SECURITIES & EXCHANGE COMMISSION
                               Washington, D.C.  20549

                                  AMENDMENT NO. 1
                                    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 September 30, 1996

                                          or

( ) Transition Report Pursuant to Section 13 or 15(d) of the Securities
    Exchange Act of 1934

    For the transition period from ____________ to ____________


                             Commission File No. 0-18222


                            COSTA RICA INTERNATIONAL, INC.
                -----------------------------------------------------
                (Exact name of Registrant as specified in its charter)


             Nevada                                       87-0432572
             ------                                       ----------
  (State or other jurisdiction                         (I.R.S. Employer
of incorporation or organization)                     Identification No.)


Suite 303, 2525 S.W. 3rd Ave., Miami, Florida                33129
---------------------------------------------                -----
  (Address of principal executive offices)                 (Zip Code)


                          (305) 250-9938 or (305) 250-9939
                (Registrant's telephone number including area code)


        Securities registered under Section 12(b) of the Exchange Act:

                                      NONE

        Securities registered under Section 12(g) of the Exchange Act:

                          Common Stock $.001 par value
                          ----------------------------
                                (Title of Class)


     Check whether the issuer: (a) 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 past 90 days.
Yes:  _X_   No:  ___

     Check if there is no 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.  /X/

     The issuer's revenues for its more recent fiscal year were:
US $61,535,457.

     The aggregate market value of the voting stock of the Registrant held by
non-affiliates as of September 30, 1996 was approximately $22,959,212.  A
total of 12,083,796 shares were owned by non-affiliates as of September 30,
1996.

     The number of shares outstanding of the Registrant's common stock, as of
the latest practicable date, December 31, 1996 was 19,809,396.

                       DOCUMENTS INCORPORATED BY REFERENCE
                       -----------------------------------

     Documents incorporated by references are found in Item 13.

<PAGE>

                                  FORM 10-KSB/A

                                    PART I

ITEM 1.   DESCRIPTION OF BUSINESS

          (a)  General Development of Business
               -------------------------------

     In March of 1997, Costa Rica International, Inc. (the "Company"), with
the assistance of its external auditors, KPMG Peat Marwick, first detected and
communicated via a press release that the September 30, 1996 10-KSB filing was
in error and that KPMG Peat Marwick was conducting a reaudit of fiscal years
1994, 1995 and 1996.  Since March, the Company has been awaiting the final
audit results in order to prepare amendments to its filings and received the
auditor's report on August 29, 1997.  This Amendment corrects those errors and
the financial statements attached hereto completely restate the Company's
financial position.

     The nature of the error can be traced to the financial statements
certified by Registrant's predecessor auditor for fiscal 1996 for the
Registrant and its subsidiary, Corporacion Pipasa, S.A. ("Pipasa"), a
Costa-Rican corporation.  These financial statements had to be restated by the
Company to properly account for the following:

     1)  The business combination of the Company and Pipasa was first recorded
         according to the purchase method of accounting.  As a result, the
         Company recorded the assets of Pipasa at fair market value.  The
         combination was actually a reverse acquisition, whereby Pipasa should
         have been treated as the accounting acquirer, and Costa Rica
         International, Inc., formerly Quantum Learning Systems, Inc. ("QLS")
         as the legal acquirer.  In accordance with Generally Accepted
         Accounting Principles ("GAAP"), Pipasa (the accounting acquirer) must
         account for its acquisition of Costa Rica International, Inc. as a
         reverse merger.

     2)  The Company, following the advice of its prior accountants, previously
         reflected the results of operations of QLS as the historical financial
         statements of the Company through the date of the merger.  GAAP
         requires that the historical financial statements of the entity after
         the reverse merger be those of Pipasa, the accounting acquirer.
         Historical financial statements of the Company have been restated
         accordingly.

     3)  The Company, under the advice of its prior accountants, mistakenly
         accounted for a transfer of goodwill.  A business combination between
         an operating enterprise and QLS, a shell company, in which the shell
         company is the issuer of securities and the operating enterprise is
         determined to be the acquiring enterprise for financial reporting
         purposes, should be treated, for financial reporting purposes, as an
         issuance of securities by the operating enterprise.  The operating
         enterprise would credit equity for the fair value of the tangible
         net assets of the shell company.  No goodwill or intangible assets
         would be recognized in this transaction.  Costs directly related to
         this transaction may be expressed as incurred or charged directly to
         equity.  The financial statements of the Company are revised so as
         not to reflect any transfer of goodwill.

     4)  The non-monetary assets and liabilities included in the financial
         statements of Pipasa have been translated from Costa Rican currency
         to U.S. dollars at historical exchange rates.  As of December 31,
         1984, Costa Rica is no longer considered to be a highly inflationary
         country according to the Statement of Financial Accounting Standards
         No. 52 parameters, and consequently, the functional currency of
         Pipasa is the Costa Rican colon.  These items should have been
         translated into U.S. dollars using year-end exchange rates.  This
         error has been corrected.

                                       1
<PAGE>

     The amended and restated financial statements are attached hereto and
have been adjusted to reflect a reduction in asset value of $24,142,964, due
to the currency translation error and use of the improper accounting method
as described above.  The financial statements contain information as of
July 1997.

     The audit conducted by KPMG Peat Marwick resulted in the following
restated amounts:

<TABLE>
<CAPTION>
                                                             Stockholders Equity
                                                                     and
                                Assets       Liabilities      Minority Interest
                                ------       -----------     -------------------

<S>                         <C>             <C>                 <C>
Previously Reported          $62,351,671     $18,919,347         $43,432,324

As restated                  $38,208,707     $22,690,396         $15,518,311

</TABLE>

ITEM 5.   MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

          (c)  Dividends
               ---------

     Holders of common stock are entitled to receive such dividends as may be
declared by the Company's Board of Directors.  The Company does not anticipate
paying dividends in the foreseeable future.  The Company's ability to do so
will depend on the payment of dividends by Pipasa to the holders of its common
stock.

     CRI receives income as a 59.56% shareholder of Pipasa.  Pipasa has
consistently paid dividends to holders of both its preferred and common stock.
Management believes it is likely to continue to do so, however, there is no
certainty that Pipasa will pay any dividends in the future.

ITEM 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS FOR THE PERIOD ENDING SEPTEMBER 30, 1996

     The following section supersedes Management's Discussion and Analysis of
Financial Condition and Results of Operations in the 10-K.

Results of Operations

     On April 30, 1996, the Company entered into an Agreement and Plan of
Reorganization with Corporacion Pipasa, S.A. ("Pipasa") for the acquisition of
Pipasa and the divestiture of all the then current subsidiaries and activities
of the Company.  This Plan of Reorganization was approved by the Company's
Shareholders on August 5, 1996 and all documentation was finalized on
September 30, 1996.

     Management of the Company elected to change its fiscal year end from
June 30 to September 30 to coincide with the fiscal year end of its sole
subsidiary, Pipasa.

     Prior to the reorganization, the Company had three subsidiary corporations
which included Cambridge Academy, Sentient, Inc. and Current Concept Seminars,
Inc., along with a division which engaged in real estate development.  As a
condition of the Agreement and the underlying acquisition, the Acquirer
divested itself of all operations, including the former subsidiary corporations
and the real estate division.  As a result, Pipasa is the only operating 
subsidiary of the Company.


                                       2
<PAGE>

     For purposes of comparison and evaluation, Statements of Income of Pipasa,
the Company's sole operating subsidiary are used.  These comparisons do not
reflect the fact that the Company owns 59.56% of Pipasa's common stock and,
as a result, receives income only through the payment of dividends by Pipasa
to the Company as a holder of Pipasa's common stock.

