UNITED STATES
                             SECURITIES AND EXCHANGE COMMISSION
                                   Washington, D.C. 20549
(Mark One)
[  X  ]                                FORM 10-K/A
                      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
                       For the fiscal year ended March 31, 1996
                                       OR
[    ]            TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
                      SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
                      for the transition period from _______ to _______

                                 Commission File No. 0-13084

                                   WARRANTECH CORPORATION
______________________________________________________________________________
                 (Exact name of registrant as specified in its charter)
           _____Delaware____                           ___13-3178732____
    (State or other jurisdiction of                     (IRS Employer
      ncorporation or organization                      Identification No.)

       300 Atlantic Street, Stamford, Connecticut         ___06901___
       (Address of Principal Executive Offices)           (Zip Code)

Registrant's telephone number, including area code  (203) 975-1100
Securities registered pursuant to Section 12(b) of  the Act:

  Title of Each Class                Name of each Exchange on which registered
 Common Stock $.007 par value                 NASDAQ National Market

             Securities registered pursuant to Section 12(g) of the Act:
                            Common Stock, $.007 par value
______________________________________________________________________________
                               (Title of Class)

         Indicate by checkmark whether the Registrant (1) has filed all reports
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 [  ].
                    _______________________________
         The number of shares outstanding of the Registrant's common stock is  
13,082,181 as of (June 21, 1996).

         The aggregate market value of the voting stock held by nonaffiliates 
of the Registrant is $35,756,096
(as of June 21, 1996).
                   DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's Definitive Proxy Statement for its 1996 Annual 
Meeting of Shareholders to be filed pursuant to Regulation 14A promulgated 
under the Securities Exchange Act of 1934, as amended are incorporated by
reference in Part III.

Index to Exhibits is on page  45.






Item 8.   Financial Statements and Supplementary Data


                     INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



                                                                  Page No.    

Report of Independent Accountants............                     20-21

Consolidated Financial Statements:
         Balance Sheets as of March 31, 1996 and 1995                22

             Statements of Operations For the Years Ended
         March 31, 1996, 1995 and 1994.......................        23

         Statements of Common Stockholders' Equity
         For the Years Ended March 31, 1996, 1995 and 1994...        24

         Statements of Cash Flows
         For the Years Ended March 31, 1996, 1995 and 1994...     25-26

Notes to Consolidated Financial Statements..........              27-40

Consolidated Financial Statement Schedule
         Schedule VIII - Valuation and Qualifying Accounts....       41


REPORT OF INDEPENDENT ACCOUNTANTS


To the Board of Directors and Stockholders of
Warrantech Corporation:


       We have audited the consolidated financial statements and the financial 
statement schedule of Warrantech Corporation and subsidiaries (the "Company") 
as of March 31, 1996 and 1995, and for the years then ended as listed in the 
accompanying index on page 19.  These financial  statements and financial
statement schedule are the responsibility of the Company's management.  Our 
responsibility is to express an opinion on the 1996 and 1995 financial
statements and financial statement schedule based on our audits.

         We conducted our audits in accordance with generally accepted auditin
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 audit provides a reasonable
basis for our opinion.

         In our opinion, the financial statements referred to above present 
fairly, in all material respects, the consolidated financial position of the 
Company as of March 31,  1996 and 1995, and the consolidated results of its 
operations and its cash flows for the years  then ended in conformity with
generally accepted accounting principles.  In addition, in our opinion, the
financial statement schedule

as of and for the years ended March 31, 1996 and 1995, when considered in 
relation to the basic 1996 and1995 consolidated financial statements taken as 
a whole, present fairly, in all material respects the information  required to 
be included therein.


                                                       Coopers & Lybrand L.L.P.

Stamford, Connecticut
June 27, 1996



INDEPENDENT AUDITORS' REPORT


To the Board of Directors and Stockholders of
Warrantech Corporation


       We have audited the consolidated balance sheet of Warrantech Corporation
(the "Company") and subsidiaries as of March 31, 1994 (not separately shown 
herein), and the related consolidated statements of operations, common 
stockholders' equity, and cash flows for the year then ended.  Our audit also
included the financial statement schedule for the year ended March 31, 1994 
listed in the Index on page 19.  These financial statements and financial
statement schedules are the responsibility of the Company's management.  Our
responsibility is to express an opinion on the 1994 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 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 audit provides a reasonable basis
for our opinion.

         In our opinion, such consolidated financial statements present fairly,
 in all material respects, the financial position of the Company as of 
March 31,  1994, and the results of its operations and its cash flows for the 
year ended March 31, 1994 in conformity with generally accepted accounting
principles. Also, in our opinion, such financial statement schedule for the 
year ended March 31, 1994, when considered in relation to the basic 1994 
consolidated financial statements taken as a whole, presents fairly in all
material respects the information set forth therein.

         As discussed in Note 9 to the consolidated financial statements, the 
Company is a defendant in certain litigation.  The ultimate outcome of this 
litigation cannot presently be determined.  Accordingly, no provision for any 
loss that may result upon resolution of these matters has been made in the
accompanying financial statements.

            As discussed in Note 8 to the consolidated financial statements, 
the Company changed its method of accounting for income taxes to conform with 
Statement of Financial Accounting Standards No. 109 in 1994.

                                                       Deloitte & Touche LLP



Stamford, Connecticut
June 29, 1994
<TABLE>

                                      WARRANTECH CORPORATION AND SUBSIDIARIES
                                           CONSOLIDATED BALANCE SHEETS
<CAPTION>
                                   AS S E T S
                                                              March 31,
                                                    -------------------------------
                                                    -------------    --------------
                                                         1996             1995
                                                    -------------    --------------
<S>                                                <C>              <C>          <C>
Current Assets:
Cash and cash equivalents                           $  11,859,487    $ 3,039,361

Investments in marketable securities                      824,648        472,344
                                                    

Accounts receivable, (net of allowances of $450,092
and $126,115, respectively)                            16,160,209     12,705,664
   
 
Other receivables, net                                  8,610,919      8,599,198
Prepaid expenses, prepaid income taxes
   and other current assets                               988,936      1,065,062
                                                    -------------    --------------
   Total Current Assets                                38,444,199     25,881,629
                                                    -------------    --------------

Property and Equipment - Net                            6,802,798      2,865,910
                                                    -------------    --------------

Other Assets:
Excess of cost over fair value of assets acquired
  ( net of accumulated amortization of
    $3,170,089 and $2,723,429, respectively)            4,118,544       3,850,724
Investment in and advances to joint venture             1,885,674      2 ,880,921
Deferred income taxes                                   2,031,535       1,029,083
Investments in marketable securities                    1,363,047       2,671,507
Certificates of deposit and cash trust fund -
    restricted                                            700,000         500,000

Split dollar life insurance policies                      683,893         698,338
Receivable from insurance company - long term                   -         505,606
Notes receivable - long-term                               87,760         290,125
Collateral security fund                                  199,389         199,389
Other assets                                              296,871         485,314
                                                    -------------    --------------
                                                                      
