SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

Quarterly  report under  Section 13 or 15(d) of the  Securities  Exchange Act of
1934.

          January 31, 1997                           0-011228
        For the Quarter Ended                 Commission File Number

                          SYSTEMS   ASSURANCE   CORPORATION   (Exact   name   of
             registrant as specified in its charter.)

         DELAWARE                                                02-0337028
(State or other jurisdiction of                                (IRS Employer
incorporation or organization)                               Identification No.)

    10 Exchange Place, Suite 309
         Salt Lake City, Utah                               84111
(Address of principal executive offices)                  (Zip Code)

                     18 West King Street, Malvern, PA 19355
                          (Former Address and Zip Code)

                                 (801) 364-3500
               (Registrant's telephone number including area code)

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

Securities registered pursuant to Section 12(g) of the Act:

                          Common Stock, $.01 Par Value
                                (Title of Class)

                 Name of each exchange on which registered: NONE

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. [X] Yes [ ] No

Number of shares of the Registrant's  Common Stock, $.01 par value,  outstanding
at March 21, 1997: 798,835.

                     DOCUMENTS INCORPORATED REFERENCE: None

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<PAGE>



                          SYSTEMS ASSURANCE CORPORATION
                                 BALANCE SHEETS
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                             January 31,           October 31,
                                                                                1997                  1996
                                                                         -----------------     -----------------
ASSETS
   Current Assets
<S>                                                                      <C>                   <C>
       Cash                                                              $             698     $             698
       Income taxes refundable                                                       1,442                 1,442
                                                                         -----------------     -----------------

                                                 TOTAL CURRENT ASSETS                2,140                 2,140
                                                                         -----------------     -----------------

                                                                         $           2,140     $           2,140
                                                                         =================     =================

LIABILITIES AND CAPITAL DEFICIT
   Current Liabilities
       Notes payable                                                     $          50,000     $          50,000
       Accrued expenses                                                              3,099                 3,099
                                                                         -----------------     -----------------

                                            TOTAL CURRENT LIABILITIES               53,099                53,099
                                                                         -----------------     -----------------

   Capital Deficit
       Common stock, par value $.01 per share;
           authorized 30,000,000 shares; outstanding
           398,835 shares                                                            3,988                 3,988
       Additional paid-in capital                                               10,077,397            10,077,397
       Deficit                                                                 (10,132,344)          (10,132,344)
                                                                         -----------------     -----------------

                                                TOTAL CAPITAL DEFICIT              (50,959)              (50,959)
                                                                         -----------------     -----------------

                                                                         $           2,140     $           2,140
                                                                         =================     =================
</TABLE>


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


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<PAGE>



                          SYSTEMS ASSURANCE CORPORATION
                             STATEMENTS OF OPERATION
               Three month periods ended January 31, 1997 and 1996
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                1997                  1996
                                                                         -----------------     -----------------

<S>                                                                      <C>                   <C>
Revenue                                                                  $               0     $               0
General and administrative expenses                                                      0                   250
                                                                         -----------------     -----------------

Income (loss) before provision for income taxes                                          0                  (250)
Provision (credit) for income taxes                                                      0                     0
                                                                         -----------------     -----------------

                                                    NET INCOME (LOSS)    $               0     $            (250)
                                                                         =================     =================

Income (loss) per common share                                           $             .00     $             .00
                                                                         =================     =================

Weighted average number of common shares                                           348,835               348,835
                                                                         =================     =================
</TABLE>


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


                                        3

<PAGE>



                          SYSTEMS ASSURANCE CORPORATION
                          STATEMENT OF CAPITAL DEFICIT
                   Twelve month period ended October 31, 1996
                                       and
                    Three month period ended January 31, 1997
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                        Additional                              Total
                                        Number             Par            Paid-in                              Capital
                                       of Shares          Value           Capital             Deficit          Deficit
                                    ---------------  -------------   -----------------  ----------------  ---------------
<S>                                 <C>              <C>             <C>                <C>               <C>
Balance, October 31, 1995                   348,835  $       3,488   $      10,026,930  $    (10,111,554) $       (81,136)
   Issuance of common stock                  50,000            500              50,467                             50,967
Net Loss                                                                                         (20,790)         (20,790)
                                    ---------------  -------------   -----------------  ----------------  ---------------

