UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

FORM 10-QSB

(Mark One)
[X] QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended: March 31, 2002

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________ to __________

Commission file number: 0-5418

Walker International Industries, Inc.
(Exact name of small business issuer as specified in its charter)

Delaware 13-2637172
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)

370 Old Country Road
Garden City, New York 11530
(Address of principal executive offices)

(516) 746-4141
(Issuer's telephone number)

Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: There were a total of 684,828
shares of the registrant's common stock, par value $.10 per share, outstanding
as of May 17, 2002.

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]

Walker International Industries, Inc.

Quarterly Report on Form 10-QSB
Quarter Ended March 31, 2002

Table of Contents

Page
PART I - FINANCIAL INFORMATION

Item 1. Financial Statements:

Condensed Consolidated Balance Sheet (Unaudited) as of March 31, 2002............................. 3
Condensed Consolidated Statements of Operations (Unaudited) for the Three Months
Ended March 31, 2002 and 2001.................................................................. 4
Condensed Consolidated Statement of Stockholders' Equity
(Unaudited) for the Three Months Ended March 31, 2002.......................................... 5
Condensed Consolidated Statements of Cash Flows (Unaudited) for the Three Months
Ended March 31, 2002 and 2001.................................................................. 6
Notes to Condensed Consolidated Financial Statements.............................................. 7
Item 2. Management's Discussion and Analysis or Plan of Operation................................... 13

PART II - OTHER INFORMATION
Item 1. Legal Proceedings........................................................................... 16
Item 2. Changes in Securities....................................................................... 16
Item 3. Defaults Upon Senior Securities............................................................. 17
Item 4. Submission of Matters to a Vote of Security Holders......................................... 17
Item 5. Other Information........................................................................... 17
Item 6. Exhibits and Reports on Form 8-K............................................................ 19

Signatures........................................................................................... 20

Exhibit Index........................................................................................ 21

PART II. FINANCIAL INFORMATION

Item 1. Financial Statements.

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)

March 31,
2002
ASSETS -------------------
Current assets -

Cash and cash equivalents............................................................... $ 452,669
Accounts receivable..................................................................... 154,718
Inventories............................................................................. 42,000
Prepaid expenses and other current assets............................................... 19,317
--------------------
Total current assets................................................................. 668,704
--------------------
Property and equipment, net................................................................ 411,464
Other assets -
Other assets............................................................................ 16,610
Intangibles - customer list, net........................................................ 360,580
--------------------
Total assets....................................................................... $ 1,457,358
====================

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities -
Accounts payable and accrued expenses................................................... $ 314,064
Customer deposits....................................................................... 1,200
--------------------
Total current liabilities............................................................ 315,264
--------------------
Other liabilities -
Long-term debt.......................................................................... 165,315
--------------------
Total liabilities.................................................................... 480,579
--------------------
Stockholders' equity -
Common stock, $.10 par value, authorized 1,000,000 shares,
684,828 shares issued and outstanding................................................ 68,482
Additional paid-in capital.............................................................. 3,575,978
Accumulated deficit..................................................................... (2,667,681)
--------------------
Total stockholders' equity........................................................... 976,779
--------------------

Total liabilities and stockholders' equity......................................... $ 1,457,358
====================

See notes to condensed consolidated financial statements

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

Three Months Ended
March 31,
---------------------------------------------
2002 2001
---------------------- --------------------

Net sales......................................................................... $ 198,269 --
Costs of sales ................................................................... 42,251 --
--------------------- --------------------
Gross profit................................................................... 156,018 --
Operating expenses................................................................ 269,404 $ 131,831
--------------------- --------------------
Operating loss................................................................. (113,386) (131,831)
Interest expense.................................................................. (11,247) (11,700)
--------------------- --------------------
Loss before extraordinary item................................................. (124,633) (143,531)
Extraordinary item................................................................ 158,690 --
--------------------- --------------------
Net income (loss)........................................................... $ 34,057 $ (143,531)
===================== ====================

Per share data - basic and diluted
Loss before extraordinary item................................................. $ (0.31) $ (0.63)

Extraordinary item............................................................. 0.39 --
--------------------- --------------------

Net income (loss) per common share............................................. $ 0.08 $ (0.63)
===================== ====================
Weighted average number of common shares outstanding........................... 403,490 225,437
===================== ====================

See notes to condensed consolidated financial statements

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(Unaudited)

Common Stock
--------------------------------- Additional
Par Value Paid-In Accumulated
Shares $0.10 Capital Deficit Total
--------------- --------------- --------------- --------------- -------------

BALANCE - January 1, 2002, as previously
reported................................. 7,374,398 $ 73,744 $ 2,040,873 $ (2,701,738) $ (587,121)
Conversion of shares pursuant to merger
(See Note 1).......................... (7,110,948) (47,399) 47,399 -- --
--------------- --------------- --------------- --------------- --------------
BALANCE - January 1, 2002, restated......... 263,450 26,345 2,088,272 (2,701,738) (587,121)