          Total Other Assets                          11,366,713       13,111,007
                                                    -------------    --------------

 
                    Total Assets                     $56,613,710      $41,858,546
                                                    =============    ==============
                                              



LIABILITIES, PREFERRED STOCK AND COMMON STOCKHOLDERS' EQUITY
                                                                          March 31,
                                                                      -----------------
                                                                    1996               1995
                                                               --------------    ---------------
      Current Liabilities:
      Current maturities of long-term debt and capital lease   
      obligations                                             $     648,650     $     205,200

      Insurance premiums payable                                 16,247,247         9,230,377
      Income taxes payable                                        1,795,018         1,010,878
      Accounts and commissions payable                            4,809,527         2,641,843
      Accrued expenses and other current liabilities              1,722,545         1,725,348
                                                               --------------    ---------------
         Total Current Liabilities                               25,222,987        14,813,646
                                                               --------------    ---------------

      Deferred Revenues                                           3,654,794         2,470,449
                                                               --------------    ---------------
       Long-Term Debt and Capital Lease Obligations               1,124,015           293,648
                                                               ------------      ---------------
     Deferred Rent Payable                                          534,620           440,245
                                                               -------------     ---------------

      Commitments and Contingencies (See Note 9)

      Convertible Exchangeable Preferred Stock
       - $.0007 par value
         Authorized, 15,000,000 shares
          Issued and outstanding - 3,234,697 shares at 
          March31, 1996 and at March 31, 1995
         (Redemption value - $6,430,000)                          6,420,363         6,396,795
                                                               --------------    ---------------

                                                                  -                 -
       Common Stockholders' Equity:
         Common stock - $.007 par value
           Authorized                 - 30,000,000 shares
           Issued and outstanding     - 13,082,181 shares
            at March 31, 1996 and 13,045,302 shares
            at March 31, 1995                                        89,375            89,117
         Additional paid-in-capital                              12,212,641        12,097,507
         Net unrealized loss on investments, net of income          
      taxes of $4,389                                               (15,031)          (42,370)                
         Accumulated translation adjustments                        (10,520)               -
         Retained earnings                                        7,843,332         5,472,039
                                                               --------------    ---------------
                                                                 20,119,797          17,616,293
      Less:  Deferred compensation                                  (70,116)            (23,438)
                                                                                 
      Treasury stock - at cost, 93,000 shares
         at March 31, 1996 and 41,000 shares at
         March 31, 1995                                            (392,750)           (149,092)
                                                               --------------    ---------------
              Total Common Stockholders' Equity                  19,656,931          17,443,763
                                                               --------------    ---------------

              Total Liabilities, Preferred Stock  and
                  Common Stockholders'  Equity                  $56,613,710        $ 41,858,546
                                                               ==============    ===============
See accompanying notes to consolidated financial statements.

===================================================================================================================================
</TABLE>
<TABLE>

                                                        WARRANTECH CORPORATION AND SUBSIDIARIES
                                                         CONSOLIDATED STATEMENTS OF OPERATIONS



<CAPTION> 
                                                                           For the Years Ended March 31,
                                                             -------------------------------------------------------------
                                                                    1996                  1995                  1994
                                                             -----------------     -----------------     -----------------
<S>                                                           <C>                   <C>                   <C>             
Gross revenues                                                  $110,246,219          $71,239,070           $46,970,763

Net increase in deferred revenues                                  1,165,495              699,745               316,290
                                                             -----------------     -----------------     -----------------
                                                             -----------------     -----------------     -----------------
Net revenues                                                     109,080,724           70,539,325            46,654,473
                                                             -----------------     -----------------     -----------------

Costs and expenses:                                                                 
   Direct costs                                                   74,013,324           46,140,548            30,350,722
   Service, selling, and general and administrative               27,362,214           20,716,655            14,674,158
   Provision for bad debt expense                                    363,179              427,483                10,955
   Depreciation and amortization                                   1,700,285            1,259,604             1,503,866
                                                             -----------------     -----------------     -----------------
Total costs and expenses                                         103,439,002           68,544,290            46,539,701
                                                             -----------------     -----------------     -----------------

Income from operations                                             5,641,722            1,995,035               114,772
                                                             -----------------     -----------------     -----------------


Equity in operations of joint venture                                (957,748)           (298,272)             (538,385)
Other income/(expense)                                               (651,620)          3,107,561             1,426,860
                                                             -----------------     -----------------     -----------------

Income before provision for income taxes                            4,032,354           4,804,324             1,003,247
Provision for income taxes                                          1,637,492           1,908,536               299,656
                                                             -----------------     -----------------     -----------------

Net Income                                                        $ 2,394,862          $2,895,788            $  703,591
                                                             =================     =================     =================

Earnings per share:

Primary                                                             $.16                  $.19                  $.05
                                                             =================     =================     =================

Fully Diluted                                                       $.15                  $.17                  $.04
                                                             =================     =================     =================


Weighted average number of shares outstanding:

Primary                                                          15,152,043           15,588,145            14,569,479
                                                             =================     =================     =================

Fully Diluted                                                    16,465,833           16,894,351            16,748,075
                                                             =================     =================     =================



                                              See accompanying notes to consolidated financial statements.


====================================================================================================================================
</TABLE>
<TABLE> 
                                                                     WARRANTECH CORPORATION AND SUBSIDIARIES
                                                                CONSOLIDATED STATEMENTS OF COMMON STOCKHOLDERS' EQUITY
<CAPTION>
                                                              Net                                                        Total
                                             Additional   Unrealized  Accumulated                                        Common
                             Common Stock    Paid-In      Loss on     Translation Retained  Deferred   Treasury Stock Stockholders'
                               --------------------------                                       -----------------------------------
                          Shares Par Value     Capital    Investments  Adjustments Earnings  Compensation Shares  Amount   Equity
                              -------------  -----------   ---------   -----------  --------  ------------ -------------------------
<S>                     <C>        <C>       <C>          <C>         <C>      <C>         <C>       <C>     <C>      <C>
Balance at April 1, 1993 12,916,802 $88,218   $11,638,418                        $1,925,840 $( 57,891)(46,000)$(167,274)$13,427,311

Issuance of common stock
through options              40,500     283        87,454                                                                    87,737
       
Issuance of common stock      8,000      56        22,564                                                                    22,620

Issuance of treasury stock                          4,318                                              5,000     18,182      22,500

Amortization of deferred                                                                       36,563                        36,563
compensation

Net income                                                                       703,591                                    703,591
                          ----------- -------  ----------  ---------------     ----------- ---------- -------- --------- ---------- 
 Balance at March 31, 1994  12,965,302  88,557  11,752,754                       2,629,431    (21,328) (41,000) (149,092) 14,300,322
Issuance of common stock
through exercise of common 
stock options                  75,000    525      321,350                                       -                           321,875
       
    
Issuance of common stock        5,000     35       23,403    (42,370)                        (23,438)

Net unrealized loss on                                                                                                            
investments                                                                                                                 (42,370)