     Since the reorganization, the Company's operational costs, including but
not limited to rent, insurance, and professional fees in connection with the
reaudit, have been paid through advances made on the Company's behalf by
Pipasa.  These advances totaled $81,302 for the year ended September 30, 1996.
The Company intends to repay Pipasa the advanced monies, with interest
accrued at the prevailing local market rate, as funds become available to it
through the receipt of dividends or through acquisition of other operating
entities.

     Pipasa's revenues increased from $57,138,759 in fiscal year 1995 to
$61,535,457 in fiscal year 1996, an increase of approximately 7% over the
previous year.  Pipasa experienced increased revenues in its latest fiscal
year over the comparable previous year period as a result of its successful
efforts to increase the volume of sales of its poultry products.

     Pipasa's operating expenses increased to $10,921,973 for the fiscal year
1996, from $10,702,149 for the comparable fiscal year 1995.  General and
administrative expenses increased slightly as a percentage of revenue,
relative to the previous fiscal year as a result of extraordinary expenses
related to Costa Rica International, Inc., such as professional fees and travel
expenses which were advanced to the Company.

     Pipasa generated net income before income tax of $3,015,940 for fiscal
year 1996, when compared to a net income before income tax of $3,754,349 for
the comparable fiscal year 1995.  The reduction in net income resulted from
rising grain prices during the early part of fiscal year 1996.  This rise
in grain prices affected the cost of sales and consequently reduced net
income.  Management decided not to pass to its customers this increase in the
sale prices of its products, because it considered the increase in prices of
the raw material a typical market fluctuation and cost of doing business and
did not want to negatively impact its customers.

     Management expects continued growth of revenues from its core business
activities.  Management is continuing to expand its market operations and to
cut costs to maximize future profit potential.


<PAGE>

Liquidity and Capital Resources

     At September 30, 1996, cash and cash equivalents of Pipasa were $5,129,312
as compared to $2,113,595 at September 30, 1995.  There was an increase in
cash and cash equivalent of Pipasa due to the collection of a note receivable
from related parties.

     At September 30, 1996, the working capital ratio was 0.98 as compared to
1.04 at September 30, 1995.

     On August 26, 1996, Pipasa entered into an agreement with Inversiones La
Ribera, S.A., a company owned and controlled by its Chairman and Chief
Executive Officer, Mr. Chaves, to acquire, for $4,858,955, 10% of the equity
ownership rights to Inolasa, S.A. and ADEC, S.A. ("Inolasa Group"), an
independent third party and significant supplier of raw material to Pipasa.
Inversiones La Ribera, S.A. is both a principal stockholder of Pipasa and a
related party since it is beneficially controled by Mr. Chavez, who is
Chairman of both the Company and Pipasa.  At September 30, 1996, Pipasa had
made payments of $934,842 in connection with such agreement; the unpaid
balance was to be paid during the year ending September 30, 1997.  As of the
date of this filing, the balance due for the transaction has been paid in full.


          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS FOR THE PERIOD ENDING SEPTEMBER 30, 1995

     For purposes of comparison and evaluation, Statements of Income of Pipasa,
the Company's sole operating subsidiary are used.  These comparisons do not
reflect the fact that the Company owns 59.56% of Pipasa's common stock and,
as a result, receives income only through the payment of dividends by Pipasa
to the Company as a holder of Pipasa's common stock.

     Revenues of Pipasa increased from $54,639,749 in fiscal year 1994 to
$57,138,759 in fiscal year 1995, an increase of approximately 4.5% over the
previous year.  Pipasa experienced increased revenues in the fiscal year
September 30, 1995 over the comparable previous year as a result of the
opening of new agencies and the increase in sales of its poultry products.
The cost of sale as of percentage of sales declined 1.61% from that of fiscal
year 1995 to 71.12% when compared to the previous fiscal year's, 72.73%, due
to stable prices of the raw materials, and the efficient management of its
resources.

     Pipasa's General and Administrative expenses increased slightly to
$4,180,417 in 1995, an increase of 1.04%, when compared to the previous year's
fiscal period expenses of $4,137,033.  This increase was a result of the
normal growth of the Company.  Selling expenses increased from US $5,925,317,
in fiscal year 1994, to US $6,521,732, in the fiscal year 1995, due to (1) the
implementation of a new sales commission policy designed as an incentive
for higher sales and (2) the renovation of the vehicle fleet.  Pipasa generated
net income before income tax of $3,754,349 for fiscal year 1995, when compared
to a net income before income tax of $2,966,440 for the comparable fiscal year
1994.  This increase in net income is a result of stable grain prices during
the fiscal year 1995, and the efficient management of resources.

     Management expects continued growth of revenues from its core business
activities.  Management is continuing to expand its market operations and to
cut costs to maximize future profit potential.

Liquidity and Capital Resources

     At September 30, 1995, cash and cash equivalents of Pipasa were $2,113,595
as compared to $1,307,675 at September 30, 1994, an increase of $805,920.
This increase is generated by inventory realization.

     At September 30, 1995, the working capital ratio was 1.044 as compared to
1.045 at September 30, 1994.  This ratio did not show a significant variation
during this period.


<PAGE>

                                     PART II

ITEM 7.   FINANCIAL STATEMENTS

          The following financial information is filed as part of this report:

          (1)  Financial Statements
               --------------------


          (2)  Schedules
               ---------

          The financial statement schedules listed in the accompanying index to
financial statements are filed as a part of this annual report.


ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     On August 26, 1996, Pipasa entered into an agreement with Inversiones La
Ribera, S.A. to acquire, for US $4,858,955, 10% of the equity ownership rights
in the Inolasa Group, an independent third party and a significant supplier of
raw materials to Pipasa.  Inversiones La Ribera, S.A. is both a principal
stockholder of Pipasa and a related party, since it is beneficially controlled
by Mr. Chavez, who is Chairman of both the Company and Pipasa.  As of
September 30, 1996, Pipasa had made payments of US $934,842 in connection with
that commitment; the unpaid balance had been agreed to be paid during the year
ending September 30, 1997.  As of the date of this filing, the balance has
been paid in full.

     The Inolasa Group is currently undergoing a corporate and legal
restructuring, which includes the formation of a new holding company.  As a
result, the investment is currently registered in the "other assets account."
Once the Inolasa Group finishes restructuring its holding company, the Company
will transfer the investment to the permanent investment account.  Share
certificates are expected to be issued and delivered to Pipasa no later than
December 1, 1997, for no additional consideration.

<PAGE>










                         INDEPENDENT AUDITORS' REPORT
                         ----------------------------




The Board of Directors and Stockholders,
Costa Rica International, Inc.


We have audited the accompanying consolidated balance sheets of Costa Rica
International, Inc. and Subsidiary as of September 30, 1996 and 1995, and the
related consolidated statements of income, stockholders' equity, and cash
flows for each of the years in the three-year period ended September 30, 1996.
These consolidated financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America.  Those standards require that we
plan and perform the audit 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 financial position of Costa Rica
International, Inc. and Subsidiary as of September 30, 1996 and 1995, and the
results of their operations and their cash flows for each of the years in the
three-year period ended September 30, 1996, in conformity with generally
accepted accounting principles.




