<PAGE>
                                                                    Exhibit 99.3










WEBCRAFT, INC. EMPLOYEES ACCUMULATED SAVINGS TRUST


FINANCIAL STATEMENTS AND SUPPLEMENTAL
SCHEDULES FOR THE YEARS ENDED
DECEMBER 31, 1998 AND 1997,
AND INDEPENDENT AUDITORS' REPORT





<PAGE>


WEBCRAFT, INC. EMPLOYEES ACCUMULATED SAVINGS TRUST

TABLE OF CONTENTS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                                            PAGE

<S>                                                                         <C>
INDEPENDENT AUDITORS' REPORT                                                  1

FINANCIAL STATEMENTS:

 Statements of Net Assets Available for Benefits
  as of December 31, 1998 and 1997                                            2
 Statement of Changes in Net Assets Available for Benefits
  for the Year Ended December 31, 1998                                        3
 Notes to Financial Statements                                               4-7

SUPPLEMENTAL SCHEDULES:

 Supplemental Schedule of Changes in Plan's Interest in
  Net Assets by Fund for the              Master Trust's
  Year Ended December 31, 1998                                                8

 Item 27A - Supplemental Schedule of Assets Held for Investment Purposes
  as of December 31, 1998                                                     9

 Item 27D - Supplemental Schedule of Reportable Transactions
  for the Year Ended December 31, 1998                                        10

</TABLE>

                            ------------------------


Supplemental Schedules other than the ones listed above have been omitted
because of the absence of conditions under which they are required.


<PAGE>


INDEPENDENT AUDITORS' REPORT


To the Retirement Committee and Participants of
  the Webcraft, Inc. Employees Accumulated Savings Trust

We have audited the accompanying statements of net assets available for benefits
of the Webcraft, Inc. Employees Accumulated Savings Trust (the "Plan") as
of December 31, 1998 and 1997, and the related statement of changes in net
assets available for benefits for the year ended December 31, 1998. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
1998 and 1997, and the changes in net assets available for benefits for the year
ended December 31, 1998 in conformity with generally accepted accounting
principles.

Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of (1)
assets held for investment purposes as of December 31, 1998, and (2)
reportable transactions for the year ended December 31, 1998, are presented
for the purpose of additional analysis and are not a required part of the
basic financial statements, but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure
under the Employee Retirement Income Security Act of 1974. The supplemental
schedule of changes in plan's interest in Master Trust's net assets by fund
is presented for the purpose of additional analysis rather than to present
the net assets available for benefits and changes in net assets available for
benefits of the individual funds. These supplemental schedules are the
responsibility of the Plan's management. Such supplemental schedules have
been subjected to the auditing procedures applied in our audits of the basic
1998 financial statements and, in our opinion, are fairly stated in all
material respects when considered in relation to the basic financial
statements taken as a whole.

/s/ Deloitte & Touche LLP

June 7, 1999


<PAGE>


WEBCRAFT, INC. EMPLOYEES ACCUMULATED SAVINGS TRUST

STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1998 AND 1997
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                               1998            1997
<S>                                                         <C>             <C>
ASSETS

Investments at fair value:
 Plan interest in the Webcraft, Inc. Master Trust for
  401(k) Plans (Note 3)                                     $3,009,413     $       --
 Fidelity Institutional Retirement Money Market Portfolio           --        196,585
 Fidelity Short-Term Bond Portfolio                                 --        110,108
 Fidelity Asset Manager                                             --        210,668
 Fidelity Growth and Income Portfolio                               --        501,235
 Fidelity Magellan Fund                                             --        494,168
 Fidelity Contrafund                                                --        296,491
 Fidelity International Growth and Income Fund                      --        112,242
 Fidelity U.S. Equity Index                                         --         34,484
 Fidelity U.S. Bond Index                                           --            233
 Employee loans receivable                                     186,409         97,702
                                                            ----------     ----------
  Total investments                                          3,195,822      2,053,916
                                                            ----------     ----------