Amortization of deferred
compensation                                                                                 21,328                           21,328
Imputed interest on preferred                                                                                                
 Stock                                                                             (53,180)                                 (53,180)
Net income                                                                      2,895,788     -                           2,895,788
                           ----------- -------- ----------- ---------------     ---------- --------- -------- --------  -----------
Balance at March 31, 1995   13,045,302  89,117  12,097,507  (42,370)            5,472,039   (23,438) (41,000) (149,092)  17,443,763
Issuance of common stock
through exercise of common stock 
options                         25,000     175      62,325                                                                   62,500
       
Issuance of common stock        11,879      83      52,809                                  (42,142)                         10,750

Purchase of treasury shares                                                                          (56,000) (260,538)    (260,538)
Issuance of treasury shares                                                                 (16,880)   4,000    16,880           -

Net unrealized loss on                                      27,339                                                          
investments                                                                                                                  27,339

Translation adjustments                                              (10,520)                                               (10,520)
Amortization of deferred
compensation                                                                                 12,344                          12,344
Imputed interest on preferred                                                     (23,569)                                  (23,569)
stock
Net income                                                                      2,394,862                                 2,394,862
                            =========== ========= ===========  ===== ========== =========== ========= ======== ======== ===========
Balance at March 31, 1996  13,082,181 $89,375  $12,212,641$(15,031)   (10,520) $7,843,332  $(70,116) (93,000)$(392,750) $19,656,931
                            =========== ========= ===========  ===== ========== =========== ========= ======== ======== ===========

See accompanying notes to consolidated financial statements.

</TABLE>
<TABLE>
                                                                                  WARRANTECH CORPORATION AND SUBSIDIARIES
                                                                                   CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                          For the Years Ended March 31,
                                                                ------------------ -- ------------------ -- ------------------
                                                                       1996                  1995                  1994
                                                                ------------------    ------------------    ------------------
<S>
Cash flows from operating activities:                           <C>                   <C>                  <C>                  
   Net income                                                   $   2,394,862          $2,895,788           $      703,591
                                                                ------------------    ------------------    ------------------
   Adjustments to reconcile net income to net cash
      provided by (used in) operating activities:
      Depreciation and amortization                                 1,712,431           1,259,604                1,503,866
      Deferred income taxes                                        (1,002,452)           (296,601)                (688,387)
      Increase in deferred rent payable                                94,375              76,796                   65,674
      Loss from equity joint venture                                  957,748             298,272                  538,385
      Elimination of intercompany profits with joint venture               -              (28,038)                 176,400
      Other                                                            (2,822)            116,150                   57,301
      Increase (decrease) in cash flows as a result of
         changes in asset and liability balances:
         Accounts receivable                                       (3,450,088)         (4,744,974)             (1,267,393)
         Other receivable                                               5,090          (3,391,088)             (3,802,436)
         Prepaid expenses, prepaid income taxes and
            other current assets                                       97,536             557,043                (530,854)
         Collateral security fund                                        -                   -                    (18,566)
         Split dollar life insurance policies                          14,445            (102,550)               (142,779)
         Other assets and receivable from insurance company           681,981             423,100                 (48,995)
         Insurance premiums payable                                 7,016,870           2,117,103               2,249,239
         Income taxes payable                                         784,140           1,010,878                (459,681)
         Accounts and commissions payable                           2,102,284             343,073                 104,112
         Accrued expenses and other current liabilities               (18,002)            919,370                 154,356
         Deferred revenues                                          1,184,345             699,744                 316,291
                                                                ------------------    ------------------    ------------------
   Total adjustments                                               10,177,881            (742,118)             (1,793,467)
                                                                ------------------
                                                                ------------------    ------------------    ------------------
 Net cash provided by (used in) operating activities               12,572,743           2,153,670              (1,089,876)
                                                                ------------------    ------------------    ------------------
 Cash flows from investing activities:
   Proceeds from sale of property and equipment                        -                  23,396                   24,000
   Purchase of property and equipment                             (3,489,974)          (1,539,093)               (449,720)
   Net cash paid for acquired company                               (735,984)                -                       -
   Certificates of deposit                                               -                 27,000                  71,707
   Purchase of marketable securities                                (948,602)          (1,038,543)             (1,800,000)
   Certificates of deposit and cash trust fund - restricted              -                157,602                (330,602)
   Proceeds from sales redemptions and maturities of
     marketable securities                                         1,730,612              500,000
   Investment in and advances to joint venture                        37,499           (2,123,440)             (1,715,000)
                                                                ------------------    ------------------    ------------------
 Net cash used in investing activities                          $ (3,406,449)         $(3,993,078)            $(4,199,615)
                                                                ------------------    ------------------    ------------------

                                                                                                            (Continued)
                                                         See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
                                                                                WARRANTECH CORPORATION AND SUBSIDIARIES
                                                                                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                                                 
                                                                                           (Continued)
<CAPTION>
                                                                                For the Years Ended March 31,
                                                                 -------------- ---- ----------------- ---- ----------------
                                                                      1996                  1995                  1994
                                                                 -------------- ---- ----------------- ---- ----------------
<S>                                                             <C>                   <C>                     <C>            
Cash flows from financing activities:
 Decrease in notes receivable                                    $   202,365             $     600              $ 34,394
 Proceeds from exercise of common stock options                       62,500               187,500                87,737
 Purchase treasury stock                                            (243,658)                -                        -
 Proceeds from the sale of preferred stock, net
   of underwriting costs                                                -                    -                 6,343,614
 Loan payable - officer                                                 -                    -                 ( 118,383)
 Proceeds from borrowings                                               -                    -                 1,500,000
 Repayments of borrowings                                           (367,375)            ( 333,613)          ( 1,846,458)
                                                                 -------------- ---- ----------------- ---- ----------------
 Net cash provided by (used in) financing activities                (346,168)            ( 145,513)            6,000,904
                                                                 -------------- ---- ----------------- ---- ----------------

 Net increase (decrease) in cash and cash equivalents              8,820,126           ( 1,984,921)              711,413

 Cash and cash equivalents at beginning of year                    3,039,361             5,024,282             4,312,869
                                                                 -------------- ---- ----------------- ---- ----------------

 Cash and cash equivalents at end of year                        $11,859,487           $ 3,039,361           $ 5,024,282
                                                                 ============== ==== ================= ==== ================

 Supplemental Cash Flow Information:

 Cash payments for:
    Interest                                                     $  127,616            $    74,815           $   137,702
                                                                 ============== ==== ================= ==== ================
    Income taxes                                                 $1,644,950            $ 1,071,363           $ 1,506,739
                                                                 ============== ==== ================= ==== ================

 Non-Cash Investing Activities:

 Property and equipment financed through capital leases          $1,640,060            $      -               $      -
                                                                 ============== ==== ================= ==== ================
 
                                                                     See accompanying notes to consolidated financial statements.
</TABLE>
WARRANTECH CORPORATION AND SUBSIDIARIES
-------------------------------------------------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


         Nature of Business - Warrantech Corporation ("Warrantech"or the 
         "Company"), through its wholly-owned subsidiaries, Warrantech 
         Automotive, Inc., Warrantech Consumer Product Services, Inc., 
         Warrantech Direct, Inc., Warrantech Home Service Company and 
         Warrantech International, Inc. markets and administers service 
         contract programs for retailers, distributors and manufacturers of 
         automobiles, recreational vehicles, automotive components, homes, home
         appliances, home entertainment products, computers and peripherals, 
         and office and communication equipment in the United States, Puerto 
         Rico, Mexico, Canada, and the United Kingdom.  Additionally, 
         third-party administrative services are provided to manufacturers of 
         consumer and automotive products and other business entities requiring
         such services.  The predominant terms of the contracts and 
         manufacturer's warranties range from one (1) to eighty-four (84) 
         months.