San Jose, Costa Rica
July 31, 1997


<PAGE>




















                        COSTA RICA INTERNATIONAL, INC.
                                AND SUBSIDIARY



                       Consolidated Financial Statements

                       September 30, 1996, 1995 and 1994

                  (With Independent Auditors' Report Thereon)


<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                          Consolidated Balance Sheets
                          September 30, 1996 and 1995


<TABLE>
<CAPTION>
                                                      1996            1995
                                                  -----------     -----------

<S>                                              <C>             <C>
ASSETS

Current Assets
  Cash and cash equivalents                       $ 5,129,312     $ 2,113,595
  Short-term investments                              260,339         249,138
  Notes and accounts receivable, net (note 2)       4,613,762       4,149,637
  Due from related parties (note 3)                 1,304,500       2,111,550
  Inventories, net (note 4)                         7,148,797       5,931,555
  Prepaid expenses                                    157,889         158,458
                                                  -----------     -----------
  Total Current Assets                            $18,614,599     $14,713,933
                                                  -----------     -----------

Long term receivable - trade                          211,362         201,433
Property, plant and equipment, net (note 6)        13,604,108      15,252,608
Long term investments (note 7)                         35,190         996,293
Other assets (note 8 and 12)                        5,743,448         902,085
                                                  -----------     -----------
Total Assets                                      $38,208,707     $32,066,352
                                                  ===========     ===========


LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
  Notes payable (note 9)                            9,411,340       8,863,144
  Due to related parties (note 3)                   3,924,114               -
  Current installments of long-term debt (note 10)  1,461,118       1,167,541
  Accounts payable                                  2,562,129       2,382,905
  Accrued expenses                                  1,642,455       1,697,477
                                                  -----------     -----------
  Total Current Liabilities                       $19,001,156     $14,111,067
                                                  -----------     -----------

Long term debt, excluding current
  installments (note 10)                            3,593,601       2,379,691
Other liabilities                                      95,639          78,338
                                                  -----------     -----------
  Total Liabilities                                22,690,396      16,569,096
                                                  -----------     -----------
Minority interest                                 $ 5,429,402     $ 5,374,895


Stockholders' Equity (note 11):

  Common stock                                         19,560          15,574
  Preferred Stock                                   2,216,072       2,216,072
  Additional paid-in capital                        9,350,252       7,266,128
  Cumulative translation adjustment                (3,596,253)     (2,404,016)
  Retained earnings                                 2,099,278       3,028,603
                                                  -----------     -----------
  Total Stockholders' Equity                       10,088,909      10,122,361
                                                  -----------     -----------
Total Liabilities and
  Stockholders' Equity                            $38,208,707     $32,066,352
                                                  ===========     ===========


         See accompanying notes to consolidated financial statements.

</TABLE>

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY

                       Consolidated Statements of Income

                 Years ended September 30, 1996, 1995 and 1994

<TABLE>
<CAPTION>
                                                      1996             1995            1994
                                                      ----             ----            ----

<S>                                              <C>              <C>             <C>
Sales                                             $ 61,535,457     $ 57,138,759    $ 54,639,749
Cost of sales                                       45,446,182       40,635,032      39,740,268
                                                  ------------     ------------    ------------
     Gross profit                                   16,089,275       16,503,727      14,899,481
Operating expenses:
  General and administrative                         4,415,842        4,180,417       4,137,033
  Selling                                            6,506,131        6,521,732       5,925,317
                                                  ------------     ------------    ------------
     Total operating expenses                       10,921,973       10,702,149      10,062,350
                                                  ------------     ------------    ------------
     Income from operations                          5,167,302        5,801,578       4,837,131
                                                  ------------     ------------    ------------
Other expenses (income):
  Interest expense                                   2,686,801        2,638,497       2,561,530
  Interest income                                     (439,821)        (299,858)       (345,985)
  Exchange losses (gains), net                         101,529          207,814         (23,420)
  Miscellaneous, net                                  (197,147)        (499,224)       (321,434)
                                                  ------------     ------------    ------------
     Other expenses, net                             2,151,362        2,047,229       1,870,691
     Income before income taxes and
       minority interest                             3,015,940        3,754,349       2,966,440
Income taxes (note 13)                                 244,431          250,802         137,463
                                                  ------------     ------------    ------------
       Income before minority interest               2,771,509        3,503,547       2,828,977
                                                  ------------     ------------    ------------
Minority interest                                    1,121,630        1,417,885       1,144,887
                                                  ------------     ------------    ------------
       Net income                                 $  1,649,879     $  2,085,662    $  1,684,090
Preferred stock dividends                              211,750          291,256         182,781
                                                  ------------     ------------    ------------
Net income applicable to common stock             $  1,438,129     $  1,794,406    $  1,501,309
                                                  ============     ============    ============
Pro-forma earnings per share:
  Net income per common shares                    $       0.09     $       0.12    $       0.10
                                                  ------------     ------------    ------------
  Weighted average number of common shares
    outstanding                                     15,573,571       15,573,571      15,573,571
                                                    ----------       ----------      ----------

                  See accompanying notes to consolidated financial statements.

</TABLE>

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY

                           Statements of Cash Flows

                 Years ended September 30, 1996, 1995 and 1994

<TABLE>
<CAPTION>
                                                      1996             1995            1994
                                                      ----             ----            ----

<S>                                              <C>              <C>             <C>
Cash flows from operating activities:
  Net income                                      $  1,649,879     $  2,085,662    $  1,684,090
  Adjustment to reconcile net income to
    net cash provided by operating activities:
      Depreciation                                   1,232,269        1,306,617       1,254,519
      Loss (gain) on sale of productive assets          77,461          (37,603)         50,520
      Increase in allowance for doubtful
        receivables                                    154,868          -                56,557
  Cash provided by (used for) changes in:
      Short-term investments                           (44,594)        (193,322)          8,387
      Notes and accounts receivable                 (1,193,383)      (1,171,739)     (1,181,268)
      Due from related parties                         496,513         (878,839)     (1,266,400)
      Inventories                                   (2,074,586)        (541,709)        (44,070)
      Prepaid expenses                                 (20,165)          53,788         119,422
      Accounts payable                                 468,898          129,844      (1,457,285)
      Accrued expenses                                 163,891          464,129        (173,414)
      Long term receivable-trade                       (36,986)         162,339        (430,282)
                                                  ------------     ------------    ------------
          Cash provided by (used for) operating
            activities                                 874,065        1,379,167      (1,379,224)
                                                  ------------     ------------    ------------
Investing activities:
  Increase in long term investments                    -                -            (1,094,845)
  Additions to property, plant and equipment        (1,672,706)      (3,343,685)     (3,005,666)
  Proceeds from sale of productive assets and
    long-term investments                            1,013,574          211,953          26,494
  Decrease (Increase) in other assets               (1,095,621)          80,162        (210,282)
                                                  ------------     ------------    ------------
          Cash used for investing activities        (1,754,753)      (3,051,570)     (4,284,299)
                                                  ------------     ------------    ------------
Financing activities:
  Short-term financing-increase in notes payable     1,745,986        2,748,535       3,939,883
  Cash dividends                                      (380,349)        (724,852)       (962,789)
  Long-term financing:
    Payments                                        (1,344,403)      (1,545,203)         49,430
    New loans                                        3,415,700        1,255,269         -
  Capital contributions (returns)                     (110,745)         (19,796)        280,796
  Increase in minority interest                        865,019          911,656         684,771
  Other liabilities                                     28,703         (122,990)        235,210
                                                  ------------     ------------    ------------
          Cash provided by financing activities      4,219,911        2,502,619       4,227,301
                                                  ------------     ------------    ------------
Effect of exchange rate changes on cash
  and cash equivalents                                (323,506)         (24,296)        212,213
                                                  ------------     ------------    ------------
          Increase (decrease) in cash and cash
            equivalents                              3,015,717          805,920      (1,224,009)
Cash and cash equivalents at beginning of year       2,113,595        1,307,675       2,531,684
                                                  ------------     ------------    ------------
Cash and cash equivalents at end of year          $  5,129,312     $  2,113,595    $  1,307,675
                                                  ============     ============    ============

Supplementary disclosures of cash flows
  information:
  Cash paid during year for:
    Interest                                      $  2,411,604     $  2,600,003    $  2,429,739
                                                  ============     ============    ============
    Income taxes                                  $    189,054     $    160,592    $    265,138
                                                  ============     ============    ============

                  See accompanying notes to consolidated financial statements.