Receivables:
 Employer contributions receivable                              12,932         12,268
 Employees contributions receivable                             65,604         60,010
                                                            ----------     ----------
  Total receivables                                             78,536         72,278
                                                            ----------     ----------
  Total assets                                               3,274,358      2,126,194
                                                            ----------     ----------
LIABILITIES

Accrued administrative expenses                                 34,845             --
                                                            ----------     ----------
NET ASSETS AVAILABLE FOR BENEFITS                           $3,239,513     $2,126,194
                                                            ----------     ----------
                                                            ----------     ----------

</TABLE>


See notes to financial statements.


                                       -2-

<PAGE>

WEBCRAFT, INC. EMPLOYEES ACCUMULATED SAVINGS TRUST

STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1998
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

<S>                                                               <C>
ADDITIONS

Investment income:

  Net appreciation in fair value of investments                   $  252,622
    Interest                                                           4,050
    Dividends                                                         35,015

  Plan interest in the investment income of the
    Webcraft, Inc. Master Trust for 401(k) Plans
    (Note 3)                                                         254,602
                                                                  ----------
                                                                     546,289
Contributions:
 Employer                                                            142,415
 Employees                                                           761,570
                                                                  ----------
                                                                     903,985
                                                                  ----------

 Total additions                                                   1,450,274
                                                                  ----------

DEDUCTIONS

Benefits paid to employees                                           161,264
Administrative expenses                                               39,566
Transfer of contributions to Webcraft Employee Savings Trust         136,125
                                                                  ----------
 Total deductions                                                    336,955
                                                                  ----------

NET INCREASE                                                       1,113,319

NET ASSETS AVAILABLE FOR BENEFITS,
 BEGINNING OF YEAR                                                 2,126,194
                                                                  ----------

NET ASSETS AVAILABLE FOR BENEFITS,
 END OF YEAR                                                      $3,239,513
                                                                  ----------
                                                                  ----------

</TABLE>


See notes to financial statements.


                                       -3-

<PAGE>


WEBCRAFT, INC. EMPLOYEES ACCUMULATED SAVINGS TRUST

NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

1.   DESCRIPTION OF THE PLAN

     The following description of the Webcraft, Inc. Employees Accumulated
     Savings Trust (the "Plan") provides only general information.
     Participants should refer to the Plan Agreement for more complete
     description of the Plan's provisions.

     GENERAL - The Plan is a defined contribution plan covering hourly
     employees of Webcraft, Inc. and Subsidiaries (the "Company") whose
     employment is governed by a collective bargaining agreement providing for
     Plan participation. Eligible employees may enroll on the first semi-annual
     enrollment date after their date of hire upon meeting the eligibility
     requirements. The Plan is subject to the provisions of the Employee
     Retirement Income Security Act of 1974 (ERISA).

     EMPLOYEE CONTRIBUTIONS - An eligible employee who participates may make
     contributions to the Plan, through payroll deductions, of any whole
     percentage from 1% to 17% of his or her annual compensation, up to the
     maximum contribution allowed by the Internal Revenue Code. For the years
     ended December 31, 1998 and 1997, the maximum allowable contribution per
     employee was $10,000 and $9,500, respectively.

     EMPLOYER CONTRIBUTIONS - Matching contributions are made by the Company
     equal to 25% of the first 6% of the participant's contribution. The Company
     may elect to increase this contribution from 25% up to 50%. Also, the
     Company will not match any contributions for participants whose annual base
     salary equals or exceeds $50,000.

     PARTICIPANT ACCOUNTS - Each participant's account is adjusted for the
     participant's contributions and withdrawals, as applicable, the appropriate
     amount of the Company's contributions and an allocation of Plan earnings
     and expenses. Allocations are based upon the participant's proportionate
     share of assets in the Plan.

     FORFEITURES - Forfeitures of non-vested Company contributions are used to
     reduce Company contributions.

