===========   ===========   ===========
 Stock issued to pay finders fee and
  services rendered                                   $     69,000  $    422,480  $    743,274
                                                       ===========   ===========   ===========
 Stock issued to acquire Powerball Industries, Inc.   $          -  $          -  $   (370,658)
                                                       ===========   ===========   ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.

<PAGE>
<PAGE> 29

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization - The Company was incorporated on July 9, 1997 under the laws of
the State of Utah.  At the present time, the Company and its subsidiary are in
the development stage.  The Company was formed for the purpose of raising
capital to invest in a joint venture which acquired a license to certain
technology relating to the production of hydrogen, to generate hydrogen for
sale, and to market hydrogen generating equipment and products.  During the
beginning of the second quarter ended June 30, 2000, the Company acquired the
remaining 50% interest in Powerball Technologies, LLC, for 1,500,000 shares of
the Company's common stock which was issued to the other joint interest
member.  At that time, Powerball Technologies, LLC became a wholly-owned
subsidiary of the Company.  The Company, through its wholly-owned subsidiary
and its joint venture, is involved in research and development efforts in
commercializing the technology.

Consoldiation policy - Prior to the acquisition, the Company accounted for its
investment in the Limited Liability Company using the equity method of
accounting.  The acquistion has been accounted for using the purchase method
of accounting, (see Note 5).  The consolidated financial statements at
December 31, 2003 and 2002, include the accounts of Powerball International,
Inc., (Company) and its wholly-owned operating subsidiary, Powerball
Technologies, Inc.  Intercompany transactions and balances have been
eliminated in consolidation.

Amortization of Organization Costs - The Company was amortizing its
organization costs over a sixty (60) month period using the straight-line
method.  In 1998, the Accounting Standards Executive Committee (AcSEC) of the
American Institute of Certified Public Accountants issued Statements of
Position (SOP) 98-5 "Reporting on the Costs of Start-Up Activities".  The SOP
requires costs of start-up activities and organization costs to be expensed as
incurred.  During 1999, the Company adopted the SOP and recognized a charge
for the cumulative effect of accounting change of $27,226.

Intangible Assets - At the time of the acquisition, the patent technology held
by the joint venture was assigned to the Company and was recorded at the
historical cost as recorded on the books of the Subsidiary.  This cost plus
additional costs relating to the technology obtained are being amortized over
ten years on a straight-line basis.

Research and Development - Research and development costs related to both
future and present products are charged to operations as incurred.

Issuance of Shares for Services and Other Expenses - Valuation of shares
issued for royalties, services and expenses of the Company and on behalf of
its joint venture partner, prior to its acquisition, were based on the fair
market value of the above items at the time of issuance.


<PAGE>
<PAGE> 30

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Income Taxes - The Company provides for income taxes based on the liability
method, which required recognition of deferred tax assets and liabilities
based on differences between financial reporting and tax bases of assets and
liabilities measured using enacted tax rates and laws that are expected to be
in effect when the differences are expected to reverse.

Use of Estimates - The preparation of financial statements in conformity with
the 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 revenue and expenses
during the reporting period.  Actual results could differ from those
estimates.

Cash and Cash Equivalents  - For purposes of the statement of cash flows, the
Company considers all investments instruments purchased with a maturity of
three months or less to be cash equivalents

Net Income (Loss) Per Common Share - Basic earnings (loss) per common share
(EPS) is calculated by dividing net income (loss) for the period by the
weighted average number of the Company's common shares outstanding and, if
applicable, EPS is computed by dividing net income by diluted common
equivalent shares from stock options and warrants, as calculated using the
treasury stock method.

Fully diluted earnings per common share reflect the calculation of the number
of common equivalent shares based on the stock price at the end of the period.
Fully diluted per common share amounts are not reported because the Company
has had losses for every period since inception and thus a diluted earnings
per share computation would be antidilutive for December 31, 2003 and 2002.
Per Financial Accounting Statement No, 128 if there is a loss from continuing
operations, diluted EPS is the same as basic EPS.

NOTE 2 - FAIR VALUE OF FINANCIAL INSTRUMENTS

The book value of the Company's financial instruments approximates fair value.
The estimated fair values of financial instruments have been determined using
appropriate market information.

NOTE 3 - LEASE

The Company leases its premises on a month to month basis.  The monthly rent
is $2,274.

Rent expense of $25,556 and $29,176 for the years ended December 31, 2003 and
2002, respectively, has been included in the statement of operations.


