UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

   (Mark One)

    [X]  Quarterly  Report  pursuant  to  Section  13 or 15(d) of the Securities
         Exchange Act of 1934 for the Three Months Ended March 31, 1998.
OR
    [ ]  Transition  Report  pursuant  to Section 13 or 15(d) of the  Securities
         Exchange  Act of 1934  for  the  transition  period  from  ________  to
         ________.


                         Commission file number 0-19998

                               WORLD ACCESS, INC.
             (Exact name of Registrant as specified in its Charter)

         DELAWARE                                       65-0044209
 (State of Incorporation)                  (I.R.S. Employer Identification No.)

         945 E. Paces Ferry Road, 
               Suite 2240,
            Atlanta, Georgia                              30326
 (Address of principal executive offices)               (Zip Code)

                                 (404) 231-2025
                         (Registrant's telephone number)



           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

                                      NONE

           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                     Common Stock, Par Value $.01 Per Share

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

         The number of shares outstanding of the Registrant's  common stock, par
     value $.01 per share, at May 20, 1998 was 21,915,043.


<PAGE>


PART 1.  FINANCIAL INFORMATION

ITEM 1.  Financial Statements

<TABLE>
World Access, Inc. and Subsidiaries

Consolidated Balance Sheets
<CAPTION>

                                                 March 31          December 31
                                                   1998               1997
                                             -------------        -------------
<S>                                          <C>                  <C>
                                               (Unaudited)
ASSETS
Current Assets
  Cash and equivalents                       $  63,278,252        $ 118,065,045 
  Marketable securities                          3,500,000               ---
  Accounts receivable                           39,683,071           20,263,971 
  Notes receivable                               6,908,270            2,050,000 
  Inventories                                   28,340,209           22,426,918 
  Other current assets                           7,153,447            8,873,723
                                             -------------        ------------- 
    Total Current Assets                       148,863,249          171,679,657 
Property and equipment                          13,940,900            5,704,585 
Investment in affiliate                             ---               5,002,000 
Goodwill                                        71,151,856           31,660,201 
Other assets                                    12,165,155           11,236,298 
                                             -------------        -------------
    Total  Assets                            $ 246,121,160        $ 225,282,741
                                             =============        ============= 

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
  Short-term debt                            $   1,883,877        $      81,739 
  Accounts payable                              17,592,293            9,339,588 
  Accrued payroll and benefits                   2,338,117            2,589,461 
  Purchase price payable                            ---               3,700,000 
  Other accrued liabilities                      6,395,260            2,219,237 
                                             -------------        -------------
    Total Current Liabilities                   28,209,547           17,930,025 
Long-term debt                                 115,527,707          115,263,984 
Noncurrent liabilities                           1,686,026              333,802 
Minority interests                              11,593,650               ---
                                             -------------        -------------
    Total Liabilities                          157,016,930          133,527,811 
                                             -------------        -------------
Stockholders' equity 
  Common Stock                                     217,059              193,062
  Capital in excess of par value               130,289,184           84,162,478
  Retained earnings (deficit)                  (41,402,013)           7,399,390
                                             -------------        -------------
    Total Stockholders' Equity                  89,104,230           91,754,930 
                                             -------------        -------------
    Total Liabilities and
      Stockholders' Equity                   $ 246,121,160        $ 225,282,741
                                             =============        ============= 

                                    

<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial statements.
</FN>
</TABLE>
<PAGE>

<TABLE>

World Access, Inc. and Subsidiaries

Consolidated Statements of Operations

(Unaudited)
<CAPTION>


                                              Three Months Ended March 31
                                             -----------------------------
                                                 1998             1997
                                             ------------     ------------
<S>                                          <C>              <C>           
Sales of products                            $ 28,228,956     $ 15,470,050 
Service revenues                                7,502,089        4,781,374 
                                             ------------     ------------
        Total Sales                            35,731,045       20,251,424 

Cost of products sold                          16,772,449        9,969,627
Cost of services                                7,427,684        4,083,481
                                             ------------     ------------ 
        Total Cost of Sales                    24,200,133       14,053,108 
                                             ------------     ------------
        Gross Profit                           11,530,912        6,198,316

Engineering and development                       788,184          316,410
Selling, general and administrative             3,255,854        1,917,563
Amortization of goodwill                          863,997          284,131 
In-process research and development            50,000,000           ---
Special charges                                 3,240,000           ---
                                             ------------     ------------
        Operating Income (Loss)               (46,617,123)       3,680,212

Interest and other income                       1,269,284          367,186
Interest expense                               (1,514,913)         (28,930)
                                             ------------     ------------
        Income (Loss) Before Income 
          Taxes and Minority Interests        (46,862,752)       4,018,468 

Income taxes                                    1,255,000        1,406,000
                                             ------------     ------------
        Income (Loss) Before 
          Minority Interests                  (48,117,752)       2,612,468

Minority interests in earnings 
  of subsidiary                                   683,651           ---
                                             ------------     ------------
        Net Income (Loss)                    $(48,801,403)    $  2,612,468
                                             ============     ============

Net Income (Loss) Per Common Share:
        Basic                                $      (2.52)    $        .16
                                             ============     ============
        Diluted                              $      (2.52)    $        .15
                                             ============     ============

Weighted Average Shares Outstanding:
        Basic                                  19,342,627       16,399,548
                                             ============     ============ 
        Diluted                                19,342,627       17,320,714
                                             ============     ============

<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial statements.
</FN>
</TABLE>
                              
<PAGE>
<TABLE>


World Access, Inc. and Subsidiaries

Consolidated Statement of Changes in Stockholders' Equity

(Unaudited)
<CAPTION>

                                                          Capital in         Retained
                                            Common         Excess of         Earnings
                                             Stock         Par Value         (Deficit)           Total
                                           ---------     -------------     -------------     -------------
<S>                                        <C>           <C>               <C>               <C>              
Balance at January 1, 1998                 $ 193,062     $  84,162,478     $   7,399,390     $  91,754,930 

Net loss                                                                     (48,801,403)      (48,801,403)

Issuance of 1,429,907 shares for NACT
  acquisition                                 14,299        26,867,953                          26,882,252

Issuance of stock options for NACT
  acquisition                                                8,359,737                           8,359,737

Issuance of 633,982 shares for ATI
  acquisition                                  6,340         6,508,200                           6,514,540

Issuance of  334,252 shares for stock
  options and warrants                         3,343         1,691,516                           1,694,859

Tax benefit from exercises of stock
  options and warrants                                       2,662,400                           2,662,400