         Basis of Presentation and Principles of Consolidation - The 
         accompanying consolidated financial statements have been prepared on 
         the basis of generally accepted accounting principles ("GAAP").  These
         consolidated financial statements include the accounts of Warrantech 
         Corporation and its wholly-owned subsidiaries.  All intercompany 
         accounts and transactions have been eliminated in consolidation.

         Amounts representing the Company's percentage interest in the 
         underlying net assets of less than majority-owned companies, in which 
         a significant equity ownership interest is held, are included in
         "investment and advances."  The Company's share of the results of 
         operations of these companies is included in the Consolidated
         Statements of Operations caption "Equity in operations of joint 
         venture."

         Risks and Uncertainties - The preparation of financial statements in 
         conformity with generally accepted accounting principles requires 
         management to make estimates and assumptions which affect the
         reporting of assets and liabilities as of the dates of the financial 
         statements and revenues and expenses during the reporting period.  
         Actual results could differ from these estimates.

         Revenue Recognition Policy - The Company's revenue recognition policy 
         is based on the proportional performance method which recognizes
         revenues in direct proportion to the costs incurred in providing the
         service contract programs to the Company's clients.  Only revenues in 
         an amount sufficient to meet future administrative costs and a 
         reasonable gross profit thereon are deferred.

         Direct Costs - Direct costs are those costs directly related to the 
         production and acquisition of service contracts.  Those costs are 
         insurance premium and commission expenses.

         Profit Sharing Arrangement - Pursuant to agreements with its insurers,
         the Company is eligible to share a portion of the insurers' profits on
         the Company's service contract programs.  The amounts to be
         received, if any, are determined by loss experience, by the type of 
         program and by policy year.  The amounts recorded are based on 
         contractual arrangements and management's best estimate of the 
         Company's expected ultimate loss experience.  Any adjustments to those
         estimates will be reflected in income, when known.

         Provision for Bad Debts Expense -  An allowance for doubtful accounts
         is provided when accounts are determined to be uncollectible. The 
         provision for bad debt expense results from the write-off of accounts 
         considered uncollectible.
 
         Earnings Per Share - Earnings per share is calculated by dividing net 
         income less imputed interest on preferred stock, where applicable, by 
         the weighted average number of common shares outstanding and
         common share equivalents outstanding during the period.

         Cash and Cash Equivalents - Cash and cash equivalents for the purpose 
         of reporting cash flows for all periods presented include cash on
         deposit and certificates of deposit.  There were no cash equivalents 
         at March 31, 1996 or 1995.  At March 31, 1996, the Company had on 
         deposit $11,256,100 of cash in excess of federally insured limits.

         Investments in Marketable Securities - Effective March 31, 1995, the 
         Company adopted Statement of Financial Accounting Standards No. 115 
         ("SFAS 115"), Accounting for Certain Investments in Debt and
         Equity Securities.  As a result, all investments have been classified
         as available-for-sale and are carried at fair value with changes in
         unrealized gains and losses being reflected as a separate
         component of Stockholders' Equity, net of tax.

         Property and Equipment - Property and equipment are stated at cost.  
         Depreciation is provided using a  straight-line method over the 
         estimated useful lives of the assets ranging between 3 to 7 years.

         Excess of Cost Over Fair Value of Assets Acquired - The excess of cost
         over fair value of the assets acquired is a result of the purchases o
         Dealer Based Services, Inc. in 1989, and Home Guarantee Corporation, 
         PLC in July 1995 and is being amortized on a straight-line basis over 
         fifteen and ten years, respectively.  Amortization expense charged to 
         operations for the years ended March 31, 1996, 1995 and 1994 amounted 
         to $458,728, $401,815 and $525,648,  respectively.

         Deferred Compensation - Certain operating officers have been issued 
         shares of the Company's common stock as part of their compensation 
         under their employment agreements.  Such compensation is to be
         earned by the officers and charged to operations over five years, the 
         term of the employment agreements.  In addition, certain employees 
         have been issued restricted shares of the Company's common stock
         as compensation.  Such compensation is amortized over the restriction 
         period which is generally two years.

         Income Taxes - Effective April 1, 1993, the Company adopted Statement
         of Financial Accounting Standards No. 109 ("SFAS 109"),  Accounting 
         for Income Taxes.  Under SFAS 109, the deferred taxes are determined 
         under the liability method.  Under this method, deferred tax assets
         and liabilities are recognized for the expected tax effect of 
         temporary differences between the financial statement carrying
         amount and the tax basis of assets and liabilities using presently 
         enacted tax rates in effect for the years in which the differences 
         are expected to reverse.

         Foreign Currency Translation -Financial statement accounts expressed 
         in foreign currencies are translated into U.S. dollars in accordance 
         with Statement of Financial Accounting Standards No. 52 "Foreign
         Currency Translation".  The functional currency for the Company's 
         United Kingdom operations is the British pound.  Transaction gains 
         and losses are reflected in operations, while translation gains and
         losses are reflected as a separate component of equity.

         Reclassification - Certain amounts from the prior years have been 
         reclassified to conform with the current year's presentation.

2.      CERTIFICATES OF DEPOSIT AND CASH TRUST FUND - RESTRICTED

         At March 31, 1996  $700,000 is on deposit with a Florida regulatory 
         agency to comply with its state insurance laws.  These funds are 
         classified as non-current.