</TABLE>


<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY

                Consolidated Statements of Stockholders' Equity

                 Years ended September 30, 1996, 1995 and 1994

<TABLE>
<CAPTION>
                                               Common Stock
                                         -----------------------               Additional  Cumulative                    Total
                                           Number of               Preferred     Paid-In   Translation   Retained    Stockholders'
                                             Shares      Amount      Stock       Capital   Adjustment    Earnings       Equity
                                         ------------  ---------   ---------   ---------   ----------   ----------   -------------

<S>                                     <C>           <C>         <C>         <C>         <C>          <C>           <C>
Balance, September 30, 1993              $ 15,573,571     15,574     395,581   7,670,938     (543,103)   1,364,419     8,903,409
Capital contributions                          --         --          --         280,796       --           --           280,796
Issuance of preferred stock to existing
  stockholders                                 --         --       1,364,480    (812,275)      --           --           552,205
Cash dividends on common stock                 --         --          --          --           --         (780,008)     (780,008)
Cash dividends on preferred stock              --         --          --          --           --         (182,781)     (182,781)
Net income                                     --         --          --          --           --        1,684,090     1,684,090
Translation adjustment                         --         --          --          --         (572,289)      --          (572,289)
                                          -----------  ---------   ---------   ---------   ----------   ----------    ----------
Balance, September 30, 1994                15,573,571     15,574   1,760,061   7,139,459   (1,115,392)   2,085,720     9,885,422
Return of capital contributions                --         --          --         (19,796)      --           --           (19,796)
Issuance of preferred stock to
  existing stockholders                        --         --         456,011    (271,462)      --           --           184,549
Capitalization of retained earnings            --         --          --         417,927       --         (417,927)       --
Cash dividends on common stock                 --         --          --          --           --         (433,596)     (433,596)
Cash dividends on preferred stock              --         --          --          --           --         (291,256)     (291,256)
Net income                                     --         --          --          --           --        2,085,662     2,085,662
Translation adjustment                         --         --          --          --       (1,288,624)      --        (1,288,624)
                                          -----------  ---------   ---------   ---------   ----------   ----------    ----------
Balance, September 30, 1995                15,573,571     15,574   2,216,072   7,266,128   (2,404,016)   3,028,603    10,122,361
Issuance of common stock                    4,152,694      4,153      --          --           --           --             4,153
Agreement and Plan of Reorganization
  dated April 30, 1996:
  Common stock returned and canceled         (116,869)      (117)     --          --           --           --              (117)
  Divestment of assets                        (50,000)       (50)     --        (117,614)      --           --          (117,664)
Capital contributions                          --         --          --           2,883       --           --             2,883
Capitalization of retained earnings            --         --          --       2,198,855       --       (2,198,855)       --
Cash dividends on common stock                 --         --          --          --           --         (168,599)     (168,599)
Cash dividends on preferred stock              --         --          --          --           --         (211,750)     (211,750)
Net income                                     --         --          --          --           --        1,649,879     1,649,879
Translation adjustment                         --         --          --          --       (1,192,237)      --        (1,192,237)
                                          -----------  ---------   ---------   ---------   ----------   ----------    ----------
Balance, September 30, 1996               $19,559,396     19,560   2,216,072   9,350,252   (3,596,253)   2,099,278    10,088,909
                                           ==========  =========   =========   =========   ==========   ==========    ==========

          See accompanying notes to consolidated financial statements.
</TABLE>


<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                         Notes to Financial Statements
                       September 30, 1996, 1995 and 1994


(1)   Business and Summary of Significant Accounting Policies
      -------------------------------------------------------

      (a)  Corporate Activity
           ------------------

           Costa Rica International, Inc. (the "Company"), formerly Quantum
           Learning Systems, Inc. was incorporated under the laws of the State
           of Utah on February 6, 1986 and filed a public offering in 1987.
           In April 1994, the Company changed its legal domicile from Utah to
           Nevada.  In April 1996, the Company entered into an acquisition
           agreement to acquire the majority of the stock of Corporacion
           Pipasa, S.A. (Pipasa).  This transaction was approved by the
           shareholders of the Company on August 5, 1996 and consummated on
           September 30, 1996.  Simultaneously with the acquisition of Pipasa,
           the Company divested itself of all other subsidiaries.

      (b)  Agreement and Plan of Reorganization
           ------------------------------------

           On April 30, 1996, the Company entered into an Agreement and Plan
           of Reorganization (the "Agreement") for the acquisition of Pipasa,
           and the divestiture of all other subsidiaries of the Company.  The
           shareholders approved the plan of reorganization on August 5, 1996.

           Prior to the reorganization, the Company had three educational
           subsidiaries:  Cambridge Academy, Sentient, Inc. and Current
           Concept Seminars, Inc., and a real estate development division.
           As a condition to the Agreement and the underlying acqusition, the
           acquiror was required to divest itself of all other operations,
           including the former subsidiary corporations and the real estate
           division, by the delivery date of the common shares.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


           Also on September 30, 1996, the Company entered into an agreement
           with InterCoast Financial Corporation (IFC) to sell the former
           subsidiaries to IFC.  Control of the Company changed on August 5,
           1996 by shareholder approval.  The final documentation was
           completed on September 30, 1996.  Pursuant to the Agreement,
           InterCoast Financial Corporation acquired the subsidiaries in
           exchange for 50,000 shares of common stock of Costa Rica
           International, Inc. and indemnification by the Company from any
           liability, damage or deficiency, all actions, suits, proceedings,
           demands, assessments, judgments, costs and expenses including
           attorney's fees, incident to the subsidiaries.  The acquisition
           of the shares was accounted at fair value.

           Pursuant to the Agreement, and as of September 30, 1996, the
           Company had exchanged 15,573,571 shares of its common stock for
           approximately 59.56% of Pipasa's common shares.  The remaining
           40.44% of Pipasa's common shares were not available for transfer
           under the Agreement because they were used to secure a loan.  The
           15,573,571 shares represent approximately 79% of the issued and
           outstanding shares of the Company.  The 40.44% interest not
           acquired in the merger transaction has been accounted for as
           minority interest for all years presented.

      (c)  Operations of Corporacion Pipasa, S.A.
           --------------------------------------

           On January 7, 1991, Industrias Derivados de Pollo, S.A
           (Idepo, S.A.), Retisa S.A., Servicios Multiples Pipasa, S.A.
           (Semupi, S.A.), Avicola Chacara, S.A., Concentrados Belen, S.A.,
           Empolladora Belen, S.A., Granja Avicola Monica, S.A., Planta
           Procesadora de Aves, S.A., Grupo Pipasa, S.A., Productores Huevo
           Fertil, S.A. (Prohufe, S.A.) and El Polluelo, S.A., merged into the
           surviving entity, Akron, S.A.  The articles of incorporation were
           simultaneously amended to reflect the Company's new name,
           Corporacion Pipasa, S.A.  On January 1996, Rincon de los Toros,
           S.A. merged with Corporacion Pipasa, S.A.  Since the mergers were
           between companies under common control, the net assets were
           recorded at book value.

           Pipasa produces and markets poultry products on 33 farms and in 2
           processing plants located throughout Costa Rica.  Pipasa's main
           market is within Costa Rica and in the countries of El Salvador,
           Honduras, Nicaragua, and Colombia.

      (d)  Consolidation Principles
           ------------------------

           The consolidated financial statements include the accounts of Costa
           Rica International, Inc. and its 59.56% owned subsidiary,
           Corporacion Pipasa, S.A.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


           The consolidated financial statements as of September 30, 1996
           reflect the acquisition of Pipasa as a reverse acquisition, whereby
           Pipasa is treated as the accounting acquirer and the Company as the
           legal acquirer.  Accordingly, for financial reporting purposes, the
           issuance of stock in the acquisition is treated as an issue by the
           operating company Pipasa, and the historical financial statements
           of Pipasa as of September 30, 1994 and 1995 have been presented in
           the consolidation.

           All significant intercompany balances and transactions have been
           eliminated in consolidation.