Issuance of 1,511 shares for matching
  contribution to 401K plan                       15            36,900                              36,915
                                           ---------     -------------     -------------     -------------
Balance at March 31, 1998                  $ 217,059     $ 130,289,184     $ (41,402,013)    $  89,104,230
                                           =========     =============     =============     =============



<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial statements.
</FN>
</TABLE>

<PAGE>
<TABLE>

World Access, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)
<CAPTION>

                                                                    Three Months Ended March 31
                                                                   ------------------------------
                                                                       1998              1997
                                                                   -------------     ------------
<S>                                                                <C>               <C>           
Cash  Flows From Operating Activities:
Net income (loss)                                                  $ (48,801,403)    $  2,612,468 
Adjustments to reconcile net income (loss) to net cash from
  (used by) operating activities:
     Depreciation and amortization                                     1,545,009          503,439 
     Income tax benefit from stock warrants and options                2,662,400           ---
     Special charges                                                  55,992,766           ---
     Minority interests in earnings of subsidiary                        683,651           ---
     Provision for inventory reserves                                     77,500           60,000 
     Stock contributed to employee benefit plan                           36,915           13,201 
      Changes in operating assets and liabilities, 
        net of effects from businesses acquired:
          Accounts receivable                                         (9,993,053)      (3,554,300)
          Notes receivable                                            (1,092,946)          ---
          Inventories                                                 (3,101,070)      (3,521,014)
          Accounts payable                                             3,606,024        2,087,347 
          Other assets and liabilities                                   423,374          462,255 
                                                                   -------------     ------------
      Net Cash From (Used By) Operating Activities                     2,039,167       (1,336,604)
                                                                   -------------     ------------
Cash Flows From Investing Activities:
Acquisitions of businesses                                           (57,406,573)      (4,099,852)
Loan repayments by affiliate                                              ---             582,500 
Expenditures for property and equipment                               (1,919,355)        (725,793)
                                                                   -------------     ------------
      Net Cash Used By Investing Activities                          (59,325,928)      (4,243,145)
                                                                   -------------     ------------
Cash Flows From  Financing Activities:
Short-term debt borrowings                                             1,771,651        4,024,000 
Proceeds from exercise of stock warrants and options                   1,694,859          160,548
Long-term debt repayments                                               (966,542)          ---
Issuance of long-term debt for capital lease                              ---             291,500 
                                                                   -------------     ------------
      Net Cash From Financing Activities                               2,499,968        4,476,048 
                                                                   -------------     ------------
      Decrease in Cash and Equivalents                               (54,786,793)      (1,103,701)
      Cash and Equivalents at Beginning of Period                    118,065,045       22,480,082 
                                                                   -------------     ------------
      Cash and Equivalents at End of Period                        $  63,278,252     $ 21,376,381 
                                                                   =============     ============

Supplemental Schedule of Noncash Financing and
     Investing Activities:
Issuance of common stock for businesses acquired                   $  33,396,792     $  2,088,118 
Issuance of stock options for businesses acquired                      8,359,737
Conversion of note receivable to investment in ATI                     4,484,534 



<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial statements.
</FN>
</TABLE>

<PAGE>


                       World Access, Inc. and Subsidiaries

                   Notes To Consolidated Financial Statements

                                 March 31, 1998


NOTE 1.  BASIS OF PRESENTATION

         The  accompanying  unaudited  consolidated financial statements include
the  accounts  of the  Company and its  subsidiary  companies,  all of which are
wholly-owned  except  for  67.3%  ownership  in  NACT  Telecommunications,  Inc.
("NACT").  Minority interests represent the minority stockholders  proportionate
share of  NACT's  equity.  These  financial  statements  have been  prepared  in
accordance  with  the  instructions  to Form  10-Q  and do not  include  all the
information and footnotes required by generally accepted  accounting  principles
for complete financial statements. In the opinion of management, all adjustments
(consisting  of  normal  recurring  accruals)  considered  necessary  for a fair
presentation  of the results of the interim  periods covered have been included.
For further information,  refer to the audited consolidated financial statements
and footnotes  included in the Company's Annual Report on Form 10-K for the year
ended December 31, 1997.

         The preparation of financial statements in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements and the reported  amounts of sales and expenses  during the reporting
period. Actual results could differ from those estimates.

         The results of operations for the three months ended March 31, 1998 are
not necessarily  indicative of the results  expected for the full year.  Certain
reclassifications  have been made to the prior period's financial information to
conform with the presentations used in 1998.


NOTE 2.  ACQUISITIONS

ATI Acquisition

         On December 24, 1997, the Company entered  into an agreement to acquire
Advanced TechCom,  Inc. ("ATI"), a Wilmington,  Massachusetts based designer and
manufacturer of digital microwave and millimeterwave radio systems for short and
long haul voice,  data and/or  video  applications.  On January  29,  1998,  the
transaction was completed in its final form whereby ATI was merged with and into
Cellular  Infrastructure Supply, Inc. ("CIS"), a wholly-owned  subsidiary of the
Company (the "ATI Merger").  In connection with the ATI Merger, the stockholders
of ATI received  approximately $300,000 in cash and 424,932 restricted shares of
the  Company's  common  stock.  These  shares  had  an  initial  fair  value  of
approximately $6.5 million.

         In addition to the 424,932 shares noted above,  the stockholders of ATI
were issued  209,050  restricted  shares of the Company's  common  stock.  These
shares  were  immediately  placed  into  escrow  and  will  be  released  to the
stockholders  of ATI contingent  upon the  realization  of predefined  levels of
pre-tax income from ATI's operations during calendar years 1998 and 1999.

         Upon issuance, the 209,050 escrowed  shares  were valued by the Company
at par value only, or $2,091.  As it becomes  probable that the  conditions  for
release from escrow will be met, the fair market value of the shares as measured
at that time will be recorded as additional  goodwill and stockholders'  equity,
respectively.

         The acquisition of ATI has been accounted for using the purchase method
of accounting.  Accordingly,  the results of ATI's operations have been included
in the accompanying consolidated financial statements from February 1, 1998. The
purchase price was allocated to net assets  acquired and to  approximately  $5.4
million of  purchased  in-process  research  and  development  (R&D).  Purchased
in-process  R&D, which consists of the value of ATI products in the  development
stage that are not  considered to have reached  technological  feasibility,  was
expensed in the first quarter of 1998 in accordance with  applicable  accounting
rules.  The excess of purchase price over the fair value of net assets  acquired
and purchased in-process R&D, currently estimated at approximately $3.0 million,
has been recorded as goodwill and is being amortized over a 15 year period.

