ASA INTERNATIONAL LTD.
                                 10 Speen Street
                         Framingham, Massachusetts 01701

                                 (508) 626-2727



March 30, 2000



Securities and Exchange Commission
450 5th Street, N.W.
Judiciary Plaza
Washington, D.C.  20549

Attention:  Filing Desk
-----------------------


                     RE:  ASA INTERNATIONAL LTD.
                          SEC FILE NO. O-14741

Pursuant to regulations of the  Securities  and Exchange  Commission,  submitted
herewith for filing on behalf of ASA  International  Ltd. (the "Company") is the
Company's Report on Form 10-K for the fiscal year ended December 31, 1999.

This  filing  is being  effected  by  direct  transmission  to the  Commission's
Operational EDGAR System.

Very truly yours,

ASA INTERNATIONAL LTD.


/s/ Terrence C. McCarthy


Terrence C. McCarthy
Vice President and Treasurer
<PAGE>
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, D.C. 20549
                              ----------------------
                                    FORM 10-K

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

For the fiscal year ended                             Commission file number:
December 31, 1999                                     0-14741
-------------------------                             ----------------------

                              ASA INTERNATIONAL LTD.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

          Delaware                                         02-0398205
-------------------------------                        --------------------
(State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

   10 Speen Street, Framingham, MA                            01701
-----------------------------------------                   ----------
 (address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code: (508) 626-2727
------------------------------------------------------------------

Securities registered pursuant to Section 12(b) of the Act:
----------------------------------------------------------
Title of each class                                     Name of each exchange
-------------------                                     on which registered
                                                        ---------------------
None                                                    Not Applicable

Securities registered pursuant to Section 12(g) of the Act:
-----------------------------------------------------------
                                 Title of Each Class
                           -------------------------------
                            Common Stock, $.01 par value
                           Preferred Stock Purchase Rights

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


     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not 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-K or any amendment to this
Form 10-K. [ ].

<PAGE>
     As of March 24, 2000,  3,092,285 shares of Common Stock, $.01 par value per
share, were outstanding. The aggregate market value, held by non-affiliates,  of
shares of the Common Stock, based upon the average of the bid and ask prices for
such stock on that date was approximately $10,400,000.



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



                                                  Part of Form 10-K Annual
                                                  Report in which Document
Document                                          is Incorporated
--------                                          ------------------------


Definitive Proxy Statement to be
supplied to Shareholders in conjunction
with the 2000 Annual Meeting of Shareholders             Part III
<PAGE>
                                        PART I


ITEM 1.     Business
            --------

GENERAL

Background
----------

     ASA  International  Ltd.  (the  "Registrant"  or  the  "Company")  provides
networked  automation  systems and ongoing monthly support to approximately 1100
businesses  in North and South  America  and  Europe.  The  Company  designs and
develops proprietary  enterprise software for the following markets: tire dealer
and  retreader,  law  firms,  manufacturing  companies  in Italy,  and  software
companies,  system integrators and e-focused companies. The Company installs its
software on a variety of computers and networks,  and various  Unix/Open Systems
hardware platforms, and provides implementation,  education, custom development,
and long-term software support to its customers.

     The  Company  has  divested  certain  product  lines in 1999 as more  fully
described below under the heading "Recent Acquisitions and Divestitures."

     The Company's current  operations are comprised of four product lines and a
corporate services group which supports all four product lines. The four current
product lines are:

     Tire  Systems.   Integrated  offering  of  systems  and  services  designed
specifically  for the  multi-user  environments  of today's tire and  automotive
after-market    businesses.    ASA   Tire   Systems   offers    e-commerce   and
business-to-business services through eTirePlace.com as well as ASP services.

     e-Business  Management   Application  Software  Systems.   Under  the  name
Khameleon(TM),   the  Company  offers  eBusiness  management   applications  for
software,  service,  system  integration  and e-focused  companies.  Khameleon's
extensive ASP services are targeted to organizations  looking to outsource their
critical front-office to back-office applications.

     Legal  Systems.  Integrated  accounting  and practice  management  software
solutions for law firms in the United States and Latin America.

     ERP Systems.  Integrated  client/server-based  Enterprise Resource Planning
("ERP") systems for manufacturing companies in Italy.

     The Company, founded in 1969, was organized as a Massachusetts  corporation
on December 15, 1982 and was reincorporated as a Delaware  corporation on May 5,
1986. As used in this Report, the term "Company" includes ASA International Ltd.
and its wholly owned  subsidiaries,  ASA Properties,  Inc.  ("Properties"),  ASA
International Ventures, Inc. ("Ventures"),  and ASA Italy, S.r.l. ASA Properties
Inc. is the sole and managing  member of 10 Speen Street LLC, which is the owner
of the Company's corporate headquarters.

                                                                               4
<PAGE>
     The Company's  consulting and general business systems  operations began in
1969 under the direction of the Company's  founder and Chief Executive  Officer,
Alfred C. Angelone.


Recent Acquisitions and Divestitures
------------------------------------

Design Data
-----------

     In November 1999, the Company  acquired the business of Design Data Systems
Corporation,  a Florida  corporation  ("DDSC"),  pursuant to that certain  Asset
Purchase  Agreement  (the "Design  Data  Purchase  Agreement")  by and among the
Company, DDSC, individually (only with respect to certain sections of the Design
Data Purchase Agreement), and Eastern Bank, as Escrow Agent (the "Escrow Agent")
(only with respect to certain  sections of the Purchase  Agreement).  The Design
Data  Purchase  Agreement  provides  that the  transaction  is  effective  as of
September 30, 1999 (the "Effective Date").

     Pursuant  to and as more  fully  set  forth  in the  Design  Data  Purchase
Agreement,  the Company had the right and obligation to purchase  certain of the
assets and assume  certain of the  liabilities  of DDSC for a purchase  price of
$5,000,000 (the "Purchase Price"). Of the Purchase Price, $4,750,000 was paid on
the Closing  Date and $250,000  was  deposited  with the Escrow Agent to be held
pursuant to the terms of the Design Data Purchase Agreement.

     Also  on the  Closing  Date,  the  Company  entered  into a  certain  Asset
Acquisition and Exchange Cooperation  Agreement (the "Exchange  Agreement") with
SQL Acquisition LLC, a Delaware  limited  liability  company  ("SQL"),  Fidelity
National 1031 Exchange  Services,  Inc., a California  corporation,  and Pacific
American Property Exchange Corporation, a California corporation and sole member
and manager of SQL. The Company has entered into the Exchange  Agreement for the
purpose of seeking the ability to  effectuate a like-kind  exchange  pursuant to
Section 1031 of the Internal  Revenue Code of 1986, as amended.  Pursuant to and
as more fully set forth in the Exchange Agreement,  the Company has reserved the
right to exchange  certain  software and related  intellectual  property of DDSC
(the  "Replacement  Property")  for certain other  relinquished  property of the
Company.  In  connection  therewith,  the Company  assigned to SQL the Company's
right and  obligation  under the Purchase  Agreement to acquire the  Replacement
Property pursuant to a certain Assignment Agreement dated the Closing Date among
the Company, DDSC and SQL (the "Assignment"). On the closing Date, the following
actions were completed:

1. SQL acquired the Replacement Property from DDSC in accordance with the Design
Data  Purchase  Agreement  and the  Assignment  in  exchange  for a  payment  of
$4,300,000.

2. The Company  acquired the remainder of DDSC's  assets in accordance  with the
Design Data  Purchase  Agreement in exchange for (a) the payment of $700,000 (of
which  $250,000 was deposited  with the Escrow Agent) and (b) the  assumption of
certain of Seller's liabilities.

                                                                               5
<PAGE>
3. The Company loaned SQL $4,300,000  pursuant to the Exchange Agreement and SQL
executed a related  promissory note in the principal amount of $4,300,000 due on
November  3,  2000 and  bearing  interest  at the rate of 6.18% per  annum.  The
proceeds of the note were used by SQL to acquire the Replacement Property.

4. SQL granted a license to the Company to use the  Replacement  Property  until
November 3, 2000 pursuant to a License Agreement between the Company and SQL, in
exchange for a one-time license fee of $285,000.

     The Company  anticipates that it will seek to complete a like-kind exchange
involving the Replacement Property on or before November 3, 2000, although there
can be no assurance that such an exchange will be completed.

SmartTime
---------

     In August 1999, the Company granted to a company  ("Optionee") an option to
purchase the Company's  SmartTime  product line,  client/server  enterprise-wide
payroll  software.  As per  the  terms  of the  Option  Agreement,  the  Company
transferred the assets and liabilities of its SmartTime  product line to a newly
formed LLC  ("Newco"),  of which the Company is the sole member and the Optionee
is the manager.

     The Option Agreement  provides that the Optionee has the option to purchase
the  SmartTime  product  line from Newco at any time from August 1, 2000 through
August 31, 2000 (the "Option  Period"),  or at such earlier date as agreed to by
the parties, for an aggregate purchase price of $7,020,000,  less any option fee
paid to date (the "Purchase Price"). The terms and conditions of the acquisition
are set  forth in an Asset  Purchase  Agreement  dated as of August 2, 1999 (the
"Smart Time Purchase Agreement"). The SmartTime Purchase Agreement provides that
the sale will occur, if at all, within two days after exercise of the option and
the  satisfaction  of certain  other  conditions  as specified in the  SmartTime
Purchase  Agreement.  During the Option  Period,  the  Optionee  will employ the
employees of the SmartTime  product line and will bear the risk of its financial
performance.

     The Optionee paid an initial  option fee in the amount of  $1,660,000  upon
execution of the Option  Agreement and is required to pay a second option fee on
August 1, 2000 in the amount of  $540,000,  unless the  Optionee  exercises  the
option prior to such date. The option fees are non-refundable to the Optionee in
the event  that the  Optionee  does not  exercise  the  option to  purchase  the
SmartTime  product line, as to which there can be no assurance.  Pursuant to the
Option  Agreement,  the Optionee has loaned to the Company the sum of $3,200,000
(with  respect to which the  Company  has  prepaid  $160,000  in  interest).  In
addition,  Newco has agreed to loan the Optionee an amount equal to the net cash
of Newco available after collection of Newco's  accounts  receivable and payment
of Newco's accounts payable.

     The  Optionee  has  purchased   exclusive  licenses  to  use  the  customer
intangibles and intellectual  property of the SmartTime  product line during the
Option  Period for $300,000 and  $500,000,  respectively.  In the event that the
Optionee  does not exercise the option to purchase  the  SmartTime  product line
prior to the  expiration of the Option Period,  the Optionee's  rights under the
above-mentioned  license  agreements  would  terminate and the Company,  through
Newco, would retain ownership of these assets.

                                                                               6
<PAGE>
     The net assets of the SmartTime product line are included in current assets
in the  Company's  balance  sheet at  December  31,  1999.  The  results for the
operations  of this product  line are shown in the  Consolidated  Statements  of
Operations  for the year ended  December  31, 1999 under the caption  "Equity in
Loss from Affiliate."

CommercialWare
--------------

     Effective March 3, 1999, the Company sold  substantially  all of the assets
of the Company's  CommercialWare  Division  ("CWI") to  CommercialWare,  Inc., a
Delaware  Corporation  ("CW").  CWI provided  enterprise  order  management  and
fulfillment  systems  to  consumer,   business  catalog,  direct  marketing  and
electronic commerce firms. In connection  therewith,  the Company transferred to
CW certain of the  liabilities  of CWI.  The  Company  received  (i) cash in the
amount of $4,000,000, (ii) a promissory note in the amount of $1,700,000,  (iii)
a junior  promissory note in the amount of $500,000,  (iv) 30,000 shares of CW's
common stock,  par value $.01 per share,  and (v) one (1) share of CW's Series A
Preferred Stock.

International Trade and Transportation Systems Group
----------------------------------------------------

     In December 1996, the Company  completed the  disposition of  substantially
all of the assets  and  liabilities  of the  Company's  International  Trade and
Transportation  Systems Group (the "International  Group") to TradePoint Systems
LLC  ("TradePoint"),  a New Hampshire limited liability company. In exchange for
the assets of the  International  Group and the assumption of the  International
Group's  liabilities,   the  Company  received  a  16%  membership  interest  in
TradePoint  and a  subordinated  promissory  note in the face amount of $600,000
from  TradePoint  (the  "TradePoint   Note").  The  remaining  84%  interest  in
TradePoint  is owned by  Christopher  J. Crane,  the former  president  of and a
former  director of the Company.  Simultaneously,  with the  completion  of this
transaction,  Mr. Crane resigned from all of his positions with the Company.  In
exchange for his interest in TradePoint,  Mr. Crane (i)  contributed  all of the
Company's  common stock,  $.01 par value per share (the "Common Stock") owned by
him,  totaling  665,597  shares;  (ii) assigned to the Company a 16% partnership
interest  in the ASA  Investment  Partnership,  a  partnership  by and among Mr.
Crane,  the Company,  and Alfred C.  Angelone,  the  Company's  Chief  Executive
Officer and Chairman;  and (iii) canceled all of his options to purchase 245,000
shares  of  Common  Stock  of the  Company.  The  consideration  to be paid  was
determined by negotiations  between the parties and was independently  evaluated
on behalf of the Company by Shields & Company, Inc. The Company accounts for its
investment in TradePoint under the cost method.

     In connection with the  transaction,  TradePoint  granted to the Company an
irrevocable  proxy covering the Company's Common Stock owned by TradePoint.  The
Company has the right to cause TradePoint to redeem the 16% membership  interest
in TradePoint  held by the Company by notice given on or after March 1, 2002, in
exchange for the Company's  Common Stock held by TradePoint  and the fair market
value of the 16% membership interest in TradePoint.  TradePoint has the right to
redeem the Company's  membership  interest by notice given on or after  December
31, 2001 in exchange for the  Company's  Common Stock held by it and the greater
of  $400,000  or the  fair  market  value  of the  16%  membership  interest  in
TradePoint.

     During  the  past  year,   there  have  been  no  bankruptcy   proceedings,
receivership,  or similar  proceedings  with respect to the Registrant,  nor has
there been any merger or consolidation  of the Registrant,  and, except as noted
above,  there has been no disposition of any material amount of the Registrant's
assets.

                                                                               7
<PAGE>
BUSINESS

     The following  paragraphs describe in greater detail the business conducted
by the Registrant.

Tire Systems
------------

     The Company provides integrated hardware and software multi-user  solutions
on  Sun,   Compaq/DEC  and  Unix-based  systems  to  independent  tire  dealers,
wholesalers,  and retreaders in the United States,  Canada and South America for
Business-to-Business  ("B2B")  via the  Internet,  point-of-sale,  work  orders,
inventory control,  purchasing,  and accounting functions.  The systems range in
price between approximately $25,000 and $300,000.

     In  September  1988,   July  1989,   September  1990,  and  November  1996,
respectively, the Company acquired Associated Software Consultants Organization,
Inc.,  Snyder  Computing  Systems,  Computers  Northwest,  and certain assets of
Progressive  Computer  Systems,  Inc.,  all of which  specialized  in  supplying
computer systems to independent  tire dealers.  In recent years, the Company has
consolidated  its  position  in the  independent  tire dealer  marketplace.  The
Company  believes that it has the largest  installed  base of  independent  tire
retailer and distributor multi-user computer systems in the United States.

     Within this  operating  group,  the Company  also  continues  to  maintain,
upgrade, and support legacy manufacturing  management and control and accounting
software based primarily on the DEC hardware platform.

Legal Systems
-------------

     The Company provides integrated  client/server-based  financial management,
knowledge  base  management  and file room  management  systems for mid-size law
firms and corporate  legal  departments  throughout  the United States and Latin
America. The Company's Visual Pyramid,  Visual FastTrack and Visual One products
are a powerful,  fully integrated suite of legal specific  applications designed
to run on PC  networks.  The products are written  using  Microsoft  development
tools and  Microsoft  relational  database  technology.  Systems  range in price
between approximately $50,000 and $200,000.

     The Company entered the legal systems marketplace in June 1991 by acquiring
Quorum  Legal  Systems of  Plymouth  Meeting,  Pennsylvania  from  Control  Data
Corporation.  In January  1992,  the Company  acquired the fixed assets of Legal
Data Systems of Boston,  Massachusetts.  In November 1994, the Company  acquired
certain software  products of Precedent  Technologies  Incorporated of New Hope,
Pennsylvania. In July 1999, the Company acquired substantially all of the assets
of Chase Technologies  Incorporated of Washington  Crossing,  Pennsylvania.  The
Company believes it has an estimated 12% share of the mid-sized law firm market.

                                                                               8
<PAGE>
e-Business Management Applications Software
-------------------------------------------

     The  Company  offers a  modular  suite of back- and  front-office  software
applications  based on the Oracle  platform,  marketed  under the name Khameleon
Software. The product, designed to meet the needs of software companies, systems
integrators,  service and e-focused  companies,  includes the following modules:
Marketing & Sales Force Automation,  Contracts & Logistics  Management,  Project
Accounting  &  Management,   Customer  Relationship   Management  and  Financial
Accounting & Management. Systems range in price from $50,000 to $300,000.

ERP Systems
-----------

     The  Company,  through  its ERP  Systems  Group  located in Venice,  Italy,
provides fully  integrated  client/server-based  ERP systems which run under the
UNIX and NT operating  systems.  The product  line,  called "GX," is targeted at
mid-range  companies  with 20 to 60 users  throughout  Italy.  The products were
developed using C++ and operate with many popular relational databases including
Oracle, Microsoft SQL, and Informix.