      (e)  Restated Consolidated Financial Statements
           ------------------------------------------

           The consolidated financial statements of Costa Rica International,
           Inc. and Subsidiary as of September 30, 1996 have been restated by
           the Company to properly account for the following:

           -  The business combination of Costa Rica International, Inc. with
              Corporacion Pipasa, S.A. had been accounted by using the purchase
              method.  As a result, the Company had recorded the assets of
              Pipasa at fair market value.  The combination should have been
              treated as a reverse acquisition, whereby Pipasa should have
              been treated as the accounting acquirer and Costa Rica
              International, Inc. as the legal acquirer.  In accordance with
              Generally Accepted Accounting Principles ("GAAP"), Pipasa (the
              accounting acquiror) must account for its acquisition of Costa
              Rica International, Inc. as a reverse merger.

           -  The Company previously reflected the results of operations of
              Quantum Learning Systems, Inc. as the historical financial
              statements of the Company through the date of the merger.
              Generally Accepted Accounting Principles require that the
              historical financial statements of the entity after the reverse
              merger be those of the accounting acquiror.  Historical
              financial statements of the Company have been recast accordingly.

           -  The Company mistakenly accounted for a tranfer of goodwill.  A
              business combination between an operating enterprise and a
              "shell company" in which the shell company is the issuer of
              securities and the operating enterprise is determined to be the
              acquiring enterprise for financial reporting purposes, should be
              treated for financial reporting purposes as an issuance of
              securities by the operating enterprise.  The operating
              enterprise would credit equity for the fair value of the
              tangible net assets of the shell company.  No goodwill or
              intangible assets would be recognized in this transaction.
              Costs directly related to this transaction may be expressed as
              incurred or charged directly to equity.  The financial
              statements of the Company will be revised so as not to reflect
              any transfer of goodwill.

           -  The non-monetary assets and liabilities included in the
              financial statements of Pipasa had been translated from Costa
              Rican currency (colones) to US $ dollars at historical exchange
              rates.  As of December 31, 1984, Costa Rica is no longer
              considered to be a highly inflationary country according to
              Statement of Financial Accounting Standards No. 52, and
              consequently, the functional currency of Pipasa is the Costa
              Rican colon (local currency).  Assets and liabilities should
              have been translated to US $ dollars using year-end exchange
              rates and income statements at average rate.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


           -  On August 26, 1996, the Company entered into an agreement to
              acquire equity ownership rights equivalent to 10% of the
              outstanding common stock of Inolasa Group for $4,858,955.  As of
              September 30, 1996, only the $934,842 advance paid on the total
              purchase price has been recorded in the financial statements.
              However, by date of this Amendment, the total purchase price has
              been paid.  The consolidated financial statements have been
              restated to reflect the total amount of the equity ownership
              rights in the other assets account; and the related liability.

           Accordingly, the 1996 consolidated balance sheet has been restated
           as follows:

<TABLE>
<CAPTION>
                                                                          Stockholders'
                                                                       Equity and Minority
                                           Assets       Liabilities         Interest
                                           ------       -----------    -------------------

          <S>                         <C>              <C>              <C>
           Balance on September 30,
             1996, as previously
             reported                  $ 62,351,671     $18,919,347      $ 43,432,324
           Adjustments for correction
             of the business
             combination method,
             translation of financial
             statements and other
             assets                     (24,142,964)      3,771,049       (27,914,013)
                                       ------------     -----------      ------------
           Balance as of September 30,
             1996, as restated         $ 38,208,707     $22,690,396      $ 15,518,311
                                       ============     ===========      ============
</TABLE>

      (f)  Accounting Principles
           ---------------------

           The consolidated financial statements have been prepared in
           accordance with accounting principles generally accepted in the
           United States of America (USGAAP).  Accounting records of Pipasa
           are kept according to generally accepted accounting principles in
           Costa Rica and have been converted to USGAAP in consolidation.

      (g)  Use of Estimates
           ----------------

           The preparation of financial statements in conformity with
           Generally Accepted Accounting Principles requires management to
           make estimates and assumptions that affect the amounts reported
           in the consolidated financial statements.  Actual results may
           differ from those estimates.

      (h)  Foreign Currency Translation
           ----------------------------

           Most business transactions of Pipasa take place in the Republic of
           Costa Rica, where the local currency is the colon ([cent sign]).  The
           parity of the colon to the US dollar is determined in a free
           exchange market, supervised by the Central Bank of Costa Rica.  As
           of September 30, 1996, 1995 and 1994, commercial exchange rates
           have been ([cent sign])213.94, ([cent sign])187.62 and
           ([cent sign])160.51 to US $1.00, respectively.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


           The financial statements of Corporacion Pipasa, S.A. have been
           translated into US dollars on the basis of the colon ([cent sign]) as
           the functional currency, as follows:  assets and liabilities
           denominated in dollars have been stated at nominal dollar amounts;
           assets and liabilities denominated in Costa Rican colones have been
           translated at the commercial exchange rates in effect on
           September 30, 1996, 1995 and 1994; Stockholders' equity accounts
           have been translated at exchange rates in effect when incurred or
           realized (historical exchange rates); income and expenses have been
           translated at average exchange rates in effect during the years
           then ended.  Translation adjustments have been recorded as a
           separate component of Stockholders' equity.

      (i)  Cash Equivalents
           ----------------

           Highly liquid investments with original maturities of 3 months
           or less are treated as cash equivalents.

      (j)  Investments
           -----------

           The Company has investments in short-term debt securities that
           have been classified under the provisions of SFAS No. 115 as held
           to maturity.

           Short-term investments consist primarily of commercial paper with
           original maturities between three and twelve months, which bear
           interest ranging from 7% to 8%, and are carried at cost, which
           approximates fair market value.

      (k)  Inventories and Allowance for Renewal of Production Poultry
           -----------------------------------------------------------

           Inventories are stated at the lower of cost or market.  Cost is
           determined using the weighted-average method, except for
           inventories in transit, which are valued at specific cost.

           Allowance for renewal of production poultry is determined based
           on the estimated poultry reproductive period.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


      (l)  Property, Plant and Equipment
           -----------------------------

           Property, plant and equipment are stated at cost.  Improvements to
           property and equipment which extend their useful lives are
           capitalized.  Disbursements for maintenance, repairs and minor
           renewals are charged to expenses when incurred.

      (m)  Depreciation and Amortization
           -----------------------------

           Depreciation is provided by the straight-line method, for both
           financial reporting and tax purposes, over estimated useful lives
           as follows:  buildings - 50 years; vehicles, machinery and
           equipment, furniture and fixtures - between 5 and 20 years.

           Cost of leasehold rights on leased properties, accounted for as
           operating leases, are amortized over 5 years (lease term) using
           the straight-line method.

      (n)  Advertising Costs
           -----------------

           Advertising costs are expensed as incurred.  Advertising costs
           amounted to $445,466, $386,135 and $475,171 in 1996, 1995 and 1994,
           respectively.

      (o)  Income Taxes
           ------------

           The Company accounts for income taxes in accordance with statement
           of Financial Accounting Standards No. 109, Accounting for Income
           Taxes.  Under the asset and liability method of Statement 109,
           deferred tax assets and liabilities are recognized for the future
           tax consequences attributable to differences between the financial
           statement carrying amounts of existing assets and liabilities and
           their respective tax bases.  Deferred tax assets and liabilities
           are measured using enacted rates expected to apply to taxable
           income in the years in which those temporary differences are
           expected to be recovered or settled.  Under Statement 109, the
           effect on deferred tax assets and liabilities of a change in tax
           rates is recognized as income in the period that includes the
           enactment date.

      (p)  Fair Value of Financial Instruments
           -----------------------------------

           Financial instruments are not held for trading purposes.  The
           Company estimates that the fair value of all financial instruments
           on September 30, 1996 and 1995 does not differ materially from the
           aggregate carrying values recorded in the financial statements.
           The estimated fair value and, accordingly, the estimates, are not
           necessarily indicative of the amounts that the Company could
           realize in a current market exchange.