<PAGE>
NACT Acquisition

         In the  fourth  quarter  of  1997,  the  Company  began a  three  phase
acquisition  of NACT,  a Provo,  Utah based  single-source  provider of advanced
telecommunications   switching  platforms  with  integrated  telephony  software
applications and network telemanagement capabilities.

         During November and December 1997, the Company purchased 355,000 shares
of NACT common stock in the open market for approximately $5.0 million.

         On  December  31,  1997,  the  Company  entered  into a stock  purchase
agreement  with GST  Telecommunications,  Inc.  ("GST") and GST USA, Inc.  ("GST
USA")  to  acquire  5,113,712  shares  of NACT  common  stock  owned by GST USA,
representing  approximately  63% of the  outstanding  shares of NACT (the  "NACT
Acquisition"). On February 27, 1998, the NACT Acquisition was completed with GST
USA  receiving  $59.7  million in cash and  1,429,907  restricted  shares of the
Company's common stock.  These shares had an initial fair value of approximately
$26.9 million. In addition,  the Company issued 740,543 non-qualified options to
purchase  Company  common  stock at $11.15 per share and  106,586  non-qualified
options to purchase  Company  common  stock at $16.25 per share in exchange  for
substantially all the options held by NACT employees,  which became  immediately
vested in  connection  with the NACT  Acquisition.  These options had an initial
fair value of approximately $8.4 million.

         On February 24, 1998 the Company  entered into a merger  agreement with
NACT  pursuant to which the Company  agreed to acquire all of the shares of NACT
common stock not already owned by the Company or GST USA.  Pursuant to the terms
of the merger agreement,  each share of NACT common stock will be converted into
shares of Company  common  stock having a value of $17.50 per share based on the
average  of the  daily  closing  price of  Company  common  stock on the  Nasdaq
National  Market for a  pre-defined  period prior to the closing  (the  "Closing
Price"), provided that if the Closing Price is more than $25.52, then each share
of NACT common  stock will be  converted  into 0.6857  shares of Company  common
stock.  If the Closing Price is less than $20.88,  then the Company may elect to
terminate  the  agreement.  The merger is subject to,  among other  things,  the
approval  of the  NACT  stockholders  and  the  satisfaction  of  certain  other
customary conditions. This merger is expected to be consummated in July 1998.

         On  August  24,   1996,   Aerotel,   Ltd.  and  Aerotel   U.S.A.   Inc.
(collectively,  "Aerotel")  commenced  an action  against NACT and a customer of
NACT in the  United  States  District  Court,  Southern  District  of New  York,
alleging that  telephone  systems  manufactured  and sold by NACT  incorporating
prepaid debit card features  infringe upon Aerotel's  patent which was issued in
November 1987 (the "Aerotel Patent").  Aerotel sought injunctive relief, damages
in an unspecified amount, damages of up to three times damages found for willful
infringement  of the  Aerotel  Patent and an order  requiring  NACT to publish a
written  apology to Aerotel.  NACT filed an answer and  Counterclaim in which it
denied  infringement of the Aerotel Patent and sought judgement that the Aerotel
patent is invalid and  unenforceable  and that Aerotel has misused its patent in
violation of antitrust laws.  NACT has denied that it has committed  defamation,
unfair   competition  and  tortuous   interference  with  prospective   business
relations.  In  August  1997,  Aerotel  amended  its  complaint  to  include  as
defendants GST, GST USA, and two former executive  officers of NACT. The amended
pleadings seek in excess of $18.7 million in damages and allege that GST and GST
USA have infringed the Aerotel patent, aided and abetted infringement by others,
including  NACT, and  participated  in, and aided and abetted  alleged  tortuous
conduct by NACT. GST, GST USA and the two former executive officers of NACT have
served answers denying all material allegations and intend to defend vigorously.

         Under the terms of the Company's stock purchase agreement with GST, the
Company and GST have agreed to share evenly the costs of any  judgement  against
NACT as a result of the Aerotel  litigation,  including  NACT's legal fees.  The
Company believes that NACT has valid defenses to the Aerotel claims, however, an
unfavorable  decision in this action could have a material adverse effect on the
Company's financial position.  Any losses incurred by the Company as a result of
the Aerotel litigation will be accounted for as additional NACT purchase price.

         The  acquisition  of the  67.3%  majority  interest  in NACT  has  been
accounted for using the purchase method of accounting.  Accordingly, the results
of  NACT's  operations  have  been  included  in the  accompanying  consolidated
financial  statements  from March 1, 1998.  The  purchase  price of the majority
interest in NACT was allocated to the net assets  acquired and to  approximately
$66.5  million of purchased  in-process  R&D.  During the first quarter of 1998,
67.3%,  or $44.6  million,  of purchased  in-process  R&D, which consists of the
value of NACT products in the development  stage that are not considered to have
reached  technological   feasibility,   was  expensed  in  accordance  with  the
applicable accounting rules. The excess of purchase price over 67.3% of the fair
value of net assets acquired and purchased  in-process R&D, currently  estimated
at  approximately  $38.3  million,  has been  recorded as goodwill  and is being
amortized over a 20 year period.
<PAGE>

Pro Forma Results of Operations

         On a pro forma, unaudited basis, as if the acquisitions of ATI and NACT
had occurred as of January 1, 1997, total sales,  operating  income,  net income
and diluted  net income per common  share for the three  months  ended March 31,
1998 and  1997  would  have  been  approximately  $38,893,000  and  $32,220,000;
$1,129,000  and  $3,699,000;   $42,000  and  $2,244,000;  and  $0.12  and  $0.0,
respectively.

         These  unaudited pro forma  results have been prepared for  comparative
purposes  only and are not  necessarily  indicative of the results of operations
which would  actually have occurred had the  acquisitions  been in effect on the
date  indicated.  In addition,  the portion of the purchase  price  allocated to
in-process R&D expensed in accordance with applicable accounting  rules of $50.0
million will not recur,  therefore,  the pro forma  results  have been  prepared
excluding this charge.