Sale of common stock..................... 6,443 644 59,356 -- 60,000
Accrued wages contributed pursuant to
merger (See Note 1)................... -- -- 304,025 -- 304,025
Common stock issued as payment of
accrued salaries...................... 2,680 268 56,584 -- 56,852
Common stock issued for the acquisition
of ADS................................ 183,984 18,398 476,519 -- 494,917
Outstanding common stock of Walker
International Industries, Inc......... 228,271 22,827 591,222 -- 614,049
Net income............................... -- -- -- 34,057 34,057
--------------- --------------- --------------- --------------- ---------------
BALANCE at March 31, 2002................... 684,828 $ 68,482 $ 3,575,978 $ (2,667,681) $ 976,779
=============== =============== =============== =============== ===============

See notes to condensed consolidated financial statements

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
----------------------------------------------
2002 2001
----------------------- --------------------
CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss)................................................................. $ 34,057 $ (143,531)
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities -
Extraordinary item............................................................. (158,690) --
Depreciation and amortization.................................................. 11,933 916
Accrued interest............................................................... 9,450 6,059
Changes in operating assets and liabilities -
Accounts receivable......................................................... (9,959) --
Inventories................................................................. 4,313 --
Prepaid expenses and other current assets................................... 96,957 410
Other assets................................................................ 1,135 --
Accounts payable and accrued expenses....................................... 43,364 129,475
--------------------- --------------------
Total adjustments......................................................... (1,497) 136,860
-------------------- --------------------
Net cash provided by (used in) operating activities....................... 32,560 (6,671)
--------------------- --------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash proceeds from merger transaction......................................... 472,209 --
--------------------- --------------------
Net cash provided by investing activities................................. 472,209 --
--------------------- --------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Principal repayment of notes payable.............................................. (175,000) --
Proceeds from notes payable....................................................... 80,000 --
Proceeds from sale of common stock................................................ 60,000 --
Repayment of due to stockholder................................................... (17,100) --
--------------------- --------------------
Net cash provided by financing activities................................. (52,100) --
--------------------- --------------------

Net increase (decrease) in cash and cash equivalents.............................. 452,669 (6,671)
Cash and cash equivalents - beginning............................................. -- 6,671
--------------------- --------------------
Cash and cash equivalents - ending................................................ $ 452,669 $ --
===================== ====================

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the periods for:
Interest....................................................................... $ -- $ --
===================== ====================
Taxes $...................................................................... -- $ --
===================== ====================

See notes to condensed consolidated financial statements

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2002
(Unaudited)

NOTE 1 - Merger and Organization of Entities

On March 19, 2002, effective as of March 1, 2002, Walker International
Industries, Inc. and subsidiaries (the "Company" and or "Walker") (which
operates in the film processing industry through its wholly-owned subsidiary,
Kelly Color, Inc. ("Kelly")), acquired, all of the issued and outstanding common
stock of American DataSource, Inc. ("ADS") and National Preplanning, Inc.
("NPI"), through a series of simultaneous mergers.

In the merger with ADS, the Company, issued to James N. Lucas, Sr., the sole
stockholder of ADS, 183,984 shares of common stock, and $325,000 in cash. In
addition, the Company issued 18% subordinated promissory notes to the sole
stockholder of ADS and his assignees in the aggregate principal amount of
$500,000 due November 30, 2002. These notes are being held in escrow pending the
completion of a certain acquisition (as defined). If the acquisition is not
completed by September 30, 2002, the notes will be canceled. ADS provides trust
administrative services to independent funeral homes, state master trusts and
companies that own funeral homes or cemeteries for pre-need funeral and cemetery
trust accounts.

In the merger with NPI, we issued to the stockholders of NPI a total of 272,573
shares of common stock. In addition, the Company issued 18% subordinated
promissory notes in the aggregate principal amount of $750,000, due November 30,
2002. These notes are being held in escrow pending the completion of a certain
acquisition (as defined). If the acquisition is not completed by September 30,
2002, the notes will be canceled. Mitchell Segal, the president, chief executive
officer, and the owner of approximately 67.5% of the outstanding shares of NPI,
received 183,967 of the shares of common stock and $506,221 principal amount of
the notes. Mr. Segal also agreed to forego $304,000 of unpaid salary. NPI, which
was a development stage company through February 28, 2002, is a managing general
insurance agency and third party marketer of prearranged death care services to
corporations, unions and affinity groups.

The Company has agreed to register a total of 91,308 shares of common stock that
was issued in the ADS and NPI acquisitions for resale by the former stockholders
of ADS and NPI. Such 91,308 shares represent approximately 20% of the shares of
common stock that were issued in the two acquisitions.