     TRANSFERS - If an employee is a participant in either the Webcraft
     Employee Savings Trust (WEST plan) or the Webcraft, Inc. Employees
     Accumulated Savings Trust (EAST plan) and the employee's job status
     changes (i.e. union to non-union or vice-versa), the employee transfers
     all plan assets and loans to the corresponding plan.

     VESTING - All participant contributions and income thereon are fully vested
     at all times. Company contributions and income thereon are vested based on
     the participant's years of service as noted below.

<TABLE>
<CAPTION>

                                                  VESTED
                YEARS OF SERVICE                PERCENTAGE
<S>                                               <C>
          Less than 1                                0%
          At least 1 but less than 2                25
          At least 2 but less than 3                50
          At least 3 but less than 4                75
          4 or more                                100

</TABLE>


                                       -4-

<PAGE>

     In addition, Company contributions and income thereon become fully vested
     upon the participant's retirement on or after age 65 or because of
     disability.

     WITHDRAWALS - During employment, a participant may withdraw amounts
     applicable to participant contributions and income thereon, if the
     participant experiences an immediate and heavy financial hardship, as
     defined in the Plan. In addition, participants may borrow against their
     accounts subject to certain restrictions.

     BENEFIT PAYMENTS - Upon death, disability, termination or retirement, a
     participant's vested values under the Plan may be distributed in a lump sum
     payment or in installments.

     INVESTMENT OPTIONS - The Plan allows a variety of funds in which to invest.
     Set forth below is a brief description of these funds. Participants should
     review each particular fund's prospectus prior to investing. The
     descriptions set forth below are qualified in their entirety by the
     particular prospectus. Upon enrollment in the Plan, a participant may
     direct employer and employee contributions in any of ten investment
     options:

         Fidelity Institutional Retirement Money Market Portfolio - Funds are
         invested in shares of a registered investment company that invests in
         high-quality U.S. dollar-denominated money market instruments of U.S.
         and foreign issuers.

         Fidelity Short-Term Bond Portfolio - Funds are invested in shares of a
         registered investment company that invests in a broad range of
         investment-grade fixed income securities.

         Fidelity Asset Manager - Funds are invested in shares of a registered
         investment company that invests in stocks, bonds and short-term
         investments of U.S. and foreign issuers.

         Fidelity Growth and Income Portfolio - Funds are invested in shares of
         a registered investment company that invests in securities of domestic
         and foreign issuers that offer growth of earnings potential while
         paying current dividends.

         Fidelity Magellan Fund - Funds are invested in shares of a registered
         investment company that invests in equity securities of domestic,
         foreign and multi-national issuers.

         Fidelity Contrafund - Funds are invested in shares of a registered
         investment company that invests in securities of companies, both in the
         U.S. and abroad, that are considered "undervalued" as a result of an
         overly pessimistic appraisal by the public.

         Fidelity International Growth and Income Fund - Funds are invested in
         shares of a registered investment company that invests in foreign
         securities.

         Fidelity U.S. Equity Index - Funds are invested primarily in the 500
         companies that make up the S&P 500 and in other securities that are
         based on the value of the Index.

         Fidelity U.S. Bond Index - Funds are invested primarily in debt
         securities whose performance corresponds to debt securities in the
         Lehman Brothers Aggregate Bond Index.

         Big Flower Stock Fund - Funds are invested primarily in common shares
         of Big Flower Holdings, Inc., the Company's ultimate Parent.
         Participants may not invest more than 10% of their account balance in
         the Big Flower Stock Fund.

     Participants may change their investment options daily.


                                       -5-

<PAGE>


2.   SUMMARY OF ACCOUNTING POLICIES

     BASIS OF PRESENTATION - The accompanying financial statements have been
     prepared on the accrual basis and present the net assets available for plan
     benefits and changes in those net assets.