NOTE 3.  INVENTORIES

Inventories consist of the following:

                                                  March 31      December 31
                                                    1998           1997
                                               ------------     ------------

Switching systems, frames and 
  related circuit boards                       $ 15,940,114     $ 13,445,770
Transport and access products                       598,418          779,674
Electronic components                             6,948,217        4,879,213
Pay telephone parts                               1,542,754        1,332,835
Work in progress                                  2,971,689        1,744,368
Other finished goods                                339,017          245,058
                                               ------------     ------------
                                               $ 28,340,209     $ 22,426,918
                                               ============     ============
                                                               
                                                  
NOTE  4.  GOODWILL

         Goodwill from  acquisitions,  representing the excess of purchase price
paid over the value of net assets acquired, is as follows:


                                           March 31       December 31
                                             1998             1997
                                         ------------     ------------

         NACT                            $ 38,302,140     $     ---
         CIS                               12,485,239       12,485,239
         AIT                               10,657,917       11,557,917
         Galaxy                             5,089,265        5,089,265
         ATI                                2,953,512           ---
         Other                              5,034,062        5,034,062
                                         ------------     ------------
                                           74,522,135       34,166,483
         Accumulated amortization          (3,370,279)      (2,506,282)
                                         ------------     ------------
                                         $ 71,151,856     $ 31,660,201
                                         ============     ============

         Goodwill is being  amortized on a  straight-line  basis over a 15 to 20
year period. The Company reviews the net carrying value of goodwill on a regular
basis, and if deemed necessary,  charges are recorded against current operations
for any  impairment  in the value of these  assets.  No  significant  impairment
charges  have been  recorded to date.  Goodwill  is removed  from the books when
fully amortized.

<PAGE>
NOTE  5.  DEBT

         The Company has a $10.0 million  revolving  line of credit with a large
European  bank. As of March 31, 1998, the Company had borrowings of $1.8 million
outstanding  under this  facility.  These  borrowing  were repaid to the bank in
April 1998.

         The bank  agreement,  which  expires in March 2001,  contains  standard
lending  covenants  including  financial  ratios,  restrictions on dividends and
limitations on additional debt and the  disposition of Company assets.  Interest
is paid at the rate of prime  plus  1and 1/4% or Libor  plus 2 and 1/2%,  at the
option of the Company.


NOTE  6.  SPECIAL CHARGES

         Special  charges in the first quarter of 1998 included $6.6 million for
costs related to the  consolidation  of several  operations and the Company exit
from the contract  manufacturing  business.  The Company's AIT and circuit board
repair  operations  have  been  consolidated  into a new  facility  in  Orlando,
Florida; the Company's manufacturing operations have moved from Orlando to a new
facility  in  Alpharetta,   Georgia;  and  the  Company's  Scottsdale,   Arizona
operations   are  being   integrated   into  ATI's   facility   in   Wilmington,
Massachusetts.  The special  charges  included  $3,360,000  to cost of sales for
obsolete and redundant inventories and $3,240,000 for severance benefits,  lease
terminations,  idle  equipment  and other  phase-down  expenses  related  to the
consolidation program.


NOTE 7.  EARNINGS PER SHARE

         Effective  in  1997,  the  Company   adopted   Statement  of  Financial
Accounting  Standards  No. 128 "Earnings per Share".  The  computation  of basic
earnings  per share is based on the  weighted  average  number of common  shares
outstanding  during the period. The computation of diluted earnings per share is
based on the weighted  average number of common shares  outstanding  plus,  when
their effect is dilutive, potential common stock consisting of shares subject to
stock options,  stock warrants and  convertible  notes.  Potential  common stock
shares of 921,166 were included in computing  diluted earnings per share for the
first quarter of 1997. A total of 1,204,000 and 1,246,000 shares of common stock
held in escrow from certain  acquisitions and a license  agreement were excluded
from the  earnings per share  calculations  for the three months ended March 31,
1998 and 1997,  respectively,  because the conditions for release of shares from
escrow had not been satisfied.

         Common stock issued and outstanding  at  March  31,  1998  and 1997 was
21,705,887 and 17,663,007 shares, respectively.


NOTE 8.  PENDING ACQUISITION

         On  February  12,  1998,   the  Company  executed  a letter  of  intent
to acquire Cherry Communications  Incorporated,  d/b/a Resurgens  Communications
Group  ("RCG"),  and Cherry  Communications  U.K.  Limited  ("Cherry  U.K.,  and
together with RCG, "Resurgens").  On May 12, 1998, the Company signed definitive
agreements to acquire Resurgens.  The agreement to acquire RCG is subject to the
approval of the Bankruptcy Court. The transactions,  which will be accounted for
under the purchase  method of  accounting,  are  currently  expected to close in
August 1998.

<PAGE>

         Pursuant to the terms of the  agreements,  the creditors of RCG and the
shareholders of Cherry U.K. will receive  approximately  3.7 million  restricted
shares of Company common stock in the aggregate, with an estimated fair value of
approximately  $90  million.  In  addition,  the RCG  creditors  and Cherry U.K.
shareholders  have the right to receive  additional  consideration  of up to 7.5
million restricted shares of Company common stock over the next two and one-half
years,  contingent  upon the  achievement  of certain EBITDA levels by Resurgens
during  this  timeframe.  The  transaction  is subject to,  among other  things,
Resurgens exceeding pre-defined levels of monthly revenues and gross margin, the
receipt of the requisite corporate and regulatory approvals, the confirmation of
RCG's Plan of Reorganization and the approval of Company stockholders.

         RCG,  currently  operating  under the  protection  of Chapter 11 of the
United States Bankruptcy Code, and Cherry U.K. are facilities-based providers of
international network access,  commonly referred to in the industry as carriers'
carrier. In October 1997, John D. ("Jack") Phillips,  a director of the Company,
entered into a series of agreements  whereby,  among other things, he became the
new Chairman and Chief Executive Officer of Resurgens.  RCG filed for bankruptcy
protection shortly thereafter. WorldCom, Inc. ("WorldCom"), a major customer and
vendor of Resurgens,  has  subsequently  provided  Resurgens  approximately  $26
million of direct financial support through a debtor in possession  facility and
additional financial support,  primarily through trade credits.  Upon completion
of the Resurgens  acquisition,  WorldCom is expected to own approximately 15% of
Company on a fully diluted basis.


<PAGE>


ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS


Overview

         The Company  develops,  manufactures  and markets wireline and wireless
switching,  transport  and access  products  for the  global  telecommunications
markets.  The products offered by the Company include those  manufactured by the
Company  as well as those  manufactured  by other  telecommunications  equipment
manufacturers.  To support and complement  its product  sales,  the Company also
provides its customers with a broad range of design, engineering, manufacturing,
testing, installation, repair and other value-added services.

         During 1995 and 1996,  the Company  completed  strategic  and financial
restructuring programs to strengthen its management team, reposition the Company
as a provider of telecommunications  products,  improve its financial condition,
reduce its  operating  costs and position the Company for future  growth.  These
programs  were  undertaken  following  the  significant  losses  incurred by the
Company in the early 1990s,  primarily due to a discontinued smart pay telephone
business,  and to take advantage of the significant growth  opportunities within
the Company's existing customer base and related markets.  In November 1994, the
Company began to rebuild its management team and change its strategic focus. The
Company  strengthened  its management  team by appointing a new Chief  Executive
Officer  and by  recruiting  and  hiring a new  President  and  Chief  Operating
Officer,  Executive  Vice  President  of Business  Development  and  experienced
product development and manufacturing professionals. These individuals, together
with other key managers  recruited  into the Company,  have brought  significant
experience in manufacturing  and marketing  telecommunications  equipment to the
Company.