The mergers were accounted for as purchase transactions, pursuant to the
guidance of Staff Accounting Bulltein Topic 2a issued by the Securities and
Exchange Commission (the "SEC"), whereby NPI not Walker was the accounting
acquirer. The historical financial statements prior to March 1, 2002 are those
of NPI.NPI has established a new basis for Walker and ADS assets and liabilities
based upon an allocation of the fair value of the merger. The Subordinated
Promissory Notes are considered contingent consideration and will be recorded
when the contingency is resolved. The condensed consolidated financial
statements reflect the Registrant's best estimate

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2002
(Unaudited)
(Continued)

at the date of the mergers. Such estimate may be subject to adjustment in
the near term. The adjustments to reflect the fair values of the assets and
liabilities of ADS and Walker acquired by NPI in the merger transactions are as
follows:

American DataSource, Inc.

Number of shares of common stock issued.......................................................... 183,984
Per share fair value of stock issued............................................................. $ 2.69
------------------
Fair value of common stock ...................................................................... $ 494,917

Cash ............................................................................................ 325,000
------------------
Total purchase price........................................................................ $ 819,917
==================

Fair value of net assets acquired -
Current assets................................................. $ 293,446
Property and equipment......................................... 401,933
Intangibles - customer list.................................... 371,597
Liabilities assumed............................................ (247,059)
------------------
Fair value of net assets acquired................................................. $ 819,917
==================

Walker International Industries, Inc.
Number of shares of common stock outstanding..................................................... 228,271
Per share fair value of stock outstanding (i).................................................... $ 2.69
Fair value of common stock....................................................................... 614,049
Merger costs..................................................................................... 55,000
-----------------
Total purchase price........................................................................ $ 669,049
==================

Fair value of net assets acquired -
Current assets................................................. $ 866,110
Property and equipment (ii).................................... --
Other assets (ii).............................................. --
Liabilities assumed............................................ (38,371)
------------------
Fair value of net identifiable assets acquired.................................... $ 827,739
Negative goodwill (iii)........................................................... (158,690)
------------------
$ 669,049
==================

(i) The number of shares of common stock outstanding is net of
249,539 shares of treasury stock which were retired as a part
of the merger transactions.

(ii) The excess of fair value of net assets acquired over the purchase
price was allocated first to reduce property and equipment and
other assets to zero, then to negative goodwill.

(iii) Negative goodwill was immediately reflected as an extraordinary
gain in the condensed consolidated statements for the three
months ended March 31, 2002.

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2002
(Unaudited)
(Continued)

The pro forma unaudited condensed consolidated results of operations for the
three months ended March 31, 2002, as if the mergers occurred on January 1,
2002, are as follows:

Pro forma
--------------------

Net sales................................................................................................ $ 558,816
Cost of sales............................................................................................ 163,543
--------------------
Gross profit.......................................................................................... 395,273
Operating expenses....................................................................................... 533,912
-------------------
Operating loss........................................................................................ (138,639)

Extraordinary item....................................................................................... 297,068
-------------------
Net income............................................................................................ $ 158,429
====================

Basic and diluted net loss per common share.............................................................. $ 0.23
====================

Weighted average number of common shares outstanding..................................................... 684,828
====================

This pro forma information does purport to be indicative of what would have
occurred had the mergers been completed as of January 1, 2002 or results which
may occur in the future.

Subsequent to the mergers, the Company changed its fiscal year end from November
30th to December 31st to correspond with the fiscal year end of NPI.

NOTE 2 - Basis of Presentation

Basis of Presentation

The condensed consolidated balance sheet of the Company as of March 31, 2002,
the related statements of operations, and cash flows for the three months ended
March 31, 2002 and March 31, 2001 include the operations of NPI for the three
months ended March 31, 2002 and 2001, and the one-month ended March 31, 2002 for
both Walker and ADS. The condensed consolidated financial statements have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations. In the opinion of management, the
accompanying condensed consolidated financial statements include all adjustments
(consisting of normal, recurring adjustments) necessary to summarize fairly the
Company's financial position and results of operations. The results of
operations for the three months ended March 31, 2002 are not necessarily
indicative of the results

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2002
(Unaudited)
(Continued)

of operations for the full year or any other interim period. These
financial statements should be read in conjunction with the audited financial
statements and notes thereto included in the Company's Annual Report on Form
10-KSB for the year ended November 30, 2001, the Company's Quarterly Report on
Form 10-QSB for the three months ended February 28, 2002 and the Company's
Current Report on Form 8-K (Date of Report: March 19, 2002), which Form 8-K
includes historical financial statements of NPI and ADS, as filed with the SEC.