<PAGE>
<PAGE> 31

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 - ROYALTY AGREEMENT

At the time of the merger, Patent technology and rights were assigned to
Powerball International, Inc.  In consideration for the assignment of the
rights the Company agreed to pay the Assignor an amounts equal to one percent
(1%) of the gross sales revenue of the Company specific to the technology that
was subject to the assignment.  All royalties are payable on or before the
fifteenth day of each quarter following the quarter in which the gross income
was earned.  For the year ended December 31, 2003 and 2002 no royalties were
due under this assignment.

NOTE 5 - BUSINESS COMBINATION

The Company in the second quarter ended June 30, 2000 completed its plan of
merger with Powerball Technologies, Inc, ("PIC") in a business combination
accounted for as a purchase.  The Company acquired the net assets of PIC for
1,500,000 shares of the Company's common stock, PIC's only business activity
was its joint interest investment in Powerball Technology, LLC (see Note 6).
The merger caused Powerball Technology, LLC ("Tech") to become a wholly-owned
subsidiary of the company.  The results of operations of Tech are included in
the accompanying financial statements since the first day of the quarter ended
June 30, 2000.  The merger was recorded at historical costs values and thus
there is no amortization of the cost of the merger over the fair value of the
net assets of PIC.

The following summarized pro forma (unaudited) information assumes the merger
had occurred on December 1, 1999.
                                                  2000          1999
                                               -----------   -----------
  Net Sales                                   $          -  $          -
  Net Income (Loss)                           $   (547,863) $   (854,858)
  Loss per share                              $       (.23) $       (.85)

NOTE 6 - INVESTMENT IN LIMITED LIABILITY COMPANY

The Company and Powerball Industries, Inc., formed a limited liability company
called Powerball Technologies, LLC, (LLC) to license the Technology; to
further develop the Technology; to build a sodium hydride pellet recycling
plant; to manufacture tanks in which hydrogen is generated; to demonstrate the
commercial viability of the Technology; and to commercialize the Technology.
Powerball Industries, Inc., assigned the Technology License to the LLC for a
50% ownership interest in the LLC.  The Company invested $250,000 in the LLC
for a 50% ownership interest.  The LLC is a development stage company.


<PAGE>
<PAGE> 32

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6 - INVESTMENT IN LIMITED LIABILITY COMPANY (continued)

The following is a summary of financial positions and results of operations of
the LLC prior the LLC becoming a subsidiary:

                                                  2000          1999
                                               -----------   -----------
 Current assets                               $     32,448  $      8,720
 Property and equipment                             15,831        18,434
 Other assets                                       17,076        18,564
                                               -----------   -----------
   Total assets                               $     65,355  $     44,718

 Current liabilities                          $     98,108  $     99,704
 Long-term debt                                    607,000       472,000
 Member's equity                                  (639,753)     (526,986)
                                               -----------   -----------
   Total liabilities and equity               $     65,355  $     44,718

 Revenue                                      $          -  $          -
                                               -----------   -----------
 Net income (loss)                            $   (112,767) $   (628,522)
                                               ===========   ===========

NOTE 7 - STOCK OFFERING AND COMMON STOCK TRANSACTIONS

On December 31, 1997, the Company successfully completed a public offering of
400,000 shares of its $.001 par value common stock for $400,000 less offering
costs of $40,000.

During March and April 1999, the Company completed a private placement of
400,000 units consisting of one share of restricted Common Stock at $.50 per
share and one Warrant for one Share of restricted Common Stock exercisable at
$1.00 per share.  The Warrants expire March and April of 2002.  Direct costs
of the offering were $1,638.  During December 1999, the Company completed a
second private placement of 120,000 Units consisting of one share of
restricted Common Stock at $1.00 per share and one Warrant for one Share of
restricted Common Stock exercisable at $1.00 per share.  All unexercised
Warrants had expired at December 31, 2002.  The Units were sold to Officers
and Directors of the Company.

Also during 1999, the Company issued a total of 14,000 shares of its common
stock to a vendor to pay for services rendered at a value of $52,000 and
15,000 common shares to pay for royalties owed by the LLC which were valued at
$45,000.  The Company had a Stock Subscription receivable of $50,000 connected
with the private placement of its Common Stock in December 1999.  During the
year ended December 31, 2000, the $50,000 was received and the subscription
receivable was satisfied.