         The Company  acquired five businesses  during 1995 to 1997 in an effort
to broaden its line of  switching,  transport and access  products,  enhance its
product  development  capabilities and strengthen its technical base.  Effective
May 1995, the Company  acquired AIT, Inc.  ("AIT"),  a full service  provider of
Northern Telecom  switching  systems,  add-on frames and related circuit boards;
effective  October  1995,  the  Company  acquired  Westec  Communications,  Inc.
("Westec"),  a provider of wireless products and services primarily to the cable
television  industry;  effective  January  1996,  the Company  acquired  Sunrise
Sierra, Inc. ("Sunrise"),  a developer and manufacturer of intelligent transport
and access  products;  effective  January 1997,  the Company  acquired  Cellular
Infrastructure  Supply, Inc. ("CIS"), a provider of mobile network equipment and
related design, installation and technical support services to cellular, PCS and
other  wireless  service  providers;  and  effective  August  1997,  the Company
acquired Galaxy Personal  Communication  Services  ("Galaxy"),  a RF engineering
firm  that  provide  system  design,  implementation,   optimization  and  other
value-added  radio  engineering and consulting  services to the wireless service
markets.  The  markets  served  by  CIS  and  Galaxy  complement  the  Company's
traditional telephone service provider and private network operator markets.

         In the first quarter of 1998, the Company  acquired ATI, a manufacturer
of  digital  point-to-point  microwave  radio  systems  for  short and long haul
applications   and  a  majority   stake  in  NACT,   a  provider   of   advanced
telecommunications switching platforms with integrated applications software. In
May 1998,  the Company  signed  definitive  agreements to acquire  Resurgens,  a
facilities-based  provider of international network access, commonly referred to
in the industry as carriers'  carrier.  These  acquisitions  have positioned the
Company to offer its customers a complete  telecommunications network  solution,
including proprietary equipment, planning and engineering services and access to
international long distance.

         The  Company  realized  significant   improvements  in  its  sales  and
operating results since 1994 as a result of the acquisitions and internal growth
initiatives. The Company's total sales increased by 82.3% in 1997, 69.2% in 1996
and 97.2% in 1995.  Total sales for the first quarter of 1998 increased by 68.0%
over the fourth quarter of 1997. As the Company increased its product sales from
18.2% of total  sales in 1994 to 79.0% of total  sales in the first  quarter  of
1998,  its gross profit margin before  special  charges  increased from 12.9% in
1994 to 21.1% in 1995,  29.4%  in  1996,  34.6% in 1997 and  41.7% in the  first
quarter of 1998. As a percentage of total sales, the Company's  operating income
(loss) before  special  charges  increased  from (8.5%) in 1994 to 5.0% in 1995,
14.4% in 1996, 21.0% in 1997 and 27.9% in the first quarter of 1998. The Company
will continue to seek further  improvements  in gross profit margin over time as
product  offerings  include  more  internally  developed,  acquired and licensed
products containing proprietary technology.

<PAGE>
         Although the Company has  aggressively  pursued  acquisitions in recent
years,  over 60 percent of the Company's  total sales growth since 1994 has come
from internal growth  initiatives.  The Company has had considerable  success in
growing  businesses post  acquisition,  most notably AIT and CIS, as a result of
its ability to provide working capital, an extensive base of  telecommunications
customers and a broad range of support services.

         Since January 1, 1995, the Company has  significantly  strengthened its
balance sheet  through  improved  operating  results,  a $115.0  million sale of
convertible   subordinated  notes,  a  $26.2  million  secondary  public  equity
offering,  proceeds  from stock  warrant and option  exercises,  and a five-year
$10.0  million  credit   facility.   The  Company  has  used  this  capital  for
acquisitions and to support the working capital requirements associated with the
Company's growth.  The Company's  working capital and stockholders'  equity have
increased from $2.3 million and $1.2 million, respectively, at December 31, 1994
to $120.7 million and $89.1 million, respectively, at March 31, 1998.

Results of Operations

         The following  table sets forth certain  financial  data,  representing
each line item in the Company's consolidated  statements of operations expressed
as a  percentage  of total  sales,  except  other data,  which is expressed as a
percentage of the applicable revenue type:

                                                      Quarter Ended March 31,
                                                        1998          1997
                                                       ------        ------

Statement of Operations Data:
  Sales of products                                     79.0%        76.4%
  Service revenues                                      21.0         23.6
                                                       -----        -----
         Total sales                                   100.0        100.0

  Cost of products sold                                 46.9         49.2
   Cost of services                                     20.8         20.2
                                                       -----        -----
         Total cost of sales                            67.7         69.4
                                                       -----        -----

         Gross profit                                   32.3         30.6

  Engineering and development                            2.2          1.6
  Selling, general and administrative                    9.1          9.4
  Amortization of goodwill                               2.4          1.4
  In-process research and development                  140.0         ---
  Special charges                                        9.1         ---
                                                       -----        -----
         Operating income (loss)                      (130.5)        18.2

  Interest and other income                              3.5          1.6
  Interest expense                                      (4.2)        ---
                                                       -----        -----
         Income (loss) before income 
           taxes and minority interests               (131.2)        19.8

  Income taxes                                           3.5          6.9
                                                       -----        -----
         Income  (loss) before minority interests     (134.7)        12.9

Minority interests in earnings of subsidiary             1.9         ---
                                                       -----        -----

         Net income (loss)                            (136.6)%       12.9%
                                                       =====        =====

Other Data:
  Gross Margin (Before Special Charges):
    Products                                            45.3%        35.6%
    Services                                            28.1         14.6

<PAGE>

 Three Months Ended March 31, 1998 Compared to Three Months Ended March 31, 1997

         Sales. Total sales increased $15.5 million,  or 76.4%, to $35.7 million
in the first  quarter of 1998 from $20.3  million in the first  quarter of 1997.
Product  sales  increased  to 79.0% of total sales in the first  quarter of 1998
from 76.4% in the first quarter of 1997.

         Product sales  increased  $12.8 million,  or 82.5%, to $28.2 million in
the first quarter of 1998 from $15.5  million in the first quarter of 1997.  The
increase  related  to  sales  generated  by NACT and ATI,  which  were  acquired
effective March 1, 1998 and February 1, 1998,  respectively,  and an increase of
mobile network equipment sold by CIS.