Marketing
---------

     The Company markets its products and services to new prospects and existing
customers  primarily  using  the  Company's  direct  sales  force,  assisted  by
technical  personnel.  These personnel are trained in the Company's  product and
service offerings and in the operations of the Company's customers.  The Company
uses its own personnel, rather than third-party distributors,  because prospects
and the  Company's  customers  often lack  comprehensive  computer  and  systems
technical expertise and require a "consultative"  selling approach,  involving a
long selling cycle.

     More importantly, the Company's objective is to develop a direct, long-term
relationship with each customer.  This marketing approach requires  substantial,
specialized  knowledge of the requirements of the Company's  customers generally
not available from third-party  distribution  arrangements.  These  requirements
result from the intangible nature of applications software and related services,
the  sophistication of the Company's  products and the need for each customer to
understand  how the  Company's  products  and  services  will  work to meet  its
requirements.  The Company's sales force is supported by marketing personnel who
develop  advertising  and  marketing  campaigns;   produce  product  literature,
periodic  newsletters,  and direct mail campaigns;  arrange  attendance at trade
shows and conventions; and sponsor seminars.

     Marketing  to  a  new  prospect   consists  of  identifying  the  prospect,
qualifying  the  prospect  and, if the  prospect  is  qualified,  preparing  and
presenting a sales proposal.  In the tire, legal, ERP, and e-Business Management
Applications  Software  markets served by the Company,  the total market is well
defined through the respective industry and professional organizations. In these
markets, trade shows and direct contacts are used to determine how prospects are
satisfying their information processing requirements.

                                                                               9
<PAGE>
     Once a prospect  is  qualified  as to interest  in the  Company's  products
and/or services, the direct sales and, as required, support personnel, visit the
prospect to  understand  the  prospect's  specific  requirements.  This  process
usually  results in the  preparation of a written  proposal which  describes the
hardware,  software,  and services that will meet the  prospect's  requirements.
This sales cycle can be long,  ranging  from six months to beyond one year.  The
Company  believes  the  success  of  its  sales  activities  depends  upon  this
consultative approach.

     The  Company   believes  that  its  customer   base   presents   continuing
opportunities  for sales of  additional  software and  services.  The  Company's
products  and  services  generally  become an  integral  part of the  customer's
business.  As a result,  the quality of customer support is essential to selling
to existing customers.

     The Company  maintains  frequent  contact with customers  through sales and
service  representatives.  The Company provides customer support lines to handle
customer  system  operational  issues  within a prescribed  response  time,  and
continually  communicates  with its customers  through  newsletters and customer
seminars.  Through  frequent contact with its customers by marketing and service
activities,  the  Company  believes  that  it  can  better  understand  customer
requirements and direct its product development activities toward developing and
enhancing  products that should be well accepted by both existing  customers and
new prospects.

Sources and Availability of Raw Materials
-----------------------------------------

     The  Company's  systems  operate on computer  hardware  supplied by leading
hardware  manufacturers  pursuant to Original  Equipment  Manufacturer  or Value
Added  Reseller  Agreements.  These  agreements  are renewable on a year-to-year
basis, and entitle the Company to purchase  equipment at various discounts based
upon  volume and the type of  equipment.  The loss of the  Company's  ability to
purchase  equipment from such  manufacturers  would not have a material  adverse
effect on the  Company's  business.  The Company could also continue to purchase
from hardware  distributors,  but on terms less favorable than from the original
manufacturer.  The Company  believes  that its  relationship  with the  hardware
manufacturers is satisfactory.

     The Company purchases all of its computer hardware and peripheral equipment
from hardware vendors, and performs only software  installation,  testing, final
system  configuration,  and  quality  control.  The Company  believes  there are
several alternative suppliers for system components used by the Company.


                                                                              10
<PAGE>
Patents and Proprietary Technology
----------------------------------

     The Company does not believe that patents are material to its business. The
Company relies primarily upon trade secrets,  unpatented  proprietary  know-how,
and continuing  technological innovation to develop and maintain its competitive
position. In particular, the Company generally provides only "run time" code for
its software to its tire and legal clients,  although  certain legal clients may
also purchase "source" code. In addition,  most Khameleon  Software clients have
source  code  licenses.  Insofar  as the  Company  relies on trade  secrets  and
unpatented know-how, there can be no assurance that others may not independently
develop similar technology or that secrecy will not be breached. Certain product
names of the Company are recognized as trademarks in interstate commerce and are
or may be registered trademarks.

Seasonality
-----------

     The Company has not experienced material seasonality in its business, other
than that due to the economic  fluctuation  of the  economies of North and South
America and Italy.

Working Capital Items
---------------------

The  Company  does not have any unusual  trade  practices  which  would  require
restrictions on working capital.

Revenue by Product Line
-----------------------

     During the  fiscal  years  ended  December  31,  1999,  1998 and 1997,  the
Company's revenue by product line was approximately as follows:
<TABLE>
<CAPTION>

                               1999            1998              1997
                          ---------------  ----------------  ----------------
Product Line              Revenue($)   %   Revenue($)    %   Revenue($)    %
------------              ----------  ---  ----------   ---  ----------   ---
<S>                      <C>          <C>  <C>          <C>  <C>          <C>
Tire Systems             $10,741,000  42%  $ 8,735,000  25%  $ 5,877,000  23%
Legal Systems              6,222,000  24     5,150,000  15     4,205,000  16
e-Business Management
  Applications Software    1,965,000   8          -                 -
ERP Systems                2,899,000  11     3,513,000  10          -
SmartTime Software/
  Legacy products          3,796,000  15     6,870,000  19     7,822,000  31
ASA Consulting                  -              424,000   1          -
CommercialWare                  -           10,776,000  30     7,603,000  30
                         ----------- ----  ----------- ----  ----------- ----
                         $25,623,000 100%  $35,468,000 100%  $25,507,000 100%
                         =========== ====  =========== ====  =========== ====

</TABLE>



                                                                              11
<PAGE>
Backlog
-------

     Set forth below is information concerning the Company's backlog at December
31, 1999 and 1998, respectively:
<TABLE>
<CAPTION>
                                               Backlog at December 31,
                                               -----------------------

                                          1999                        1998
                               -------------------------   -------------------------
                                                Support                     Support
Product Line                       Total       Contracts       Total       Contracts
------------                       -----       ---------       -----       ---------
<S>                            <C>           <C>           <C>           <C>
Tire Systems/Legacy Products   $ 2,700,000   $ 2,000,000   $ 4,300,000   $ 1,900,000
Legal Systems ..............     2,200,000     1,700,000     2,900,000     1,600,000
ERP Systems ................       600,000       500,000     1,100,000       600,000
e-Business Management
  Applications Software ....     1,600,000       900,000          --            --
SmartTime Software .........          --            --       2,700,000     1,100,000

                               -----------   -----------   -----------   -----------
                               $ 7,100,000   $ 5,100,000   $11,000,000   $ 5,200,000
                               ===========   ===========   ===========   ===========
</TABLE>
The Company  expects that all of the backlog  existing at December 31, 1999 will
be filled in fiscal year 2000. Support contracts are generally cancelable by the
Company or the Company's customers upon 90 days prior written notice.

Customers
---------

     See Item 14(a)1 Note I in the  Company's  Notes to  Consolidated  Financial
Statements.

Competition
-----------

     The Company's  primary  competitors for Tire Systems are Madden Co., Signal
Software and TireMaster.  The Company believes the principal competitive factors
for tire systems are:  the ability to offer B2B products via the  Internet;  the
ability to offer web site development;  complete point-of-sale  functionality to
assist  sales  personnel to maximize  gross margin on each sale;  the ability to
post data  automatically  to the  accounting  system;  the  ability to track the
manufacturing  process  of tire  retreaders;  the  ability  to  have  electronic
connectivity to manufacturers;  and the availability of marketing products which
assist in retaining  and  increasing  existing  customer  business.  The Company
believes it competes favorably with respect to all of these factors.

     The Legal  Systems  market is highly  competitive.  The  Company's  primary
competitors  for legal  systems  are  CMS/DATA  Corp.,  Elite  Data  Processing,
Barrister,   Prolaw,   and  Omega.  The  Company  believes  that  the  principal
competitive  factors in the legal systems  business are:  vendor  reputation and
references;  the  ability to provide 32 bit  client/server  products  with a GUI
front end and MS SQL Server back end; the ability to easily interface with other

                                                                              12

<PAGE>
Windows-based  applications;  the ability to run both the "front office" and the
"back office"  applications on a single network;  product  reliability;  and the
quality of professional  services and support.  The Company believes it competes
favorably with respect to all of these factors.  ASA Legal System's market share
in the mid-size law firm market is estimated to be 12%.

     The  E-Business  Management  Applications  Software  market is also  highly
competitive.  The primary  competitors for the Company's  Khameleon product line
are SOFTRAX, Great Plains,  Solomon, Deltec and Lawson. The Company believes the
principal competitive factors for these systems are: cost; name recognition; the
quality of professional services and support; and the ability to manage business
processes that integrate customers;  suppliers and business partners.  While the
Company believes it competes favorably with respect to most of these factors, it
has embarked on a marketing  campaign to increase the  visibility of its product
in the marketplace.

     The mid-range ERP market in Italy is highly  competitive with the principal
competition  coming from highly  competent and efficient  local  providers.  The
principal competitive factors are: market visibility; reputation and references;
solid  technology;  Year 2000 and EURO compliance;  product  functionality;  and
quality of professional  services.  The Company  believes it competes  favorably
with respect to each of these factors.

Research and Development
------------------------

     During the last three  fiscal  years,  the amounts  spent by the Company on
Company-sponsored  research and development activities and on customer-sponsored
research  activities relating to the development of new products,  services,  or
techniques or the improvement of existing products, services, or techniques were
not material.

Government Regulation
---------------------

     There is presently no material  government  regulation  with respect to the
Company's   business.   Approvals  for  computer  hardware  from   Underwriter's
Laboratories  and the  Federal  Communications  Commission  are  obtained by the
hardware  manufacturer.  However, the extent to which future federal,  state, or
local governmental  regulations may regulate the Company's  activities cannot be
predicted,  and the  Company  may be  subject to  restrictions  on export of its
computer systems to other countries if it seeks further  expansion into non-U.S.
markets.

Employees
---------

     As of December 31, 1999, the Company had 212 full time employees.  Of these
employees,  9 are  executive  officers  or senior  managers,  29 are  engaged in
marketing and sales, 79 in customer support and training,  67 in  product/custom
development or engineering and 28 in general and administrative  positions.  The
Company's  ability to develop,  market and sell  products and to  establish  and
maintain its  competitive  position in light of new  technological  developments
will  depend,  in large part,  on its  ability to attract  and retain  qualified
personnel.  The  Company  believes  that  it has  been  successful  to  date  in

                                                                              13

<PAGE>
attracting skilled personnel critical to its business.  No employees are covered
by collective bargaining agreements. Management of the Company believes that its
relationship with its employees is satisfactory.

Financial Information about Geographic Areas
--------------------------------------------

     See Item 14(a)i,  Note J, in the Company's Notes to Consolidated  Financial
Statements.

ITEM 2.          Description of Properties
                 -------------------------

     The Company's  corporate  headquarters  are located in a 32,000 square foot
office building at 10 Speen Street, Framingham,  Massachusetts. This property is
owned  by 10 Speen  Street  LLC,  a  Delaware  limited  liability  company.  ASA
Properties,  Inc., a wholly owned subsidiary of the Company, is the managing and
sole member of 10 Speen Street LLC. The Company  occupies  approximately  17% of
the space in the building,  while  tenants lease the remainder of the space.  In
September 1998, the Company refinanced this facility with a $3,000,000  mortgage
loan at 7.24% for 10 years with  monthly  principal  and  interest  payments  of
$20,445 through October 2008 and a final payment of approximately  $2,638,000 of
principal, together with interest thereon.

     The Company's Tire Systems  operations are located in  approximately  7,000
square  feet of a 24,000  square foot  office  building  at 615 Amherst  Street,
Nashua, New Hampshire,  purchased in December 1992.  Approximately 12,000 square
feet of the  facility  is leased to  TradePoint  Systems,  LLC under a long-term
lease.  The carrying costs for the facility  include  approximately  $10,000 per
month for principal and interest on  twenty-year  mortgage  notes plus operating
costs and taxes.

The Company maintains the following additional offices:

                            Current                     Date of Lease
Location                  Monthly Rent    Office Area   Expiration
--------                  ------------    -----------   ----------------

Blue Bell, Pennsylvania     $12,736       9,667 s.f.   January 31, 2006

Kirkland, Washington        $ 4,805       3,720 s.f.   October 31, 2001

Clearwater, Florida         $17,252      16,252 s.f.   September 30, 2004

Udine, Italy                $ 1,516       3,068 s.f.   December 31, 2000

Venice, Italy               $ 6,831       5,801 s.f.   February 28, 2001


ITEM 3.          Legal Proceedings
                 -----------------

      There are no material  pending legal  proceedings  to which the Company or
any of its subsidiaries is a party or of which any of their property is subject.

                                                                              14
<PAGE>
ITEM 4.          Submission of Matters to a Vote of Security-Holders
                 ---------------------------------------------------

     (a) No matter was submitted to a vote of security-holders during the fourth
quarter of the fiscal-year ended December 31, 1999,  through the solicitation of
proxies or otherwise.

     (b)  Not applicable.

     (c)  Not applicable.

     (d)  Not applicable.


                                    PART  II

ITEM 5.          Market Price of and Dividends on the Company's Common
                 Equity and Related Stockholder Matters
                 -------------------------------------------------------

     The  Common  Stock of ASA  International  Ltd.  is traded  on the  National
Association of Securities Dealers Automated  Quotation System (NASDAQ) under the
symbol  ASAA.  The table below  indicates  the high and low sales  prices of the
Company's Common Stock during 1998 and 1999:

          Calendar Year 1998           Low           High
          ------------------         -------       --------
          First Quarter               $1.750         $2.313
          Second Quarter              $1.750         $2.250
          Third Quarter               $1.719         $2.125
          Fourth Quarter              $2.000         $2.563

          Calendar Year 1999           Low           High
          ------------------         -------       --------

          First Quarter               $1.875         $2.750
          Second Quarter              $2.500         $2.719
          Third Quarter               $2.250         $2.313
          Fourth Quarter              $2.063         $3.000

     These quotations represent prices between dealers and do not include retail
markups,  markdowns,  or commissions,  and may not necessarily  represent actual
transactions.  There were 1,200 holders of record of the  Company's  outstanding
Common  Stock as of March 24,  2000.  Each  holder  of Common  Stock is also the
holder of a Preferred Stock Purchase Right which entitles the holder to purchase
one one-hundreth of a share of Series A Junior Participating  Preferred Stock of
the Company for each share of Common Stock held by such person upon satisfaction
of certain conditions set forth in the Company's Shareholders Rights Plan.

     Under the terms of a share repurchase  program  authorized by the Company's
Board of Directors in June 1990,  August 1998,  July 1999 and January 2000,  the
Company is authorized  to  repurchase up to $2,000,000 of its Common Stock.  The
Company repurchased shares as follows for the months indicated:

     1991          Number of Shares        Per Share Purchase Price
     ----          ----------------        ------------------------
     December         25,000                         $1.06


     1992          Number of Shares        Per Share Purchase Price
     ----          ----------------        ------------------------
     March             5,000                         $1.15
     May              10,000                          1.53
     July              3,000                          1.81
     August            6,700                          1.81
                       8,100                          2.00
     September        45,000                          1.94
                      15,000                          2.00
                       5,000                          1.99
     October           5,000                          1.88


     1993          Number of Shares        Per Share Purchase Price
     ----          ----------------        ------------------------
     March             5,000                         $1.54
     August           10,000                          2.93
     September         1,800                          3.02


     1997          Number of Shares        Per Share Purchase Price
     ----          ----------------        ------------------------
     December         23,000                         $2.29


     1998          Number of Shares        Per Share Purchase Price
     ----          ----------------        ------------------------
     May              15,000                         $2.15
     June             20,000                          2.05
     July             15,000                          2.03
     August           80,000                          1.99
     September        55,000                          1.97
     October          25,000                          2.13

     1999          Number of Shares        Per Share Purchase Price
     ----          ----------------        ------------------------
     March            62,500                         $2.26
     April            60,000                          2.63
     May              62,000                          2.69
     June             22,500                          2.69
     September         3,877                          3.00
     October           5,000                          2.30
     November         35,000                          2.43
     December         20,200                          2.72
                     -------                         -----
     1999 Total      271,077                         $2.50


                                                                              16
<PAGE>
     Although  it is not  obligated  to do  so,  the  Company  may  continue  to
repurchase shares of Common Stock when market conditions for the purchase of its
stock meet its requirements.

     Since its  organization,  the  Company  has not paid any  dividends  on its
Common  Stock and its Board of  Directors  does not  contemplate  declaring  any
dividends in the foreseeable future. The declaration and payment of dividends in
the future will be  determined  by the Board of Directors in light of conditions
then existing,  including the Company's  earnings,  its financial  condition and
requirements  (including working capital needs), any agreements  restricting the
payment  of  dividends  and  other  factors.   The  Company's   current  banking
arrangements prohibit the payment of dividends by the Company.


ITEM 6.         Selected Consolidated Financial Data
                ----------------------------------------
                (in thousands, except per share amounts)

     The following  selected  consolidated  financial  data are derived from the
consolidated  financial  statements of the Company.  The statement of operations
data for the years ended  December 31,  1999,  1998,  and 1997,  and the balance
sheet data as of December 31, 1999 and 1998,  are derived from and  qualified by
reference to the  consolidated  financial  statements and notes thereto included
herein and audited by BDO Seidman,  LLP,  the  Company's  independent  certified
public  accountants,  as set forth in their report and also  included  elsewhere
herein.  The financial  data for the statement of operations for the years ended
December  31, 1996 and 1995 and the balance  sheet data as of December 31, 1997,
1996 and 1995 have been derived  from the audited  financial  statements  of the
Company (not included herein).