<PAGE>
<PAGE> 33

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 - STOCK OFFERING AND COMMON STOCK TRANSACTIONS (continued)

In July 2000, the Company successfully completed a private placement offering
of 110,000 units at $4.00 per unit, consisting of one common shares and one
common share warrant, (exercise price $6.00 and expire July 11, 2002), of its
$.001 par value common stock for $440,000 less offering costs of $42,030, for
a net of $397,970.  All unexercised Warrants had expired at December 31, 2002.

On January 22, 2001, the Company completed a subscription agreement for a
private placement of 150,000 units at $4.00 per unit, each unit consisting of
one unit of common stock and one warrant to purchase one share of stock at an
exercise price of $6.00, exercisable for two years from the date of issuance.
The total subscription price was $600,000 and was paid by the issuance of a
promissory note for the same amount.  The note was to be paid in monthly
installments of $50,000; $50,0000; $50,000; $100,000 $150,000 and $200,000 at
the end of each month starting February 2001.

The note was unsecured and carried no interest and was subject to prepayment.
The shares under the subscription would be held in escrow until the note was
satisfied.  As of March 31, 2001, the subscription receivable had a balance of
$550,000.  In connection with the private placement, the Company was to pay a
finder's fee to an individual consisting of 15,000 shares of restricted common
stock and a warrant to purchase up to 15,000 shares of common stock on the
same terms as the above private placement.  In June 2001, the Company
cancelled the subscription agreement for nonpayment in the amount of $550,000.
A total of 13,750 shares were issued under agreement for payments prior to the
cancellation.  Of the 13,750 shares issued, 1,250 shares that were issued
represented the finder's fee.  The recipient of the finder's fee subsequently
became an officer of the Company.  Direct costs of this private placement were
$5,000.

During October and November 2001, the Company completed two separate private
placements of its common stock.  Under the October private placement, it sold
356,000 shares of common stock at $1.00 per share for $356,000.  Under the
November private placement, it sold 161,000 shares of common stock at $2.50
for $402,500.  Direct costs associated with these private placements were
$6,512.

During February, October and November of 2001, 110,000 warrants were exercised
at $1.00 per shares for a total amount of $110,000.  Of this amount, $10,000
was received in the year 2000 and was treated as a deferred liability for that
year.  Consideration for 20,000 of the above warrants exercised was provided
by services rendered to the Company by an officer and stockholder.


<PAGE>
<PAGE> 34

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 - STOCK OFFERING AND COMMON STOCK TRANSACTIONS (continued)

During October 2001, an officer and director of the Company was issued 100,000
shares of common stock valued at $150,000.  During December 2001, another
officer of the Company was issued 10,000 shares of common stock valued at
$33,000.  During October 2001, a vendor was issued 100,000 shares of common
stock for services to be rendered per an agreement between the vendor and the
Company.  The shares issued were valued at $190,000.

During March, April and June of 2002, 192,500 warrants were exercised at $1.00
per share for a total amount of $192,500.  Of this amount $90,000 was
exercised for cash, $40,000 was a subscription that was subsequently paid, and
$62,500 was exercised as compensation to certain officers and directors of the
Company.  During March 2002, 50,000 shares were issued upon exercise of the
same number of $1.00 options as compensation to a director of the Company.
During December 2002, 24,031 shares of Common stock were issued to a
consultant as payment for services rendered.  The shares were issued at a fair
market value of $2.60 per share for a total compensation of $62,480.

The Board of Directors of the Company approved a private placement of up to
800,000 units priced at $1.90 per unit, each unit consisting of one share of
restricted common stock and one warrant for the purchase of restricted common
stock at $2.50 per share exercisable for two years.  During March of 2003, the
Company sold 110,000 units of the private placement for $209,000.

During August 2003, the Company issued an officer and director 100,000 shares
of common stock valued at $46,000.  Also, during August 2003, the Company
issued another officer and director 50,000 shares of common stock valued at
$23,000.  The 150,000 shared were issued for services rendered to the Company.
The shares were issued at a fair value of $0.46 per share for a total
compensation of $69,000.

During September 2003, the Company completed a private placement of its common
stock.  Under the September private placement, it sold 200,000 shares of
common stock at $0.50 per share for $100,000.

NOTE 8 - STOCK OPTIONS AND WARRANTS

The Company's president agreed to perform services on behalf of the Company
for no compensation.  To provide incentive for such services, the Board of
Directors agreed on August 1, 1997 to grant an option to purchase 100,000
shares of the Company's common stock at $1 per share.  Of these options 50,000
have expired and 50,000 were exercised at December 31, 2002.