3.      INVESTMENTS IN MARKETABLE SECURITIES

<TABLE>
         At March 31, 1996, investments in marketable securities are comprised of the following:


<CAPTION>
                      Amortized            Gross Unrealized          Aggregate Fair          Carrying Amount
                        Cost            Gains          (Losses)          Value          Short Term      Long Term
<S>                 <C>             <C>            <C>              <C>                <C>             <C>                  
Municipal Bonds      $1,880,633        $2,660         $(13,913)         $1,869,380       $506,333        $1,363,047
Common Stock            330,880              -         (12,565)            318,315        318,315           -
                   -------------    -------------    -------------    -------------    -------------    -------------

Total
Investments
  in Marketable     $2,211,513         $2,660         $(26,478)        $2,187,695        $824,648        $1,363,047
  Securities
                   =============    =============    =============    =============    =============    =============



        At March 31, 1995, investments in marketable securities are comprised of the following:

</TABLE>
<TABLE>
<CAPTION>
                      Amortized            Gross Unrealized           Aggregate Fair            Carrying Amount
                        Cost            Gains          (Losses)           Value           Short Term        Long Term
<S>                 <C>             <C>           <C>               <C>              <C>                <C>             
Corporate Bonds      $ 336,325         $   962        $   (606)         $  336,681       $ 272,344         $   64,337
                                                                                        
Municipal Bonds      2,676,985             221         (70,036)          2,607,170           -              2,607,170
                                                                                                               
Callable                                                                                   
Preferred                                                                                                     -
  Stock                200,000              -              -               200,000         200,000
                   --------------    --------------    -------------    --------------    --------------     =============
                                                                                                             
Total
Investments
  in Marketable                                                                         
  Securities       $ 3,213,310         $ 1,183         $(70,642)        $ 3,143,851       $472,344         $2,671,507
                   ==============    ==============    =============    ==============    ==============    =============

 </TABLE>
  As discussed in Note 1, the Company adopted SFAS 115 as of March 31, 1995.  
  All of the above investments are considered "available for sale".  The 
  resultant differences between cost and fair value, net of taxes, have been 
  reflected as a separate component of Stockholders' Equity.

  The amortized cost and estimated fair value of marketable securities, by 
  contractual maturity date, are listed below.  Expected maturities may differ 
  from contracted maturities because borrowers may have  the right to call or 
  prepay obligations with or without penalties.

<TABLE>
<CAPTION> 
                                         Amortized         Aggregate 
                                            Cost           Fair Value
                                       ---------------   ---------------
<S>                                   <C>               <C>
Investments available for sale:
Due in one year or less                $   506,679       $   506,633
Due after one year through five years    1,373,954         1,363,047
Due after five years through ten                -                 -
years
Due after ten years                             -                 -
                                       ===============   ===============
                                       $ 1,880,633       $ 1,869,380
                                       ===============   ===============
 

</TABLE>

<TABLE>
4.      PROPERTY AND EQUIPMENT

         Property and equipment is summarized as follows:

<CAPTION>
                                                                            March 31,
                                                           --------------------------------------------
                                                                  1996                     1995
         <S>                                             <C>                     <C>                      
          Automobiles                                                        $                       $
                                                                        97,811                  16,901
          Equipment, furniture and fixtures                          8,101,861               4,725,444
          Leasehold improvements                                       382,938                 300,272
                                                           --------------------     -------------------
                                                                     8,582,610               5,042,617

          Less:  Accumulated depreciation
            and amortization                                         3,550,346               2,639,234
                                                           --------------------     -------------------
                                                                     5,032,264               2,403,383
                                                           --------------------     -------------------
          Assets under capital leases:
            Cost                                                     3,300,093               1,657,220
            Less:  Accumulated amortization                          1,529,559               1,194,693
                                                           --------------------     -------------------
                                                                     1,770,534                 462,527
                                                           --------------------     -------------------

          Total Property and Equipment, net                                  $      $        2,865,910
                                                                     6,802,798
                                                           ====================     ===================
</TABLE>
Amortization expense on assets under capital leases for the years ended 
March 31, 1996, 1995 and 1994 was $334,866, $289,765, and $357,370, 
respectively.  Depreciation expense on property and equipment other than under 
capital leases for the years ended March 31, 1996, 1995 and 1994 was $911,112, 
$515,596, and $584,285, respectively.

During fiscal 1996, the Company capitalized $2,918,076 related to the
development and implementation of its proprietary relational database and 
interactive operating software.  The Company is amortizing the cost of this 
software over its estimated useful life not to exceed five years.

5.      COLLATERAL SECURITY FUND

At March 31, 1996 and 1995, a former insurance carrier of the Company, is 
holding $199,389 in escrow accounts as collateral for the performance of the 
administrative runoff of outstanding contracts.  Such amounts are returnable to
the Company when the contracts expire under this policy.

6.      SPLIT DOLLAR LIFE INSURANCE POLICIES

As of March 31, 1996 and 1995, the Company made payments on split dollar
insurance policies on the lives of five officers of the Company.  Included in 
other assets non-current is the cash surrender value of these policies totaling 
$683,893 and $698,338, as of March 31, 1996 and 1995 respectively.  The Company
will receive a refund of all split-dollar premiums advanced.  The Company is 
the beneficiary of any proceeds of the policies up to the amount of premiums 
paid and interest earned thereon.


<TABLE>
7.      LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS
        Long-term debt and capital lease obligations consists of the following:

<CAPTION> 
                                                                                         March 31,
                                                                          ------------------------------------------
                                                                                   1996                   1995
       <S>                                                                       <C>                    <C>            
       Capital lease obligations - for property and
          equipment  payable monthly with interest
          rates ranging from 9.1% to 13.4% through 2001                          $  1,768,475            $  490,343
        
       Installment note - secured by equipment with
          an undepreciated cost of $5,164 payable
          in equal monthly installments of $393
          including interest at 5.44% through
          February, 1997.                                                               4,190                 8,505
                                                                          --------------------    ------------------
                                                                                    1,772,665               498,848
       Less: Current maturities                                                       648,650               205,200
                                                                          --------------------    ------------------


       Long-term portion                                                         $  1,124,015            $  293,648
                                                                          ====================    ==================

         The aggregate amounts of maturities at March 31, 1996 were as follows:

</TABLE>
<TABLE>
<CAPTION>
Fiscal Year                           Installment Note            Minimum Future
                                                                  Lease Payments
<S>                                  <C>                          <C>
1997                                  $        4,190                 $    806,507
1998                                             -                        657,842
1999                                             -                        384,195
2000                                             -                        187,932
2001                                             -                         53,105
Thereafter                                       -                           -
                                      ------------------------    ------------------------
                                              4,190                     2,089,581
Less amount representing
  interest                                       -                        321,106
                                      ========================    ========================
Net                                   $       4,190                    $1,768,475
                                      ========================    ========================
</TABLE>
         The capital lease obligations are collateralized by the property and
equipment related to the underlying leases.