     The  financial  information  set forth below should be read in  conjunction
with,  and is qualified in its  entirety  by, the  detailed  information  in the
consolidated financial statements and notes thereto appearing elsewhere herein.


                                                                              17
<PAGE>
<TABLE>
<CAPTION>
                                               Years Ended December 31,
                                               ------------------------

                                   1999       1998       1997       1996       1995
                                   ----       ----       ----       ----       ----

Operating Data:
---------------
<S>                             <C>        <C>        <C>        <C>         <C>
Revenues ....................   $ 25,623   $ 35,468   $ 25,507   $ 25,471    $ 31,032
Costs, Expenses, and Other
  excluding income tax
  expense ...................     21,534     34,398     24,534     26,362      29,983
Earnings (Loss)
  from Operations ...........        491      1,532      1,485       (144)      1,502
Net Earnings (Loss) .........      2,167        417        388       (649)        457

Basic Earnings (Loss) per
  Common Share ..............   $    .67   $    .12   $    .12   $   (.17)   $    .12
Diluted Earnings (Loss) per
  Common Share ..............   $    .63   $    .11   $    .11   $   (.17)   $    .11
</TABLE>

<TABLE>
<CAPTION>
                                               Years Ended December 31,
                                               ------------------------

                                   1999       1998       1997       1996       1995
                                   ----       ----       ----       ----       ----

Balance Sheet Data:
-------------------
<S>                             <C>        <C>        <C>        <C>         <C>
Total Assets ................   $ 27,870   $ 19,732   $ 17,826   $ 16,630    $ 19,515
Long-Term Obligations .......      3,915      4,068      2,696      3,012       2,707
Long-Term Liabilities - other        272        305       --         --          --
Shareholders' Equity ........     10,240      8,809      8,398      8,012      10,110
</TABLE>


ITEM 7.          Management's Discussion and Analysis of Financial
                 Condition and Results of Operations
                 -------------------------------------------------

     In addition to the historical information contained herein, the discussions
contained in this document  include  statements that constitute  forward-looking
statements under the safe harbor provisions of the Private Securities Reform Act
of  1995.  By way of  example,  the  discussions  include  statements  regarding
revenues, gross margins, future marketing efforts,  potential acquisitions,  and
Year  2000  implications.   Such  statements  involve  a  number  of  risks  and
uncertainties,  including  but not  limited to those  discussed  below and those
identified  from time to time in the Company's  filings with the  Securities and
Exchange Commission. These risks and uncertainties could cause actual results to
differ materially from those projected. Readers are cautioned not to place undue
reliance on these forward-looking  statements. The Company assumes no obligation
to update these  forward-looking  statements to reflect events or  circumstances
arising after the date hereof.

                                                                              18
<PAGE>
Results of Operations
---------------------
<TABLE>
<CAPTION>
Comparison of 1999 to 1998
--------------------------
                                                 (000's omitted)
                                 ---------------------------------------
                                      Revenue        Increase/(Decrease)
                                 ------------------  -------------------
                                  1999       1998     Amount  Percentage
                                  ----       ----    -------- ----------

<S>                               <C>       <C>      <C>        <C>
Product licenses                  $ 6,506   $ 8,490  $(1,984)   (23%)
Services                           15,064    18,218   (3,154)   (17%)
Computer and add-on hardware        4,053     8,760   (4,707)   (54%)
                                  -------   -------   -------

Net Revenue                       $25,623   $35,468  $(9,845)   (28%)
                                  =======   =======  ========
</TABLE>

REVENUE

     During  1999,  the  Company  completed  a  product  line   disposition,   a
discontinuation  of a product  line  pending  its  sale,  and one  product  line
acquisition.  The revenues  related to these  product  lines for the three years
ended December 31, 1999, 1998 and 1997 are as follows.

Disposition/Discontinuation:
============================
<TABLE>
<CAPTION>
                                                  (000's omitted)
                                        Revenue for year-ended December 31,
Product Line         Month               1999          1998          1997
------------         -----            ----------    -----------   -----------
<S>                                   <C>             <C>           <C>
CommercialWare       March 1999             -       $10,776,000   $ 7,603,000
SmartTime Software   August 1999      $2,915,000      5,890,000     6,412,000
                                      ----------    -----------   -----------
                     Total            $2,915,000    $16,666,000   $14,015,000
                                      ==========    ===========   ===========
</TABLE>
<TABLE>
<CAPTION>
Acquisition:
============

Product Line        Month              1999             1998          1997
------------        -----            -----------     ----------    ----------
<S>                                   <C>              <C>          <C>
Khameleon Software  November 1999     $1,965,000         -            -
</TABLE>


     Net  revenue.  The Company  designs  and  develops  proprietary  enterprise
software for the tire dealer,  legal,  ERP  (enterprise  resource  planning) and
e-Business  management  software  markets.  The Company  entered the  enterprise
management software market in November 1999 with the acquisition of the business
of Design Data Corporation, a Florida corporation.  The Company has renamed this
product line,  formerly  known as SQL Time,  Khameleon  Software.  The Company's
revenues are derived from the licensing of the Company's software products, from
client service and support, and from the sale of third party computer and add-on

                                                                              19
<PAGE>
hardware. The Company's total revenues decreased by approximately $9,845,000, or
28%, for the period when compared to the year ended  December 31, 1998.  Revenue
from existing businesses increased by approximately  $3,905,000,  or 21% for the
period,  when  approximately  $2,915,000  and  $16,666,000  in revenue  from the
Company's  catalog direct marketing  systems and SmartTime product lines for the
year ended December 31, 1999 and 1998, respectively, is excluded.  Approximately
$1,965,000 of the increase in revenue from existing businesses is from the newly
acquired Khameleon product line for which there is no comparable amount in 1998.

     Product  licenses.  The  Company's  software  license  revenues are derived
primarily  from the licensing of the  Company's  enterprise  products.  Software
license  revenues  decreased by approximately  $1,984,000,  or 23%, for the year
ended December 31, 1999,  compared to the same period in 1998.  Product  license
revenue from existing businesses increased by approximately  $1,404,000, or 30%,
for the period,  when compared to 1998, and the product license revenue from the
catalog direct  marketing  systems and SmartTime  product lines of approximately
$458,000  and  $3,846,000  for the  1999  and  1998  periods, respectively,  are
excluded. Approximately $498,000 of the increase in product license revenue from
existing  business  is from the  Khameleon  product  line for which  there is no
comparable amount in 1998.

     Services.   Services  are  comprised  of  fees   generated  from  training,
consulting,  software  modifications,  and ongoing client support provided under
maintenance  agreements that renew automatically unless either party gives prior
notice  as  specified  in  the  agreements.   Service   revenues   decreased  by
approximately $3,154,000, or 17%, for the year ended December 31, 1999, compared
to the year ended December 31, 1998.  Service  revenue from existing  businesses
increased by approximately  $1,895,000, or 18%, for the period, when compared to
1998,  and the service  revenue from the catalog  direct  marketing  systems and
SmartTime product lines of approximately  $2,389,000 and $7,438,000 for the 1999
and 1998 periods,  respectively,  are excluded.  Approximately $1,467,000 of the
increase in service revenue from existing  businesses is from the newly acquired
Khameleon  product  line for which  there is no  comparable  amount  in  service
revenue for the year ended December 31, 1998.

     Computer and add-on hardware. Hardware revenues are derived from the resale
of third-party  hardware  products to the Company's  clients in conjunction with
the  licensing  of  the  Company's  software.  Hardware  revenues  decreased  by
approximately $4,707,000, or 54%, for the year ended December 31, 1999, compared
to the same period in 1998. Hardware revenue from existing businesses  increased
by approximately $607,000, or 18% for the period, when approximately $68,000 and
$5,382,000 hardware revenues from the Company's catalog direct marketing systems
and  SmartTime  product  lines for the 1999 and 1998 periods are  excluded.  The
increase in hardware revenues from existing  businesses was due primarily to the
increase of hardware unit sales by the Company's tire systems product line.

COST OF REVENUE

     Product  licenses  and  development.  Cost  of  software  license  revenues
consists of the costs of  amortization of capitalized  software  costs,  and the
costs of sublicensing  third-party  software products.  The amount also includes
the expenses associated with the development of new products and the enhancement
of  existing  products  (net  of  capitalized  software  costs),  which  consist
primarily of employee salaries, benefits, and associated overhead costs. Cost of
software  license revenues and development  decreased by approximately  $194,000
for the year ended December 31, 1999,  compared to the same period in 1998. Cost
of product license and development increased by approximately $1,411,000, or 63%
for the year  when  compared  to  1998,  and the cost of  product  licenses  and
development from the catalog direct marketing systems and SmartTime product

                                                                              20

<PAGE>
lines for the 1999 and 1998 periods are excluded.  Approximately $907,000 of the
increase in the cost of product  licenses  and  development  from the  Company's
existing businesses is attributable to the newly acquired Khameleon product line
for which there is no comparable amount in 1998. The cost of product licenses as
a percentage of product  license revenue may fluctuate from period to period due
to the mix of sales of third-party  software  products in each period contrasted
with certain fixed expenses such as the amortization of capitalized software.

     Services.  Cost of  services  consists of the costs  incurred in  providing
client  training,  consulting,  and  ongoing  support  as well as  other  client
service-related expenses. Cost of services decreased by approximately $2,257,000
for the year ended  December 31, 1999,  compared to the same period in 1998. The
gross  margin  percentage  for  services  for the year ended  December  31, 1999
increased to  approximately  37% from 36% of revenue from services in 1998.  The
Company's  revenue and margin from services  fluctuate from period to period due
to changes in the mix of contracts and projects.

     Computer and add-on hardware.  Cost of hardware revenues consists primarily
of the  costs  of  third-party  hardware  products.  Cost of  hardware  revenues
decreased by approximately  $4,407,000,  or 58%, for the year ended December 31,
1999,  compared to the prior period.  The cost of hardware revenue from existing
businesses  increased  by  approximately  $294,000,  or 11%,  when  the  cost of
hardware  from the  Company's  catalog  direct  marketing  systems and SmartTime
product lines is excluded from the results for the years ended December 31, 1998
and 1999.  The increase in dollar  amount for the cost of hardware  revenues for
the year ended  December 31, 1999 was due  primarily to increased  unit sales of
hardware products by the Company's tire systems product line.

   The gross margin  percentage for hardware sales increased to 21% for the year
ended  December  31,  1999,  from 13% in the same  period  in 1998.  Margins  on
computer  and add-on  hardware  can  fluctuate  based on the mix of computer and
ancillary  hardware  products sold.  Accordingly,  the Company expects  hardware
gross margins to continue to fluctuate in the future.  The Company  continues to
direct its efforts toward  building  service and license  revenues to offset the
historical decline in hardware revenue and margins.

EXPENSES

     Marketing and sales.  Marketing  and sales  expenses  consist  primarily of
employee salaries, benefits,  commissions and associated overhead costs, and the
cost of marketing programs such as direct mailings,  trade shows,  seminars, and
related   communication  costs.   Marketing  and  sales  expenses  decreased  by
$1,221,000,  or 22%, for the year ended December 31, 1999, compared to 1998. The
change in marketing and sales expenses reflects the elimination of the marketing
and sales expenses of the catalog direct marketing systems and SmartTime product
lines partially offset by increased sales and marketing  expenses from the tire,
ERP systems and, the newly acquired Khameleon Software, product lines.

     General and  administrative.  General and  administrative  expenses consist
primarily of employee salaries and benefits for administrative,  executive,  and
finance  personnel  and  associated  overhead  costs,  as  well  as  consulting,
accounting, and legal expenses. General and administrative expenses decreased by
approximately  $432,000,  or 11%, for the year ended December 31, 1999, compared
to the same period in 1998. The change primarily reflects the elimination of the
expenses related to the catalog direct marketing  systems and SmartTime  product
lines,  partially offset by increased general and  administrative  expenses from
the tire, ERP, legal and, the newly acquired Khameleon Software, product lines.

                                                                              21
<PAGE>
     Net  earnings  for the year  ended  December  31,  1999 were  approximately
$2,167,000,  as compared to net earnings of approximately $417,000 for 1998. The
change results from the gain on the sale of  CommercialWare  of $3,824,000 and a
reduction in net interest expense of approximately $585,000, partially offset by
a decrease in earnings from operations of $1,041,000,  a loss from the equity in
earnings from affiliate of approximately $166,000, an increase in other expense,
net of  $183,000  and  an  increase  in  income  tax  expense  of  approximately
$1,269,000.



                                                                              22
<PAGE>
<TABLE>
<CAPTION>
Comparison of 1998 to 1997
--------------------------
                                                 (000's omitted)
                                 ---------------------------------------
                                      Revenue        Increase/(Decrease)
                                 ------------------  -------------------
                                  1998       1997     Amount  Percentage
                                  ----       ----    -------- ----------

<S>                             <C>        <C>        <C>         <C>
Product licenses                $ 8,490    $ 6,178    $ 2,312     37%
Services                         18,218     14,005      4,213     30%
Computer and add-on hardware      8,760      5,324      3,436     65%
                                -------    -------    -------

Net Revenue                     $35,468    $25,507    $ 9,961     39%
                                =======    =======    =======
</TABLE>

REVENUE

   In March 1999, the Company  completed the  disposition of its  CommercialWare
Division  (direct  marketing  systems  product  line).  In the three years ended
December 31, 1998, 1997, and 1996, this group's  revenues totaled  approximately
$10,776,000,  $7,603,000  and  $6,530,000,  or 30%, 30% and 26% of total Company
revenue.

   Net  revenue.   The  Company's  total  revenues  increased  by  approximately
$9,961,000,  or 39%, for the year ended December 31, 1998,  compared to the year
ended December 31, 1997,  with the ERP systems  product line acquired in January
1998 accounting for $3,513,000, or 14%, of the increase in revenue.

   Product  licenses.   Product  license  revenues  increased  by  approximately
$2,312,000,  or 37%, for the year ended December 31, 1998,  compared to the same
period in 1997,  with the newly  acquired  ERP systems  product  accounting  for
$629,000 or 10% of the  increase in product  license  revenue.  The  increase in
dollar amount was primarily due to increased market  acceptance of the Company's
software products, and the increased capacity created by growth in the Company's
direct sales force and marketing efforts.

   Services. Service revenues increased by approximately $4,213,000, or 30%, for
the year ended December 31, 1998,  compared to the same period in 1997, with the
newly acquired ERP systems  product  accounting for  $2,721,000,  or 19%, of the
increase in services revenue.

   Computer and add-on hardware.  Hardware  revenues  increased by approximately
$3,436,000,  or 65%, for the year ended December 31, 1998,  compared to the same
period in 1997,  with the newly  acquired  ERP systems  product  accounting  for
$163,000,  or 3%, of the  increase  in computer  add-on  hardware  revenue.  The
increase in hardware revenues from existing  businesses was due primarily to the
increase of hardware unit sales accompanying increased product license sales.

                                                                              23
<PAGE>
COST OF REVENUE

   Product  licenses  and  development.  Cost of software  license  revenues and
development  increased by  approximately  $1,325,000 for the year ended December
31, 1998, compared to the same period in 1997. The change primarily reflects the
costs  associated  with  license  revenue  increases  from the  electronic  time
recording,  tire, and legal systems product lines.  The cost of product licenses
as a percentage of product  license  revenue may fluctuate from period to period
due to the  mix of  sales  of  third-party  software  products  in  each  period
contrasted  with certain fixed expenses such as the  amortization of capitalized
software.

   Services. Cost of services increased by approximately $3,732,000 for the year
ended  December 31, 1998,  compared to the same period in 1997. The gross margin
percentage for services for the year ended 1998 decreased to approximately  36%,
from 43% of revenue  from  services  in the same period in 1997.  The  Company's
revenue and margin from services  fluctuate from period to period due to changes
in the mix of contracts and projects.

   Computer  and  add-on  hardware.  Cost  of  hardware  revenues  increased  by
approximately  $2,635,000, or 53%, for year ended December 31, 1998, compared to
the same period in 1997.  The increase in dollar amount for the cost of hardware
revenues  for the year ended  December  31, 1998 was due  primarily to increased
unit sales of hardware products accompanying increased product license sales.

   The gross margin  percentage for hardware sales increased to 13% for the year
ended  December  31,  1998,  from 6%,  in the same  period in 1997.  Margins  on
computer  and add-on  hardware do  fluctuate  based on the mix of  computer  and
ancillary  hardware  products sold.  Accordingly,  the Company expects  hardware
gross  margins to fluctuate in the future.  The Company  continues to direct its
efforts toward  building  service and license  revenues to offset the historical
decline and uncertainty in hardware revenue and margins.

EXPENSES

   Marketing and sales. Marketing and sales expenses increased by $1,090,000, or
24%, for the year ended December 31, 1998,  compared to the same period in 1997.
The change in marketing and sales expenses primarily reflects increases in sales
staffing,  the higher sales commissions  associated with increased revenues, and
the additional expenses related to the newly acquired ERP systems product line.

   General and administrative.  General and administrative expenses increased by
approximately $1,027,000, or 35%, for the year ended December 31, 1998, compared
to the same period in 1997. The change primarily  reflects  additional  expenses
related to the ERP, Tire Systems, and catalog direct marketing product lines.

     Net  earnings  for 1998 were  approximately  $417,000,  as  compared to net
earnings of approximately $388,000 in 1997. The change resulted from an increase
in earnings from operations of  approximately  $47,000,  and a decrease in other
expense, net of approximately  $184,000,  partially offset by an increase in net
interest  expense  of  approximately  $134,000,  and an  increase  in income tax
expense of approximately $68,000. Interest expense for the current year includes
a one-time  charge of  approximately  $248,000  related to the early payoff of a
mortgage on Company-owned real estate, which was refinanced.

