SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549



                                   FORM 8-K SB

                                 CURRENT REPORT

     PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


        Date of Report (Date of Earliest Event Reported) JANUARY 20, 1998


                           TENGTU INTERNATIONAL CORP.
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             (Exact Name of Registrant as Specified in its Charter)


DELAWARE                         033-27707                    77-0407366
(State or Other                 (Commission                 (I.R.S. Employer
Jurisdiction of                 File Number)                 Identification
                                                                No.)




      Suite 3825
      First Canadian Place, 100 King Street West
      TORONTO, ONTARIO, CANADA                                M5X 1E3
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      (Address of Principal Executive Offices)                (Zip Code)



      (416) 368-8400
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      (Registrant's Telephone Number, Including Area Code)




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ITEM 4.     CHANGES IN REGISTRANTS CERTIFYING ACCOUNTANTS
            ---------------------------------------------

     On January 20, 1998, the Registrant engaged

             Moore Stephens, P.C.
             331 Madison Avenue
             New York, NY 10017,

as its new Independent Auditors.

         The Registrant has addressed the concerns of the former independent
auditors, raised in Registrant's prior form 8-K, and discussed each item with
Moore Stephens, P.C. and such other items as Moore Stephens, P.C. deemed
appropriate in describing whether to accept this engagement. Moore Stephens,
P.C. was consulted by the Registrant with respect to each of the items set forth
in that prior form 8-K.

         As required by Item 304(a)(2) of Regulation S-K, the following
addresses the specific issues raised by the former auditors in the prior 8-K and
the changes made by and responses of the Registrant.

CONCERNS ADDRESSED IN PRIOR FORM 8-K FILING RELATING TO DELOITTE & TOUCHE LLP
("D&T") RESIGNATION.


         A.       LACK OF RELIABLE ACCOUNTING SYSTEMS
                  AND EFFECTIVE INTERNAL CONTROLS.

         The reorganized senior management team (the "Management Team") took
over in April 1997.(1) It hired a Chinese-speaking chartered accountant as its
controller in June, 1997. A new accounting system was established. Internal
control procedures were implemented shortly after the new controller, Simon Hui,
joined the Registrant. The described procedures have been fully implemented.

         In addition, bank statement reconciliations have been completed to
ensure all cash transactions were recorded (and are properly reflected) in the
Registrant's books. The Registrant has also conducted a review of outstanding
invoices to ensure all material transactions have been properly recorded. The
prior accounting firm, D&T, and the Registrant's Controller believe that Tengtu
United, the Chinese joint venture in which the Registrant


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(1) Barry Clark joined the Registrant as its President and Chief Operating
Officer. He is also a Director. Millard Roth joined the Registrant as Special
Consultant, the Chairman of the Company Audit Committee and a Director. The
former President and Corporate Secretary, who were also Directors, are no longer
with the Registrant.


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owns 57%, and its wholly owned subsidiary, have reliable accounting systems and
appropriate internal controls.


         B.   LACK OF ADEQUATE MANAGEMENT
              OVERSIGHT OF ACCOUNTING MATTERS.

         The Registrant believes its former auditors' concerns regarding
management oversight stem from its appraisal of the Registrant's former senior
managers responsible for accounting matters.

         The Management Team is committed to strengthening the Registrant's
accounting systems and internal controls. Two Management Team members have
extensive experience in accounting oversight. Barry Clark, the Registrant's
President, was a Vice- President of IBM Canada and responsible for eleven
divisions of that company's operations. His duties included accounting oversight
for those divisions. Millard Roth, who is currently Chairman of the Audit
Committee, has been an officer and/or director of eight small- to medium-size
public companies. He has extensive experience overseeing accounting matters for
publicly-owned companies. The Registrant's new Controller received a mandate to
take all necessary action to establish appropriate accounting systems and
internal controls. The Management Team has given, and will continue to give, the
new Controller full support.


         C.       LACK OF SUFFICIENT SUPPORTING DOCUMENTATION.

         The Registrant believes that its former auditors' concerns regarding
supporting documentation arose because certain documentation was not available
at that time. This documentation was not then available because new management
had delivered these records to Vancouver counsel, Battle Fowler L.L.P., and
Toronto counsel for their review. The new Controller has now centralized all
accounting records.

         In this connection, the Controller has located all bank statements,
cancelled checks, and substantially all supporting documentation necessary to
enable an outside independent accounting firm to complete its audit for the
fiscal year ended, June 30, 1997. A discussion with the Registrant's former
managers and employees has been completed with respect to any payments for which
sufficient documentation was not previously available. Detailed records and
analyses concerning the foregoing have been prepared, which appear to be
satisfactory to the Registrant's new independent auditors. Where appropriate,
the Registrant's accounting records have been updated.