<TABLE>
8.      INCOME TAXES

         A reconciliation of the income tax provision to the amount computed 
using the federal statutory rate is as follows:
<CAPTION> 
                                                                               March 31,
                                -------------------------------- -- ---------------------------- --- ------------------------------
                                             1996                              1995                              1994
                                -------------------------------- -- ---------------------------- --- ------------------------------
<S>                               <C>              <C>            <C>           <C>                <C>                <C>          
Federal statutory rate             $ 1,411,324      35.0%          $ 1,681,513      35.0%            $ 351,000          35.0%
State and local  income             
  taxes net of federal tax
  benefit                              123,728       3.0               101,141       2.1                70,000           6.9
                                   
Amortization of excess cost                          
  over net assets acquired             90,647        2.3                90,648       1.9                    -             -
                                                             
Other                                (323,419)      (8.0)              (69,161)     (1.5)               2,656            0.2
                                                          
Benefit for recognition of
  tax deductibility of prior
  years' amortization of
  acquired customer list                    -           -           -                -               (312,000)        (31.0)
                                                                   
Loss of foreign joint venture          335,212        8.3              104,395       2.2              188,000          18.7
                                 -------------    -----------    -------------    ------------     ------------      ------------

Provision for income taxes          $1,637,492       40.6%         $ 1,908,536      39.7%            $299,656          29.8%
                                   =============    ===========    =============    ============     ============    ============
</TABLE>
<TABLE>
The components of tax expense are as follows:

         For the Year Ended 3/31/96:
<CAPTION>
                                        Current              Deferred            Provision
                                    -----------------    -----------------    ----------------
           <S>                     <C>                 <C>                   <C>
           Federal                  $    2,479,759       $    (966,087)       $  1,513,672
           State                           160,185            ( 36,365)            123,820
                                    -----------------    -----------------    ----------------

           Total                    $    2,639,944       $  (1,002,452)       $  1,637,492
                                    =================    =================    ================


         For the Year Ended 3/31/95:

                                          Current            Deferred            Provision
                                       --------------    -----------------    ----------------

           Federal                     $ 2,076,907       $  (242,100)         $ 1,834,807
           State                           101,141         (  27,412)              73,729
                                       --------------    -----------------    ----------------

           Total                       $ 2,178,048       $  (269,512)         $ 1,908,536
                                       ==============    =================    ================


         For the Year Ended 3/31/94:

                                          Current            Deferred            Provision
                                       --------------    -----------------    ----------------

           Federal                     $   527,656       $      (294,000)     $   233,656
           State                            99,000               (33,000)          66,000
                                       --------------    -----------------    ----------------

           Total                       $   626,656        $     (327,000)     $   299,656
                                       ==============    =================    ================


</TABLE>


In accordance with SFAS 109, deferred income tax assets and liabilities reflect
the impact of temporary differences between values recorded as assets and 
liabilities for financial reporting purposes and values utilized for 
remeasurement in accordance with tax laws. The components of the net deferred
asset are as follows:
<TABLE>
<CAPTION>
                                                                 March 31,
                                                   ------------------- -- -------------------
                                                          1996                   1995
<S>                                                  <C>                         <C>
Deferred Tax Assets:
     Deferred revenue                                  $    1,418,018             $  963,475
     Deferred rent                                            169,857                171,696
     Provision for doubtful accounts                          156,000                      -
     Reserve for customer refunds                             159,327                      -
     Unrealized loss on securities                              4,389                 27,089
     Foreign loss benefit                                   1,111,804                      -
     Other                                                     60,959                 55,283
                                                   -------------------    -------------------
                                                   -------------------    -------------------
          Total assets                                      3,080,354              1,217,543
                                                   -------------------    -------------------

Deferred Tax Liabilities:
  Excess of tax over book depreciation                         44,500                102,659
  Section 174 expense                                       1,004,319
  Installment sales                                                 -                 85,801
                                                   -------------------    -------------------
          Total liabilities                                 1,048,819                188,460
                                                   -------------------    -------------------
     Net deferred tax assets                           $    2,031,535           $  1,029,083
                                                   ===================    ===================
</TABLE>
Section 174 expense represents research and experimental expenses related to
the development of proprietary relational data base and interactive software.

Management believes that it is more likely than not that the deferred tax 
assets will be realized and therefore no valuation allowance is considered 
necessary.  Management expects to realize the foreign loss benefit, which has 
an indefinite carryforward period, against the gain on the sale of its foreign 
joint venture interest to be recognized in the first quarter of fiscal 1997 
(see Note 12) and other future foreign income.

As discussed in Note 1, the Company adopted SFAS No. 109, during the fiscal 
year ended March 31, 1994.  The effect of adopting SFAS No. 109 did not have a 
material impact on the Company's financial position or results of operations 
for the year ended March 31, 1994.




9.      COMMITMENTS AND CONTINGENCIES

         Operating Lease Commitments - The Company leases office and warehouse 
         space under noncancellable operating leases.  These leases include 
         scheduled rent increases over their respective terms.  The
         accompanying consolidated statements of operations reflect rent 
         expense on a straight-line basis over the lease terms, which differ 
         from the cash payments required.  Rent expense charged to operations
         for the years ended March 31, 1996, 1995 and 1994 was $1,371,446, 
         $894,121, and $730,917, respectively.

         Future minimum lease commitments as at March 31, 1996 are as follows:

          1997                                                   $1,476,552
          1998                                                    1,483,001
          1999                                                    1,432,358
          2000                                                    1,081,294
          2001                                                      972,757

          Thereafter through 2004                                 2,538,208
                                                            ================
                                                                 $8,984,170
                                                            ================

         Employment Contracts - The Company entered into employment agreements 
         with its officers and certain key employees which will provide for 
         aggregate annual salaries of approximately $1,752,150.  Certain
         agreements call for (i) annual increases (ii) cost of living 
         increases, and (iii) additional compensation, but only if certain 
         defined performance levels are attained.  This additional compensation
         is tobe paid in the form of cash and or Company common stock.

         Bonus Incentive Plans - The Company has bonus incentive plans designed
         to reward key management personnel with bonuses based on the 
         attainment of specified operating goals.  Total bonuses under the 
         bonus incentive plans for the years ended March 31, 1996, 1995 and 
         1994, were $ 405,948, $1,413,057, and $46,669, respectively.

         Profit Sharing Arrangement - For the fiscal years ended March 31, 
         1996, 1995 and 1994 the Company accrued for profit sharing in the 
         amounts of $(865,000), $2,676,001, and $1,364,089, respectively.  
         Such amounts are included in the financial statements in other income/
         (expense). (refer to Note 11)

         The accrued profit sharing due the Company as of March 31, 1996 and 
         1995 is $1,820,791 and $4,467,104, and such amounts are included in 
         other receivables.

         Bank Line of Credit - The Company has a revolving credit agreement 
         with a bank which provides for a maximum aggregate borrowing up to 
         $10,000,000 with interest at the bank's prime rate or LIBOR plus 2%.
         As of March 31, 1996 the Company had no outstanding borrowings under 
         this agreement.

         Letters of Credit - At March 31, 1996, the Company was contingently 
         liable for letters of credit which are as follows:

            (i)   Standby letter of credit in the amount of $42,623 issued to 
                  the landlord in lieu of a rent security deposit.

           (ii)   Standby letter of credit in the amount of $16,339 issued to a 
                  lessor on certain equipment leased.  The Company has pledged 
                  funds in a certificate of deposit as collateral for the 
                  letter of credit.