Balance, October 31, 1996                   398,835          3,988          10,077,397       (10,132,344)         (50,959)
Net Loss                                                                                                                0
                                    ---------------  -------------   -----------------  ----------------  ---------------

Balance, January 31, 1997                   398,835  $       3,988   $      10,077,397  $    (10,132,344) $       (50,959)
                                    ===============  =============   =================  ================  ===============
</TABLE>


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


                                        4

<PAGE>



                          SYSTEM ASSURANCE CORPORATION
                            STATEMENTS OF CASH FLOWS
               Three month periods ended January 31, 1997 and 1996
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                1997                  1996
                                                                         -----------------     -----------------
<S>                                                                      <C>                   <C>
Cash flows from operating activities:
   Net income (loss)                                                     $               0     $            (250)
                                                                         -----------------     -----------------

Net Cash provided (used) by operating activities                                         0                  (250)
                                                                         -----------------     -----------------

Net increase (decrease) in cash                                                          0                  (250)
Cash at beginning of year                                                              698                   382
                                                                         -----------------     -----------------

                                                CASH AT END OF PERIOD    $             698     $             132
                                                                         =================     =================
</TABLE>


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


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<PAGE>



                          SYSTEMS ASSURANCE CORPORATION
                          NOTES TO FINANCIAL STATEMENTS

1.   Basis of Presentation

     The accompanying  financial statements include herein have been prepared by
     the Company,  without audit,  pursuant to the rules and  regulations of the
     Securities and Exchange  Commission.  Certain information normally included
     in footnote disclosures in financial statements prepared in accordance with
     generally  accepted  accounting  principles  has been  condensed or omitted
     pursuant to such rules and regulations,  although the Company believes that
     the  disclosures  are  adequate  to  make  the  information  presented  not
     misleading.  It is suggested that these condensed  financial  statements be
     read in  conjunction  with the financial  statements  and the notes thereto
     included in the  Company's  latest  annual report on Form 10-K for the year
     ended October 31, 1996.

2.   Net Income (Loss) Per Share

     Net income  (loss) per share of Common  Stock is computed  by dividing  net
     income (loss) by the weighted  average number of shares of Common Stock and
     Common Stock Equivalents, if dilutive, outstanding during the period.

3.   Reverse Stock Split

     On January 24, 1997, shareholders approved a one-for-seventy reverse split.
     Prior financial statements have been restated to reflect the split.

4.   Subsequent Events

     Subsequent to January 31, 1997,  the Company  issued  400,000 shares of its
     restricted   common  stock  to  Exchange   Place  Capital   Partners,   LLC
     ("Exchange") to cancel notes payable in the amount of $50,000.  Exchange is
     not the majority shareholder of the Company.


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<PAGE>


Item 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

Results of Operations

During the three  months ended  January 31,  1997,  the Company had no principal
business activity. The Company had no revenue and had no operating expenses. The
Company is presently  seeking  investment  opportunities but has not yet entered
into any substantive negotiations.

Financial Condition and Liquidity

The  Company has  suffered  recurring  losses,  has no current  expectations  of
revenue and has a capital deficit.  Although  management intends to seek funding
for normal operating expenses and is presently seeking investment opportunities,
it is not certain that such  opportunities or funding will become available,  or
if available, that it will be on acceptable terms.

                           PART II - OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

The Company is the  defendant  in an action  brought in  Massachusetts  Superior
Court,  County of  Suffolk,  by McDevitt  Recruitment  Advertisement,  Inc.  The
complaint  was served in December  1986 and alleges a breach of an oral warranty
of fitness for a  particular  purpose of a computer  system sold to plaintiff in
1982,  which  allegedly  never  performed  properly.  Plaintiff seeks damages of
$30,000. The Company believes that it is not liable for any damages; however, in
order to save the cost of potential litigation,  has offered a settlement in the
amount  of  $1,000  to the  attorney  for the  plaintiff  which it  believes  is
sufficient to settle this case. At this date,  the attorney has not been able to
locate the plaintiff.

                                   SIGNATURES

Pursuant  to the  requirements  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.

                                        SYSTEMS ASSURANCE CORPORATION
                                        (Registrant)


Date:    March 24, 1997                 By:   /s/ Dean Becker
                                              Dean Becker
                                              President and Chairman


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