     USE OF ESTIMATES - 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 revenues and
     expenses during the reporting period. Actual results could differ from
     those estimates.

     VALUATION OF INVESTMENTS - The Plan's investments are stated at fair value.
     Shares of the Fidelity funds are valued at quoted market prices which
     represent the net asset value of shares held by the Plan at year-end.
     Shares of Big Flower stock, included in the Big Flower Stock Fund, are
     valued at their quoted market price. The net asset value for each
     outstanding unit of the Big Flower Stock Fund is determined by the trustee.
     The Plan's interest in the Webcraft, Inc. Master Trust (Note 3) is stated
     at fair value. Quoted market prices are used to value investments in the
     Master Trust.

     PAYMENT OF BENEFITS - Benefit payments to participants are recorded upon
     distribution.

3.   INTEREST IN THE WEBCRAFT, INC. MASTER TRUST

     The Plan has an agreement with the Trustee, whereby, beginning in August
     1998, substantially all of the assets of the Plan are held in the Master
     Trust. The assets are maintained in a commingled account by the Trustee
     The Plan's beneficial interest in the combined investments of the Master
     Trust is determined on the basis of the initial asset contribution to the
     Master Trust, adjusted for subsequent contributions, distributions and
     allocated income and realized and unrealized gains and losses. Allocations
     of investment income and net appreciation (depreciation) in the fair value
     of investments (both realized and unrealized) are determined on the basis
     of proportionate share in the Master Trust's assets stated at market
     value. At December 31, 1998, the Plan's interest in the net assets of the
     Master Trust was approximately 6%. The remaining 94% interest is held by
     another plan sponsored by the Company.


                                       -6-

<PAGE>


     The following table presents the cost and fair value of investments held by
     the Master Trust at December 31, 1998.

<TABLE>
<CAPTION>


                                                                             FAIR
                                                               COST          VALUE

<S>                                                        <C>           <C>
Fidelity Institutional Retirement Money Market Portfolio   $ 2,720,590   $ 2,720,590*
Fidelity Short-Term Bond Portfolio                           5,983,855     5,771,223*
Fidelity Asset Manager                                       3,409,509     3,488,946*
Fidelity Growth and Income Portfolio                        10,661,055    16,374,164*
Fidelity Magellan Fund                                       6,504,261     8,781,264*
Fidelity Contrafund                                          4,945,801     6,392,534*
Fidelity International Growth and Income Fund                1,771,752     1,917,414
Fidelity U.S. Equity Index                                   1,306,517     1,576,718
Fidelity U.S. Bond Index                                       678,340       687,910
Big Flower Stock Fund                                          171,648       176,113
                                                           -----------   -----------
                                                           $38,153,328   $47,886,876
                                                           -----------   -----------
                                                           -----------   -----------

*   Represents the Plan's investments which exceeded 5% of net assets available
    for benefits as of December 31, 1998.

</TABLE>

     Investment income for the Master Trust for the period August 1, 1998 to
     December 31, 1998 is as follows:

<TABLE>
<S>                                              <C>
Investment income:
 Net appreciation in fair value of investments   $1,492,761
 Interest                                            74,732
 Dividends                                        2,335,667
                                                 ----------
                                                 $3,903,160
                                                 ----------
                                                 ----------

</TABLE>

4.   INCOME TAX STATUS

     The Plan has obtained a favorable tax determination letter from the
     Internal Revenue Service dated August 5, 1996 indicating that the Plan
     qualifies under the provisions of Section 401(a) of the Internal Revenue
     Code and that the related trust is exempt from federal income taxes under
     Section 501(a) of the Internal Revenue Code. The Plan has been amended
     since receiving the determination letter. However, in the opinion of
     management, the Plan is designed and is currently being operated in
     compliance with the applicable provisions of the Internal Revenue Code.

5.   ADMINISTRATION OF THE PLAN

     The Plan is administered by the Retirement Committee appointed by the
     Company. Administrative expenses are paid by the Plan.