<PAGE>
<PAGE> 35

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 - STOCK OPTIONS AND WARRANTS (continued)

Pursuant to an employment agreement the President was also issued in June of
1999, 150,000 shares of common stock and warrants.  The common stock was
valued at $.50 for compensation of $75,000 and the warrants can be exercised
at $1.00 per share.  The transaction was concurrent with the March 1999
Private Placement of the Company's common stock.  The warrants were all
exercised at December 31, 2002.

During the years ended December 31, 2002 and 2001, the Company issued to
employees options for 75,000 and 25,000 shares of common stock at $2.45 and
$1.50 per share, respectively, under a Stock Option and Award Plan authorized
by the Board of Directors and approved by shareholders on May 15, 2000.  A
maximum of 150,000 options to purchase common stock can be issued under the
plan.

Issuance of the options is at the discretion of the management of the Company.
The 75,000 shares vest immediately upon issuance and expire June 26, 2005.
The 25,000 shares vest immediately upon issuance and expire October 5, 2004.
Under the option plan the exercise price of incentive based options is equal
to the market price of the Company's stock on the date of the grant.

During 2003, the Company issued options for 15,875 shares of common stock at
$2.00 per share under a Stock Option and Award Plan authorized by the Board of
Directors on April 1, 2003.  The options vest immediately and expire on
December 31, 2006.  A total of 350,000 shares of stock may be issued under the
plan.  The exercise price and the term of each option shall be determined by
the Board of Directors; however, in no event may an option have a term in
excess of six years.

As of December 31, 2003, the Company had option outstanding under the Plans as
well as from other individual grants.  Information regarding the Options is as
follow:

                                                Number of    Option Price
                                                 Options      Per Share
                                               -----------   -----------
 Outstanding at January 1, 2002                  135,000    $1.00 - $3.00
  Granted                                         90,875    $2.00 - $2.45
  Exercised                                      (50,000)        1.00
  Forfeited                                            -            -
  Expired                                       (135,000)   $1.00 - 2.45
                                               -----------   -----------
 Outstanding at December 31, 2003                 40,875    $1.50 - $3.00

Options available for future grant at December 31, 2003 was 334,125 under the
2003 Stock Option and Award Plan and 125,000 under the 2000 Stock Option and
Award Plan.


<PAGE>
<PAGE> 36

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 - STOCK OPTIONS AND WARRANTS (continued

The Company has adopted the disclosure-only provisions of Statement of
Financial Accounting Standards (SFAS) No. 123, "Accounting for Stock Based
Compensation".  Accordingly, no compensation cost had been recognized in the
financial statements.  Had compensation cost for the Company's stock option
plans been determined based on the fair value at the grant date for awards in
2003 and 2002, consistent with SFAS No. 123, the Company's net earnings per
share would have reduced to the pro forma amounts indicated below:

                                                 For the Years Ended
                                                      December 31,
                                                   2003          2002
                                               -----------   -----------
Net loss - as reported                        $   (437,644) $   (922,380)
Net loss - proforma                           $   (443,066) $ (1,060,880)
Loss per share - as reported                  $       (.10) $       (.21)
Loss per share - pro forma                    $       (.10) $       (.25)

The fair market value of each option grant is estimated at the date of grant
using the Black-Scholes option pricing model with the following assumptions
for the years ended December 31, 2003 and 2002, respectively.  Expected
dividend yield $-0-; expected stock price volatility 80% and 100%,
respectively; risk-free interest rate 3.25%; and expected life of options 3
years and 3.8 years, respectively.

The following table summarizes information about stock options outstanding at
December 31, 2003:

                             Weighted
                Number       Average     Weighted      Number     Weighted
  Range of  Outstanding at  Remaining    Average   Exercisable at  Average
  Exercise    December 31, Contractual   Exercise    December 31, Exercise
    Price         2003        Life         Price         2003       Price
 -----------  -----------  -----------  -----------  -----------  -----------
 $      1.50       15,000   0.76 years  $      1.50       15,000  $      1.50
 $      2.00       15,875   3.00 years  $      2.00       15,875  $      2.00
 $      3.00       10,000   2.01 years  $      3.00        3,333  $      3.00
 -----------  -----------  -----------  -----------  -----------  -----------
 $1.50-$3.00       40,875   1.58 years  $      2.24       34,208  $      1.88
 ===========  ===========  ===========  ===========  ===========  ===========

The weighted average fair value of options issued during 2003 was $2.00.