NOTE 3 - Selected Significant Accounting Policies

Earnings Per Share

The Company adopted the provisions of Statement of Financial Accounting
Standards ("SFAS") No. 128, "Earnings per Share." SFAS No. 128 requires the
presentation of basic and diluted Earnings Per Share ("EPS"). Basic EPS is
computed by dividing income available to common stockholders by the
weighted-average number of common shares outstanding for the period. Diluted EPS
includes the potential dilution that could occur if options or other contracts
to issue common stock were exercised or converted. The effect of the shares
issued in the NPI merger transaction on the Company has been given retroactive
application in the earnings per share calculation. The Company's outstanding
warrants are out-of-the-money and are not reflected in diluted earnings per
share. Accordingly, basic and diluted earnings per share are identical.

New Accounting Pronouncements

In July 2001, the Financial Accounting Standards Board ("FASB") issued SFAS No.
141, "Business Combinations," and SFAS No. 142, "Goodwill and Other Intangible
Assets." SFAS No. 141 requires the use of the purchase method of accounting for
business combinations initiated after June 30, 2001, and eliminates the
pooling-of-interests method. SFAS No. 142 requires, among other things, the use
of a non-amortization approach for purchased goodwill and certain intangibles.
Under a non-amortization approach, goodwill and certain intangibles will not be
amortized in earnings, but instead will be reviewed for impairment at least
annually.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets," which supercedes SFAS No. 121, "Accounting for
the Impairment of Long-lived Assets and for Long-Lived Assets to Be Disposed
Of." SFAS No. 144 retains the fundamental provisions of SFAS No. 121 but sets
forth new criteria for asset classification and broadens the scope of qualifying
discontinued operations.

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2002
(Unaudited)
(Continued)

The Company implemented these standards effective January 1, 2002 and they
resulted in an extraordinary gain of $158,690, pursuant to the acquisition of
the Company by NPI (Note 1).

Intangibles
- -----------

Intagibles consist of a customer list obtained in the merger with ADS. The
customer list was recorded at its estimated fair value at the merger date and is
being amortized using the greater of the income forecast method or straight-line
method over its estimated useful life of three years.

NOTE 4 - Stockholders' Equity

During the three months ended March 31, 2002, the Company issued 6,443 shares
of its Common Stock to an investor in a separate private equity transaction
resulting in total proceeds of $60,000.

During the three months ended March 31, 2002, the Company issued 2,680 shares of
common stock as settlement of $56,852 of accrued wages.

NOTE 5 - Commitment and Contingencies

Litigation

The Company is involved in litigation through the normal course of business. The
Company believes that the resolution of these matters will not have a material
adverse effect on the financial position of the Company.

Commitments

The Company has entered into an employment agreement with Mitchell Segal to
serve as the Company's president and chief executive officer through December
31, 2005. Under Mr. Segal's employment agreement, the Company will pay Mr. Segal
an annual base salary of $200,000 for 2002, with annual increases of not less
than $10,000, plus a bonus equal to a minimum of 3% to a maximum of 5% of the
gross proceeds received from equity financings and a minimum of 3% to a maximum
of 7.5% of the Company's net income, provided the Company's net income is at
least $500,000. The bonus is payable through 2008, even if Mr. Segal's
employment with the Company is terminated by the Company except in the event the
termination is for cause. In no

WALKER INTERNATIONAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2002
(Unaudited)
(Continued)

event may the bonuses due Mr. Segal exceed an aggregate of $304,025. Mr.
Segal also is entitled to discretionary bonuses, if any, awarded by the
Company's board of directors.

The Company also has entered into an employment agreement with Peter Walker to
serve as president of the Company's Kelly Color Laboratories, Inc. subsidiary
through March 18, 2012. Under Mr. Walker's employment agreement, the Company
will pay Mr. Walker an annual base salary of $100,000, plus a monthly
non-accountable expense allowance of $1,000. Mr. Walker's employment agreement
does not require Mr. Walker to devote a minimum number of hours to the business
of Kelly Color. Mr. Walker's employment agreement does require the Company to
use the Company's best efforts to cause Mr. Walker to be nominated for election
to the Company's board of directors during the term of Mr. Walker's employment
agreement.

NOTE 6 - Segment Reporting

Commencing March 1, 2002, the Company began classifying its operations into two
business segments: (a) the administrative services to independent funeral homes,
state master trusts and companies that own funeral homes or cemeteries for
pre-need funeral and cemetery accounts and (b) film processing. Information
concerning the Company's business segments is as follows:

2002
Segment
------------------------------------
(a) (b) Total
------------- ------------- --------------

Revenue................................................... $ 136,310 $ 61,959 $ 198,269
Loss before extraordinary item............................ (113,173) (11,460) (124,633)
Total identifiable assets at March 31, 2002............... 653,830 803,528 1,457,358

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

Throughout this Current Report on Form 10-QSB, the terms "we," "us," "our" and
"our company" refers to Walker International Industries, Inc. ("Walker") and,
unless the context indicates otherwise, includes Walker's wholly-owned
subsidiaries, National Preplanning, Inc. ("NPI"), American DataSource, Inc.
("ADS") and Kelly Color, Inc. ("Kelly").