                                                                              24
<PAGE>
Liquidity and Capital Resources
-------------------------------

     The Company had total cash  and cash  equivalents,  at December 31, 1999 of
approximately  $2,297,000,  a decrease of approximately $1,965,000 from December
31,  1998.  At December  31,  1999,  the Company  had  approximately  $3,366,000
invested in marketable  securities.  In October 1999, the Company entered into a
new revolving  demand loan  agreement  totaling  $1,500,000 at prime minus 1/2%,
which expires on June 30, 2000. In addition,  the Company  arranged a $3,000,000
acquisition line of credit at prime minus 1/2% which is convertible on or before
June 30,  2000 to a five-year term at a fixed rate equal to two and  one-quarter
(2.25%) over the average yield on US Treasury  securities.  The credit  facility
was fully available at December 31, 1999.

     In November 1999, the Company  acquired the business of Design Data Systems
Corporation, a Florida corporation, pursuant to an Asset Purchase Agreement (the
"Purchase  Agreement") by and among the Company, the Seller,  individually (only
with respect to certain sections of the Purchase  Agreement),  and the Company's
Bank,  as Escrow  Agent  (the  "Escrow  Agent")  (only  with  respect to certain
sections of the Purchase  Agreement).  The Purchase  Agreement provides that the
transaction is effective as of September 30, 1999 (the "Effective Date").

     Pursuant  to and as more  fully set forth in the  Purchase  Agreement,  the
Company  had the right and  obligation  to  purchase  certain  of the assets and
assume  certain of the  liabilities of Seller for a purchase price of $5,000,000
(the "Purchase Price"). Of the Purchase Price, $4,750,000 was due and payable on
the Closing Date and  $250,000  was to be deposited  with the Escrow Agent to be
held pursuant to the terms of the Purchase Agreement.

     Also  on the  Closing  Date,  the  Company  entered  into a  certain  Asset
Acquisition and Exchange Cooperation  Agreement (the "Exchange  Agreement") with
SQL Acquisition LLC, a Delaware  limited  liability  company  ("SQL"),  Fidelity
National 1031 Exchange  Services,  Inc., a California  corporation,  and Pacific
American Property Exchange Corporation, a California corporation and sole member
and manager of SQL. The Company has entered into the Exchange  Agreement for the
purpose of seeking the ability to  effectuate a like-kind  exchange  pursuant to
Section 1031 of the Internal  Revenue Code of 1986, as amended.  Pursuant to and
as more fully set forth in the Exchange Agreement,  the Company has reserved the
right to exchange certain software and related  intellectual  property of Seller
(the  "Replacement  Property")  for certain other  relinquished  property of the
Company.  In  connection  therewith,  the Company  assigned to SQL the Company's
right and  obligation  under the Purchase  Agreement to acquire the  Replacement
Property  pursuant to a certain  Assignment  Agreement  dated the  Closing  Date
between the Company, Seller and SQL (the "Assignment"). On the closing Date, the
following actions were completed:

1. SQL acquired the  Replacement  Property  from Seller in  accordance  with the
Purchase Agreement and the Assignment in exchange for a payment of $4,300,000.

2. The Company  acquired the remainder of Seller's assets in accordance with the
Purchase  Agreement  in  exchange  for (a) the  payment  of  $700,000  (of which
$250,000 was deposited  with the Escrow Agent) and (b) the assumption of certain
of Seller's liabilities.

                                                                              25
<PAGE>
3. The Company  loaned SQL $4,300,000  pursuant to the Exchange  Agreement and a
related promissory note due on November 3, 2000 and bearing interest at the rate
of 6.18% per  annum.  The  funds  were used by SQL to  acquire  the  Replacement
Property.

4. SQL granted a license to the Company to use the  Replacement  Property  until
November 3, 2000 pursuant to a License Agreement between the Company and SQL, in
exchange for a one-time license fee of $285,000.

     The Company  anticipates that it will seek to complete a like-kind exchange
involving the Replacement Property on or before November 3, 2000, although there
can be no assurance that such an exchange will be completed.

     In August 1999, the Company granted to a company  ("Optionee") an option to
purchase the  Company's  SmartTime  product line. As per the terms of the Option
Agreement,  the Company  transferred the assets and liabilities of its SmartTime
product  line to a newly formed LLC, of which the Company is the sole member and
the Optionee is the manager.

     The terms of the Option Agreement  provide that the Optionee has the option
to purchase  the  SmartTime  product line from the LLC at anytime from August 1,
2000 through August 31, 2000 (the "Option  Period"),  or at such earlier date as
agreed to by the parties,  for an aggregate  purchase price of $7,020,000,  less
any option fee paid to date (the "Purchase Price").

     The Optionee paid an initial  option fee in the amount of  $1,660,000  upon
execution of the Option  Agreement and is required to pay a second option fee on
August 1, 2000 in the amount of  $540,000,  unless the  Optionee  exercises  the
option prior to such date. The option fees are non-refundable to the Optionee in
the event  that the  Optionee  does not  exercise  the  option to  purchase  the
SmartTime  product line,  as to which there can be no assurance.  Also under the
terms of the Option Agreement, the Optionee has loaned to the Company the sum of
$3,200,000 (with respect to which the Company has prepaid $160,000 in interest).
In addition,  the LLC has agreed to loan the Optionee an amount equal to the net
cash of the LLC available after collection of the LLC's accounts  receivable and
payment of the LLC's accounts payable.

     In  addition,  the  Optionee has  purchased  exclusive  licenses to use the
customer  intangibles and  intellectual  property of the SmartTime  product line
during the Option Period for $300,000 and $500,000,  respectively.  In the event
that the Optionee does not exercise the option to purchase the SmartTime product
line prior to the expiration of the Option Period,  the Optionee's  rights under
the above-mentioned license agreements would terminate and the Company,  through
the LLC, would retain ownership of these assets.

     In March 1999,  the  Company  sold  substantially  all of the assets of its
catalog  direct  marketing  systems  product  line to  CommercialWare,  Inc.,  a
Delaware  Corporation (the Purchaser).  Under the terms of the sale, the Company
transferred to the Purchaser certain of the liabilities of the product line. The
Company  received (i) cash in the amount of $4,000,000,  (ii) a promissory  note
due in three years in the amount of $1,700,000,  (iii) a junior  promissory note
in the amount of $500,000,  (iv) 30,000 shares of the Purchaser's  common stock,
par  value  $.01  per  share,  and (v) one (1)  share  of  Purchaser's  Series A
Preferred Stock.

                                                                              26
<PAGE>
     The Company  expects to continue to pursue  strategic  acquisitions.  These
acquisitions have been, and are expected to continue to be, financed in a number
of  ways.  Management  believes,  subject  to the  conditions  of the  financial
markets,  that it should be able to continue its program of acquisitions.  These
acquisitions  could  present  challenges to the  Company's  management,  such as
integrating and  incorporating new operations,  product lines,  technologies and
personnel. If the Company's management is unable to manage these challenges, the
Company's  business,  financial  condition  or  results of  operations  could be
materially  adversely  affected.  Any acquisition,  depending on its size, could
result in significant dilution to the Company's stockholders. Furthermore, there
can be no  assurance  that any acquired  products  will gain  acceptance  in the
Company's markets.

     The Company  has  experienced  significant  fluctuations  in its  quarterly
operating  results and anticipates  such  fluctuations in the future.  Quarterly
revenues  and  operating  results  depend  on the  volume  and  timing of orders
received  during the quarter which are  difficult to forecast.  Large orders for
the  Company's  products  often have a lengthy  sales cycle  while the  customer
evaluates and receives  approvals  for the purchase of the  products.  It may be
difficult to  accurately  predict the sales cycle of any large order.  If one or
more large orders fail to close as forecasted in a fiscal quarter, the Company's
revenues and  operating  results  could be  materially  adversely  affected.  In
addition,  the Company typically  receives a substantial  portion of its product
orders in the last month of the quarter.  Orders are shipped as received and, as
a result,  the  Company  often has little or no backlog  except for  support and
service revenue. The Company acknowledges the potential adverse impact that such
fluctuations  and  general  economic  uncertainty  could have on its  ability to
maintain liquidity and raise additional capital.

     The Company's future financial  performance is also dependent in large part
on the successful development,  introduction, and customer acceptance of new and
enhanced  versions of its software  products.  Due to the rapid change in vendor
hardware platforms,  operating systems, and updated versions, the complexity and
expense of  developing,  testing,  and  maintaining  the Company's  products has
increased.  The Company intends, as it has in the past, to fund this development
primarily from its cash from operations and bank debt. There can be no assurance
that  these  efforts  will  be  successful  or  result  in  significant  product
enhancements.

     Subject to the foregoing,  the Company  believes that based on the level of
operating  revenue,  cash on hand,  and available  bank debt, it has  sufficient
capital to finance its ongoing business.

Inflation
---------

     General  inflation over the last three years has not had a material  effect
on the Company's cost of doing business.

                                                                              27
<PAGE>
New Accounting Standards Not Yet Adopted
----------------------------------------

     In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities" ("SFAS No. 133").
SFAS No. 133 requires companies to recognize all derivative  contracts as either
assets or  liabilities  in the balance  sheet and to measure  them at their fair
values.  If  certain  conditions  are  met,  a  derivative  may be  specifically
designated as a hedge,  the objective of which is to match the timing of gain or
loss  recognition  on the hedging  derivative  with the  recognition  of (i) the
changes in the fair value of the hedged assets or liability or (ii) the earnings
effect of the hedged forecasted transaction.  For a derivative not designated as
a hedging instrument,  the gain or loss is recognized in income in the period of
change.  SFAS No. 133, as amended by SFAS No. 137, is  effective  for all fiscal
quarters of fiscal years beginning after June 15, 2000.

   Historically, the Company has not entered into derivative contracts either to
hedge existing risks or for speculative purposes.  Accordingly, the Company does
not expect adoption of the new standard to affect its financial statements.

Other Information; Year 2000 Issue Disclosure
---------------------------------------------

     Prior to December 31, 1999, where  necessary,  the Company had provided its
customers upgrade  alternatives to its Year 2000  non-compliant  software and to
date has experienced only minor Year 2000 problems related to its products.  The
majority of computer  hardware  and  software  the Company  uses in its internal
operations did not require  replacement or modification as a result of Year 2000
non-compliance.  The Company  believes that its significant  vendors and service
providers are Year 2000 compliant and has not, to date, been made aware that any
of its  significant  vendors  or  service  providers  have  suffered  Year  2000
disruptions  in their  systems.  Accordingly,  the Company  does not  anticipate
incurring material expenses or experiencing any material operational disruptions
as a result of any Year 2000 problems. The total cost of the Company's Year 2000
compliance measures was not material and was funded through operating cash flows
and expensed as incurred.


ITEM 7A.         QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
                 ---------------------------------------------------------

     The Company is exposed to the impact of interest  rate  changes and foreign
currency fluctuations and changes in the value of its investments.

     Interest Rate Risk. The Company's  exposure to market rate risk for changes
in  interest  rates  relates   primarily  to  the  Company's   cash   equivalent
investments.  The Company has not used  derivative  financial  instruments.  The
Company  invests its excess cash in  short-term  floating rate  instruments  and
senior  secured  floating  rate loan funds which carry a degree of interest rate
risk. These  instruments may produce less income than expected if interest rates
fall.

     Foreign Currency Risk.  International  revenues from the Company's  foreign
subsidiary  and other foreign  sources were  approximately  11% of all revenues.
International  sales are made primarily from the Company's foreign subsidiary in

                                                                              28

<PAGE>
Italy  and are  denominated  in the local  currency.  Accordingly,  the  foreign
subsidiary  uses the local  currency as its functional  currency.  The Company's
international business is subject to risk typical of an international  business,
including,  but not  limited  to,  differing  economic  conditions,  changes  in
political climate, differing tax structures, other regulations and restrictions,
and foreign exchange rate volatility.  Accordingly, the Company's future results
could be materially adversely impacted by changes in these or other factors. The
Company is  exposed  to  foreign  currency  exchange  rate  fluctuations  as the
financial results of its foreign  subsidiary are translated into U.S. dollars in
consolidation.  As exchange rates vary, these results, when translated, may vary
from  expectations  and adversely  impact overall  profitability.  The effect of
foreign  exchange  rate  fluctuations  on the  Company  in 1999 and 1998 was not
material.

     Investment Risk. The Company has invested, and may invest in the future, in
equity  instruments  of  privately-held  companies  for business  and  strategic
purposes.  These  investments  are  included in other  long-term  assets and are
accounted  for under the cost method when  ownership is less than 20%. For these
non-quoted  investments,  the  Company's  policy  is  to  regularly  review  the
assumptions  underlying  the operating  performance  and cash flow  forecasts in
assessing the carrying  values.  The Company  identifies and records  impairment
losses on  long-lived  assets when events or  circumstances  indicate  that such
assets might be impaired.


ITEM 8.          Financial Statements and Supplementary Data
                 -------------------------------------------

     The financial  statements and supplementary  data are listed under Part IV,
Item 14, in this Report.


ITEM 9.          Disagreements with Accountants on Accounting and
                 Financial Disclosure
                 ------------------------------------------------

     Not applicable.


                                    PART III

     Items  10-13  are  incorporated  herein  by  reference  from the  Company's
definitive  proxy  statement  to be  filed  with  the  Securities  and  Exchange
Commission.


                                    PART IV

ITEM 14.         Exhibits, Financial Statement Schedules and Reports On
                 Form 8-K
                 ------------------------------------------------------

(a)1.  Financial Statements.
       ---------------------
       The Consolidated  Financial Statements required to be filed herein are as
       follows:
            Independent Auditors' Reports
            Consolidated Balance Sheets
            Consolidated Statements of Operations
            Consolidated Statements of Comprehensive Income
            Consolidated Statements of Shareholders' Equity
            Consolidated Statements of Cash Flows
            Notes to Consolidated Financial Statements


                                                                              29
<PAGE>
(a)2.     Financial Statement Schedules.
          -----------------------------
          None

(a)3.     Exhibits.
          ---------
          The following exhibits are filed with this report:

10-1      Revolving Demand Note between ASA International Ltd./ASA International
          Ventures, Inc. and Eastern Bank dated 10/20/99.

10-2      Acquisition  Line  of  Credit  Agreement   between  ASA  International
          Ltd./ASA International Ventures, Inc. and Eastern Bank dated 10/20/99.

21        Subsidiaries of Registrant.

23-1      Consent of BDO Seidman, LLP, independent certified public accountants.

23-2      Consent  of  Deloitte  & Touche,  LLP,  independent  certified  public
          accountants.

27        Financial Data Schedule.


A)        The following  exhibits were filed with the  Registrant's  Form 8-K on
          November 15, 1999 and are incorporated herein by reference:

2         Asset Purchase Agreement dated November 4, 1999.

10-1      Assignment and Assumption Agreement dated November 4, 1999.

10-2      Bill of Sale and General Assignment of Assets dated November 4, 1999.

10-3      Assignment of Trademarks dated November 4, 1999.

10-4      Assignment of Copyrights dated November 4, 1999.

10-5      Asset Acquisition and Exchange Cooperation Agreement dated November 4,
          1999.

10-6      Promissory Note dated November 4, 1999.

10-7      Security Agreement dated November 4, 1999.

10-8      Intellectual Property License Agreement dated November 4, 1999.

10-9      Assignment Agreement dated November 4, 1999.

10-10     Bill of Sale and General Assignment of Assets dated November 4, 1999.

10-11     Assignment of Trademarks dated November 4, 1999.

10-12     Assignment of Copyrights dated November 4, 1999.

                                                                              30
<PAGE>
B)        The following  exhibits were filed with the  Registrant's  Form 8-K on
          August 13, 1999 and are incorporated herein by reference:

10-1      Option to Purchase Agreement dated as of August 2, 1999.

10-2      Asset Purchase Agreement dated as of August 2, 1999.

10-3      Operating Agreement dated as of August 2, 1999.

10-4      Sublease and Consent Agreement dated as of August 2, 1999.

10-5      Revolving Promissory Note dated as of August 2, 1999.

10-6      Customer Intangibles License Agreement dated as of August 2, 1999.

10-7      Intellectual Property License Agreement dated as of August 2, 1999.

10-8      Promissory Note dated as of August 2, 1999.


C)        The following  exhibits were filed with the  Registrant's  Form 8-K on
          March 18, 1999 and are incorporated herein by reference:

b.        Pro forma financial information for the Registrant.

    The  following   unaudited  pro  forma  condensed   consolidated   financial
    statements are filed with this report:

    Pro forma Condensed Consolidated Balance Sheet
    at September 30, 1998                               F-1 to F-2

    Pro forma Condensed Consolidated Statements of Operations.
       Year Ended December 31, 1997                     F-3
       Nine Months Ended September 30, 1998             F-4

    The pro forma condensed  consolidated  balance sheet of the Registrant as of
    September 30, 1998,  reflects the financial position of the Registrant after
    giving  effect  to the  disposition  of the  assets  and  assumption  of the
    liabilities  discussed in Item 2 and assumes the  disposition  took place on
    September  30, 1998.  The pro forma  condensed  consolidated  statements  of
    operations  for the fiscal year ended December 31, 1997, and the nine months
    ended September 30, 1998,  assume that the disposition  occurred on December
    31, 1996,  and are based on the  operations of the  Registrant  for the year
    ended  December  31,  1997 and the nine months  ended  September  30,  1998,
    respectively.