         Litigation -

            (i)   In 1989, a lawsuit was filed in an Illinois court against a 
                  subsidiary of the Company by a former agent alleging  breach 
                  of contract.  While the complaint does not specify the dollar
                  amounts of its alleged damages, the Plaintiff retained an 
                  expert witness who estimates the Plaintiff's damages in 
                  excess of $9 million.  Recently, the District Court ruled 
                  that the report from Plaintiff's damage expert was not 
                  admissible at trial.  This ruling would preclude Plaintiff's
                  expert from offering trial testimony based on legal theories 
                  contained in his report.  The Company has retained its own
                  economic expert who will directly  refute the magnitude of 
                  the plaintiff's damages.  The Company's expert has concluded 
                  that the maximum amount recoverable by the Plaintiff, if any,
                  is less than $1 million after allowances of all appropriate 
                  offsets.  The Company intends to vigorously defend this 
                  lawsuit.  No trial date has been set as yet.

                  In February 1996, the Plaintiff in this matter filed another 
                  lawsuit in an Illinois court against a subsidiary of the 
                  Company, the parent Company, the parent Company's Chairman 
                  and the parent Company's President alleging that the 
                  Defendants tortuously interfered with the Plaintiff's 
                  business relationships after the Plaintiff was terminated as
                  an agent.  The Plaintiff seeks to recover
                  commissions that it contends it would have earned if the
                  Defendants had not precluded the Plaintiff from servicing
                  certain accounts after the Plaintiff's termination.In the 
                  Complaint the Plaintiff is seeking $8 million in compensatory
                  damages. The Plaintiff also seeks to recover punitive damages
                  in the amount of $24 million.  All of the Defendants deny and
                  dispute Plaintiff's claims against them in this case, and 
                  they intend to vigorously defend and oppose those claims.

           (ii)   In December 1993, a lawsuit was filed by a former officer and
                  director of the Company, David Robertson, against the Compan
                  and one of its subsidiaries in a Texas Court.  The matter is 
                  currently pending before the American Arbitration Association
                  in Connecticut.  Robertson has alleged that the Company
                  wrongfully terminated an employment agreement between 
                  Robertson and WDBS, and that the Company engaged in tortuous
                  interference and fraud.  Robertson has requested damages 
                  ranging from $450,000 to $5 million which includes his
                  request for punitive damages.  The Company has denied
                  all material allegations in the claims.  The Company has
                  asserted a counterclaim in the amount of approximately 
                  $340,000 for reimbursement of attorneys' fees advanced by it 
                  on behalf of Robertson in connection  with certain other 
                  actions.  Management intends to vigorously defend against 
                  Robertson's claims and to vigorously prosecute its 
                  counterclaims.  No hearing is presently scheduled on this
                  matter.

                  Management believes that the ultimate outcome of these 
                  matters will not have a substantial impact on the operations 
                  of the Company.




10.     CAPITAL STOCK

Stock Options and Stock Option Plan - Under the Employee Incentive Stock Option
Plan (the "Plan"), there are 300,000 shares of the Company's common stock 
reserved for issuance to employees (including officers).  The options are to be
granted at an exercise price not less than 100% of the fair market value of the
Company's common stock at date of grant.  The number of shares granted, terms 
of exercise, and expiration dates are to be decided at the date of grant of 
each option by the Company's Board of Directors.  The Plan will terminate in 
November 1998 unless sooner terminated by the Board of Directors.

On April 16, 1992 the Company's Board of Directors and subsequently on
October 22, 1992 the shareholders of the Company at the annual meeting voted 
to approve stock options to three directors (two of  whom are officers and one 
is a former officer of the Company).  The stock options entitle the three
Directors to purchase an aggregate of 3,000,000 shares of the Company's common 
stock at an exercise price of $2.6875 per share; the market price at the date 
of grant.

The term of the options is five (5) years from the date on which they become 
exercisable or thirty days after termination of employment, whichever occurs
earlier.  Of the total options granted, fifty percent (50%) may be exercised 
beginning one year following October 22, 1992 in increments of 10% per year for 
a five-year period.

The portions of the options that are based upon the Company's earnings, 
consisting of fifty percent (50%) of the total options granted, became 
exercisable on October 22, 1995.

Stock options granted during the years ended March 31, are as follows:
<TABLE>
<CAPTION>
                                                                                   March 31,
                                                      ----------------- -- ------------------ -- ---------------------
                                                            1996                 1995                    1994
<S>                                                  <C>                     <C>                 <C>
Options outstanding at beginning of
     year - shares                                        3,233,500            3,237,833             3,214,500
Options granted                                               9,524               91,667               121,833
Options canceled                                              -                  (21,000)              (58,000)
Options exercised                                           (25,000)             (75,000)              (40,500)
                                                      -----------------    ------------------    ---------------------
Options outstanding
     at end of year                                       3,218,024            3,233,500             3,237,833
                                                      =================    ==================    =====================

Exercise price options outstanding                      $1.63-$6.38          $1.63-$6.38           $1.63-$6.38
                                                      =================    ==================    =====================
 Exercise price of options exercised                       $2.50                 $2.50           $1.63-$2.50
                                                      =================    ==================    =====================
</TABLE>
In October 1995 the Financial Accounting Standards Board ("FASB") issued 
Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based
Compensation.  This statement establishes new financial accounting and 
reporting standards for stock-based employee compensation plans, including 
stock option and stock purchase plans.  Compensation resulting from the award 
of stock-based compensation must be determined based on the fair value of 
consideration received or fair value of the equity instrument issued, whichever
is more reliably measurable.  Such compensation expense, net of income taxes, 
may be recognized in the Statement of Operations over the service period of the
employee (generally the vesting period). In lieu of recording such compensatio
expense, entities are permitted to disclose its pro-forma impact, net of income
taxes, on reported net income and earnings per share.  Entities choosing such 
disclosure will continue to measure compensation expense from stock-based 
compensation in the Statement of Operations based on the intrinsic value method
prescribed in Accounting Principles Board No. 25, Accounting for Stock Issued 
to Employee.

Management is evaluating the effect of the new pronouncement on its stock 
option plans and has not determined which option will be utilized when 
implemented.

<TABLE>
11.     OTHER INCOME/(EXPENSE)

         Other income/(expense) is comprised of the following:
<CAPTION>
                                                                                March 31,
                                                       -------------------------------------------------------------
                                                             1996                  1995                  1994
<S>                                                    <C>                      <C>                   <C>  
Interest and dividend income                               $622,873              $519,592              $209,301
Interest expense                                           (182,523)              (88,032)             (146,530)
Profit sharing (refer to Note 9)                           (865,000)            2,676,001             1,364,089
Write-off note receivable                                  (222,845)                -                     -
Miscellaneous                                                (4,125)                -                     -
                                                       ------------------    -----------------     -----------------

                                                          $(651,620)           $3,107,561            $1,426,860
                                                       ==================    =================     =================

Profit Sharing amounts were reflected as a component of Direct Costs in prior
years' financial statements.
</TABLE>
12.      JOINT VENTURE AGREEMENT AND SALE

In July, 1993, the Company and American International Group Inc. ("AIG") formed
a corporate joint venture, Techmark Services Ltd. ("Techmark" or the "Joint 
Venture") owned fifty-one percent (51%) by AIG and forty-nine percent (49%) by 
the Company.