      (q)  Pro-Forma Earnings per Share
           ----------------------------

           Pro-forma earnings per share have been computed on the basis of
           the weighted-average number of common shares outstanding, totaling
           15,573,571 for the years ended September 30, 1996, 1995 and 1994.
           The shares used in computing earnings per share for the periods
           prior to the reverse merger are those shares issued by the Company
           to effect the business combination.  The minority interest in the
           earnings of Pipasa and dividends on preferred stock have been
           excluded from earnings available to common stockholders.

      (r)  Impairment of Long-Lived Assets and Long-Lived Assets to Be
           Disposed Of
           -----------------------------------------------------------

           In March 1995, the Financial Accounting Standards Board issued
           SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and
           for Long-Lived Assets to Be Disposed of, which became effective for
           fiscal years beginning after December 15, 1995.  This Statement
           requires that long-lived assets and certain identifiable
           intangibles be reviewed for impairment whenever events or changes
           in circumstances indicate that the carrying amount of an asset may
           not be recoverable.  Recoverability of assets to be held and used is
           measured by a comparison of the carrying amount of an asset to
           future net cash flows expected to be generated by the asset.  If
           such assets are considered to be impaired, the impairment to be
           recognized is measured by the amount by which the carrying amount
           of the assets exceed the fair value of the assets.  Assets to be
           disposed of are reported at the lower of the carrying amount or
           fair value less cost to sell.  Management does not expect that the
           adoption of this Statement will have a material impact on the
           Company's financial position, results of operations, or liquidity.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


      (s)  Transfers and Servicing of Financial Assets and Extinguishments of
           Liabilities
           ------------------------------------------------------------------

           In June 1996, the Financial Accounting Standards Board issued
           SFAS No. 125, Accounting for Transfers and Servicing of Financial
           Assets and Extinguishments of Liabilities.  SFAS No. 125 is
           effective for transfers and servicing of financial assets and
           extinguishments of liabilities occurring after December 31, 1996.
           It is to be applied prospectively.  This Statement provides
           accounting and reporting standards for transfers and servicing of
           financial assets and extinguishment of liabilities placed on
           consistent application of a financial-components approach that
           focuses on control.  It distinguishes between transfers of
           financial assets that are sales and transfers that are secured
           borrowings.  Management of the Company does not expect that
           adoption of SFAS No. 125 will have a material impact on the
           Company's financial position, results of operations, or liquidity.

(2)   Notes and Accounts Receivable
      -----------------------------

      Notes and accounts receivable consist of the following:

<TABLE>
<CAPTION>
                                               1996                1995
                                               ----                ----

     <S>                                  <C>                 <C>
      Accounts Receivables
        Trade receivables                  $  3,802,023        $  3,246,364
        Other                                   845,917             918,014
                                           ------------        ------------
                                           $  4,647,940        $  4,164,378
      Less allowance for doubtful
        accounts                                212,872              77,012
                                           ------------        ------------
                                           $  4,435,068        $  4,087,366
      Short-term notes-trade                    178,694              62,271
                                           ------------        ------------
                                           $  4,613,762        $  4,149,637
</TABLE>


(3)   Accounts and Transactions with Related Parties
      ----------------------------------------------

      In 1994, Pipasa acquired 9% of the outstanding common stock of Cerveceria
      Americana, S.A. (C.A.) from Inversiones La Ribera, S.A., Pipasa's main
      stockholder, for approximately $1,080,000.  On June 30, 1996, Pipasa
      sold its 9% ownership in C.A. back to Inversiones La Ribera for $848,402,
      which was the carrying value as of the date of this Amendment.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


      On August 26, 1996, Pipasa entered into an agreement with Inversiones
      La Ribera, S.A. (principal stockholder) to acquire,for $4,858,955, 10%
      of the equity ownership rights in Grupo Inolasa, an independent third
      party and a significant supplier to Pipasa.  As of September 30, 1996,
      Pipasa has made payments of $934,842 in connection with its commitment;
      the unpaid balance has been agreed to be paid during the year ending
      September 30, 1997 (see note 8).  As of the date of this Amendment, the
      total purchase price has been paid.

      Balance and transactions with related parties consist of the following:

<TABLE>
<CAPTION>
                                               1996                1995
                                               ----                ----

     <S>                                  <C>                 <C>
      Due from stockholders                $  1,104,990        $  1,939,380
      Due from related parties                  199,510             172,170
                                           ------------        ------------
                                           $  1,304,500        $  2,111,550
                                           ============        ============

      Due to stockholders                  $  3,924,114        $     -
                                           ============        ============
</TABLE>

      Balance due to stockholders is originated from the agreement to acquire
      equity ownership rights equivalent to 10% of the outstanding common
      stock of Inolosa Group, which was owned by Inversiones La Ribera, S.A.

      Balance due from stockholders originates from non-interest bearing loans
      made when the Company was still privately owned to Inversiones La
      Ribera, S.A. and the Company's Chief Executive Officer and shareholder,
      starting on October 1, 1996, such loans bear interest at market rates.

(4)   Inventories, net
      ----------------

      Inventories, net consist of the following:

<TABLE>
<CAPTION>
                                               1996                1995
                                               ----                ----

     <S>                                  <C>                 <C>
      Finished products                    $  2,176,876        $  1,074,102
      Poultry                                 1,770,714           1,654,080
      Production poultry                      1,452,607           1,407,635
      Materials and supplies                  1,361,296           1,079,171
      Raw materials                             786,848           1,119,594
      In transit                                 19,929              26,063
                                           ------------        ------------
                                           $  7,568,270        $  6,360,645
      Allowance for renewal of
        production poultry                     (419,473)           (429,090)
                                           ------------        ------------
          Inventories, net                 $  7,148,797        $  5,931,555
                                           ============        ============
</TABLE>


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


(5)   Fair Value of Financial Instruments
      -----------------------------------

      The following table presents the carrying amounts and estimated fair
      values of the Company's financial instruments on September 30, 1996 and
      1995.  The fair value of a financial instrument is the amount at which
      the instrument could be exchanged in a current transaction between
      willing parties.

<TABLE>
<CAPTION>
                                                       1996                            1995
                                            ---------------------------     ---------------------------
                                              Carrying          Fair          Carrying          Fair
                                               Amount           Value          Amount           Value
                                              --------          -----         --------          -----

     <S>                                   <C>             <C>             <C>             <C>
      Current assets:
        Cash and cash equivalents           $ 5,129,312     $ 5,129,312     $ 2,113,595     $ 2,113,595
        Short-term investments                  260,339         260,339         249,138         249,138
        Notes and accounts
          receivable, net                     5,918,262       5,918,262       6,261,187       6,261,187
        Long-term receivable-trade              211,362         211,362         201,433         201,433
      Current liabilities:
        Notes payable                        13,335,454      13,335,454       8,863,144       8,863,144
        Current installments of
          long-term debt                      1,461,118       1,461,118       1,167,541       1,167,541
        Accounts payable                      2,562,129       2,562,129       2,382,905       2,382,905
        Long-term debt                        3,593,601       3,593,601       2,379,691       2,379,691
</TABLE>

      The data presented above represent management's best estimates based on
      a range of methodologies and assumptions, including the following:

      -  For cash and cash equivalents, short-term investments, accounts
         payable, notes and accounts receivable and long-term receivable-trade,
         the carrying amounts approximate fair value because of the short
         maturity of these instruments.

      -  For notes payable, current installments of long-term debt and
         long-term debt, the carrying amount approximates fair value.