    The unaudited pro forma  condensed  consolidated  financial  statements have
    been prepared by the Registrant based upon assumptions  deemed proper by it.
    The unaudited pro forma condensed  consolidated financial statements are not
    necessarily  indicative  of the  future  financial  position  or  results of
    operations or actual  results that would have  occurred had the  transaction
    been in effect as of the dates presented.

                                                                              31
<PAGE>
    The unaudited pro forma condensed  consolidated  financial statements should
    be read in conjunction with the Registrant's historical financial statements
    and related notes.


c.   Exhibits

2    Asset Purchase Agreement dated as of March 3, 1999.

4-1  Shareholder Agreement dated as of March 3, 1999.

4-2  Promissory Note dated as of March 3, 1999.

4-3  Security Agreement dated as of March 3, 1999.

4-4  Trademark Assignment dated as of March 3, 1999.

4-5  Trademark Security Agreement dated as of March 3, 1999.

4-6  Sub-Lease and Consent Agreement dated as of March 3, 1999.

4-7  Subordinated Promissory Note dated as of March 3, 1999.


D)   The following  documents are  incorporated by reference to the Registrant's
     Report on Form 10-K filed on March 30, 1999:

10   Lease for 475 Sentry  Parkway,  Blue Bell,  Pennsylvania,  dated August 26,
     1998.

E)   The  following  exhibits  were  filed  with the  Registrant's  Form 10-Q on
     November 16, 1998 and are incorporated herein by reference:

10-1 Commercial Lease dated September 15, 1998,  between 10 Speen Street, LLC as
     Lessor, and ASA International  Ltd., as Lessee, for the property located at
     10 Speen Street, Framingham, MA.

10-2 Indemnification  Agreement made September 21, 1998, by 10 Speen Street, LLC
     and ASA International Ltd., as Indemnitors, for the benefit of John Hancock
     Real Estate Finance, Inc., as Mortgagee.

                                                                              32
<PAGE>
10-3 Guarantee Agreement effective September 21, 1998 by ASA International Ltd.,
     as Guarantor, in favor of John Hancock Real Estate Finance, Inc.


F)   The  following  exhibits  were  filed  with  the  Registrant's  Form 8-K on
     November 4, 1998 and are incorporated herein by reference:

10-1 Rights  Agreement,  dated as of October 21, 1998 between the Registrant and
     American Securities Transfer & Trust, Inc., as Rights Agent, which includes
     as Exhibit B thereto the Form of Rights Certificate.

10-2 Letter to the holders of the Registrant's  Common Stock,  dated November 4,
     1998 (including summary of Rights).

10-3 Press release, dated October 22, 1998.


G)   The  following  exhibits  and  Financial  Statements  were  filed  with the
     Registrant's  Form 8-K on January 15, 1997 and are  incorporated  herein by
     reference:

2(b) Pro forma financial information for the Registrant.

        The  following  unaudited  pro forma  condensed  consolidated  financial
        statements are filed with this report:

            Pro Forma Condensed Consolidated Balance Sheet at
            September 30, 1996                     F-1 to F-2

            Pro Forma Condensed Consolidated Statements of Operations.
                 Year Ended December 31, 1995             F-3
                 Nine Months Ended September 30, 1996     F-4

        The Pro Forma Condensed  Consolidated Balance Sheet of the Registrant as
        of September 30, 1996 reflects the financial  position of the Registrant
        after giving effect to the  disposition  of the assets and assumption of
        the  liabilities  discussed in Item 2 and assumes the  disposition  took
        place on  September  30,  1996.  The Pro  Forma  Condensed  Consolidated
        Statements of Operations for the fiscal year ended December 31, 1995 and
        the nine months  ended  September  30, 1996 assume that the  disposition
        occurred on January 31,  1995,  and are based on the  operations  of the
        Registrant  for the year ended  December 31,  1995,  and the nine months
        ended September 30, 1996, respectively.

        The unaudited pro forma condensed consolidated financial statements have
        been prepared by the Registrant based upon assumptions  deemed proper by
        it. The unaudited pro forma condensed  consolidated financial statements
        are not  necessarily  indicative  of the future  financial  position  or
        results of operations or actual results that would have occurred had the
        transactions been in effect as of the dates presented.

        The  unaudited pro forma  condensed  consolidated  financial  statements
        should be read in conjunction with the Registrant's historical financial
        statements and related notes.

2(c)    Reorganization Agreement by and between the Registrant,
        TradePoint Systems LLC and Christopher J. Crane.


H)  The following exhibits were filed with the Registrant's Form 8-K on November
    27, 1996 and are incorporated herein by reference:

2(a)   First Amendment to the Asset Purchase Agreement (the "Purchase
       Agreement") by and between the Company and Progressive Computer
       Systems, Inc. dated October 18, 1996.

                                                                              33
<PAGE>
2(b)   Second Amendment to the Purchase Agreement dated
       November 15, 1996.


I)  The  following  exhibits  were  filed  with  the  Registrant's  Form  8-K on
    September 20, 1996 and are incorporated herein by reference:

2      Agreement by and between the Registrant and Progressive Computer
       Systems, Inc. dated as of August 30, 1996.


J)  The following  documents are  incorporated by reference to the  Registrant's
    Report on Form 10-K filed on March 28, 1996:

2-1    The Commonwealth of Massachusetts Articles of Merger Merging
       ASA Incorporated and ASA Legal Systems Company, Inc. into ASA
       International Ltd., dated December 28, 1995.

2-2    Certificate of Ownership and Merger Merging ASA Incorporated and
       ASA Legal Systems Company, Inc. into ASA International Ltd.,
       dated December 28, 1995.

3a     Certificate of Incorporation of ASA International Ventures, Inc.,
       dated December 28, 1995.

3b     Bylaws of ASA International Ventures, Inc.

10-4   Agreement for Purchase and Sale of Assets between ASA
       International Ventures, Inc. and ASA Incorporated, dated
       December 29, 1995.

10-5   Agreement for Purchase and Exchange of Assets between ASA
       International Ventures, Inc. and ASA International Ltd., dated
       December 29, 1995.

                                                                              34
<PAGE>
10-6   Agreement for Exchange of Intangibles between ASA International
       Ventures, Inc. and ASA International Ltd., dated December 29,
       1995.


K)  The following document is incorporated by reference to the Registrant's Form
    8-K filed on August 31, 1995:

16     The Registrant  announced  that it had retained BDO Seidman,  LLP, as its
       new independent accountants, replacing its prior independent accountants,
       Deloitte & Touche LLP.


L)  The following  documents are  incorporated by reference to the  Registrant's
    Report on Form 10-K filed on March 30, 1994:

10-5   Promissory Note between ASA Properties, Inc., and Granite State
       Development Corporation, dated December 23, 1992.


10-6   Servicing Agent Agreement between ASA Properties, Inc., and
       Colson Services Corporation, dated May 12, 1993.

10-15  Amendment to Merger Agreement by and among the Company, ASA Incorporated,
       CommercialWare,  Donald Askin, and Jonathan  Ellman,  dated September 15,
       1993.


M)  The following  documents are  incorporated by reference to the  Registrant's
    Report on Form 10-K filed on March 30, 1993:

10-4   Mortgage and Security Agreement between ASA Properties, Inc. and
       Sun Life Assurance Company of Canada.

10-5   Promissory Note of ASA Properties, Inc. in favor of Sun Life
       Assurance Company of Canada.


N)  The following document is incorporated by reference to the Registrant's Form
    8-K filed on September 29, 1993:

10-1   Agreement and Plan of Merger by and among the Company,  ASA Incorporated,
       CommercialWare, Donald Askin, and Jonathan Ellman, dated as of August 31,
       1993.


O)  The following  documents are  incorporated by reference to the  Registrant's
    Report on Form 10-K filed on March 31, 1988:

3b     Bylaws, as amended.


P)  The  following  documents  are  incorporated  by reference to the  Company's
    Registration Statement on Form S-18 (File number 33-5832-B):

4c     Specimen Convertible Note.


Q)  The  following  documents  are  incorporated  by reference to the  Company's
    Registration Statement on Form S-1 (File number 33-15381):

3a     Certificate of Incorporation, as amended.



(b)    Reports on Form 8-K.
       --------------------

    Form 8-K filed on November 11, 1999 reporting the acquisition by the Company
    of the business of Data Design Systems Corporation.

                                                                              35
<PAGE>




                                   SIGNATURES


     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                  ASA INTERNATIONAL LTD.


                                  By  /s/ Alfred C. Angelone
                                          ---------------------------
                                          Chief Executive Officer
                                  (principal executive officer and
                                   principal financial officer)

     Pursuant to the requirements of the Securities Exchange Act of 1934, report
has been signed below by the following persons on the dates indicated.


Name                            Capacity                 Date
----                            --------                 ----


/s/ Alfred C. Angelone          Director, Chief          March 30, 2000
--------------------------      Executive Officer,
Alfred C. Angelone              and President
                                (principal executive
                                officer and principal
                                accounting officer)

/s/ James P. O'Halloran         Director                 March 30, 2000
--------------------------
James P. O'Halloran


/s/ Alan J. Klitzner            Director                 March 30, 2000
--------------------------
Alan J. Klitzner


/s/ William A. Kulok            Director                 March 30, 2000
--------------------------
William A. Kulok


/s/ Robert L. Voelk             Director                 March 30, 2000
--------------------------
Robert L. Voelk



                                                                              36
<PAGE>


INDEPENDENT AUDITORS' REPORT



Board of Directors and Shareholders ASA INTERNATIONAL LTD.


     We  have  audited  the  accompanying  consolidated  balance  sheets  of ASA
International  Ltd.  and  subsidiaries  as of December 31, 1999 and 1998 and the
related   consolidated   statements   of   operations,   comprehensive   income,
shareholders'  equity and cash  flows for each of the three  years in the period
ended December 31, 1999. These financial  statements are the  responsibility  of
the Company's  management.  Our responsibility is to express an opinion on these
financial  statements  based on our audits.  We did not audit the 1999 financial
statements of the Company's foreign  subsidiary,  which statements reflect total
assets of approximately $2,056,000 as of December 31, 1999 and total revenues of
approximately  $2,899,000 for the year then ended. Those statements were audited
by other  auditors  whose  report has been  furnished  to us,  and our  opinion,
insofar as it relates to the  amounts  included  for such  subsidiary,  is based
solely on the report of the other auditors.

     We conducted  our audits in accordance  with  generally  accepted  auditing
standards.  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  and the  report of the other  auditors  provide a
reasonable basis for our opinion.

     In our opinion,  based on our audits and the report of the other  auditors,
the consolidated  financial  statements referred to above present fairly, in all
material  respects,  the  financial  position  of  ASA  International  Ltd.  and
subsidiaries at December 31, 1999 and 1998, and the results of their  operations
and their cash flows for each of the three  years in the period  ended  December
31, 1999, in conformity with generally accepted accounting principles.

     As discussed in the Summary of Significant Accounting Policies, the Company
changed its method of recognizing revenue in 1998 with the adoption of Statement
of Position 97-2, "Software Revenue Recognition."


/s/ BDO Seidman, LLP


Boston, Massachusetts
March 11, 2000




                                                                              37
<PAGE>
February 15, 2000


INDEPENDENT AUDITOR'S REPORT


Board of Directors and Shareholders
ASA ITALY S.r.l.

We have audited the financial  statements  of ASA Italy S.r.l.,  consisting of a
balance sheet as at December 31, 1999 and the related  statement of  operations,
income  statement,  shareholder's  equity  and cash  flows  for the  year  ended
December 31, 1999.  These  financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audit.

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

The financial  statements  referred to above,  present  fairly,  in all material
respects,  the financial  position of ASA Italy S.r.l.  at December 31, 1999 and
the results of their  operations  and cash flows for the year ended December 31,
1999, in conformity with generally accepted accounting principles.





Fausto Zanon
Partner

Deloitte & Touche, LLP
Treviso, Italy
                                                                              38
<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEETS

                                                            December 31,
                                                            -------------
                                                         1999            1998
                                                         ----            ----
<S>                                                  <C>             <C>
     ASSETS

CURRENT ASSETS:
     Cash and cash equivalents .................     $ 2,297,364     $ 4,262,438
     Marketable securities .....................       3,365,737            --
     Receivables -- net ........................       5,326,722       5,187,076
     Other current assets ......................       1,289,170         704,613
     Net assets of CommercialWare division .....            --         1,312,962
     Net assets of SmartTime division ..........       1,411,240            --
                                                     -----------     -----------
TOTAL CURRENT ASSETS ...........................      13,690,233      11,467,089
                                                     -----------     -----------
PROPERTY AND EQUIPMENT:
     Land and buildings ........................       4,192,882       4,018,949
     Computer equipment ........................       2,249,005       3,278,879
     Office furniture and equipment ............       1,162,820         934,032
     Leasehold improvements ....................         142,766          36,574
     Vehicles ..................................         415,991         463,402
                                                     -----------     -----------
                                                       8,163,464       8,731,836

     Accumulated depreciation
       and amortization ........................       3,092,487       3,889,322
                                                     -----------     -----------
NET PROPERTY AND EQUIPMENT .....................       5,070,977       4,842,514
                                                     -----------     -----------
SOFTWARE
  (less cumulative amortization
  of $2,822,289 and $6,480,122) ................       6,034,685       1,908,723

COST EXCEEDING NET ASSETS ACQUIRED
  (less cumulative amortization
  of $1,411,455 and $1,369,222) ................          18,045          60,278

NOTE RECEIVABLE ................................       1,700,000            --

OTHER ASSETS ...................................       1,356,345       1,453,751

                                                     -----------     -----------
                                                     $27,870,285     $19,732,355
                                                     ===========     ===========
</TABLE>

See notes to consolidated financial statements.

                                                                              39
<PAGE>
<TABLE>
<CAPTION>
                                                         December 31,
                                                         ------------
                                                      1999           1998
                                                      ----           ----
<S>                                                 <C>             <C>
     LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
     Notes payable - bank .......................   $    601,527    $       --
     Note payable - other .......................      3,200,000            --
     Deferred option and license fees ...........      2,460,000            --
     Accounts payable ...........................      1,047,228       1,174,792
     Accrued expenses ...........................      2,514,673       2,735,837
     Accrued commissions ........................        436,584         539,628
     Customer deposits ..........................        514,723         789,705
     Deferred revenue ...........................      2,056,600         726,117
     Current maturities of long-term obligations         114,391         152,571
                                                    ------------    ------------
TOTAL CURRENT LIABILITIES .......................     12,945,726       6,118,650
                                                    ------------    ------------
LONG-TERM OBLIGATIONS,
  NET OF CURRENT MATURITIES .....................      3,915,331       4,067,797
                                                    ------------    ------------
LONG-TERM LIABILITIES - Other ...................        272,220         304,769
                                                    ------------    ------------
DEFERRED INCOME TAXES ...........................        497,000         432,000
                                                    ------------    ------------
COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
  Preferred stock, par value
    $.01 per share: Authorized
    and unissued, 1,000,000 shares,
    60,000 shares of which are designated
    as Series A Junior Participating
    Preferred Stock .............................           --              --
  Common stock, par value
    $.01 per share: Authorized, 6,000,000
    shares; issued 4,384,458 and 4,376,858
    shares; outstanding, 3,084,985 and
    3,348,462 shares ............................         43,845          43,768
  Additional paid-in capital ....................      7,801,387       7,793,774
  Retained earnings .............................      5,131,487       2,964,622
  Accumulated other comprehensive income (loss):
  Foreign currency translation ..................        (10,968)         17,026
  Unrealized loss on marketable securities ......        (26,478)           --
                                                    ------------    ------------
                                                      12,939,273      10,819,190

  Less treasury stock, at cost ..................      2,699,265       2,010,051
                                                    ------------    ------------
                                                      10,240,008       8,809,139
                                                    ------------    ------------
                                                    $ 27,870,285    $ 19,732,355
                                                    ============    ============
</TABLE>
See notes to consolidated financial statements ..

                                                                              40

<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF OPERATIONS

                                               --Years Ended December 31,--
                                           1999            1998            1997
                                           ----            ----            ----
<S>                                  <C>             <C>             <C>
REVENUES
  Product licenses ...............   $  6,506,376    $  8,490,301    $  6,177,507
  Services .......................     15,062,870      18,217,434      14,005,494
  Computer and add-on hardware ...      4,053,289       8,760,421       5,323,734
                                     ------------    ------------    ------------
NET REVENUE ......................     25,622,535      35,468,156      25,506,735
                                     ------------    ------------    ------------
COST OF REVENUE
  Product licenses and development      4,456,953       4,650,739       3,326,174
  Services .......................      9,485,924      11,742,580       8,010,547
  Computer and add-on hardware ...      3,219,535       7,626,820       4,992,025
                                     ------------    ------------    ------------
TOTAL COST OF REVENUE ............     17,162,412      24,020,139      16,328,746
                                     ------------    ------------    ------------
EXPENSES
  Marketing and sales ............      4,356,610       5,577,389       4,487,320
  General and administrative .....      3,570,022       4,002,374       2,974,900
  Amortization of goodwill .......         42,234         336,183         230,360
                                     ------------    ------------    ------------
TOTAL EXPENSES ...................      7,968,866       9,915,946       7,692,580
                                     ------------    ------------    ------------
EARNINGS FROM OPERATIONS .........        491,257       1,532,071       1,485,409
INTEREST EXPENSE .................       (386,396)       (603,299)       (419,039)
INTEREST INCOME ..................        508,793         140,837          90,780
GAIN ON SALE OF COMMERCIALWARE ...      3,824,420            --              --
OTHER EXPENSE, NET ...............       (183,237)           --          (184,000)
EQUITY IN LOSS FROM AFFILIATE ....       (165,972)           --              --
                                     ------------    ------------    ------------
EARNINGS BEFORE
   INCOME TAXES ..................      4,088,865       1,069,609         973,150

INCOME TAXES .....................      1,922,000         653,000         585,000
                                     ------------    ------------    ------------

NET EARNINGS .....................   $  2,166,865    $    416,609    $    388,150
                                     ============    ============    ============

BASIC EARNINGS PER
  COMMON SHARE:
    NET EARNINGS .................   $        .67    $        .12    $        .12
                                     ============    ============    ============

DILUTED EARNINGS PER
  COMMON SHARE:
    NET EARNINGS .................   $        .63    $        .11    $        .11
                                     ============    ============    ============
</TABLE>
See notes to consolidated financial statements.