         Service revenues  increased $2.7 million,  or 56.9%, to $7.5 million in
the first  quarter of 1998 from $4.8 million in the first  quarter of 1997.  The
increase related to engineering services performed by Galaxy, which was acquired
effective July 1, 1997, and additional pay telephone refurbishment revenues.

         Gross Profit.  Gross profit increased $5.3 million,  or 86.0%, to $11.5
million in the first  quarter of 1998 from $6.2 million in the first  quarter of
1997.  Gross profit margin  increased to 32.3% in the first quarter of 1998 from
30.6% in the first quarter of 1997.  Gross profit  margin  excluding the special
charge of approximately $3.4 million (see Note 6 to "Financial  Statements") was
41.7% in the  first  quarter  of 1998 The  improved  performance  resulted  from
economies  of scale  associated  with the 76.4%  increase in total sales and the
change in sales mix to  products,  which  generally  carry a higher gross profit
margin than service revenues.

         Gross profit  margin on products  sold  increased to 40.6% in the first
quarter of 1998 from 35.6% in the first  quarter of 1997.  Gross  profit  margin
excluding  the  special  charge  was 45.3% in the  first  quarter  of 1998.  The
improved margins related to the NACT and ATI sales of proprietary  equipment and
systems and the increase in sales of CIS mobile network equipment,  all of which
generally  carry margins in excess of 40.0%.  The Company's  switching  products
experienced  declines in gross margin during the first quarter of 1998 primarily
related  to margin  pressure  on sales of  Northern  Telecom  add-on  frames and
related circuit boards.

         Gross profit  margin on service  revenues was 1.0% in the first quarter
of 1998 as compared to 14.6% in the first  quarter of 1997.  Gross profit margin
excluding  the  special  charge  was 28.1% in the  first  quarter  of 1998.  The
improvement  was due to the addition of consulting  revenues from Galaxy,  which
was  acquired  effective  July 1, 1997,  and improved  margins on pay  telephone
refurbishment revenues.

         Engineering  and  Development.  Engineering  and  development  expenses
increased  $472,000,  or 149.1%,  to $788,000 in the first  quarter of 1998 from
$316,000 in the first quarter of 1997. The increase in expenses was attributable
to the acquisitions of NACT and ATI and the continued expansion of the Company's
development  group.  Engineering and development  expenses  increased to 2.2% of
total  sales in the first  quarter of 1998 from 1.6% of total sales in the first
quarter of 1997.

         Selling,  General and  Administrative  Expenses.  Selling,  general and
administrative expenses increased $1.3 million, or 69.8%, to $3.3 million in the
first  quarter  of 1998 from $1.9  million  in the first  quarter  of 1997.  The
increase related  primarily to expenses  associated with the operations of NACT,
ATI and Galaxy,  which were acquired subsequent to the first quarter of 1997. As
a  percentage  of total  sales,  selling,  general and  administrative  expenses
decreased to 9.1% in the first quarter of 1998 from 9.5% in the first quarter of
1997.

<PAGE>

         Amortization of Goodwill.  Amortization of goodwill  increased $580,000
to $864,000 in the first  quarter of 1998 from  $284,000 in the first quarter of
1997,  primarily as a result of goodwill  recorded in connection  with the NACT,
ATI and Galaxy  acquisitions and additional goodwill recorded related to earnout
performances for the CIS, AIT and Galaxy acquisitions.

         Operating  Income  Before  Special  Charges.  Operating  income  before
special charges increased $6.3 million, or 171.3%, to $10.0 million in the first
quarter of 1998 from $3.7 million in the first quarter of 1997. Operating income
margin  increased to 27.9% in the first  quarter of 1998 from 18.2% in the first
quarter of 1997.

         Special Charges.  Special charges in the first quarter of 1998 included
$50.0  million for  in-process  research  and  development  related to the first
quarter 1998 acquisitions of a 67.3% interest in NACT and ATI (see Note 2 to the
"Financial  Statements").  Purchased in-process research and development,  which
consists of the value of NACT and ATI products in the development stage that are
not  considered  to have reached  technological  feasibility,  were  expensed in
accordance with applicable  accounting  rules.  The Company expects to record an
additional  in-process  research and development  charge of approximately  $22.0
million in the third quarter of 1998 in connection  with the  acquisition of the
remaining 32.7% of NACT.

         Special charges in the first quarter of 1998 also included $6.6 million
for costs related to the  consolidation of several  operations and the Company's
exit from the contract  manufacturing  business.  The  Company's AIT and circuit
board repair  operations have been  consolidated into a new facility in Orlando,
Florida; the Company's manufacturing operations have moved from Orlando to a new
facility in Alpharetta, Georgia; and Westec's Scottsdale, Arizona operations are
being transferred into ATI's facility in Wilmington, Massachusetts.  The special
charges  included  $3,360,000  to cost  of  sales  for  obsolete  and  redundant
inventories  and $3,240,000 for severance  benefits,  lease  terminations,  idle
equipment and other phase-down expenses related to the consolidation program.

         Interest and Other Income. Interest and other income increased $902,000
to $1.3 million in the first  quarter of 1998 from $367,000 in the first quarter
of 1997 due to a significant  increase in invested cash balances of the Company,
resulting  primarily  from the sale of $115.0 million  convertible  subordinated
notes in October 1997.

         Interest and Other Expense.  Interest expense increased to $1.5 million
in the first  quarter  of 1998 from  $29,000 in the first  quarter of 1997.  The
increase  is  primarily  due to the  interest  recorded  on the  $115.0  million
convertible subordinated notes sold in October 1997, which bear interest at 4.5%
and the related debt issuance cost amortization.

         Income Taxes.  The  Company's  effective  income tax rate  increased to
40.0% in the first quarter of 1998 from 35.0% in the first quarter of 1997.  The
Company's  1998  effective  rate  is  unfavorably  impacted  by the  significant
increase in non-deductible goodwill amortization resulting from acquisitions.

<PAGE>

Liquidity and Capital Resources

         Overview.  Cash management is a key element of the Company's  operating
philosophy and strategic  plans.  Acquisitions  to date have been  structured to
minimize  the cash  element of the  purchase  price and ensure that  appropriate
levels of cash are  available  to support  the  increased  product  development,
marketing  programs  and working  capital  normally  associated  with the growth
initiatives of acquired businesses.  As of March 31, 1998, the Company had $63.3
million of cash and equivalents  and $8.2 million in borrowings  available under
its  credit  line to  support  its  current  working  capital  requirements  and
strategic growth initiatives.