<PAGE>
<PAGE> 37

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 - STOCK OPTIONS AND WARRANTS (continued)

The following table summarizes changes in outstanding warrants during the
years ended December 31, 2003 and 2002:

                                                                 Price
                                    Shares         Shares        Range
                                  -----------   -----------   -----------
Outstanding at December 31, 2001      548,750
 Issued                                     -
 Expired                             (277,500)                $5.00 - $6.00
 Exercised                           (192,500)                $1.00 - $1.00
                                  -----------   -----------   -----------
Outstanding at December 31, 2002       78,750
Exercisable at December 31, 2002                     78,750   $4.50 - $6.00

                                                                 Price
                                    Shares         Shares        Range
                                  -----------   -----------   -----------
Outstanding at December 31, 2002       78,750                 $4.50 - $6.00
 Issued                               110,000                     $2.50
 Expired                               13,750                     $6.00
 Exercised                                  -
                                  -----------   -----------   -----------
Outstanding at December 31, 2003      175,000
Exercisable at December 31, 2003                    175,000   $2.50 - $4.50


The above warrants expire between the dates of February 19, 2005 to December
11, 2006.

NOTE 9 - INCOME TAXES

Due to losses at December 31, 2003 and 2002, the Company had no income tax
liability and thus no provision for taxes was recorded.  The Company had a
deferred tax benefit of $2,479 derived from the amortizing of organization
costs for tax reporting and expensing of organization costs for financial
reporting purposes.  At December 31, 2003, the Company has a net operating
loss carryforward of approximately $3,183,497 which will expire between the
years 2012 and 2022.  A valuation allowance of $955,050 has been established
for those tax credits which are not expected to be realized.  The change in
the valuation allowances for 2003 was $21,460.

The Subsidiary which is a Limited Liability Company is not a tax paying entity
for Federal or State income tax purposes and, thus, no income tax expense has
been recorded.  Instead, its earnings and losses since the merger are included
in the Parent Company's income tax return.


<PAGE>
<PAGE> 38

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 - DEVELOPMENT STAGE COMPANY AND GOING CONCERN

The Company and its subsidiary are development stage companies as defined in
Financial Accounting Standards Board Statement No. 7.  They have yet to
commence full-scale business operations.  From inception through the date of
these financial statements, the Company and its Subsidiary did not have any
net income from operations.  At the current time, the Company has a deficit
accumulated during the development stage of $3,183,497.

Accordingly, the entity's ability to accomplish its business strategy and to
ultimately become profitable is at this time dependent on the success of its
subsidiary's future ability to generate significant revenue and to ultimately
achieve profitable operations.  At present most of the capital the Company has
obtained has been loaned to the subsidiary or prior joint venture.  There can
be no assurance that the Company will be able to obtain additional funding
and, if available, that the funding will be obtained on terms favorable to or
affordable or in adequate amounts needed to complete its current business plan
with its subsidiary.  The Company's management is exploring all of its options
so that if can successfully develop successful operations around its business
plan.  Ultimately, however, the Company will need to achieve profitable
operations in order to continue as a going concern.

NOTE 11 - AGREEMENTS AND COMMITMENTS

On October 11, 2001, the Company entered into a research services contract
with a partnership called The Investor Online ("TIO").  The Company paid
$35,000 upon the execution of the contract and issued to the vendor 100,000
shares of restricted common stock under a subscription agreement.  The shares
were valued at $190,000 at the time of the execution of the contract.  The
term of the contract is for one (1) year.  The Company authorized the cost of
the contract over 12 months and the balance of the unamortized and unearned
cost of the contract was treated as a subscription receivable and for
financial statement purposes was treated as a reduction of stockholders'
equity.  In March of 2002, the Board of Directors determined that the vendor's
performance under the contract was deficient and resolved to seek the return
of the shares issued in connection with the contract.  The Company has now
retained legal counsel to pursue a civil action against TIO.  Legal counsel
filed a complaint on behalf of the Company in the United States District Court
for the District of Utah on September 30, 2002.

TIO contested jurisdiction in Utah through a Motion to Dismiss.  The court has
not ruled on the Motion and has granted the Company until May 15, 2003 to
conduct discovery concerning TIO's contacts with Utah.  TIO has not asserted
any counterclaim against the Company.  Negotiations have been conducted with
TIO's counsel regarding the possible settlement of the Company's claims.
Legal counsel believes that no evaluation of the likelihood of a favorable
outcome or possible recovery can be made at this time.