Introductory Comment - Forward-Looking Statements.

Statements contained in this report include "forward-looking statements" within
the meaning of such term in Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-looking statements
involve known and unknown risks, uncertainties and other factors which could
cause actual financial or operating results, performances or achievements
expressed or implied by such forward-looking statements not to occur or be
realized. Such forward-looking statements generally are based on our best
estimates of future results, performances or achievements, predicated upon
current conditions and the most recent results of the companies involved and
their respective industries. Forward-looking statements may be identified by the
use of forward-looking terminology such as "may," "will," "could," "should,"
"project," "expect," "believe," "estimate," "anticipate," "intend," "continue,"
"potential," "opportunity" or similar terms, variations of those terms or the
negative of those terms or other variations of those terms or comparable words
or expressions. Potential risks and uncertainties include, among other things,
such factors as:

o the results our business strategies and future plans of operations,

o our ability to integrate our recent mergers of ADS and NPI into our
business and administrative operations,
o our ability to obtain stockholder approval for the issuance of shares to
permit the conversion of promissory notes we issued in connection with the
merger transactions,
o general economic conditions in the United States and elsewhere, as well as
the economic conditions affecting the industries in which we operate,
o our historical losses,
o the decline in sales by our Kelly subsidiary due to the rising use of
digital cameras,
o the competitive environments within the photographic development, funeral
home administrative services and pre-arranged death care services
industries,
o our ability to raise additional capital, if and as needed,
o the cost-effectiveness of our product and service development activities,
o political and regulatory matters affecting the industries in which we
operate,
o our ability to combine our various operations so that they may work
together and grow successfully,
o the market acceptance, revenues and profitability of our current and future
products and services,
o the extent that our sales network and marketing programs achieve
satisfactory response rates, and
o the other risks detailed in this Quarterly Report on Form 10-QSB and, from
time to time, in our other filings with the Securities and Exchange
Commission.

Readers are urged to carefully review and consider the various disclosures made
by us in this Form 10-QSB, our Current Reports on Form 8-K (Date of Reports:
March 19, 2001 and May 14, 2002), our Annual Report on Form 10-KSB for the year
ended November 30, 2001 and our other filings with the SEC. These reports
attempt to advise interested parties of the risks and factors that may affect
our business, financial condition and results of operations and prospects. The
forward-looking statements made in the Form 10-QSB speak only as of the date
hereof and we disclaim any obligation to provide updates, revisions or
amendments to any forward-looking statements to reflect changes in our
expectations or future events.

Financial Condition and Liquidity

We had working capital of $353,440 at March 31, 2002. This working capital is a
combination of the working capital provided by Walker, of approximately
$366,000, and by ADS of $50,000, offset by NPI's negative working capital
of $63,000, as a result of the acquisition transactions and further
increased due to our net income for the three months ended March 31, 2002.
Included in our net income for the three months ended March 31, 2002 was an
extraordinary item of $159,000 resulting from the cancellation of negative
goodwill of NPI in connection with the acquisition transactions which resulted
in an extraordinary gain.

Net cash provided by operating activities was approximately $32,500 for the
three months ended March 31, 2002, compared to net cash used in operating
activities of $7,000 for the three months ended March 31, 2001. This difference
primarily resulted from net income for the current fiscal period compared to a
net loss in the prior comparable period, offset in part by the write-off of
negative goodwill, a decrease in prepaid expense and other current assets and a
decrease in accounts payable and accrued expenses in the current fiscal period,
as compared to those items for the prior fiscal period.

Net cash provided by investing activities was approximately $472,000 for three
months ended March 31, 2002, all as a result of the cash proceeds received as a
result of the acquisition transactions. There were no cash flows generated by
investing activities during the three months ended March 31, 2001.

Net cash used in financing activities was approximately $52,000 for three
months ended March 31, 2002, resulting from sale of a promissory note in the
principal amount of $80,000, sale of common stock for gross proceeds of $60,000,
offset by the repayment of outstanding notes totaling $175,000 and repayment of
due to stockholder in the amount of $17,100. There were no cash flows generated
by financing activities during the three months ended March 31, 2001.

As a result of these activities, our cash and cash equivalents increased to
$452,669 as of March 31, 2002, compared to zero cash and cash equivalents at
March 31, 2001.

Plan of Operations

We intend to become a leading financial services company operating in the
death care industry. Through NPI, we anticipate seeking to market and sell
pre-arrangements of death care as a

voluntary benefit to corporations, unions and affinity groups. Through ADS,
we intend to seek to increase the amount of pre-need trust dollars currently
under our administration. We anticipate continuing to operate our Kelly Color
subsidiary as a non-digital photographic development laboratory to the
photographic profession.

