UNITED STATES
                        SECURITY AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB
                                  May 14, 1997


                      For the quarter ended: March 31, 1997

                         Commission file number: 0-26322


                                    IAC, Inc.


                              a Nevada corporation
                              IRS Number 88-0303769


                  714 "C" Street, San Rafael, California 94901

                                 (800) 554-1250






Check whether issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 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 __





                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
                                4,272,578 shares.

   Transitional Small Business Disclosure Format (Check one): Yes ___ No _X_



<PAGE>


                         PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements.


                                    IAC, Inc.
                           CONSOLIDATED BALANCE SHEET
                                 March 31, 1997
                                   (Unaudited)

                                     ASSETS
CURRENT ASSETS
Cash in bank                                        $2,129
Prepaid expense                                     10,343
                                                ---------------
TOTAL CURRENT ASSETS                                12,472
                                                ---------------

OTHER ASSETS
Organizational costs, net of amortization            1,969
                                                ---------------

                                                     1,969
                                                ---------------

TOTAL ASSETS                                        $14,441
                                                ===============


                             LIABILITIES AND EQUITY

CURRENT LIABILITIES
Accounts payable                                    $42,641
Other liabilities                                     1,891
                                                ---------------
TOTAL CURRENT LIABILITIES                           $44,532
                                                ---------------


STOCKHOLDERS' EQUITY
Preferred stock, no par value, 5,000,000              2,500
shares authorized; 630,000 outstanding
Capital stock, $.001 par value, 25,000,000            4,273
shares authorized; 4,272,578 shares outstanding
Additional paid in capital                          695,125
Accumulated deficit                                (731,989)
                                                ---------------
                                                    (30,091)
                                                ---------------

LIABILITIES AND STOCKHOLDERS' EQUITY                 $14,441
                                                ===============




See notes to unaudited consolidated financial statements.


<PAGE>


                                    IAC, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                             AND ACCUMULATED DEFICIT
                                   (Unaudited)

                                             Three Months Ended
                                    March 31, 1997            March 31, 1996

REVENUES
    Management fees                     $28,356                   $29,971
    Other income                             26                       684
                                    -----------------    ----------------------
                                        $28,382                   $30,655
                                    -----------------    ----------------------

OPERATING AND GENERAL EXPENSES
Compensation and employee benefits       33,870                    15,912
Promotion and advertising                 3,224                     5,314
Administrative expenses                  42,699                    13,841
                                    -----------------    ----------------------
                                         79,793                    35,067
                                    -----------------    ----------------------
LOSS FROM OPERATIONS                    (51,411)                   (4,412)
                                    -----------------    ----------------------

INCOME TAXES                               (800)                     (800)
                                    -----------------    ----------------------

NET LOSS                                (52,211)                   (5,212)

DEFICIT-beginning of period            (679,778)                 (215,967)
                                    -----------------    ----------------------

DEFICIT- end of period                ($731,989)                ($215,967)
                                    =================    ======================

Loss Per Share                           ($0.01)                   ($0.00)
                                    =================    ======================






See notes to unaudited consolidated financial statements


<PAGE>


                                    IAC, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (Unaudited)


                                                           Three Months Ended
                                                 March 31, 1997  March 31, 1996

CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss                                             ($52,211)      ($5,212)
Adjustment to reconcile net loss to
net cash provided by (used in) operating activities:
   Amortization                                         4,317           180
   Increase in receivable from related party                         (5,393)
   Decrease in refundable payroll taxes                               3,973
   Increase in accounts payable and other liabilities  38,310         1,637
                                                   -------------  -------------
Net Cash Used In Operating Activities                  (9,584)       (4,815)
                                                   -------------  -------------

CASH FLOWS FROM INVESTING ACTIVITIES
                                                   -------------  -------------
Net Cash Used In Investing Activities                        0             0
                                                   -------------  -------------

CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock, net of expenses                        0            600
                                                   -------------   ------------
                                                   -------------   ------------
Net Cash Provided By Financing Activities                    0            600
                                                   -------------   ------------

Net Increase (Decrease) In Cash                         (9,584)        (4,215)
Cash At Beginning Of Period                             11,713         37,967
                                                   =============   ============
Cash At End Of Period                                   $2,129        $33,752
                                                   =============   ============

            Income taxes paid during period                              $800
                                                   =============   ============



See notes to unaudited consolidated financial statements.










<PAGE>


                                    IAC, INC
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  FOR THE PERIODS ENDED MARCH 31, 1997 AND 1996

Note 1 - Organization, operations and basis of presentation:

Organization:

IAC,  Inc.(IAC)  is a Nevada  corporation  engaged in the business of managing a
malpractice insurance contract between International  Associations' Coalitions',
Inc.,  (Coalitions)  a related  party,  and an  insurance  company,  Pacific Rim
Insurance Company, a minority stockholder of IAC. The members of Coalitions' and
its successor,  Health  Professionals  Coalition,  Inc. (Health) are podiatrists
seeking affordable  malpractice insurance.  Under the management contract,  IAC,
Inc. is entitled to receive  27.5% of the premiums  paid by the  podiatrists  to
United and Pacific Rim.