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         D.       INADEQUATE CONTROL OVER CHECK STOCK AND
                  LACK OF DUAL SIGNATURES OR OTHER CONTROLS.

         During fiscal year ended June 30, 1997, the Registrant maintained
offices in Seattle, Washington; Vancouver, British Columbia; and Toronto,
Ontario. Each office had a portion of the check stock. A designated employee in
each office issued checks. While two signatures were required on check
requisitions, only one signature was required on checks. This procedure may have
caused the former auditors' concern that payments could be made without proper
approval.

         The Registrant now requires two signatures on each check requisition
and each check before a check can be issued. All checks are now issued only by
the Controller and all check stock is maintained under his sole control. The
Registrant has now completed monthly bank statement reconciliations. Payment
accuracy and authorization have been confirmed.

         E.       GOING CONCERN STATUS AND PLANS.

         The Registrant's financial advisor is confident that the Registrant can
raise substantial additional capital to finance its future business plans. The
Registrant, directly, and indirectly through its financial advisor, has received
indications of interest in equity investments, including a term sheet from one
of the prospective investors. A number of North American and international
companies have expressed interest in investing with the Registrant as either
strategic partners or Registrant allies, including a term sheet from a
prospective strategic partner.

         The Registrant's ICONIX subsidiary had a pre-tax profit of
approximately $70,000 for the first seven months of its operations, which ended
on December 31, 1997. It also expects to have a profit and positive cash flow
for the three months ended March 31, 1998. The Registrant's two operating units
in China, (i) animation (wholly owned) and (ii) educational software/hardware
(57% owned joint venture), presently have a negative cash flow at the rate of
approximately $50,000 per month. The Registrant anticipates that both units will
show a positive cash flow in 1998. Nevertheless, the Registrant has instituted a
temporary cash management plan to preserve existing cash until additional
financing or sufficient positive cash flow from its subsidiary and joint venture
is obtained, including obtaining agreements from Registrant's senior officers to
defer their own cash compensation. If necessary, the Registrant has available
collateral, including its ICONIX(2) subsidiary receivables to facilitate
borrowing funds.


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         F.       UNCERTAINTIES AS TO THE LEGAL STATUS OF THE
                  JOINT VENTURE, THE CONTRIBUTIONS OF THE CHINESE
                  PARTNERS,AND THE REQUIRED CHINESE GOVERNMENT APPROVAL.

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(2) ICONIX was formerly the educational computer subsidiary of UNYSIS.

        The Registrant believes its former auditors' concerns arose from its
inability to reconcile its view of accounting requirements for joint ventures
and Chinese law. The auditors focussed on contributions made (or to be made) by
joint venture partners and the question of whether government approvals
necessary for the formation of the joint venture were obtained.

         In fact, all Chinese government approvals required for the original
formation of the joint venture were obtained. The Registrant, however,
recognizes the need to provide clearer information regarding its Chinese joint
venture's nature and legal status. It intends to do so in future periodic
reports.

         The parties to the joint venture have agreed that, due to the
fast-changing nature of information and computing technology, the joint venture
arrangement should be modified. A new joint venture agreement has been prepared
and will be submitted for government approval, after signature by the
Registrant's Chinese partners. It specifies the terms and conditions under which
the Chinese joint venture partners will make contributions.

         G.       COMPLETENESS AND ACCURACY OF
                  ALL COMMON STOCK AND OPTION TRANSACTIONS.

         The Registrant believes its former auditors' concerns regarding
completeness and accuracy of all Common Stock and options transactions arose
when they learned that proceeds received by the Registrant from its issuance and
sale of common stock and warrants were deposited in a lawyer's general trust
account controlled by one of its former senior managers. The attorney had
undertaken responsibility for raising capital. The Registrant believes its
former auditors were concerned as to whether the Registrant had adopted a stock
option plan because the board of directors minutes authorizing the stock option
dated April 25, 1997 were for a form of stock option plan, with the form
attached to the minutes, rather than the adoption of a definitive plan. (3)

         The Registrant believes it has accounted for all cash proceeds from the
sale of its securities through a reconciliation of share proceeds, subscription
agreements and transfer records, including revised subscription agreements, that
the former senior manager prepared. The Registrant's ability to account for cash
proceeds has not been impaired by the co-mingling of funds in the attorney's
general trust account. The Registrant has control over all funds in its account.