6.   TERMINATION

     Although it has not expressed any intention to do so, the Company has the
     right under the Plan to terminate the Plan subject to the provisions of
     Employee Retirement Income Security Act of 1974. In the event of the
     Plan's termination, all amounts credited to participants' accounts will
     become 100% vested.

7.   RELATED PARTY TRANSACTIONS

     Certain Plan investments are shares of mutual funds managed by Fidelity
     Institutional Retirement Services Co. ("Fidelity"). Fidelity is the
     trustee as defined by the Plan and, therefore, these transactions qualify
     as party-in-interest. Fees paid by the Plan for the investment
     management services amounted to $18,005 for the year ended December 31,
     1998.

                                    * * * * *

                                       -7-
<PAGE>
<TABLE>
<CAPTION>

WEBCRAFT, INC. EMPLOYEES ACCUMULATED SAVINGS TRUST

SUPPLEMENTAL SCHEDULE OF CHANGES IN PLAN'S INTEREST IN MASTER TRUST'S NET ASSETS BY FUND
FOR THE YEAR ENDED DECEMBER 31, 1998
----------------------------------------------------------------------------------------


                                                                                   Fidelity
                               ---------------------------------------------------------------------------------------------------
                                Retirement                                  Growth                                  International
                                  Money     Short-Term                       and                                       Growth
                                  Market      Bond          Asset           Income      Magellan                     and Income
                                Portfolio   Portfolio      Manager         Portfolio      Fund       Contrafund         Fund
<S>                            <C>          <C>           <C>             <C>           <C>          <C>             <C>
Balance, January 1, 1998       $  206,060   $  115,218    $  217,881      $   517,797   $ 510,905    $ 307,705       $ 116,606
  Contributions                   105,337       65,774        82,396          219,564     217,735      122,445          51,209
  Investment income                15,219        9,239        34,238          164,452     195,577       95,998          14,029
  Loan repayments                  16,084        5,229         4,530           15,751      20,777       11,425           5,128
  Transfer to WEST Plan           (13,379)      (2,099)      (31,932)         (16,502)    (28,959)     (27,765)        (11,785)
  Participant benefits             (6,446)      (6,781)      (15,570)         (59,915)    (18,749)     (35,358)         (8,263)
  Fees and expenses                (3,455)      (2,080)       (3,005)         (10,020)    (12,858)      (5,042)         (1,753)
  Loans to participants           (26,873)     (12,130)      (14,364)         (37,003)    (43,486)     (32,230)         (7,376)
  Transfers between funds          (6,078)        (167)      (17,012)          23,604     (10,008)     (13,319)        (10,210)
Transfer to Master Trust         (286,469)    (172,203)     (257,162)        (817,728)   (830,934)    (423,859)       (147,585)
                               ----------   ----------    ----------      -----------   ---------    ---------       ---------
Balance, December 31, 1998     $        -   $        -    $        -      $         -   $       -    $       -       $       -
                               ==========   ==========    ==========      ===========   =========    =========       =========

<CAPTION>

                                        Fidelity
                                  --------------------

                                      U.S.       U.S.     Big Flower                  Webcraft, Inc.
                                    Equity      Bond        Stock          Loan           Master
                                     Index      Index        Fund          Fund            Trust            Total
<S>                               <C>         <C>         <C>           <C>             <C>              <C>
Balance, January 1, 1998          $  36,064   $    256    $      -      $    97,702     $         -      $ 2,126,194
  Contributions                      37,293      1,096       1,136                -                          903,985
  Investment income                  16,806         56         675                -                          546,289
  Loan repayments                     3,181          -          24          (82,129)                               -
  Transfer to WEST Plan              (3,704)         -           -                -                         (136,125)
  Participant benefits               (3,009)         -           -           (7,173)                        (161,264)
  Fees and expenses                  (1,271)       (15)        (67)               -                          (39,566)
  Loans to participants              (4,547)         -           -          178,009                                -
  Transfers between funds            30,728          -       2,462                -                                -
Transfer to Master Trust           (111,541)    (1,393)     (4,230)               -       3,053,104                -
                                  ---------   --------    --------      -----------     -----------      -----------
Balance, December 31, 1998        $       -   $      -    $      -      $   186,409     $ 3,053,104      $ 3,239,513
                                  =========   ========    ========      ===========     ===========      ===========
</TABLE>