In conjunction with the foregoing alliance, in October, 1993, AIG purchased, 
for a price of $6,430,000, options and a special issue of preferred stock which
was convertible into an issue of new shares of common stock which, subsequent 
to its issuance, would be equivalent to twenty percent (20%) of the Company's 
issued and outstanding common stock.  Under the terms of the purchase
agreement, AIG had the right to purchase an increased interest in the Company,
to a maximum of thirty percent (30%) of the Company's issued and outstanding 
common stock, if certain operating goals were achieved by the Company.

On April 18, 1996, the Company and AIG consumated an agreement for the 
termination of the Techmark Joint Venture (the "Agreement").  Under the terms 
of the Agreement, AIG agreed to purchase the Company's forty-nine (49%)
interest in the joint venture for approximately $3.8 million and for the 
Company to repurchase the 3,234,697 shares of convertible preferred stock 
held by AIG for its original redemption value of $6,430,000 and further
relinquish their rights to other options under the original agreement.    
As a result of this transaction, the Company no longer has any investment in o
liability to the Joint Venture and will no longer record any equity in the 
operations of the Joint Venture.  The redemption value will be offset by the 
amount due the Company from the sale of its investment, with the net amount 
due AIG of $2,395,960 resulting in a three year, non-interest bearing note
payable in 11 equal quarterly installments of $205,000 commencing June 30, 1996
with a final installment of $140,960 due March 1999.  In the event of default
by the Company under the note payable, the Company would be required to reissue
to AIG preferred stock for the remaining amount due at the default date.

At March 31, 1996, the Company's carrying value of its investment amounted to 
$1,885,674 which will result in a gain on the sale of the investment of
]$1,876,480, the excess of the proceeds over the carrying value, to be 
recognized in the first quarter of fiscal 1997.

Also, as part of the agreement, AIG paid the Company  $1,480,000 related to
amounts due the Company as of March 31, 1996, under its profit sharing 
arrangement.  In connection with this payment, the Company issued an 
irrevocable letter of credit to the benefit of AIG through December 2002 which
can be drawn upon by AIG in the event the ultimate profit sharing amount due
the Company is less than the amount previously paid.  It is anticipated that no
amounts will be due AIG under the letter of credit.


13.      ACQUISITION

In July of 1995, Warrantech International, Inc., acquired Home Guarantee 
Corporation Plc (subsequently renamed Warrantech Europe Plc.) a British 
Company, which markets home warranty products, as well as, other warranty 
products similar to those marketed by the Company in the United States.  
The acquisition was accounted for as a purchase and the resultant goodwill 
amounting to $695,800 is being amortized over a 10 year period.

14.      SIGNIFICANT CUSTOMERS

The Company has two significant customers that accounted for approximately 
19% of consolidated gross revenues for the year ended March 31, 1996 and one 
customer that accounted for approximately 10% and 11% of consolidated gross 
revenues for the years ended March 31,  1995 and 1994, respectively.

15.      RELATED PARTY TRANSACTION

During the years ended March 31, 1996 and 1995 the Company recognized net 
insurance expense of $27,774,163, $15,893,173, respectively for insurance 
coverage provided by AIG for certain service contract programs.  At 
March 31, 1996 and 1995 the Company had a receivable for accrued profit sharing
from AIG of $1,480,000 and $1,524,920, respectively.




===============================================================================
16.     Quarterly Financial Data (Unaudited)
================================================================================
The following fiscal 1996 quarterly financial information for each of the three
month periods ended June 30, September 30, December 31, 1995 and 1994 and 
March 31, 1996 and 1995 is unaudited.  However, in the opinion of management, 
all adjustments (consisting of normal recurring adjustments) necessary to 
present fairly the results of operations for such periods, have been made for
a fair presentation of the results shown.
<TABLE>
<CAPTION>
 
                            Quarter Ended               Quarter Ended             Quarter Ended                Quarter Ended
                               June 30,                 September 30,              December 31,                  March 31,
                        1995          1994           1995          1994         1995         1994          1996           1995
<S>                  <C>            <C>           <C>            <C>          <C>           <C>          <C>          <C>          
Net revenues          $19,994,221    $13,939,184   $23,417,612    $17,018,432  $34,396,845   $20,202,935  $31,272,046  $19,378,774

Income from
    operations          1,487,194         52,333     1,410,907        289,917    2,780,482       678,391      (36,861)     974,394

Income
     before provision
     for income taxes   1,390,502        968,155     1,095,485        834,275    3,016,148     1,271,041   (1,469,781)(1)1,730,853

Net income               $650,460     $  618,813      $607,503       $539,652   $1,626,809    $1,032,696  $ (489,910)(2)$704,627(3)

Earnings per
     share:

Primary                      $.04           $.04          $.04           $.04         $.10          $.07       ($.04)         $.04
Fully Diluted                $.04           $.04          $.04           $.03         $.09          $.06       ($.03)         $.04
</TABLE>
(1)     As a result of renegotiation of the Company's profit sharing 
        agreements, and a reexamination of it's current experience, the Company
        recorded a charge of $1,300,000 during the fourth quarter of fiscal
        1996.  In addition, the Company reserved for the potential
        uncollectability of a note receivable in the amount of $222,845 related
        to a prior year's sale of a business.

(2)     Based on the agreement to sell the Techmark Joint Venture 
        (see Note 12), which will result in a gain to be recorded in fiscal
        1997, a tax benefit of $627,000 was recorded in the fourth quarter 
        related to equity losses of Techmark recognized by the Company.

(3)     As a result of reviews with its insurers of profit sharing
        calculations, the Company increased its profit sharing income by 
        approximately $700,000 in the fourth quarter of fiscal 1995.




<TABLE>

                                                        WARRANTECH CORPORATION AND SUBSIDIARIES
                                                              FINANCIAL STATEMENT SCHEDULE
                                                    SCHEDULE VIII-VALUATION AND QUALIFYING ACCOUNTS


 <CAPTION>
------------------------------------------------------------ -------------------------------------------------- -----------------
                       Column                  Column                      Column                          Column          Column
                          A                      B                            C                              D              E
------------------------------------------------------ ----------------------- -------------------------------------------------- 
------------------------------------------------------ ----------------------- -------------------------------------------------- 
                     Description               Balance at                   Additions                      Deductions-   Balance at
                                               Beginning of-------------------------------------------------
                                               Year       ------------------------- ------------------------
                                                          Charged to Costs         Charged to Other                       End of
                                                          and Expense (a)          Accounts-Describe       Describe (b)    Year
---------------------------------------------------------------------------------------------------------------------------------
<S>                                           <C>           <C>                    <C>                  <C>            <C>       
Year Ended March 31, 1996:
-             Allowance for doubtful accounts $    126,115   $  363,179               $  -               $   39,202     $   450,092

Year Ended March 31, 1995:
         Allowance for doubtful accounts              -         427,483                  -                  301,368         126,115

Year Ended March 31, 1994:
         Allowance for doubtful accounts            5,000        10,995                  -                   15,995           -


(a)   Bad debt expense charged to operations pertaining to accounts receivable.

(b)   Amount of write-offs during the year.

</TABLE>