NPI is currently developing relationships with various distribution channels in
which to sell pre-arranged death care plans. NPI will seek to earn insurance
commissions and channel trust administration fees to ADS upon the sale of
pre-arrangements. Additionally, NPI may seek to acquire direct third party
marketers of pre-arranged death care which market pre-arranged death care
services primarily by direct mail, as well as run the pre-arrangement office in
many funeral home locations.

ADS is currently seeking to increase the amount of pre-need trust monies it
currently administrates. Currently, ADS administers approximately $ 215 million
in trust funds. We anticipate that ADS will seek to administer trust funds held
by various state funeral association trusts, establish and market master trusts
to the independent funeral home community and to acquire existing trust
administration companies.

There can be no assurance that we will achieve successful and profitable results
from our distribution and marketing efforts or that we will be able to complete
acquisitions within the third party marketer segment of the death care services
industry.

We intend any acquisitions to be accomplished through issuances of stock, debt
and cash, or a combination of such forms of consideration. Accordingly, any
future merger or acquisition may have a dilutive effect on our stockholders as
of the time of such mergers and acquisitions. Additionally, our ability to
accomplish any future acquisitions may depend on our cash position, our ability
to raise capital, the stock price of our common stock, and our ability to
service any debt we may incur.

We believe that our operating results may fluctuate greatly quarter to quarter
due to several factors, including the success of our merger and acquisition
strategy and the impact of any increases in our results of operations as we
pursue new business in the death care services industry.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

Reference is hereby made to Item 3 of our Annual Report on Form 10-KSB, for the
fiscal year ended November 30, 2001, filed with the Securities and Exchange
Commission on February 26, 2002 (Commission File No.:0-5418), and to the
references made in such Item, for a discussion of all material pending legal
proceedings to which we or any of our subsidiaries are parties.

Item 2. Changes in Securities.

In March 2002, we issued to the former stockholder of American DataSource, Inc.
and his designees an aggregate of 183,984 shares of our common stock and our 18%
subordinated promissory notes in the aggregate principal amount of $500,000 in
connection with our acquisition of ADS. These securities were issued in a
transaction exempt from the registration requirements of the Securities Act of
1933 pursuant to the provisions of Section 4(2) of the Securities Act. Further
information concerning this acquisition is provided in Item 5 of Part II of this
Current Report on Form 10-QSB.

In March 2002, we issued to the former stockholders of National Preplanning,
Inc. an aggregate of 272,573 shares of our common stock and our 18% subordinated
promissory notes in the aggregate principal amount of $750,000 in connection
with our acquisition of NPI. These securities were issued in a transaction
exempt from the registration requirements of the Securities Act of 1933 pursuant
to the provisions of Section 4(2) of the Securities Act. Further information
concerning this acquisition is provided in Item 5 of Part II of this Current
Report on Form 10-QSB.

In January 2002, we acquired 3,000 shares of our common stock from a trust in
which our then president, Peter Walker, served as a trustee. The purchase price
for these shares was $4,822. Mr. Walker disclaims beneficial ownership of these
shares and the proceeds of their sale.

Payment of the subordinated promissory notes issued in the ADS and NPI
acquisitions is subject to our acquisition of an unaffiliated investment
management and technology company serving the funeral and cemetery industry.
These notes are being held in escrow until the unaffiliated party acquisition is
completed or abandoned. The notes will be delivered to their respective
registered owners if we complete this unaffiliated party acquisition. The notes
will be returned to us for cancellation if such acquisition is abandoned or does
not occur on or before September 30, 2002. We have the right to deliver a total
of 187,570 shares of our common stock in full satisfaction of the promissory
notes we issued in the ADS acquisition and a total of 277,870 shares in payment
of the promissory notes we issued in the NPI acquisition. The promissory notes
were issued as part of the consideration in the two acquisitions in order to
provide for the contingency that we may be able to complete the unaffiliated
party acquisition within certain parameters. Although NPI has had previous
discussions with the acquisition candidate, we have not entered into a

definitive agreement or letter of intent to acquire such unaffiliated party, and
we may not acquire that company by September 30, 2002, or at all.

Item 3. Defaults on Senior Securities.

None.

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

None.

Item 5. Other Information.

Effective March 1, 2002, we acquired ADS and NPI through mergers of such
companies with two of our wholly owned subsidiaries that we formed to effectuate
the acquisitions. ADS provides trust administrative services to independent
funeral homes, state master trusts and companies that own funeral homes or
cemeteries for pre-need funeral and cemetery trust accounts. NPI, a development
stage company, is a managing general insurance agency and third party marketer
of prearranged death care services to corporations, unions and affinity groups.

In the ADS acquisition, we issued to James N. Lucas, Sr., the sole stockholder
of ADS prior to our acquisition of the company, 183,984 shares of our common
stock, together with our 18% subordinated promissory note in the principal
amount of $500,000, issued in escrow, due November 30, 2002 and $325,000 in
cash. At the direction of Mr. Lucas, we delivered 91,992 of such shares and
$250,000 principal amount of such notes to an irrevocable trust for the benefit
of Mr. Lucas' adult children and delivered 45,996 of such shares and $125,000
principal amount of such notes to Mr. Lucas' adult son, James N. Lucas, Jr.