                                                                              41
<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                                               --Years Ended December 31,--
                                             1999            1998         1997
                                             ----            ----         ----
<S>                                     <C>            <C>           <C>
NET INCOME ..........................   $ 2,166,865    $   416,609   $   388,150
OTHER COMPREHENSIVE INCOME (LOSS)
  NET OF INCOME TAX:
Foreign currency translation ........       (27,994)        17,026          --
Unrealized loss on
      marketable securities .........       (26,478)          --            --
                                        -----------    -----------   -----------
COMPREHENSIVE INCOME ................   $ 2,112,393    $   433,635   $   388,150
                                        ===========    ===========   ===========
</TABLE>


See notes to consolidated financial statements.

                                                                              42

<PAGE>
ASA INTERNATIONAL LTD AND SUBSIDIARIES
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

                                                                               Accumu-
                                                                                lated
                                                                                Other
                            Common Stock         Additional                     Compre-           Treasury Stock
                       ----------------------     Paid-in        Retained       hensive     -------------------------
                         Shares      Amount       Capital        Earnings       Income        Shares         Amount         Total
                       ---------   ---------   ------------   ------------    -----------   ---------    ------------   -----------
<S>                    <C>         <C>         <C>            <C>             <C>           <C>          <C>            <C>
BALANCES,
  1/1/97 ............  3,984,237   $  39,842   $  7,344,564   $  2,159,863    $     --        795,396    $ (1,532,442)  $ 8,011,827
Exercise of
  stock
  options ...........      8,143          82          7,847           --            --           --              --           7,929
Issuance of
  contingent
  shares ............    104,122       1,041         51,870           --            --           --              --          52,911
Purchase of
  Treasury
  Stock .............       --          --             --             --            --         23,000         (53,255)      (53,255)
Repurchase of
  stock
  options ...........       --          --          (10,000)          --            --           --              --         (10,000)
Net earnings ........       --          --             --          388,150          --           --              --         388,150
                      ----------   ---------   ------------   ------------    ----------   ----------    ------------    ----------
BALANCES,
  12/31/97 ..........  4,096,502      40,965      7,394,281      2,548,013          --        818,396      (1,585,697)    8,397,562
Exercise of
  stock
  options ...........        210           2            205           --            --           --              --             207
Issuance of
  contingent
  shares ............     80,146         801         26,288           --            --           --              --          27,089
Purchase of
  Treasury
  Stock .............       --          --             --             --            --        210,000        (424,354)     (424,354)


Issuance of
  shares for
  Cedes
  acquisition            200,000       2,000        373,000           --            --           --              --         375,000
Net earnings ........       --          --             --          416,609          --           --              --         416,609
Foreign
  currency
  translation .......       --          --             --             --          17,026         --              --          17,026
                      ----------   ---------   ------------   ------------    ----------   ----------    ------------    ----------
BALANCES,
12/31/98 ............  4,376,858      43,768      7,793,774      2,964,622        17,026    1,028,396      (2,010,051)    8,809,139



                                                                              43
<PAGE>
Exercise of
  stock
  options ...........      7,600          77          7,613           --            --           --              --           7,690
Purchase of
  Treasury
  Stock .............       --          --             --             --            --        271,077        (689,214)     (689,214)
Net earnings ........       --          --             --        2,166,865          --           --              --       2,166,865
Foreign
  currency
  translation .......       --          --             --             --         (27,994)        --              --         (27,994)
Unrealized
  loss on
  marketable
  securities ........       --          --             --             --         (26,478)        --              --         (26,478)
                      ----------   ---------   ------------   ------------    ----------   ----------    ------------    ----------

                       4,384,458   $  43,845   $  7,801,387   $  5,131,487    $(  37,446)   1,299,473    $( 2,699,265)  $10,240,008
                      ==========   =========   ============   ============    ==========   ==========    ============   ===========
</TABLE>

See notes to consolidated financial statements.



                                                                              44
<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                 --Years Ended December 31,--
                                              1999             1998          1997
                                              ----             ----          ----

<S>                                       <C>            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net earnings .........................   $ 2,166,865    $   416,609    $   388,150
                                          -----------    -----------    -----------
  Adjustments  to  reconcile  net
     earnings to net cash
     provided  by  operating
  activities:
   Depreciation and amortization ......     1,735,286      2,316,093      1,864,730
   Deferred taxes .....................        65,000       (184,000)       236,000
   Doubtful receivables provision .....       348,538        203,131        125,381
   Gain on sale of CommercialWare .....    (3,824,420)          --             --
   Changes in assets and liabilities,
   net of effects of acquisitions:
    Receivables .......................      (430,991)    (2,383,472)    (2,298,020)
    Other current assets ..............      (601,710)       171,153        (91,605)
    Accounts payable ..................      (162,825)    (1,274,586)       902,988
    Accrued expenses ..................      (601,084)     3,416,443        629,577
    Customer deposits .................      (302,346)       450,277        119,640
    Deferred revenue ..................     2,647,606        473,952          7,192
                                          -----------    -----------    -----------
   Total adjustments ..................    (1,126,946)     3,188,991      1,495,883
                                          -----------    -----------    -----------
 Net cash provided by operating
  activities ..........................     1,039,919      3,605,600      1,884,033
                                          -----------    -----------    -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Additions to property and equipment ..      (717,521)    (1,040,547)      (249,743)
 Additions to software ................       (90,817)        (8,283)       (39,967)
 Increases in sales-type leases .......          (575)          (582)          --
 Cash received from divestiture,
  net of cash paid ....................     3,437,382         98,272           --
 Cash paid in acquisition
  of Design Data Systems ..............    (5,094,507)          --             --
 Additions to marketable securities ...    (3,392,215)          --             --
 Other assets .........................        83,574       (350,893)       257,623
                                          -----------    -----------    -----------
 Net cash used for investing
  activities ..........................    (5,774,679)    (1,302,033)       (32,087)
                                          -----------    -----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Increase (decrease) in bank notes ....       481,473           --         (795,000)
 Increase in note payable - other           3,200,000           --             --
 Reduction in long-term debt ..........      (142,939)    (2,084,463)      (643,042)
 Increase in long-term debt ...........          --        3,182,042        250,000
 Decrease in long-term liabilities ....       (32,549)        (8,748)          --
 Issuance of common stock .............         7,690            207          7,929
 Purchase of Treasury Stock ...........      (689,214)      (424,354)       (53,255)
 Repurchase of stock options ..........          --             --          (10,000)
                                          -----------    -----------    -----------

                                                                               45
<PAGE>
 Net cash provided by (used for)
  financing activities ................     2,824,461        664,684     (1,243,368)
                                          -----------    -----------    -----------
 EFFECT OF EXCHANGE RATES ON
 CASH & CASH EQUIVALENTS ..............       (54,775)        11,370           --
                                          -----------    -----------    -----------

CASH AND CASH EQUIVALENTS:
 Net increase (decrease) ..............    (1,965,074)     2,979,621        608,578
 Balance, beginning of year ...........     4,262,438      1,282,817        674,239
                                          -----------    -----------    -----------
Balance, end of year ..................   $ 2,297,364    $ 4,262,438    $ 1,282,817
                                          ===========    ===========    ===========
</TABLE>

SUPPLEMENTAL CASH FLOW INFORMATION.

INVESTING AND FINANCING ACTIVITIES:

During 1997, the Company acquired  $102,634 of equipment through a capital lease
transaction.

During 1998 and 1997, the Company issued  contingently  issuable common stock in
the amount of $27,089 and $52,911.

Acquisitions:

During 1999, the Company  acquired  substantially  all the assets of Design Data
Systems Corporation. Assets acquired, liabilities assumed and consideration paid
for this acquisition were as follows:

     Fair value of assets acquired  $ 7,776,332
     Liabilities assumed             (2,681,825)
                                    ------------
     Net cash paid                  $ 5,094,507
                                    ============

During  1998,  the  Company  acquired  substantially  all of the assets of Cedes
S.r.l. and SIPI-U S.r.l. (now known as ASA Italy). Assets acquired,  liabilities
assumed, and consideration paid for this acquisition were as follows:

    Fair value of assets acquired
      excluding cash received
      of $306,733                    $ 1,356,742
    Liabilities assumed               (1,080,014)
    Issuance of common stock            (375,000)
                                     ------------
    Net cash received                $   (98,272)
                                     ============

See notes to consolidated financial statements.

                                                                              46

<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1999, 1998, 1997

A.  Summary of Significant Accounting Policies:

Business description and principles of consolidation

     The Company  develops,  markets,  and provides services for its proprietary
enterprise  software products and distributes  computer hardware to its software
customers.  The  Company  considers  its  operations  to be a  single  reporting
segment.  The  consolidated  financial  statements  include the  accounts of ASA
International Ltd. and its wholly owned subsidiaries,  ASA Properties, Inc., ASA
International  Ventures,  Inc., and ASA Italy S.r.l.,  after  elimination of all
material inter-company balances and transactions.


Cash equivalents

     The Company  considers all highly liquid debt instruments  purchased with a
maturity  of  three  months  or less to be cash  equivalents.  On a cash  basis,
interest income received  approximates the amounts reported on the statements of
operations.  The Company had approximately  $864,000 and $2,473,000  invested in
money market funds at December 31, 1999 and 1998, respectively.

Concentration of credit risks

     Concentration of credit risk with respect to accounts receivable is limited
due to the large number of customers  comprising  the Company's  customer  base.
Customers'  financial  condition is reviewed on an ongoing basis, and collateral
is not required.  The Company maintains reserves for potential credit losses and
such losses, in the aggregate, have not exceeded management's expectations.

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  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

     Many of the  Company's  estimates  and  assumptions  used in the  financial
statements  relate  to the  Company's  products,  which  are  subject  to  rapid
technological  change.  It is possible  that  changes may occur in the near term
that would affect management's estimates with respect to capitalized software.


                                                                              47
<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Marketable securities

     At December 31, 1999 the Company holds an investment in a senior,  secured,
floating rate loan,  mutual fund.  The Company  accounts for this  investment as
available-for-sale   in  accordance  with  Statement  of  Financial   Accounting
Standards No. 115 ("SFAS No. 115"),  "Accounting for Certain  Investment in Debt
and  Equity   Securities,"  which  requires  that  debt  and  marketable  equity
securities be classified as trading,  available-for-sale,  or  held-to-maturity.
Available-for-sale  securities  are reported in the balance  sheet at fair value
with  unrealized   gains  or  losses   included  in  a  separate   component  of
stockholders' equity.

At December 31, 1999, the fair market value of this investment was approximately
$3,366,000.  Accumulated  unrealized losses for the year ended December 31, 1999
were approximately $26,000.

Property and equipment

     Property and equipment are stated at cost.  Depreciation  for equipment and
vehicles is recorded on the straight-line  method, based on the estimated useful
lives  of  the  related  assets  (ranging  from  3 to 7  years).  Buildings  are
depreciated  over  40  years.  Equipment  under  capital  leases  and  leasehold
improvements  are amortized  over the shorter of the lease term or the estimated
useful lives of the assets.

Advertising

     The Company expenses advertising costs as incurred. Advertising expense was
approximately $519,000,  $653,000, and $513,000 in the years ending December 31,
1999, 1998, and 1997, respectively.

Costs exceeding net assets acquired

     Costs  exceeding  net assets of  businesses  acquired  are  amortized  on a
straight-line  basis over periods of 10 and 20 years.  On an annual  basis,  the
Company  reviews the carrying value of the costs  exceeding net assets  acquired
against  projections  of  undiscounted  cash flows and,  if  necessary,  records
impairment.

Revenue recognition

     The  Company is engaged as a seller and  licensor  of  software.  Effective
January 1, 1998,  the  Company  adopted  Statement  of  Position  ("SOP  97-2"),
"Software Revenue  Recognition" for purposes of recognizing  revenue on software
transactions. In accordance with SOP 97-2, revenue is recognized when all of the
following are met:  pervasive  evidence of an arrangement  exists;  delivery has
occurred;  the vendor's fee is fixed and  determinable;  and  collectibility  is
probable.  For  multiple-element  license  arrangements,   the  license  fee  is
allocated to the various elements based on fair value.  When a  multiple-element
arrangement includes rights to a post-contract  customer support, the portion of
the license fee allocated to such support is recognized ratably over the term of
the arrangement.  For arrangements to deliver software that requires significant

                                                                              48
<PAGE>
ASA  INTERNATIONAL  LTD.  AND  SUBSIDIARIES  NOTES  TO  CONSOLIDATED   FINANCIAL
STATEMENTS (continued)

modification    or    customization,    revenue    is    recognized    on    the
percentage-of-completion  method.  The effect of  adopting  SOP 97-2 on the 1998
Statement  of  Operations  was to decrease  income  before  income taxes and net
income by approximately $446,000 and $174,000, respectively.

     During 1998, SOP 98-9 was issued.  The provisions of SOP 98-9 amend certain
provisions  of SOP 98-4 and SOP 97-2.  The  adoption of these  standards  had no
material effect on the Company's financial position or results of operations.

     Prior to adoption of SOP 97-2,  the Company  followed SOP 91-1 for purposes
of recognizing revenue for software  transactions.  In accordance with SOP 91-1,
product license revenue was recognized upon shipment to the client provided that
no  significant  vendor  obligation  remained in connection  with software being
licensed and the collectibility of the sale was probable.

     Computer  hardware  revenue is  recognized  upon shipment of product to the
client.

     Service  revenues include  post-contract  client support,  consulting,  and
training  support.  Post-contract  client  support is generally  provided  under
self-renewing maintenance agreements. Revenue on these maintenance agreements is
recognized  ratably over the contract  term.  Consulting  and training  services
revenue is recognized in the period the service is rendered.

Research and development

     The Company  expenses  research and  development  costs as incurred.  Costs
incurred other than capitalized costs for software were not material.

Software

     The  Company  accounts  for the costs of  computer  software  developed  in
accordance with Statement of Financial  Accounting Standard No. 86. Accordingly,
the costs of purchased software, and of that software developed internally (once
technological   feasibility   is   established)   associated   with  coding  new
applications or modules and enhancing and porting existing applications software
are  capitalized.  Amortization  of these  costs is based on the  greater of the
charge  resulting from the application of either the  straight-line  method over
five years or the  proportion of current sales to estimated  future  revenues of
each  product.   Total  amortization  of  software  charged  to  operations  was
approximately  $1,305,000,  $1,446,000,  and  $1,201,000  for  the  years  ended
December 31, 1999, 1998, and 1997, respectively.

Income taxes

     Deferred tax assets or  liabilities  are  recognized  for the estimated tax
effects of temporary  differences  between the tax and financial reporting basis
of the Company's  assets and  liabilities  and for loss  carryforwards  based on
enacted tax laws and rates.


                                                                              49
<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


Comprehensive income

     In 1998, the Company adopted  Statement of Financial  Accounting  Standards
("SFAS") No. 130  "Reporting  Comprehensive  Income."  SFAS No. 130  establishes
rules  for  the   reporting  of   comprehensive   income  and  its   components.
Comprehensive  income  consists  of net  income,  foreign  currency  translation
adjustments and unrealized loss on marketable securities and is presented in the
consolidated  statements of comprehensive  income.  The adoption of SFAS No. 130
had no impact on total shareholders' equity.

Net earnings per share

     The Company  follows  SFAS No. 128  "Earnings  per Share."  Under SFAS 128,
Basic  Earnings Per Share (EPS)  excludes  the effect of any  dilutive  options,
warrants or convertible  securities and is computed by dividing the net earnings
available to common shareholders by the weighted average number of common shares
outstanding for the period. Diluted EPS is computed by dividing the net earnings
available to common  shareholders  by the sum of the weighted  average number of
common shares and common share  equivalents  computed  using the average  market
price for the period under the treasury stock method.

Foreign currency translation

     The  Company  has  determined  that  the  local  currency  of  its  Italian
Subsidiary is the functional currency. In accordance with Statement of Financial
Accounting  Standards No. 52,  "Foreign  Currency  Translation,"  the assets and
liabilities  denominated in foreign currency are translated into U.S. dollars at
the current rate of exchange  existing at  period-end  and revenues and expenses
are  translated  at  average  monthly   exchange  rates.   Related   translation
adjustments  are  reported  as a separate  component  of  shareholders'  equity,
whereas,  gains or losses  resulting  from  foreign  currency  transactions  are
included in results of operations.

New Accounting Standards Not Yet Adopted

     In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities" ("SFAS No. 133").
SFAS No. 133 requires companies to recognize all derivative  contracts as either
assets or  liabilities  in the balance  sheet and to measure  them at their fair
values.  If  certain  conditions  are  met,  a  derivative  may be  specifically
designated as a hedge,  the objective of which is to match the timing of gain or
loss  recognition  on the hedging  derivative  with the  recognition  of (i) the
changes in the fair value of the hedged assets or liability or (ii) the earnings
effect of the hedged forecasted transaction.  For a derivative not designated as
a hedging instrument,  the gain or loss is recognized in income in the period of
change.  SFAS No. 133, as amended by SFAS No. 137, is  effective  for all fiscal
quarters of fiscal years beginning after June 15, 2000.