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(3) Mr. Cornelissen, an ex-employee, was entitled to receive stock options
thereunder. He has signed a release agreeing to waive all claims against the
Registrant arising out of his employment and a related consulting agreement,
including any claims relating to the stock options.


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         H.       UNCERTAINTIES AS TO COMPLIANCE WITH APPLICABLE SECURITIES
                  LAWS AND PRIOR ISSUANCES AND SALES OF SECURITIES

         The Registrant engaged special counsel, Hecht & Steckman, P.C., to
review and analyze compliance of the issuance of securities with the federal
securities laws. There were four distinct offerings:

            (1)      A Rule 504 distribution at $.05 per share Common
                     Stock and attached warrants, raising $760,875 in June
                     and July 1996. Most of these warrants expire on July
                     30, 1998. To date, none of the warrants has been
                     exercised. The purchasers were primarily Registrant
                     officers and directors, and close associates. All
                     purchasers, with two exceptions, were and are
                     non-residents of the United States. The two United
                     States residents are highly sophisticated
                     professional investors who participated in the
                     subsequent Section 4(2) offering. SEE (3) below.
        
            (2)      A Regulation S placement of Common Stock at $2.25 per
                     share and attached warrants, raising $5,130,999 in
                     October and November 1996. None of these warrants was
                     exercised prior to the August 30, 1997 expiration
                     date.
        
            (3)      A Section 4(2) private placement of $2.25 per share
                     of Common Stock and attached warrants for an
                     aggregate of $2,025,000 in November 1996 to the two
                     investors referred to in (1), above. None of these
                     warrants was exercised prior to the August 30, 1997,
                     expiration date.
        
            (4)      A Regulation S placement of Common Stock at $2.25 per
                     share and attached warrants, raising $348,498 in
                     February 1997. None of these warrants has been
                     exercised. None of these warrants was exercised prior
                     to the November 27, 1997, exercise date.
     
         These transactions were supervised by special United States securities
counsel, Frascona, Joiner and Goodman, P.C. Copies of its opinion letters were
furnished to Hecht & Steckman, P.C. Except for some of the shares in the Rule
504 offering, as to which a restrictive legend is not required, all of the stock
certificates issued in the other three financings were stamped with an
appropriate restrictive legend.

         Battle Fowler L.L.P. was subsequently retained as U.S.
counsel.  On March 14, 1997, it issued stop transfer and other
instructions to the Registrant's transfer agent.  It instructed the
transfer agent (a) not to retransfer any stock certificates, and
(b) if any clean stock certificates came in, not to issue such
stock without a restrictive legend without express permission.
Upon completion of the Hecht & Steckman review, the Registrant


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intends to rescind the general stop transfer letters and to have Hecht &
Steckman, P.C. review each request for transfer or removal of a restrictive
legend on a case-by-case basis.

         A review of the stock transfer records in November 1997 indicates: (i)
each of the purchasers of the stock issued pursuant to Section 4(2) still owns
all of the shares initially purchased; (ii) each of the purchasers of the
Regulation S stock maintained ownership for more than 40 days and, in fact,
almost all of these persons still own the shares purchased in 1996;(4) and (iii)
all of the Rule 504 shares are still owned by the original purchasers or their
designees. The Registrant's special securities counsel has independently
confirmed ownership.

         A review of the transfer agent's records as of November 27, 1997
indicates almost no trading activity in Registrant's securities after July 1,
1996.

         I.       THE FAIRNESS AND RELIABILITY OF PRIOR
                  FINANCIAL STATEMENTS WHICH ARE A
                  SUBJECT OF ANOTHER INDEPENDENT ACCOUNTANT

         The Registrant's former auditors were engaged to audit the Registrant's
financial statements for the fiscal year ended June 30, 1997. The Registrant's
financial statements for the fiscal year ended June 30, 1996 were audited by
different auditors. D&T did not conduct the previous year's audit. Because there
were few transactions during the fiscal year ending June 30, 1996, the
Registrant believes any concerns as to whether material transactions were
properly recorded can be readily confirmed by another audit of the financial
statements with respect to that fiscal year. To the extent there is any need for
an adjustment, appropriate modifications to the financial statements can be
made.

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(4) One of the original purchasers of 450,000 shares appears to have sold or
assigned its shares after the requisite holding period to two other foreign
corporations.


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                                   SIGNATURES

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


                                         TENGTU INTERNATIONAL CORP.
                                         (Registrant)



Date:  January 25, 1998                  By: /s/ Pak Cheung
                                             ------------------
                                             Name:   Pak Cheung
                                             Title:  Chairman