         Operating Activities.  Cash provided from operating activities was $2.0
million in the first  quarter of 1998 as compared to cash used by  operations of
$1.3 million in the first quarter of 1997.

         Accounts receivable increased $19.4 million, or 95.8%, to $39.7 million
at March 31, 1998 from $20.3  million at December 31, 1997.  This was due to the
acquisitions of NACT, ATI and Galaxy and increased sales activity at the Company
(first  quarter 1998 sales were $35.7 million as compared to fourth quarter 1997
sales of $21.3 million).  Average days sales  outstanding at March 31, 1998 were
approximately 90 days as compared to 81 days at December 31, 1997.

         Inventories increased $5.9 million, or 26.4%, to $28.3 million at March
31, 1998 from $22.4  million at December 31, 1997.  This increase was due to the
acquisitions  of NACT and ATI and the  planned  build-up  of CDX  switching  and
WX-5501inventories related to the closure of the Company's Orlando manufacturing
facility.  The  increases  above were offset by the $3.4 million  provision  for
obsolete  and  redundant   inventories  related  to  the  consolidation  program
initiated in the first quarter of 1998 (see Note 6 to "Financial Statements").

         Investing Activities. Cash used by investing activities,  primarily for
the acquisitions of businesses, was $59.3 million and $4.2 million for the first
quarters of 1998 and 1997, respectively.

         On  December  31,  1997,  the  Company  entered  into a stock  purchase
agreement with GST and GST USA to acquire  5,113,712 shares of NACT common stock
owned by GST USA,  representing  approximately 63% of the outstanding  shares of
NACT common stock (the "NACT Stock Acquisition").  On February 27, 1998 the NACT
Stock Acquisition was completed with GST USA receiving $59.7 million in cash and
1,429,907  restricted shares of the Company's common stock.  These shares had an
initial fair value of approximately  $26.9 million.  This transaction  increased
the Company's ownership of NACT to 67.3%.

         On February 24, 1998 the Company  entered into a merger  agreement with
NACT  pursuant to which the Company  agreed to acquire all of the shares of NACT
common stock not already  then owned by the Company or GST USA.  Pursuant to the
terms of the merger agreement, each share of NACT common stock will be converted
into shares of Company  common stock having a value of $17.50 per share based on
the average of the daily  closing  price of Company  common  stock on the NASDAQ
National  Market for a  pre-defined  period prior to the closing  (the  "Closing
Price"), provided that if the Closing Price is more than $25.52, then each share
of NACT common  stock will be  converted  into 0.6857  shares of Company  common
stock.  If the Closing Price is less than $20.88,  then the Company may elect to
terminate the agreement. This merger is expected to be consummated in July 1998.

         On December 24, 1997, the Company  entered into an agreement to acquire
ATI.  On January 29,  1998,  the  transaction  was  completed  in its final form
whereby ATI was merged with and into CIS (the "ATI Merger").  In connection with
the ATI Merger,  the  stockholders  of ATI received  approximately  $300,000 and
424,932  restricted  shares of the Company's  common stock.  These shares had an
initial fair value of approximately $6.5 million.

<PAGE>

         In addition to the 424,932 shares noted above,  the stockholders of ATI
were issued  209,050  restricted  shares of the Company's  common  stock.  These
shares  were  immediately  placed  into  escrow  and  will  be  released  to the
stockholders  of ATI contingent  upon the  realization  of predefined  levels of
pre-tax net income from ATI's operations during calendar years 1998 and 1999.

         In December 1997, the Company  loaned ATI  approximately  $4.5 million.
ATI used $2.6  million of the proceeds to pay off its line of credit with a bank
and the remainder for working capital purposes.  The note receivable from ATI is
included in Other  assets on the  Company's  December  31, 1997  balance  sheet.
During the first  quarter  of 1998,  the note  receivable  was  included  in the
Company's purchase price of ATI.

         During the first  quarter of 1998 and 1997,  the Company  invested $1.9
million and $726,000,  respectively, in capital expenditures. These expenditures
were primarily for new  manufacturing  and test equipment,  computer network and
related  communications  equipment designed to upgrade the Company's  management
information systems and facilitate the integration of acquisitions, and facility
improvements required in connection with the Company's growth.

         Financing Activities.  Cash provided from financing activities was $2.5
million and $4.5 million for the first quarter of 1998 and 1997, respectively.

         On  October 1, 1997,  the  Company  sold  $100.0  million in  aggregate
principal amount of convertible subordinated notes (the "Notes") under Rule 144A
of the  Securities  Act of 1933. The Notes bear interest at the rate of 4.5% per
annum,  are convertible  into Company common stock at an initial price of $37.03
per share and mature on October  1,  2002.  Interest  on the Notes is payable on
April 1 and October 1 of each year,  commencing on April 1, 1998.  The Notes are
general  unsecured  obligations  of the Company and are  subordinate in right of
payment to all  existing and senior  indebtedness.  The Company  received  $97.0
million from the sale of the Notes, after the initial purchasers'  discount fees
of $3.0 million.

         In addition to the Notes sold on October 1, 1997,  the Company  granted
the initial  purchasers an option to purchase up to an additional  $15.0 million
in Notes to cover  over-allotments.  On October 28, 1997, the initial purchasers
exercised  the  over-allotment  option  in full  and  the  Company  received  an
additional  $14.6  million,  after the  application  of the initial  purchasers'
discount fees.

         The  total  discount  fees  of  $3,450,000,  along  with  approximately
$550,000 of legal,  accounting,  printing and other expenses (the "Debt issuance
costs")  are being  amortized  to expense  over the five year term of the Notes.
Debt issuance costs of  approximately  $3.2 million,  net of  amortization,  are
included in Other assets on the Company's March 31, 1998 balance sheet.

         As of  March  31,  1998  and  1997, the  Company had borrowings of $1.8
million and $4.5 million,  respectively,  outstanding  under its $10.0 revolving
line of credit.  Borrowings  under the Company's line of credit are secured by a
first lien on substantially  all the assets of the Company.  The bank agreement,
which expires in March 2001,  contains  standard  lending  covenants,  including
financial  ratios,  restrictions on dividends and limitations on additional debt
and the  disposition  of Company  assets.  Interest is paid at the rate of prime
plus 1 1/4% or LIBOR plus 2 1/2%,  at the option of the Company.  As of the date
of  this Report, there were no amounts  outstanding  under the Company's line of
credit.

         During the first quarter of 1998, the  Company  received  approximately
$4.4 million in cash,  including  related federal income tax benefits,  from the
exercises  of  incentive  and  non-qualified  stock  options and warrants by the
Company's directors and employees.