In the NPI acquisition, we issued to the stockholders of NPI, a total of 272,573
shares of our common stock, together with our 18% subordinated promissory note
in the aggregate principal amount of $750,000, issued in escrow, due November
30, 2002. Mitchell Segal, the president, chief executive officer, and the owner
of approximately 67.5% of the outstanding shares of NPI prior to our acquisition
of the company, received 183,967 of such shares and $506,221 principal amount of
such notes.

the promissory notes we issued in the ADS acquisition and a total of 277,870
shares in payment of the promissory notes we issued in the NPI acquisition. The
promissory notes were issued as part of the consideration in the two
acquisitions in order to provide for the contingency that we may be able to
complete the unaffiliated party acquisition within certain parameters. Although
NPI has had previous discussions with the acquisition candidate, we have not
entered into a definitive agreement or letter of intent to acquire such
unaffiliated party, and we may not acquire that company by September 30, 2002,
or at all.

The consideration issued in the merger transactions was determined in
arms-length negotiations among the parties.

We have agreed to register a total of 91,308 shares of our common stock that we
issued in the ADS and NPI acquisitions for resale by the former stockholders of
ADS and NPI. Such 91,308 shares represent approximately 20% of the shares of our
common stock that we issued in the two acquisitions.

We have entered into an employment agreement with Mitchell Segal to serve as our
president and chief executive officer through December 31, 2005. Under Mr.
Segal's employment agreement, we will pay Mr. Segal an annual base salary of
$200,000 for 2002, with annual increases of not less than $10,000, plus a bonus
equal to a minimum of 3% to a maximum of 5% of the gross proceeds received from
equity financings and a minimum of 3% to a maximum of 7.5% of our net income,
provided our net income is at least $500,000. The bonus is payable through 2008,
even if Mr. Segal's employment with us is terminated by us except in the event
the termination is for cause. In no event may the bonuses due Mr. Segal exceed
an aggregate of $304,025. Mr. Segal also is entitled to discretionary bonuses,
if any, awarded by our board of directors.

We also have entered into an employment agreement with Peter Walker to serve as
president of our Kelly Color Laboratories, Inc. subsidiary through March 18,
2012. Under Mr. Walker's employment agreement, we will pay Mr. Walker an annual
base salary of $100,000, plus a monthly non-accountable expense allowance of
$1,000. Mr. Walker's employment agreement does not require Mr. Walker to devote
a minimum number of hours to the business of Kelly Color. Mr. Walker's
employment agreement does require us to use our best efforts to cause Mr. Walker
to be nominated for election to our board of directors during the term of Mr.
Walker's employment agreement.

Historical financial statements of ADS and NPI were provided in our Current
Report on Form 8-K (Date of Report: March 19, 2002) which we filed with the SEC
on April 3, 2002. We have set forth certain pro forma financial information
concerning the effects of these two acquisitions in our Quarterly Report on Form
10-QSB for the quarter ended February 28, 2002 which we filed with the SEC on
April 22, 2002.

Item 6. Exhibits and Reports on Form 8-K.

(a) Exhibits.

Set forth below is a list of the exhibits to this Quarterly Report on Form
10-QSB.

Exhibit
Number Description

2.1 Agreement and Plan of Merger, dated as of March 19, 2002, among
Walker International Industries, Inc., NPI Acquisition Corp. and
National Preplanning, Inc.*
2.2 Agreement and Plan of Merger, dated as of March 19, 2002, among
Walker International Industries, Inc., Walker Mergerco, Inc. and
American DataSource, Inc.*
10.1 Form of 18% Subordinated Promissory Note issued in connection
with National Preplanning, Inc. acquisition.*
10.2 Form of 18% Subordinated Promissory Note issued in connection
with American DataSource, Inc. acquisition.*
10.3 Employment Agreement, dated as of March 19, 2002, among Walker
International, Inc., Kelly Color, Inc. and Peter Walker.*
10.4 Employment Agreement, dated as of March 19, 2002, between Walker
International Industries, Inc., National Preplanning, Inc. and
Mitchell Segal.*
10.5 Form of Registration Rights Agreement among Walker International
Industries, Inc. and the former stockholders of National
Preplanning, Inc.*
10.6 Form of Registration Rights Agreement among Walker International
Industries, Inc. and the former stockholders of American
DataSource, Inc.*
10.7 Form of Escrow Agreement among Walker International Industries,
Inc., National Preplanning, Inc., and Snow Becker Krauss P.C.,
as escrow agent.*
10.8 Form of Escrow Agreement among Walker International Industries,
Inc., American DataSource, Inc. and Snow Becker Krauss P.C., as
escrow agent.*
- ----------
* Incorporated by reference. See Exhibit Index on page 21.