                                      -8-
<PAGE>


WEBCRAFT, INC. EMPLOYEES ACCUMULATED SAVINGS TRUST

ITEM 27A - SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1998
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>

                                                     NUMBER OF
                                                       UNITS        COST          MARKET
<S>                                                  <C>         <C>           <C>
Webcraft, Inc. Master Trust

FIDELITY*:
 Institutional Retirement Money Market Portfolio     2,720,590   $ 2,720,590   $ 2,720,590
 Short-Term Bond Portfolio                             662,597     5,983,855     5,771,223
 Asset Manager                                         200,629     3,409,509     3,488,946
 Growth and Income Portfolio                           357,203    10,661,055    16,374,164
 Magellan Fund                                          72,680     6,504,261     8,781,264
 Contrafund                                            112,564     4,945,801     6,392,534
 International Growth and Income Fund                   91,699     1,771,752     1,917,414
 U.S. Equity Index                                      35,867     1,306,517     1,576,718
 U.S. Bond Index                                        62,423       678,340       687,910
Big Flower Stock Fund                                   17,115       171,648       176,113
                                                                 -----------   -----------
    TOTAL                                                        $38,153,328   $47,886,876
                                                                 -----------   -----------
                                                                 -----------   -----------
Webcraft, Inc. Employees Accumulated Savings
 Trust-Employees Loans                                           $   186,409   $   186,409
                                                                 -----------   -----------
                                                                 -----------   -----------

</TABLE>

*Represents party-in-interest


                                       -9-
<PAGE>


WEBCRAFT, INC. EMPLOYEES ACCUMULATED SAVINGS TRUST

ITEM 27D - SUPPLEMENTAL SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
--------------------------------------------------------------------------------
SERIES OF TRANSACTIONS, WHEN AGGREGATED, INVOLVING AN AMOUNT EXCEEDING 5% OF
THE CURRENT VALUE OF PLAN ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

                                                                                       TOTAL        TOTAL
                                                                TOTAL      TOTAL       DOLLAR       DOLLAR                 NET
    IDENTITY OF PARTY               DESCRIPTION               NUMBER OF    NUMBER     VALUE OF      VALUE     COST OF      GAIN
         INVOLVED                    OF ASSET                 PURCHASES   OF SALES    PURCHASES    OF SALES    ASSET      (LOSS)
<S>                           <C>                              <C>        <C>        <C>          <C>         <C>         <C>
Webcraft, Inc. Master Trust

Fidelity Institutional        Institutional Retirement           172        140      $1,826,067   $1,229,423  $1,229,423  $     --
 Retirement Service Company*  Money Market Portfolio

Fidelity Institutional        Short-Term Bond                    200        151       1,449,985    1,628,481   1,680,640   (52,159)
 Retirement Service Company*  Portfolio

Fidelity Institutional
 Retirement Service Company*  Asset Manager                      167        126       1,547,646      865,361     761,021   104,610

Fidelity Institutional        Growth and Income                  232        172       3,854,235    2,671,476   1,893,639   777,837
 Retirement Service Company*  Portfolio

Fidelity Institutional
 Retirement Service Company*  Magellan Fund                      210        169       2,537,090    1,298,900   1,065,156   233,744

Fidelity Institutional
 Retirement Service Company*  Contrafund                         190        154       1,990,153    1,323,351   1,104,577   218,774

</TABLE>


*Represents party-in-interest

                                      -10-

<PAGE>