The  term of the  insurance  contract  between  Coalitions'  and  the  insurance
carriers is one year and is generally  renewable if both parties have  performed
satisfactorily.  The  management  contract  with  Coalitions'  also  has a  term
concurrent with the insurance contract.

Coalitions'   is  a  wholly-owned   by  the  Company's   Chairman  and  majority
shareholder.  In September, 1996, the business of Coalitions' was transferred to
a newly created  company,  Health  Professionals  Coalition,  Inc. which is also
wholly owned by IAC's Chairman .

On December 8, 1995,  IAC formed a  subsidiary,  Mt. Tam Re, Inc. In Nevis (in
the West Indies)  with  initial  capital of $25,000. Mt. Tam Re was formed to
provide reinsurance coverage for other insurance companies. See note 4.

Basis of presentation:

The  consolidated  financial  statements have been prepared on the going concern
basis.  IAC has reported a loss during the last two years and the quarter  ended
March 31, 1997. In addition,  its current liabilities  substantially  exceed its
available cash. Losses are expected to continue.

On March 5, 1997, the Company and Health Professionals Coalition,  Inc. signed a
Consent  Cease and Desist  Order  (Cease and Desist  Order)  issued by the Texas
Insurance Commissioner that insurance coverage for podiatrists resident in Texas
must be terminated effective April 21, 1997. In 1996, Health & Coalition, in the
aggregate,  collected insurance premiums of $95,000 from podiatrists residing in
Texas. IAC received related management fees of approximately $26,000 (20% of its
revenue) in 1996. The Cease and Desist Order also requires  payment of a $10,000
fine which was recognized as an expense in the quarter ended March 31, 1997.


<PAGE>


                                    IAC, INC
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  FOR THE PERIODS ENDED MARCH 31, 1997 AND 1996

Note 1 - Organization, operations and basis of presentation (continued):

The Cease and Desist  Order  provides  that IAC and  Health  can in the  future,
accept  payment of  premiums  only if first  authorized  to conduct  business in
Texas. Such  authorization  will be dependent upon formation of a risk retention
group (RRG), or retention of an insurance  broker and insurer licensed in Texas.
Pacific Rim is not licensed in Texas.  Management  was unable to retain a broker
licensed in Texas, or an insurer licensed in Texas by April 21, 1997.  Retention
in the future of some or all of the  revenues  from Texas based  podiatrists  is
dependent upon formation of an RRG.

In 1996, the Company received revenues of approximately  $19,000 from Mt. Tam Re
reinsurance  premiums and a gain from sale of a security  which will not reoccur
in 1997.

The Company has been seeking  funding for the initial  capitalization  of a Risk
Retention  Group (RRG) for  podiatrists.  The Company entered into a contract in
October of 1996 to provide  $600,000  but such  funding has yet to be  received.
This  agreement,  as amended,  provides that upon funding by the  investor,  the
Company must pledge 500,000 shares of convertible  preferred stock. Such pledged
shares can, at the Company's option,  either be from those currently outstanding
or be newly issued shares.  The agreement provides for a success fee of $47,500.
Without a RRG, IAC is unable to  substantially  expand its marketing  efforts to
podiatrists around the country and reduce its dependence upon the limited number
of members of Health.

Note 2 - Accounting Policies:

The process of preparing  financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions regarding certain assets,  liabilities,  revenue and expenses.  Such
estimates  primarily relate to unsettled  transactions and events as of the date
of the financial statements.  Accordingly,  upon settlement,  actual results may
differ.

Revenues are recorded by IAC when insurance premiums are collected by Coalitions
or Health.

Expenses are recorded on the accrual method of accounting.

The  carrying  value of cash,  note  receivable,  accounts  payable  and accrued
liabilities  is  a  reasonable   estimate  of  fair  value  of  these  financial
instruments.



<PAGE>


                                    IAC, INC
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  FOR THE PERIODS ENDED MARCH 31, 1997 AND 1996

Note 3 - Authorized stock:

The Company's  authorized  capital  consists of  25,000,000  shares of $.001 par
value common stock and 5,000,000 shares of no par preferred stock. Each share of
preferred  stock is  entitled to one vote per share and is  convertible  into 10
shares  of  common  stock;  the  preferred  stock  has no  dividend  rights  nor
preference in liquidation.

Note 4 - Mt. Tam Re Trust:

In December  1995, a shareholder  of IAC  deposited  common stock of an Bulletin
Board  company in a trust account  which is held by a domestic  stock  brokerage
firm.  These  securities  are to serve as additional  capital,  for  reinsurance
underwriting  purposes, for Mt. Tam Re, Inc. At March 31, 1997, the value of the
securities held by the trust was $73,500.