(b) Reports on Form 8-K.

A Current Report on Form 8-K (Date of Report: March 19, 2002) was filed with the
Securities and Exchange Commission on April 3, 2002, reporting, under Items 1, 2
and 7, a change of control in our company and our acquisition of ADS and NPI.
This Form 8-K included historical financial statements for ADS and NPI. Pro
forma financial information concerning the parties to the ADS and NPI
acquisitions is provided in Item 5 of Part II to this Current Report on Form
10-QSB.

A Current Report on Form 8-K (Date of Report: May 14, 2002) was filed with the
Securities and Exchange Commission on May 16, 2002, reporting, under Item 4, our
change in certifying accountant and, under Item 5, the change in our fiscal
year.

SIGNATURES

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

Dated: May 22, 2002 Walker International Industries, Inc.

By: /s/ Mitchell S. Segal
---------------------------------------------
Mitchell S. Segal, President

Walker International Industries, Inc.

Quarterly Report on Form 10-QSB
Quarter Ended February 28, 2002

EXHIBIT INDEX

Exhibit
Number Description

2.1 Agreement and Plan of Merger, dated as of March 19, 2002, among Walker
International Industries, Inc., NPI Acquisition Corp. and National
Preplanning, Inc. (Incorporated by reference to exhibit 2.1 to the
registrant's Current Report on Form 8-K (Date of Report: March 19,
2002) (Commission file number: 0-5418), filed with the Securities and
Exchange Commission on April 3, 2002.)
2.2 Agreement and Plan of Merger, dated as of March 19, 2002, among Walker
International Industries, Inc., Walker Mergerco, Inc. and American
DataSource, Inc. (Incorporated by reference to exhibit 2.2 to the
registrant's Current Report on Form 8-K (Date of Report: March 19,
2002) (Commission file number: 0-5418), filed with the SEC on April 3,
2002.)
10.1 Form of 18% Subordinated Promissory Note issued in connection with
National Preplanning, Inc. acquisition. (Incorporated by reference to
exhibit 3.1(c) of exhibit 2.1 to the registrant's Current Report on
Form 8-K (Date of Report: March 19, 2002) (Commission file number:
0-5418), filed with the SEC on April 3, 2002.)
10.2 Form of 18% Subordinated Promissory Note issued in connection with
American DataSource, Inc. acquisition. (Incorporated by reference to
exhibit 3.1(c) of exhibit 2.2 to the registrant's Current Report on
Form 8-K (Date of Report: March 19, 2002) (Commission file number:
0-5418), filed with the SEC on April 3, 2002.)
10.3 Employment Agreement, dated as of March 19, 2002, among Walker
International, Inc., Kelly Color, Inc. and Peter Walker. (Incorporated
by reference to exhibit 10.3 to the registrant's Current Report on Form
8-K (Date of Report:March 19, 2002) (Commission file number: 0-5418),
filed with the SEC on April 3, 2002.)
10.4 Employment Agreement, dated as of March 19, 2002, between Walker
International Industries, Inc., National Preplanning, Inc. and Mitchell
Segal. (Incorporated by reference to exhibit 10.4 to the registrant's
Current Report on Form 8-K (Date of Report: March 19, 2002) (Commission
file number: 0-5418), filed with the SEC on April 3, 2002.)
10.5 Form of Registration Rights Agreement among Walker International
Industries, Inc. and the former stockholders of National Preplanning,
Inc. (Incorporated by reference to exhibit 8.2(h) to exhibit 2.1 to
the registrant's Current Report on Form 8-K (Date of Report: March 19,
2002) (Commission file number: 0-5418), filed with the SEC Commission
on April 3, 2002.)

10.6 Form of Registration Rights Agreement among Walker International
Industries, Inc. and the former stockholders of American DataSource,
Inc. (Incorporated by reference to exhibit 8.2(g) to exhibit 2.2 to the
registrant's Current Report on Form 8-K (Date of Report: March 19,
2002) (Commission file number: 0-5418), filed with the SEC on April 3,
2002.)

10.7 Form of Escrow Agreement among Walker International Industries, Inc.,
National Preplanning, Inc., and Snow Becker Krauss P.C., as escrow
agent. (Incorporated by reference to exhibit 3.4 to exhibit 2.1 to the
registrant's Current Report on Form 8-K (Date of Report: March 19,
2002) (Commission file number: 0-5418), filed with the SEC on April 3,
2002.)
10.8 Form of Escrow Agreement among Walker International Industries, Inc.,
American DataSource, Inc. and Snow Becker Krauss P.C., as escrow agent.
(Incorporated by reference to exhibit 3.4 to exhibit 2.2 to the
registrant's Current Report on Form 8-K (Date of Report: March 19,
2002) (Commission file number: 0-5418), filed with the SEC on April 3,
2002.)