                                                                              50
<PAGE>
   Historically, the Company has not entered into derivative contracts either to
hedge existing risks or for speculative purposes.  Accordingly, the Company does
not expect adoption of the new standard to affect its financial statements.


B.  Business Acquisitions and Divestitures:

Acquisitions

     In November 1999, the Company  acquired the business of Design Data Systems
Corporation,  a Florida  corporation,  pursuant to that certain  Asset  Purchase
Agreement  (the  "Purchase  Agreement")  by and among the  Company,  the Seller,
individually (only with respect to certain sections of the Purchase  Agreement),
and the Company's  Bank, as Escrow Agent (the "Escrow Agent") (only with respect
to certain sections of the Purchase Agreement).  The Purchase Agreement provides
that the  transaction  is  effective as of  September  30, 1999 (the  "Effective
Date").

     Pursuant  to and as more  fully set forth in the  Purchase  Agreement,  the
Company  had the right and  obligation  to  purchase  certain  of the assets and
assumed  certain of the liabilities of Seller for a purchase price of $5,000,000
(the "Purchase Price"). Of the Purchase Price, $4,750,000 was due and payable on
the Closing Date and  $250,000  was to be deposited  with the Escrow Agent to be
held pursuant to the terms of the Purchase Agreement.

     Also  on the  Closing  Date,  the  Company  entered  into a  certain  Asset
Acquisition and Exchange Cooperation  Agreement (the "Exchange  Agreement") with
SQL Acquisition LLC, a Delaware  limited  liability  company  ("SQL"),  Fidelity
National 1031 Exchange  Services,  Inc., a California  corporation,  and Pacific
American Property Exchange Corporation, a California corporation and sole member
and manager of SQL. The Company has entered into the Exchange  Agreement for the
purpose of seeking the ability to  effectuate a like-kind  exchange  pursuant to
Section 1031 of the Internal  Revenue Code of 1986, as amended.  Pursuant to and
as more fully set forth in the Exchange Agreement,  the Company has reserved the
right to exchange certain software and related  intellectual  property of Seller
(the  "Replacement  Property")  for certain other  relinquished  property of the
Company.  In  connection  therewith,  the Company  assigned to SQL the Company's
right and  obligation  under the Purchase  Agreement to acquire the  Replacement
Property  pursuant to a certain  Assignment  Agreement  dated the  Closing  Date
between the Company,  Seller and SQL (the "Assignment").  The Exchange Agreement
provides the Company with the option to purchase the Replacement Property within
twelve  months of the  Closing  Date for a  purchase  price of  $4,300,000  plus
interest  incurred by SQL on the  promissory  note due November 3, 2000.  On the
closing Date, the following actions were completed:

1. SQL acquired the  Replacement  Property  from Seller in  accordance  with the
Purchase Agreement and the Assignment in exchange for a payment of $4,300,000.

2. The Company  acquired the remainder of Seller's assets in accordance with the
Purchase  Agreement  in  exchange  for (a) the  payment  of  $700,000  (of which
$250,000 was deposited  with the Escrow Agent) and (b) the assumption of certain
of Seller's liabilities.

                                                                              51
<PAGE>
3. The Company  loaned SQL $4,300,000  pursuant to the Exchange  Agreement and a
related promissory note due on November 3, 2000 and bearing interest at the rate
of 6.18% per  annum.  The  funds  were used by SQL to  acquire  the  Replacement
Property.

4. SQL granted a license to the Company to use the  Replacement  Property  until
November 3, 2000 pursuant to a License Agreement between the Company and SQL, in
exchange for a one-time license fee of $285,000.

     Due to the existence of the Exchange Agreement between the Company and SQL,
the  Company  obtained  control  of the  net  assets  of  Design  Data  Systems.
Accordingly,  the Company recorded the acquisition of Design Data Systems by SQL
as if the  purchase  had been  completed  by the  Company  at a  purchase  price
consisting of the $4,300,000  promissory note with SQL, the $700,000  payment to
Design  Data  Systems,  the  assumption  of certain  liabilities  of Design Data
Systems and direct costs of the acquisition.  The net assets acquired consisting
of  approximately  $5,900,000 of software,  $1,700,000 of other assets,  and the
assumption of  approximately  $2,500,000 of  liabilities  were recorded at their
fair values based on the Company's estimate of these values.

     The Company  anticipates that it will seek to complete a like-kind exchange
involving the Replacement Property on or before November 3, 2000, although there
can be no assurance that such an exchange will be completed.

     Unaudited pro forma  consolidated  revenues,  net income and net income per
basic and diluted  share for the years ended  December 31, 1999 and 1998,  would
have been  approximately  as follows if the 1999  acquisition  had  occurred  on
January  1,  1998.  The  unaudited  pro  forma  financial   information  is  not
necessarily indicative of future results of operations of the Company because it
does not give  effect to what  might  have  occurred  had the  restructured  and
combined operations been functioning on January 1, 1998.

<TABLE>
<CAPTION>
                                            Years Ended December 31,
                                            ------------------------
                                               1999          1998
                                               ----          ----
<S>                                         <C>            <C>
Revenues                                  $30,775,000  $42,381,000
Net income                                  2,333,000      305,000
Net income per share:
   Basic                                         $.72         $.09
   Diluted                                       $.68         $.08
</TABLE>

     In January 1998, the Company  acquired  substantially  all of the assets of
Cedes S.r.l. and SIPI-U S.r.l.  ("Cedes"),  subsidiaries of the Findest Group of
Padova,  Italy.  Cedes sells  enterprise  resource  planning  (ERP)  software to
mid-range   companies  in  Italy.  The  transaction   involved  an  exchange  of
approximately $30,000 in cash,  assumption of certain liabilities,  and issuance
of 200,000  shares of the  Company's  Common Stock in exchange for the assets of
Cedes.  The  acquisition  was recorded  using the purchase  method of accounting
whereby the net assets  acquired were recorded at their fair values based on the
Company's estimate of these values.

     The  acquisition  price of  CommercialWare,  Inc.  (CWI) in December  1993,
contemplated a contingent future payment in Company stock or cash (an adjustment
to purchase  price) based on the future  performance of CWI and the market value


                                                                              52
<PAGE>
of the Company's stock.  Certain former owners of CWI received in March 1997 and
1998 deficiency payments in Company stock amounting to 104,122 shares and 80,146
shares,  respectively,  based on the difference between the market price for the
measurement period, as defined, and $5 per share.

Divestitures

     In March 1999,  the Company  exchanged  the assets and  liabilities  of its
CommercialWare Division (CWI) for approximately $4,000,000 in cash, a $1,700,000
note with  interest  at 7.06%  maturing  March 2003,  a 10%  interest in a newly
formed entity, CommercialWare, Inc., and a $500,000 Junior Note. The Company did
not  reflect  the  $500,000  Junior  Note  as part  of the  proceeds  due to the
uncertainty of the ultimate  collection of this Note. Through December 31, 1999,
the Company  had  collected  approximately  $255,000 on the Junior Note which is
recorded as Income in the 1999  Statement  of  Operations.  A pretax gain on the
sale  of  CWI of  approximately  $3,824,000  is  included  in  the  Consolidated
Statement of Operations  for the year ended  December 31, 1999.  Financial  data
relative to the CWI operation is as follows:

<TABLE>
<CAPTION>
                                                Year Ended December 31,
                                              --------------------------
                                                  1998          1997
                                                  ----          ----
<S>                                           <C>            <C>
    Revenues                                  $10,776,000    $7,603,000
    Net earnings                                  278,000       553,000
    Basic earnings per share                          .08           .17
    Diluted earnings per share                        .08           .16
</TABLE>

Assets  applicable  to  CWI,  net of  related  liabilities  assumed,  have  been
segregated  in the December  31, 1998  balance  sheet and shown as net assets of
CommercialWare division.

A summary of net assets of CWI division at December 31, 1998, is as follows:
<TABLE>
<S>                                             <C>
    Current assets                              $ 3,510,543
    Property and equipment                          239,804
    Excess of cost over net assets acquired         562,578
    Other assets                                    657,503
    Current liabilities                          (3,657,466)
                                                ------------
    Net assets                                  $ 1,312,962
                                                ============
</TABLE>

     In November 1998, the Company entered into a joint venture agreement with a
third party whereby the Company will sell and support  software  products in the
United States and Canada.  The Company had agreed to provide $500,000 in funding
for this venture.  No activity occurred under the joint venture agreement during
1998. During 1999, the Company contributed  approximately $156,000 in funding to
the venture.  In January 2000, the joint venture was terminated with all assets,
net of  liabilities  sold to a third  party.  The Company  received a payment of
$17,500 in January 2000 with a payment of $52,500 plus  interest at 6% due on or
before  December  31,  2000.  The Company has  recorded a loss of  approximately
$86,000 in Other Expense,  net in the Consolidated  Statements of Operations for
the year ended December 31, 1999.


                                                                              53
<PAGE>
     In December 1996, the Company disposed of  substantially  all of the assets
and  liabilities of the Company's  international  trade product line  (Product).
Product's revenues totaled  approximately  $6,718,000,  or 26%, of total Company
revenue for the year ended  December  31,  1996.  In exchange  for the assets of
Product  and the  assumption  of its  liabilities,  the  Company  received a 16%
membership   interest  in  TradePoint  Systems,   LLC  (Trade),   the  acquiring
corporation, and a subordinated promissory note in the face amount of $600,000
from Trade.  The note bears interest of 12%, is due on December 31, 2002, and is
being  repaid in monthly  installments  of  principal  and  interest of $11,730.
Included  in other  assets at  December  31,  1999 and 1998 was the  outstanding
balance on this note of $369,000 and $460,000,  respectively.  The remaining 84%
interest in Trade is owned by the former  President  and Director of the Company
(Buyer). In exchange for his interest in Trade, Buyer (i) contributed all of the
Company's  common stock,  $.01 par value per share (the "Common Stock") owned by
him,  totaling  665,597  shares;  (ii) assigned to the Company a 16% partnership
interest in the ASA Investment Partnership, a partnership by and among Buyer the
Company,  and the Company's  Chief  Executive  Officer and  Chairman;  and (iii)
canceled  all of his options to purchase  245,000  shares of Common  Stock.  The
Company recorded a loss on the transaction of $322,333,  based on the fair value
of the consideration  received, less the book value of the net assets exchanged.
The consideration to be paid was determined by negotiations  between the parties
and was  independently  evaluated  on behalf  of the  Company  by an  investment
banking firm. The Company's investment in Trade, which is valued at $500,000, is
accounted  for under the cost method and is included in other assets at December
31, 1999 and 1998.

     In  connection  with the  transaction,  Trade  granted  to the  Company  an
irrevocable  proxy  covering  the  Company's  Common  Stock owned by Trade.  The
Company  has the right to cause Trade to redeem the 16%  membership  interest in
Trade held by the Company by notice given on or after March 1, 2002, in exchange
for the Company's  Common Stock held by Trade,  and the fair market value of the
16%  membership  interest in Trade.  Trade has the right to redeem the Company's
membership  interest by notice given on or after  December 31, 2001, in exchange
for the Company's  Common Stock held by it, and the greater of $400,000,  or the
fair market value of the 16% membership interest in Trade.

     In 1990,  the  Company  sold the  assets  of its BIT  unit  which  provided
computer systems to the hardgoods  distribution market segment. A portion of the
consideration paid consisted of a promissory note for $300,000, with a five-year
term at 6% interest  (discounted value of $272,000 at 10% interest),  and 10,000
shares of Class B Non-Voting  Stock of the acquiring  corporation,  Distribution
Management  Systems,  Inc. (DMS). The note was paid in full during 1995. The DMS
shares,  originally  valued at  $334,000,  included  under the category of other
assets at December  31, 1998 and 1997,  were  written  down to a net  realizable
value of  approximately  $150,000  during 1997.  The writedown of  approximately
$184,000 is recorded in other  expense for the year ended  December 31, 1997. In
November  1999,  the shares were  redeemed by DMS for $25,000 with the remaining
balance of approximately  $125,000 written-off and recorded under Other Expense,
net in the Consolidated  Statement of Operations for the year ended December 31,
1999.

                                                                              54
<PAGE>
Option to Purchase

     In August 1999, the Company granted to a company  ("Optionee") an option to
purchase the  Company's  SmartTime  product line. As per the terms of the Option
Agreement,  the Company  transferred the assets and liabilities of its SmartTime
product  line to a newly formed LLC, of which the Company is the sole member and
the Optionee is the manager.

     The  Agreement  provides  that the  Optionee has the option to purchase the
SmartTime  product  line from the LLC at  anytime  from  August 1, 2000  through
August 31, 2000 (the "Option  Period"),  or at such earlier date as agreed to by
the parties, for an aggregate purchase price of $7,020,000,  less any option fee
paid to date (the "Purchase Price"). The terms and conditions of the acquisition
are set  forth in an Asset  Purchase  Agreement  dated as of August 2, 1999 (the
"Purchase Agreement"). The Purchase Agreement provides that the sale will occur,
if at all, within two days after exercise of the option and the  satisfaction of
certain  other  conditions  as specified in the Purchase  Agreement.  During the
Option Period,  the Optionee will employ the employees of the SmartTime  product
line and will bear the risk of its financial performance.

     The Optionee paid an initial  option fee in the amount of  $1,660,000  upon
execution of the  Agreement and is required to pay a second option fee on August
1, 2000 in the amount of  $540,000,  unless the  Optionee  exercises  the option
prior to such date.  The option fees are  non-refundable  to the Optionee in the
event that the Optionee  does not exercise the option to purchase the  SmartTime
product line, as to which there can be no assurance.  Pursuant to the Agreement,
the Optionee has loaned to the Company the sum of  $3,200,000  (with  respect to
which the Company has prepaid  $160,000 in interest).  In addition,  the LLC has
agreed to loan the Optionee an amount equal to the net cash of the LLC available
after  collection  of the LLC's  accounts  receivable  and  payment of the LLC's
accounts payable.

     The  Optionee  has  purchased   exclusive  licenses  to  use  the  customer
intangibles and intellectual  property of the SmartTime  product line during the
Option  Period for $300,000 and  $500,000,  respectively.  In the event that the
Optionee  does not exercise the option to purchase  the  SmartTime  product line
prior to the  expiration of the Option Period,  the Optionee's  rights under the
above-mentioned license agreements would terminate and the Company,  through the
LLC, would retain ownership of these assets.

     Assets applicable to the SmartTime division net of liabilities assumed have
been segregated in the Company's balance sheet at December 31, 1999 and shown as
net assets of the SmartTime  division.  The initial option fee of $1,660,000 and
license  fees  aggregating  $800,000  paid by the  optionee  are included in the
accompanying 1999 balance sheet as deferred option and license fees. The results
for the operations of this product line are shown in the Consolidated Statements
of Operations for the year ended December 31, 1999 under the caption  "Equity in
Loss from Affiliate."

     A summary of net assets of SmartTime at December 31, 1999 is as follows:

<TABLE>
<S>                                <C>
     Current assets                $1,293,103
     Property and equipment           198,237
     Software                         643,923
     Liabilities                     (724,023)
                                   -----------
          Net Assets               $1,411,240
                                   ===========
</TABLE>

                                                                              55
<PAGE>
<TABLE>
<CAPTION>
C.  Receivables:
                                             December 31,
                                             ------------
                                         1999           1998
                                         ----           ----
<S>                                 <C>             <C>
     Trade                          $4,747,089      $5,198,384
     Amounts due from officers
       and employees                   230,243         204,572
     Other                             739,147          15,340
                                    ----------      ----------
                                     5,716,479       5,418,296
     Less allowance for
       doubtful accounts               389,757         231,220
                                    ----------      ----------
                                    $5,326,722      $5,187,076
                                    ==========      ==========
</TABLE>

     Amounts  due from  officers  and  employees  represent  unsecured  periodic
advances reduced by repayments. There is no interest charged on these advances.

     The  allowance  for  doubtful  accounts at December  31, 1996 was  $92,792.
During the three years ended  December 31, 1999,  1998, and 1997, the provisions
for doubtful accounts were $348,538,  $203,131, and $145,886 and write-offs were
$190,001, $135,353, and $75,236, respectively.

<TABLE>
<CAPTION>
D.  Notes Payable, Long-Term Obligations, Commitments, and Contingencies:

                                             December 31,
                                             ------------
                                          1999          1998
                                          ----          ----
<S>                                    <C>            <C>
     Short-term obligations
     Note payable                      $3,200,000     $     -
                                       ==========     ==========

     Long-term obligations

     Term loans                        $  144,310     $  182,041
     Mortgage notes                     3,884,373      3,948,071
     Capital lease obligations              1,039         90,256
                                       ----------     ----------
                                        4,029,722      4,220,368
     Less current maturities              114,391        152,571
                                       ----------     ----------
                                       $3,915,331     $4,067,797
                                       ==========     ==========
</TABLE>

The current carrying value of short-term and long-term  obligations  approximate
their fair market value.

                                                                              56
<PAGE>
Note Payable

     Under the terms of the August  1999 Option to  Purchase  Agreement  for the
Company's  SmartTime  product line, the Company  borrowed  $3,200,000 at a fixed
rate of 5% per annum.  The note is due on August 31,  2000.  The interest on the
note totaling  $160,000 was prepaid upon the execution of the Option to Purchase
Agreement.