Under the terms of the trust agreement, the trustee can require this shareholder
to add  sufficient  securities  to the  trust to  maintain  an  aggregate  value
$500,000 as of each quarter.  In March, 1997, the Company made a demand upon the
shareholder  to add  additional  securities  to the  trust to bring its value to
$500,000.

Note 5 - Income Taxes:

At December 31, 1996,  IAC's  consolidated  net  operating  loss carry  forwards
(NOL's) amounted to approximately $516,000 for federal tax purposes.  These NOLs
will expire from 1999 through 2011. For California  franchise tax purposes,  the
NOL is approximately $258,000 and expires in 2001.





<PAGE>


Item 2.   Management's Discussion and Analysis or Plan of Operation.


The following  discussion relates to the unaudited financial  statements for the
three month  periods  ended March 31, 1997 and 1996 which are included in Item 1
above.

Basis of presentation:

The consolidated financial statements as of March 31, 1997 have been prepared on
the going concern  basis.  IAC has reported a loss during the last two years and
the  quarter  ended  March  31,  1997.  In  addition,  its  current  liabilities
substantially  exceed its available cash. Losses are expected to continue in the
foreseeable future.

On March 5, 1997, the Company and Health Professionals Coalition,  Inc. signed a
Consent  Cease and Desist  Order  (Cease and Desist  Order)  issued by the Texas
Insurance Commissioner that insurance coverage for podiatrists resident in Texas
must be terminated effective April 21, 1997. In 1996, Health & Coalition, in the
aggregate,  collected insurance premiums of $95,000 from podiatrists residing in
Texas. IAC received related management fees of approximately $26,000 (20% of its
revenue) in 1996. The Cease and Desist Order also requires  payment of a $10,000
fine which was recognized as an expense in the quarter ended March 31, 1997.

The Cease and Desist  Order  provides  that IAC and  Health  can in the  future,
accept  payment of  premiums  only if first  authorized  to conduct  business in
Texas. Such  authorization  will be dependent upon formation of a risk retention
group (RRG), or retention of an insurance  broker and insurer licensed in Texas.
Pacific Rim is not licensed in Texas.  Management  was unable to retain a broker
licensed in Texas, or an insurer licensed in Texas by April 21, 1997.  Retention
in the future of some or all of the  revenues  from Texas based  podiatrists  is
dependent upon formation of an RRG.

In 1996, the Company received revenues of approximately  $19,000 from Mt. Tam Re
reinsurance  premiums and a gain from sale of a security  which will not reoccur
in 1997.

The Company has been seeking  funding for the initial  capitalization  of a Risk
Retention  Group (RRG) for  podiatrists.  The Company entered into a contract in
October of 1996 to provide  $600,000  but such  funding has yet to be  received.
This  agreement,  as amended,  provides that upon funding by the  investor,  the
Company must pledge 500,000 shares of convertible  preferred stock. Such pledged
shares can, at the Company's option,  either be from those currently outstanding
or be newly issued shares.  The agreement provides for a success fee of $47,500.
Without a RRG, IAC is unable to  substantially  expand its marketing  efforts to
podiatrists around the country and reduce its dependence upon the limited number
of members of Health.

 Liquidity:

During the past 27 months, IAC has used about $120,000 of cash in its operations
with the result that cash  reserves  have  declined to about $2,000 at March 31,
1997. As of March 31, 1997, IAC's current liabilities of $$44,632  substantially
exceed its cash  resources  of $2,129.  Moreover,  payroll  tax  liabilities  of
$14,050  which  were  due in  April,  1997  remain  unpaid  as of May 12,  1997.
Penalties and interest will be assessed on these unpaid taxes.

Discussion of quarterly results:

Management  fees in the first  quarter  of 1997  declined  $1,600 or 5% from the
preceding  year.  This  was  due  to a  decrease  in  premiums  written  to  the
podiatrists group under management.

During the third quarter of 1996, The Board of Directors  authorized an increase
in the  salary  of the CEO from  $5,000 to  $10,000  per  month  reflecting  the
increased time required to conduct the company's affairs.

Administrative  expenses  increased  largely as a result of an increase in legal
fees of  $6,000,  accounting  fees of $5,000,  amortization  of  Directors'  and
Officer's  liability  insurance  premiums of $4,300 and the nonrecurring cost of
the $10,000 fine imposed by the Texas  Insurance  Commissioner.  The increase in
legal fees resulted from discussions with the Texas Insurance Commissioner which
led to the Cease and Desist Order (see discussion above).

                           PART II - OTHER INFORMATION

Item 1.   Legal Proceedings.
         NA.
Item 2.   Changes in Securities.
         NA.
Item 3.   Defaults Upon Senior Securities.
         NA.
Item 4.   Submission of Matters to a Vote of Security Holders.
         NA.
Item 5.   Other Information.
         NA

Item 6.   Exhibits and Reports on Form 8-K.
         a.  Exhibits
                  Exhibit 27.  Financial Data Schedule

         b.  Reports on Form 8-K.
                  No reports have been filed on Form 8-K during this quarter.


/S/   Dr. Michael Wener, President

May 14, 1997