<PAGE>

         Income  Taxes.  As a result of the  exercises  of  non-qualified  stock
options and warrants by the Company's  directors and employees,  the Company has
realized a federal  income tax  benefit of  approximately  $2.7  million for the
first quarter of 1998. Although this tax benefit does not have any effect on the
Company's provision for income tax expense for 1998, it represents a significant
cash benefit to the Company.  This tax benefit is accounted for as a decrease in
current income taxes payable and an increase in capital in excess of par value.

         Summary. The Company's improved operating performance and completion of
the sale of  $115.0  million  of Notes in 1997 has  significantly  enhanced  its
financial  strength and improved its  liquidity.  As of the date of this Report,
the  Company  has  approximately  $60.0  million  of cash  and a  $10.0  million
revolving  line of credit  available.  The Company  believes  that existing cash
balances,  available  borrowings  under the  Company's  line of credit  and cash
projected  to be  generated  from  operations  will  provide  the  Company  with
sufficient capital resources to support its current working capital requirements
and business plans for at least the next 12 months.



Item 3 - Quantitative and Qualitative Disclosures About Market Risks

         Not Applicable


PART II. OTHER INFORMATION

Item 2.  Changes in Securities

         On January 29, 1998, the Company  completed the acquisition of Advanced
TechCom,  Inc.,  a  Delaware  corporation  ("ATI"),  pursuant  to  that  certain
Agreement  and Plan of Merger  dated as of  December  24,  1998 by and among the
Company, ATI, Cellular Infrastructure Supply, Inc., a Delaware corporation and a
wholly-owned  subsidiary  of  the  Company,  and  Ernest  H.  Lin  (the  "Merger
Agreement").  Pursuant to the Merger  Agreement,  (i) the issued and outstanding
shares of ATI's Series A Preferred  Convertible  Preferred Stock, $.10 par value
per share (the "ATI Preferred Stock"),  were converted into the right to receive
(the  "Merger  Stock  Consideration")  an  aggregate  of  424,932  shares of the
Company's common stock, $.01 par value (the "Common Stock"); (ii) holders of the
issued and outstanding  shares of ATI's common stock, $.10 par value, were given
a choice to  convert  their  ATI  common  stock  into ATI  Preferred  Stock on a
one-for-one  basis and thereupon  receive the Merger Stock  Consideration to the
same extent as holders of ATI  Preferred  Stock or (b) receive  $.01 in cash for
each share of ATI common stock not so  converted;  and (iii) except for Dr. Lin,
who  received  cash and  shares of  Common  Stock,  each  holder of an option to
acquire ATI common  stock that was vested as of December  31, 1997 was paid cash
in the amount equal to the  difference  (if any) between  $1.00 and the exercise
price of such ATI option  multiplied  by the number  shares of ATI common  stock
underlying such option.

         In  addition,   the  persons  entitled  to  receive  the  Merger  Stock
Consideration  are also entitled to receive up to an aggregate of 209,050 shares
of Common Stock payable upon the achievement of certain  earnings targets during
1998 and 1999 (the "Contingent  Merger Stock").  The Contingent Merger Stock has
been issued and placed into escrow  pending its release to the persons  entitled
to receive the Merger Stock Consideration.

         The sale of the shares of Common  Stock issued in  connection  with the
Merger Agreement was not registered under the Securities Act of 1933, as amended
(the "Securities Act"), in reliance on the exemption provided by Section 4(2) of
the Securities Act.

         On February 27, 1998, the Company  completed the acquisition (the "NACT
Stock   Acquisition")   of  5,113,712   shares  of  the  common  stock  of  NACT
Telecommunications,   Inc.  from  GST  Telecommunications,   Inc.,  a  federally
chartered  Canadian   corporation   ("GST"),  and  GST  USA,  Inc.,  a  Delaware
corporation and a wholly-owned  subsidiary of GST ("GST USA"),  pursuant to that
certain  Stock  Purchase  Agreement by and between the Company,  GST and GST USA
dated as of December 31, 1997.  In connection  with the NACT Stock  Acquisition,
the Company issued to GST USA 1,429,907  shares of Common Stock. The sale of the
shares of Common Stock issued in connection with the NACT Stock  Acquisition was
not registered under the Securities Act in reliance on the exemption provided by
Section 4(2) of the Securities Act.

<PAGE>

Item 6.  Exhibits and Reports on Form 8-K

(a)      Exhibits

27.1     Financial Data Schedule


(b)      Reports on Form 8-K

         On  February  13,  1998,  the  Company  filed a report on Form 8-K,  as
amended  by  Amendment  No. 1 thereto  on Form  8-K/A  filed on April 14,  1998,
announcing  that on  January  29,  1998 the  merger of ATI with and into CIS,  a
wholly-owned subsidiary of the Company was consummated.

         On February 20, 1998, the Company filed a report on Form 8-K announcing
that the  Company  signed a letter of intent to  acquire  Cherry  Communications
Incorporated d/b/a Resurgens  Communications Group ("RCG"). On May 18, 1998, the
filed a  report  on Form  8-K  announcing  that the  Company  signed  definitive
agreements to acquire RCG and Cherry Communications U.K. Limited.

         On  February  20,  1998,  the  Company  filed a report on Form 8-K,  as
amended by  Amendment  No. 1 thereto on Form 8-K/A filed on February  25,  1998,
announcing  that on  December  31,  1997 the  Company  signed  a Stock  Purchase
Agreement  pursuant to which the Company agreed to acquire  5,113,712  shares of
common stock of NACT from GST  Telecommunications, Inc. (the "Acquisition").  On
March  13,  1998,  the  Company  filed a report on Form 8-K  announcing  that on
February 27, 1998 the  Acquisition was consummated and that on February 24, 1998
the Company agreed to acquire all of the shares of NACT Common Stock not already
then owned by the Company or GST USA, Inc.

         On April 23, 1998,  the Company  filed a report on Form 8-K, as amended
by Amendment No. 1 thereto on Form 8-K/A filed on April 24, 1998, announcing the
resignation of William P. O'Reilly from the Company's Board of Directors.


<PAGE>


                                   SIGNATURES

Pursuant to the  requirements  of the  Securities  and Exchange Act of 1934, the
Registrant  has duly  caused  this  Report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.

                                               WORLD ACCESS, INC.



                                               By: /s/ Mark A. Gergel
                                                   ----------------------------
                                                   Mark A. Gergel
                                                   Executive Vice President and
                                                   Chief Financial Officer

Dated:  May 20, 1998