Revolving demand note

     In October  1999,  the Company  entered  into (i) a  revolving  demand loan
agreement  with  a  bank  for  up to  $1,500,000,  bearing  interest  at a  rate
approximating prime (8.5% at December 31, 1999) minus .5%, which extends through
June 30, 2000,  and (ii) a  $3,000,000  acquisition  line of credit  under which
advances  will bear  interest at a rate  approximating  prime minus 1/2% until a
conversion date upon which the outstanding principal balance of advances will be
amortized on a straight-line  basis over five (5) years at a fixed interest rate
equal to two and  one-quarter  (2.25%)  over the  average  yield on US  Treasury
securities.  The acquisition  line of credit is available for use by the Company
based upon the  lesser of  $3,000,000  or the sum of 75% of the value  (lower of
purchase price or appraised value) of any business acquired by the Company. This
credit  facility  requires the Company to maintain  stated tangible net worth as
well as,  stated debt service  coverage  and debt to tangible net worth  ratios.
Payment of dividends is prohibited under the terms of this agreement.  The loans
are secured by the personal  property of the Company along with a first priority
perfected security interest in all business assets acquired by the Company.

     Prior to this arrangement, the Company had a revolving credit agreement for
$1,500,000 (which could not exceed 80% of acceptable accounts  receivable).  The
agreement stipulated interest at prime plus .5%. Short-term borrowings under the
revolving credit and demand  agreements,  at and for the year ended December 31,
are as follows:


<TABLE>
<CAPTION>
                                              December 31,
                                              ------------
                                     1999          1998         1997
                                     ----          ----         ----

<S>                               <C>           <C>          <C>
     Balance outstanding at
       December 31                $    -        $    -       $    -
                                  ===========   ===========  ===========
     Interest rate at
       December 31                     -             -          9.50%
                                  ===========   ===========  ===========
     Maximum amount outstanding
       during the year            $    -        $    -       $1,055,000
                                  ===========   ===========  ===========
     Average amount outstanding
       during the year            $    -        $    -       $  337,000
                                  ===========   ===========  ===========
     Weighted average interest
       rate during the year
       based on average
       month-end balances              -             -           9.44%
                                  ===========   ===========  ===========

</TABLE>
                                                                              57
<PAGE>
Term loans

     The term loan outstanding at December 31, 1999, is due on December 31, 2003
and payable in semi-annual  installments of approximately $37,000, plus interest
at 3.8%.

Mortgage notes

     The Company has three mortgage  notes  outstanding at December 31, 1999. In
September 1998, the Company completed the refinancing of its mortgage related to
its Corporate Headquarters in Framingham,  Massachusetts. The new mortgage note,
in the  original  amount  of  $3,000,000,  with  interest  at 7.24% for 10 years
provides for monthly  principal and interest payments of $20,445 through October
2008 with a final principal payment of approximately $2,638,000 plus interest.

     The  financing  required  a  prepayment  fee to the prior  lender for early
pay-off on the existing mortgage of $248,000.  This fee was recorded as interest
expense in the Statement of Operations  for the year ended  December 31, 1998. A
note on a second building  acquired in December 1992 requires monthly  principal
and interest (at 9.5%)  payments of $5,710 over twenty years.  In May 1993,  the
Company received $507,000 in mortgage financing for the improvement and updating
of this facility under a note from the Small Business Administration. The twenty
year note, with interest at approximately  6.6%, calls for monthly principal and
interest  payments  of  $4,277.  Each of these  notes is  collateralized  by the
buildings which they financed.

Equipment loans and capital lease obligations

     The Company  purchases or leases  various  vehicles and computer  equipment
under loan and capital  lease  agreements.  The  agreements  require  monthly or
quarterly payments of varying amounts and expire through 2000.

     Interest paid was approximately  $386,000,  $603,000, and $383,000, for the
years ended December 31, 1999, 1998, and 1997, respectively. The Company and its
subsidiaries  lease  office and  warehouse  facilities  under  operating  leases
expiring on various dates through  January 2006.  Total rent expense  charged to
operations  approximated  $433,000,  $270,000,  and $240,000, in 1999, 1998, and
1997, respectively.

     At December 31, 1999, long-term  obligations and minimum rental commitments
under noncancellable operating and capital leases with initial terms of one year
or more are as follows:

<TABLE>
<CAPTION>
             Capital Leases   Long-Term Obligations  Operating Leases
             --------------   ---------------------  ----------------
<S>              <C>             <C>                 <C>
     2000         $1,978          $  113,353          $  517,435
     2001           -                107,680             424,377
     2002           -                113,680             365,779
     2003           -                116,647             368,954
     2004           -                 93,084             320,435
     Thereafter     -              3,484,239             182,529
                 -------          ----------          ----------
                   1,978           4,028,683           2,179,509
                 -------          ----------          ----------
       Less
     imputed
     interest        939                -                   -
                 -------          ----------          ----------
                 $ 1,039          $4,028,683          $2,179,509
                 =======          ==========          ==========
</TABLE>

                                                                              58
<PAGE>
     The amount recorded under capital leases included in computer equipment was
approximately   $172,000   and   $358,000,   at  December  31,  1999  and  1998,
respectively.   Accumulated  depreciation  and  amortization  was  approximately
$172,000 and $300,000, at December 31, 1999 and 1998, respectively.

E.  Income Taxes (Credits):

Income before income taxes is as follows:

                      Years Ended December 31,
                      ------------------------
                1999           1998          1997
                ----           ----          ----
Domestic   $ 4,397,409    $   922,066   $   973,150
Foreign       (308,544)       147,543          --
           -----------    -----------   -----------
Total ..   $ 4,088,865    $ 1,069,609   $   973,150
           ===========    ===========   ===========



Components of income taxes (credits) are as follows:
                      Years Ended December 31,
                      ------------------------
                   1999          1998          1997
                   ----          ----          ----
Current:
     Federal   $1,290,000   $  394,000    $  108,000
     State .      499,000      308,000       241,000
     Foreign       68,000      135,000          --

Deferred ...       65,000     (184,000)      236,000
               ----------   ----------    ----------
               $1,922,000   $  653,000    $  585,000
               ==========   ==========    ==========



     A non-US  subsidiary  computes taxes at rates in effect in Italy.  Earnings
from this  subsidiary may also be subject to additional  income and  withholding
taxes when they are distributed as dividends. These earnings are not expected to
be remitted because they are permanently  reinvested  locally by the subsidiary.
At  December  31,  1999,  there  were no  undistributed  earnings  of the non-US
subsidiary due to cumulative losses.

     On  a  cash  basis,  income  taxes  paid  in  1999,  1998,  and  1997  were
approximately $1,170,000, $633,000, and $64,000, respectively.



                                                                              59
<PAGE>
     Income  taxes  are  reconciled  with the  U.S.  federal  statutory  rate as
follows:

<TABLE>
<CAPTION>
                                      Years Ended December 31,
                                      ------------------------
                                     1999      1998        1997
                                     ----      ----        ----
<S>                              <C>         <C>        <C>
 Income taxes at
   U.S. statutory federal rate   $1,390,000  $364,000   $331,000
 State income tax,
   net of federal income
   tax benefit                      284,000   117,000    133,000
 Non-deductible amortization
   of intangibles                    14,000    81,000     78,000
 Foreign tax differential           173,000    85,000       -
 Other, net                          61,000     6,000     43,000
                                  ---------  --------   --------
                                 $1,922,000  $653,000   $585,000
                                  =========  ========   ========
</TABLE>

     Deferred  income  taxes  reflect  the  net  tax  effects  of (a)  temporary
differences between the carrying amounts of assets and liabilities for financial
reporting  purposes and the amounts for income tax  purposes  and (b)  operating
loss  and  tax  credit  carryforwards.  The tax  effects  of  significant  items
comprising  the Company's net deferred tax liability as of December 31, 1999 and
1998 are as follows:
<TABLE>
<CAPTION>

                                              1999              1998
                                              ----              ----
<S>                                         <C>            <C>
     Deferred tax liabilities:
       Software development
         deducted for tax, not book         $ 183,000      $ 833,000
       Differences between book
         and tax basis of property             57,000         29,000
       Deferred gain on CommercialWare        479,000           -
       Deferred gain on divestiture           175,000        175,000
       Other                                    3,000          8,000
                                            ----------     ----------
                                              897,000      1,045,000
                                            ----------     ----------
       Deferred tax assets:
       Tax credit carryforwards                 -            366,000
       Accruals/reserves                      370,000        217,000
       Other                                   30,000         30,000
                                            ----------     ----------
                                              400,000        613,000
                                            ----------     ----------
     Net deferred tax liability             $ 497,000      $ 432,000
                                            ==========     ==========
</TABLE>



                                                                              60
<PAGE>
F.  Capital Transactions:

     Series A Junior Participating Preferred Stock
In October 1998 the Company's Board of Directors  adopted a Shareholders  Rights
Plan (the "Plan"),  which  provides a dividend of one preferred  share  purchase
right (a "Right") for each outstanding  share of the Company's common stock, par
value $.01 per share. Except as set forth below and subject to adjustment as set
forth in the Plan,  each Right will entitle the holder to buy one  one-hundredth
of a share of authorized  Series A Junior  Participating  Preferred  Stock,  par
value $.01 per share ("Series A Preferred Stock") at a purchase price of $10 per
right.  Initially,  the  Rights  will  attach to all Common  Stock  Certificates
representing  shares  then  outstanding,  and may not be traded  apart  from the
stock. The Rights become exercisable on the tenth day after public announcements
that a person  or  group  has  acquired,  or  obtained  the  right  to  acquire,
beneficial  ownership of 20% or more of the Company's  outstanding common stock,
commencement  of a tender or exchange  offer that would  result in a  beneficial
ownership by a person or group of 20% or more of the Company's  common stock, or
a person or group  acquired 10% or more of the  outstanding  common stock and is
deemed an  Adverse  Person  under the terms of the Plan.  If,  after the  Rights
become  exercisable,  the  Company  is a party to  certain  merger  or  business
combination  transactions,  or  transfers  50% or more of its assets or earnings
power,  or if an acquirer  engages in certain  self-dealing  transactions,  each
Right  (except  those held by the  acquirer)  will  entitle  its holder to buy a
number  of shares  of the  Company's  Series A  Preferred  Stock or, in  certain
circumstances,  a number of shares of the acquiring  company's  common stock, in
either case having a market value equal to two times the  exercise  price of the
Right.  The Rights  may be  redeemed  by the  Company at any time up to ten days
after a person or group acquires 20% or more of the Company's  common stock at a
redemption price of $.01 per Right. The Rights will expire on October 20, 2008.

     The Company has  reserved  60,000  shares of Series A Junior  Participating
Preferred Stock for the exercise of the Rights.

Treasury Stock

     Approximately  $343,000  of the balance in treasury  stock  represents  the
Company's 75%  investment in a partnership  which  consists of shares of its own
common  stock.  The  Chief  Executive  Officer  holds the  remaining  25% of the
investment.

Stock options

     At December 31, 1999, the Company has four stock-based  compensation plans,
which are described  below.  The Company applies APB Opinion 25,  Accounting for
Stock Issued to Employees,  and related  Interpretations  in accounting  for its
plans.  Accordingly,  no  compensation  cost has been  recognized  for its stock
option plans.  Had  compensation  cost for the Company's four stock option plans
been  determined  based on the fair value at the grant  dates for  awards  under


                                                                              61
<PAGE>
those plans  consistent  with the method of FASB Statement  123,  Accounting for
Stock-Based  Compensation,  the  Company's  net  earnings and earnings per share
would have been adjusted to the pro forma amounts indicated below:

<TABLE>
<CAPTION>

                                          1999        1998       1997
                                          ----        ----       ----
<S>                                    <C>          <C>        <C>
Net income              As reported    $2,166,865   $416,609   $388,150
                        Pro forma       2,119,701   $384,132   $348,771

Basic Earnings
per share               As reported          $.67       $.12       $.12
                        Pro forma            $.66       $.11       $.11

Diluted Earnings
per share               As reported          $.63       $.11       $.11
                        Pro forma            $.62       $.10       $.10
</TABLE>

     The Company's four stock option plans, the 1986, 1988, 1993, and 1995 Stock
Option  Plans,   provide  for  the  granting  of  incentive  stock  options  and
nonqualified  stock options to purchase an aggregate of 980,000 shares of common
stock at a price  not less  than  fair  market  value on the date the  option is
granted.

     The fair value of each option grant is estimated on the date of grant using
the  Black-Scholes  option  pricing  model with the  following  weighted-average
assumptions  used for grants in 1999,  1998,  and 1997,  respectively:  dividend
yield of 0% for all years, and expected volatility of 46% for 1999 and 1998, and
47% for 1997,  risk-free  rates  ranging from 5.18% to 6.15% for 1999,  5.50% to
5.80% for 1998,  and 5.76% to 6.73% for 1997, and expected lives ranging from 12
to 48 months for 1999, 1998, and 1997.


                                                                              62


<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

     A summary of the status of the Company's  stock option plans as of December
31, 1999, 1998, and 1997, and changes during the years ending on those dates, is
presented below:
<TABLE>
<CAPTION>
                         1999                      1998                     1997
               -----------------------  ------------------------  -----------------------
                     Weighted Average          Weighted Average         Weighted Average
               Shares Exercise Price    Shares  Exercise Price    Shares Exercise Price
               ------ ----------------  ------ -----------------  ------ ----------------
<S>            <C>         <C>          <C>         <C>           <C>         <C>
Outstanding
 at beginning
 of year       415,752     $1.17        359,749     $1.05         366,097     $1.37
Granted         90,000      2.50         60,300      1.90          22,700      1.46
Exercised        7,600      1.16            210      1.00           8,143       .97
Canceled        47,860      1.86          4,087      1.13          20,905      1.08
               -------                  -------                   -------

Outstanding at
 end of year   450,292     $1.36        415,752     $1.17         359,749     $1.05
               =======     =====        =======     =====         =======     =====
Options
 exercisable
 at year-end   337,518     $1.07        319,735     $1.03         306,799     $1.02
               =======     =====        =======     =====         =======     =====

Weighted-
 average fair
 value of
 options
 granted
 during the
 year                      $1.42                    $1.07                     $ .59
                           =====                    =====                     =====
</TABLE>

     As of December 31, 1999,  the 450,292  options  outstanding  under the Plan
have exercise prices between $.88 and $2.63,  and a  weighted-average  remaining
contractual life of approximately 4 years.

     As of December 31, 1999 the exercisable  options outstanding under the Plan
have exercise  prices  between $.88 and $2.63 and a  weighted-average  remaining
contractual life of approximately 3 years.

Common stock reserved

     At December 31, 1999, the Company has reserved 908,792 shares of its common
stock for incentive and nonqualified stock options.

G. Earnings per Share:

     The  weighted  average  number of  common  shares  outstanding  used in the
computation of earnings (loss) per share is summarized as follows:

                                                                              63
<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
<TABLE>
<CAPTION>
                              1999            1998            1997
                              ----            ----             ----
<S>                          <C>            <C>            <C>
Denominator:

Denominator for basic
  earnings per share -
  weighted average shares    3,218,291      3,456,362      3,278,689


Effect of dilutive
  securities:

Employee stock options         211,553        178,546        135,919

Contingently issuable
  shares                          -              -            80,146
                            ----------      ----------      ---------

Denominator for diluted
  earnings per share -
  adjusted weighted
  average shares and
  assumed conversions        3,429,844      3,634,908      3,494,754
                            ==========     ===========    ===========
</TABLE>

     The following  table  summarizes  securities  which were  outstanding as of
December 31,  1999,  1998,  and 1997,  but not  included in the  calculation  of
diluted net earnings per share because such shares are antidilutive:

<TABLE>
<CAPTION>
                                       Year Ended December 31,
                                       --------------------------
                                   1999           1998           1997
                                   ----           ----           ----
<S>                              <C>             <C>            <C>
Employee stock options           36,000          3,900          4,000
</TABLE>

H. Transactions with Major Suppliers:

     In 1998 and 1997, the Company made significant  purchases from two hardware
suppliers totaling approximately $2,900,000, and $2,700,000, respectively.


                                                                              64
<PAGE>
ASA INTERNATIONAL LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

I. Major Customers:

     The Company had sales to one customer  approximating 13% of gross sales for
the fiscal year ended December 31, 1997.  There were no major  customers in 1999
and 1998 from which the Company derived sales in excess of 10%.

J. Geographic Information:

     The  following  is a  summary  of  selected  geographic  information  as of
December 31, 1999, 1998, and 1997.
<TABLE>
<CAPTION>
Revenues:
                              1999            1998             1997
                              ----            ----             ----
<S>                      <C>              <C>              <C>
United States            $22,200,000      $31,500,000      $25,000,000
Italy                      2,900,000        3,500,000           -
Other                        500,000          500,000          500,000
                         -----------      -----------      -----------
Total                    $25,600,000      $35,500,000      $25,500,000
                         ===========      ===========      ===========
</TABLE>

Revenues are attributed to countries based on location of customers.
<TABLE>
<CAPTION>

Long-lived assets:
                              1999            1998             1997
                              ----            ----             ----
<S>                      <C>              <C>              <C>
United States            $13,543,000      $7,528,000       $9,727,000
Italy                        637,000         737,000             -
                          ----------      ----------       -----------
Total                    $14,180,000      $8,265,000       $9,727,000
                         ===========      ==========       ===========
</TABLE>

K. Commitments:

     The  Company  maintains  a  defined   contribution  benefit  plan  covering
substantially all its employees.  The Company makes contributions to the plan at
the  discretion  of the Board of Directors  based upon a percentage  of employee
compensation  as  provided  by the terms of the plan.  Contributions  charged to
operations in 1999, 1998, and 1997 were approximately  $149,000,  $132,000,  and
$62,000, respectively.

     The long-term  liability  amount  outstanding  in the December 31, 1999 and
1998 balance sheet represents an employee  severance  liability as calculated in
conformance  with Italian  law.  The  liability is computed on the basis of: the
category of employee, their length of service, annual compensation, and includes
the effect of inflation.  The Company's liability under the law is fully accrued
at December 31, 1999 and 1998.



                                                                              65