<PAGE>
<PAGE> 39

POWERBALL INTERNATIONAL, INC., AND SUBSIDIARY
(Development Stage Companies)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12- OTHER EVENTS

In connection with the preparation of the quarterly report of the Company on
Form 10-QSB for the period ending March 31, 2003 to be filed with the
Securities and Exchange Commission, certain accounting irregularities were
discovered.  In connection with its review, the Company has accepted the
resignation of William Freise, the Company's President, as an officer and as a
director.

During the second quarter of fiscal 2002, Mr. Freise exercised certain
warrants for the purchase of 40,000 shares of the Company's common stock.  Mr.
Freise received the shares but never paid the $40,000 exercise price.
Subsequently, in the fourth quarter of fiscal 2002, Mr. Freise used $7,200 of
the Company's funds for personal expenses without authorization for the
Company.  This matter caused the cash on the original financial statements to
be overstated by $47,200.  Since Mr. Freise, as of May 22, 2003, has repaid
the company the $40,000 for the common stock purchased and the $7,200 for
personal expenses (see the following paragraph), the amounts are shown as
current assets on the balance sheet at December 31, 2002.  The $40,000 is
shown as a common stock subscription receivable and the $7,200 is shown as an
officer receivable.  This matter had no effect on the net loss amount, the
total assets amount, or the total liabilities and stockholders' equity
amounts.  The change is to cash, officer receivable, and subscription
receivable amounts in current assets but the total current assets amount
remained unchanged from amounts of the originally issued financial statements
of the Company at December 31, 2002.

On April 30, 2003, Mr. Freise paid $20,000 into the Company's account as
partial restitution of the above amounts.  On May 22, 2003, the Company signed
a Settlement and Release Agreement with Mr. Freise accepting the $20,000 cash
repayment, plus the wire transfer to the Company's account of an additional
$27,200 representing the balance owed by Mr. Freise to the Company.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>3
<FILENAME>f03dex31.txt
<DESCRIPTION>03DEC PRIN EXEC AND FIN 302 CERT
<TEXT>
Exhibit 31

SECTION 302 CERTIFICATION

CERTIFICATION

I, Robert K. Ipson, certify that:

1. I have reviewed this annual report of Powerball International, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the small
business issuer as of, and for, the periods presented in this report;

4. The small business issuer's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
small business issuer and have:
 (a) designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the small business issuer,
including its consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this report is being
prepared;
 (b) evaluated the effectiveness of the small business issuer's disclosure
controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
 (c) disclosed in this report any change in the small business issuer's
internal control over financial reporting that occurred during the small
business issuer's most recent fiscal quarter (the small business issuer's
fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the small business
issuer's internal control over financial reporting; and

5. The small business issuer's other certifying officer(s) and I have
disclosed, based on our most recent evaluation of internal control over
financial reporting, to the small business issuer's auditors and the audit
committee of the small business issuer's board of directors (or persons
performing the equivalent functions):
 (a) all significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the small business issuer's ability to record,
process, summarize and report financial information; and
 (b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the small business issuer's internal
control over financial reporting.

Date: April 5, 2004

/s/Robert K. Ipson
Robert K. Ipson, Chief Executive Officer and Chief Financial Officer

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>4
<FILENAME>f03dex32.txt
<DESCRIPTION>03DEC PRIN EXEC AND FIN 906 CERT
<TEXT>
Exhibit 32

SECTION 906 CERTIFICATION

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the annual report of Powerball International, Inc. (the
"Company") on Form 10-KSB for the year ended December 31, 2003, as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), I,
Robert K. Ipson, Chief Executive Officer and Chief Financial Officer of the
Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my
knowledge and belief:

 (1) the Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and

 (2) the information contained in the Report fairly presents, in all material
respects, the financial condition and result of operations of the Company.


/s/ Robert K. Ipson
Robert K. Ipson, Chief Executive Officer and Chief Financial Officer

Date: April 5, 2004


A signed original of this written statement required by Section 906, or other
document authenticating, acknowledging, or otherwise adopting the signature
that appears in typed form within the electronic version of this written
statement has been provided to the Company and will be retained by the Company
and furnished to the Securities and Exchange Commission or its staff upon
request.

</TEXT>
</DOCUMENT>
</SUBMISSION>