      The Company has entered into derivative transactions for purposes other
      than trading as a means of managing the risk of future commitments.
      Futures contracts of less than one year are used to hedge fluctuations
      in the prices of corn.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


(6)   Property, Plant and Equipment, net
      ----------------------------------

      Property, plant, and equipment, net, are summarized as follows:

<TABLE>
<CAPTION>
                                                    1996                1995
                                                    ----                ----

     <S>                                       <C>                 <C>
      Land                                      $  2,444,323        $  2,818,755
      Buildings and facilities                     6,394,134           6,271,683
      Machinery and equipment                      6,687,936           6,734,058
      Vehicles                                     1,685,967           2,067,595
      Advertising signs and display                  381,039             429,780
      Machinery in transit                             5,380              47,724
      Construction in process                        441,130           1,263,880
                                                ------------        ------------
                                                $ 18,039,909        $ 19,633,475
      Less accumulated depreciation                4,435,801           4,380,867
                                                ------------        ------------
      Property, plant, and equipment, net       $ 13,604,108        $ 15,252,608
                                                ============        ============
</TABLE>

      Most of the above assets have been pledged in guarantee of certain
      long-term debt (see note 10).

      Depreciation expense in 1996, 1995 and 1994 amounted to $1,232,269,
      $1,306,617 and $1,254,519, respectively.

(7)   Long-Term Investments
      ---------------------

      Long-term investments consist of the following:

<TABLE>
<CAPTION>
                                                    1996                1995
                                                    ----                ----

     <S>                                       <C>                 <C>
      Investments in equity
        Brewery Cerveceria Americana, S.A.
          (9% ownership)                        $     -             $    956,168
        Other                                         35,190              40,125
                                                ------------        ------------
                                                $     35,190        $    996,293
                                                ============        ============
</TABLE>

(8)   Other Assets
      ------------

      As of September 30, 1996 other assets include $4,858,955 of equity
      ownership rights equivalent to 10% of the outstanding common shares of
      Grupo Inolasa, a significant supplier of raw materials to Pipasa.  Grupo
      Inolasa is currently undergoing a corporate and legal restructuring,
      which includes the formation of a new holding company.  Share
      certificates are expected to be issued and delivered to Pipasa by no
      later than December 1, 1997, for no additional consideration.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


(9)   Notes Payable
      -------------

      Notes payable consist of the following:

<TABLE>
<CAPTION>
                                                    1996                1995
                                                    ----                ----

     <S>                                       <C>                 <C>
      Loans payable                             $  5,232,010        $  4,715,866
      Bank overdrafts                                545,118             867,563
      Commercial paper                             3,498,193           3,130,453
      Other                                          136,019             149,262
                                                ------------        ------------
                                                $  9,411,340        $  8,863,144
                                                ============        ============
</TABLE>

      Loans payable include lines of credit and commitments with banks for
      letters of credit to support commercial operations with suppliers to
      acquire raw materials.

      As of September 30, 1996, the Company has line of credit agreements with
      banks for a maximum of $8.9 million, of which $5.2 million has already
      been used ($9.1 million and $4.7 million, respectively, for 1995).
      Agreements may be renewed annually, and bear interest at rates ranging
      between 9.75% and 10.75% per annum.  Those agreements are secured by
      property.

      Commercial paper is unsecured debt certificates in colones registered
      with the Costa Rican Stock Exchange, with a maximum authorized amount of
      $4.6 million ([cent sign] billion).  Commercial paper bears annual
      interest rates ranging from 20.25% through 39.75% (from 29% through
      39.75% in 1995).

(10)  Long-Term Debt
      --------------

      Long-term debt is as follows:

<TABLE>
<CAPTION>
                                                    1996                1995
                                                    ----                ----

     <S>                                       <C>                 <C>
      Colones-Denominated:
        Bank loans                              $  3,027,335        $  2,659,491
        Commercial paper-unsecured                    43,470             201,338
        Other                                         25,780              40,701
                                                ------------        ------------
                                                   3,096,585           2,901,530

      US $ Dollars-Denominated:
        Bank loans                                 1,953,489             641,360
        Other                                          4,645               4,342
                                                ------------        ------------
                                                   1,958,134             645,702
                                                ------------        ------------
                                                   5,054,719           3,547,232
          Less current installments                1,461,118           1,167,541
                                                ------------        ------------
                                                $  3,593,601        $  2,379,691
                                                ============        ============
</TABLE>


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


      Bank loans are secured by most of the Company's land, buildings,
      machinery and equipment and vehicles, and are due from January 1997
      through April 2003.

      Interest rates for long-term debt are as follows:

<TABLE>
<CAPTION>

                                              1996              1995
                                              ----              ----
     <S>                                  <C>              <C>
      US dollar loans                       8%-10.75%       6.84%-10.75%
      Costa Rican colones loans            23%-30.25%        26.25%-33%
      Commercial paper-unsecured             20%-34%         20%-39.75%

</TABLE>

      Future payments on long-term debt at September 30, 1996 are as follows:

<TABLE>
<CAPTION>

                           Year                          Amount
                           ----                          ------

                          <C>                        <S>
                           1997                       $  1,461,118
                           1998                            914,479
                           1999                            812,513
                           2000                            440,498
                           2001                            440,101
                        Thereafter                         986,010
                                                      ------------
                                                      $  5,054,719
                                                      ============

</TABLE>

(11)  Stockholders' Equity
      --------------------

      CRI

      Common Stock

      As of September 30, 1996, 60,000,000 common shares of CRI at $0.001 par
      value were authorized and 19,559,396 shares had been issued.

      Preferred Stock

      As of September 30, 1996, 5,000,000 preferred shares of CRI were
      authorized and no shares had been issued.

      PIPASA

      Preferred Stock

      As of September 30, 1996, 82,169 Class "C" preferred shares were
      authorized but not issued.  No price in US dollars can be set for these
      shares that are authorized but not issued.  The price in US dollars for
      these shares will depend on the prevailing exchange rate at the time the
      shares are actually issued.

      317,831 Class "C" preferred shares amounting to $2,216,072 were
      authorized and outstanding.  The main characteristics of Class "C"
      preferred shares are as follows:

      -  The 53,034 shares of Class "C-A" and the 60,702 shares of Class "C-B"
         and 72,695 shares of Class "C-D" receive a 10% annual dividend payable
         monthly and adjustable by the Board of Directors.

      -  The 131,400 shares of Class "C-C" receive an dividend equal to the
         prime rate set by the Central Bank of Costa Rica plus two points and
         payable monthly.

      As of September 30, 1996, 200,000 Class "D" shares were authorized but
      not issued.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


      Retained Earnings
      -----------------

      Costa Rican legislation requires that 5% of annual net income (in local
      currency) up to an amount equivalent to 20% of total capital stock, be
      allocated to a legal reserve.  As of September 30, 1996 and 1995, the
      Company has set aside earnings of $296,781 and $236,105 respectively,
      for the creation of a legal reserve.

(12)  Operating Leases
      ----------------

      The Company has operating leases for vehicles and cooling equipment.
      At the end of lease terms, the Company has the option of returning
      the equipment or buying the equipment at a depreciated price.  A
      percentage of the money paid during the lease terms will be applied to
      this reduced purchase price.

      Under the lease terms, the Company is required to maintain a
      self-insurance trust with the lessor bank.  An initial deposit is made
      with the bank at the inception of the lease to create the self-insurance
      fund.  After an initial 6 month period, during which time the Company
      does not need to make payments to the Fund, the Company is required
      to make monthly payments to the Fund for the remainder of the lease
      term.  In case of accidents or major repairs to vehicles under the
      lease, the Company submits request for reimbursement, less a deductible,
      to the Fund.  The life of each trust is equivalent to the duration of
      the respective lease.  At the end of the lease term, any remaining
      funds will be returned to the Company.  The Company established three
      funds in May, July and August 1995, and no claims have been filed.  The
      balance of the self-insurance fund amounted to $80,736 and $113,574 at
      September 30, 1996 and 1995, respectively.

      Future minimum lease payments for the years ending in September 30 are
      as follows:

<TABLE>
                        <C>                          <S>
                         1997                         $  307,734
                         1998                            213,495
</TABLE>

      Rental expenses for operating leases amounted to $276,740, $252,143 and
      $413,712 in 1996, 1995 and 1994, respectively.

(13)  Income Taxes
      ------------

      Income tax expense attributable to income from continuing operations
      for the years ended September 30, 1996, 1995 and 1994 consists of:

<TABLE>
<CAPTION>
                                           Current       Deferred         Total
                                           -------       --------         -----

     <S>                                <C>             <C>           <C>
      Year ended September 30, 1996:     $  244,431         -          $  244,431
      Year ended September 30, 1995:     $  250,802         -          $  250,802
      Year ended September 30, 1994:     $  137,463         -          $  137,463

</TABLE>


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


      Costa Rican income tax expense attributable to income from continuing
      operations was $244,431, $250,802, and $137,463, for the years ended
      September 30, 1996, 1995, and 1994, respectively, and differs from the
      amounts computed by applying the Costa Rican corporate tax rate of 30%
      to pretax income from continuous operations as a result of the following:

<TABLE>
<CAPTION>
                                                         1996              1995            1994
                                                         ----              ----            ----

     <S>                                            <C>               <C>               <C>
      Computed "expected" income tax expense         $    904,782      $  1,125,704      $    889,995
      Increase (reduction) in income taxes
        resulting from:
        Interest earned outside Costa Rica
          and other income not subject to taxation       (106,994)          (87,619)          (72,297)
        Reduction of allowance for doubtful
          accounts                                         -                (39,848)           -
        Tax benefits under Costa Rica Income Tax
          Law Article 8, Section T for Agricultural
          Companies and Article 8, Section F             (356,136)         (483,277)         (406,998)
        Deduction for reinvestment of prior
          year earnings in machinery and
          equipment under Costa Rica Income Tax
          Law Article 8, Section T for Agricultural
          Companies                                      (250,284)         (302,332)         (291,696)
        Non-Deductible depreciation expense                57,792            40,432            19,508
        Export incentives granted under Costa Rica
          Income Tax Law Article 66                        (4,729)           (2,258)           (1,049)
                                                     ------------      ------------      ------------
                                                     $    244,431      $    250,802      $    137,463
                                                     ============      ============      ============
</TABLE>


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


      The tax effects of temporary differences that give rise to significant
      portions of the deferred tax assets and deferred tax liabilities at
      September 30, 1996, 1995 and 1994 are presented below:

<TABLE>
<CAPTION>
                                                         1996              1995            1994
                                                         ----              ----            ----

     <S>                                            <C>               <C>               <C>
      Deferred tax assets

      Allowance for doubtful accounts                $     44,230      $     23,104      $     38,264
      Revaluation of property, plant and
        equipment depreciable for Costa Rican
        tax purposes                                    2,547,293         2,614,635         3,326,463
                                                     ------------      ------------      ------------
      Total gross deferred tax assets                   2,591,523         2,637,739         3,364,727
      Less valuation allowance                         (2,591,523)       (2,637,739)       (3,364,727)

      Net deferred tax assets                              -                 -                 -
                                                     ============      ============      ============

</TABLE>

      The Company has not recognized a deferred tax asset for the current
      year or the prior years.  The valuation allowance has been established
      at 100% of the deferred tax asset balance.  Under Costa Rican Income Tax
      Law, the Company is subject to a 1% asset tax which may be credited
      against the regular income tax liability.  However, if the income tax
      is less than the asset tax liability in the same tax year, the asset
      tax must still be paid in full.  The deferred tax asset results
      primarily from the revaluation of the fixed assets.  The Company has
      historically reported a slightly higher asset tax liability compared to
      the income tax liability.  In addition, the Company has significant tax
      incentives available in Costa Rica which will reduce future taxable
      income thereby reducing the potential benefit of the additional
      depreciation resulting from the fiscal asset revaluation.  Based on the
      above, the Company's management does not consider that the deferred tax
      asset will be realized in the foreseeable future and thereby justify
      the recognition of a deferred tax asset on the financial statements.

      In accordance with the Costa Rican income tax regulations, the
      companies are required to file the annual income tax returns for the
      twelve-month period ended September 30 of each year.

      The income tax returns of Pipasa for the years ended September 30, 1994
      through 1996 are open to inspection by the Costa Rican tax authorities.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


(14)  Stock Warrants
      --------------

      On January 21, 1994, the Company entered into an investment banking
      agreement with M. H. Meyerson & Co.  The agreement required the Company
      to issue warrants to purchase 300,000 shares of common stock with an
      exercise price of $1.85 per warrant and demand and piggyback registration
      rights.  The registration rights may not be demanded during the 18
      months immediately following the date of the agreement.  The rights
      become exercisable 19 to 48 months after the date of the agreement.

      On June 1, 1994, Management of the Company approved the issuance of
      warrants to purchase 200,000 shares of common stock at $.75 per share to
      an outside consultant in exchange for services to be rendered to the
      Company.

      On August 1, 1995, the Management of the Company approved the sale of
      warrants to two members of its Board of Directors and one independent
      consultant, for the purchase price of $100 each.  The warrants are
      for the purchase of a total of 250,000 shares of the Company's
      $0.001 common stock at an exercise price of $0.10 per share.  The
      warrants may be exercised anytime from August 1, 1995 to August 1, 2000.
      Between November and December 1996, 250,000 warrants were exercised
      and both Directors and the independent consultant received 250,000
      shares.

(15)  Concentration of Risk
      ---------------------

      Financial instruments that potentially subject the Company to
      concentrations of credit risk consist primarily of cash equivalents,
      short-term investments, and trade receivables.

      The Company places its cash equivalents and short-term investments with
      high credit quality financial institutions.

      Concentrations of credit risk with respect to trade receivables are
      limited because a large number of geographically diverse customers make
      up the Company's customer base.  Thus, the trade credit risk is wide
      spread.  The Company controls credit risk through credit approvals,
      credit limits and monitoring procedures.  Losses due to uncollectible
      receivables have not been material.

(16)  Commitments and Contingencies
      -----------------------------

      The Company does not have damage insurance or a specific self-insurance
      fund for vehicles that are not under lease agreements.  The Company has
      liability insurance to cover third parties through an umbrella policy
      ranging from $58,153 to a maximum of $1,453,826.


                                                                    (Continued)

<PAGE>

                 COSTA RICA INTERNATIONAL, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                       September 30, 1996, 1995 and 1994


      The income tax returns of Pipasa for 1993, 1994 and 1995 were assessed
      at $43,922 and $169,851 and $85,907, respectively.  Due to the
      disallowance by the Costa Rican tax authorities of approximately 26.03%
      in the aggregate of the deductions taken by Pipasa for 1993, 1994, and
      1995, the 1993 assessment has been contested, and 1994 and 1995
      assessments are in the process of being contested by the Company.
      Management does not believe this matter will be resolved in the next
      fiscal year.  No accrual has been made for any losses that may result
      from the resolution of this uncertainty.

      The Company is involved in various other claims and legal actions
      arising in the ordinary course of business.  In the opinion of
      Management, the ultimate disposition of these matters will not have a
      material adverse effect on the Company's consolidated financial position,
      results of operations or liquidity.


<PAGE>

                                     SIGNATURES
                                     ----------

          In accordance with Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant that duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                     COSTA RICA INTERNATIONAL, INC.



Dated:  August 29, 1997              By:/s/---------------------------------
                                        Calixto Chaves
                                        Chairman


Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

                                     CHIEF FINANCIAL AND ACCOUNTING OFFICER



Dated:  August 29, 1997              By:/s/--------------------------------
                                        Lic. Jorge Ml. Quesada
                                        Treasurer


                                     SECRETARY



Dated:  August 29, 1997              By:/s/----------------------------------
                                        Monica Chaves
                                        Secretary