<PAGE>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

(Mark One)

[XX]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
      EXCHANGE ACT OF 1934

For the quarterly period ended   June 30, 1998
                              -------------------------------------------------
                                       OR

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
      EXCHANGE ACT OF 1934

For the transition period from_______________________to________________________
                              _______________________

For Quarter Ended June 30, 1998                Commission File No.  0-21396


                             AFG Investment Trust A
-------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

Delaware                                              04-3145953
---------------------------------------         -------------------------------
(State or other jurisdiction of                      (IRS Employer
 incorporation or organization)                       Identification No.)

88 Broad Street, Boston, MA                           02110
---------------------------------------         -------------------------------
(Address of principal executive offices)             (Zip Code)

Registrant's telephone number, including area code     (617) 854-5800
                                                  -----------------------------

-------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last 
 report.)

     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
                                             -----  -----
                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS

     Indicate by check mark whether the  registrant  has filed all documents and
reports  required  to be filed by  Sections  12, 13, or 15(d) of the  Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court 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      No
                                                     -----   -----

<PAGE>


                             AFG Investment Trust A

                                    FORM 10-Q

                                      INDEX


<TABLE>
<CAPTION>


                                                                           Page

<S>                                                                         <C>
PART I.  FINANCIAL INFORMATION:

    Item 1.   Financial Statements

      Statement of Financial Position
        at June 30, 1998 and December 31, 1997                               3

      Statement of Operations
        for the three and six months ended June 30, 1998 and 1997            4

      Statement of Changes in Participants' Capital
        For the six months ended June 30, 1998                               5

      Statement of Cash Flows
        for the six months ended June 30, 1998 and 1997                      6

      Notes to the Financial Statements                                   7-16


    Item 2.   Management's Discussion and Analysis of Financial
              Condition and Results of Operations                        17-22


PART II.  OTHER INFORMATION:

    Items 1 - 6                                                             23
</TABLE>


                                       2

<PAGE>


                             AFG Investment Trust A

                         STATEMENT OF FINANCIAL POSITION
                       June 30, 1998 and December 31, 1997

                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                                      June 30,              December 31,
                                                                                        1998                    1997
                                                                                    ------------           ------------    
<S>                                                                                      <C>                    <C>
ASSETS

Cash and cash equivalents                                                      $       3,659,184       $      3,176,850
Restricted cash                                                                        2,592,096              2,606,496
Rents receivable                                                                         301,158                533,052
Accounts receivable - affiliate                                                           64,822                305,209
Note receivable - affiliate                                                              462,353                462,353
Investment securities - affiliate                                                        170,376                157,270
Equipment at cost, net of accumulated depreciation
  of $11,096,973 and $11,445,495 at June 30, 1998
  and December 31, 1997, respectively                                                  5,029,632              6,817,333
                                                                               -----------------    -------------------

         Total assets                                                          $      12,279,621       $     14,058,563
                                                                               -----------------    -------------------
                                                                               -----------------    -------------------

LIABILITIES AND PARTICIPANTS' CAPITAL

Notes payable                                                                  $       1,524,696      $       2,342,924
Accrued interest                                                                          17,424                 31,244
Accrued liabilities                                                                      114,534                 11,550
Accrued liabilities - affiliate                                                            3,425                 35,621
Deferred rental income                                                                    12,070                 79,776
Cash distributions payable to participants                                               194,568                195,306
                                                                               -----------------    -------------------

         Total liabilities                                                             1,866,717              2,696,421
                                                                               -----------------    -------------------
                                                                               -----------------    -------------------
Participants' capital (deficit):
     Managing Trustee                                                                    (13,357)               (12,052)
     Special Beneficiary                                                                (106,648)               (92,015)
     Class A Beneficiary Interests (482,016 Interests,
       initial purchase price of $25 each)                                             7,962,021              8,357,529
     Class B Beneficiary Interests (826,072 Interests;
       initial purchase price of $5 each)                                              3,205,299              3,728,691
     Treasury Interests (67,202 Interests at Cost)                                      (634,411)              (620,011)
                                                                               -----------------    -------------------

         Total participants' capital                                                  10,412,904             11,362,142
                                                                               -----------------    -------------------

         Total liabilities and participants' capital                           $      12,279,621      $      14,058,563
                                                                               -----------------    -------------------
                                                                               -----------------    -------------------

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

                                        3

<PAGE>
                             AFG Investment Trust A

                             STATEMENT OF OPERATIONS
            for the three and six months ended June 30, 1998 and 1997

                                   (Unaudited)


<TABLE>
<CAPTION>
                                                              Three Months                               Six Months
                                                              Ended June 30,                           Ended June 30,
                                                         1998              1997                   1998               1997
                                                      ---------         ---------              ---------          ----------
<S>                                                       <C>               <C>                    <C>                 <C>   
Income:

    Lease revenue                                $       549,647   $     1,477,298         $     1,281,535   $     2,567,135

    Interest income                                       76,249            27,119                 155,120            52,919

    Interest income - affiliate                           11,716                --                  23,275                --

    Loss on sale/exchange of equipment                   (77,440)         (364,901)                (78,738)         (362,806)
                                                 ---------------   ---------------         ---------------   ---------------

      Total income                                       560,172         1,139,516               1,381,192         2,257,248
                                                 ---------------   ---------------         ---------------   ---------------

Expenses:

    Depreciation and amortization                        610,333           861,524               1,263,921         1,794,021

    Interest expense                                      25,734            67,229                  57,870           110,587

    Equipment management fees
      - affiliate                                         24,101            49,807                  57,227            94,385

    Operating expenses - affiliate                       165,419            60,403                 215,652            99,260
                                                 ---------------   ---------------         ---------------   ---------------

      Total expenses                                     825,587         1,038,963               1,594,670         2,098,253
                                                 ---------------   ---------------         ---------------   ---------------


Net income (loss)                                $      (265,415)  $       100,553         $      (213,478)  $       158,995
                                                 ---------------   ---------------         ---------------   ---------------
                                                 ---------------   ---------------         ---------------   ---------------

Net income (loss)
  per Class A Beneficiary Interest               $            --   $         0.17          $           --    $         0.26
                                                 ---------------   ---------------         ---------------   ---------------
                                                 ---------------   ---------------         ---------------   ---------------

  per Class B Beneficiary Interest               $        (0.32)   $            --         $        (0.32)   $           --
                                                 ---------------   ---------------         ---------------   ---------------
                                                 ---------------   ---------------         ---------------   ---------------
Cash distributions declared
  per Class A Beneficiary Interest               $         0.41    $         0.41          $         0.82    $         0.82
                                                 ---------------   ---------------         ---------------   ---------------
                                                 ---------------   ---------------         ---------------   ---------------

  per Class B Beneficiary Interest               $         0.16    $            --         $         0.33    $           --
                                                 ---------------   ---------------         ---------------   ---------------
                                                 ---------------   ---------------         ---------------   ---------------
</TABLE>

                   The accompanying notes are an integral part
                         of these financial statements.

                                        4


<PAGE>

                             AFG Investment Trust A

                  STATEMENT OF CHANGES IN PARTICIPANTS' CAPITAL
                     for the six months ended June 30, 1998

                                   (Unaudited)

<TABLE>
<CAPTION>

                                                  Managing       Special          Class A Beneficiaries
                                                  Trustee       Beneficiary       ----------------------
                                                  Amount          Amount         Interests       Amount
                                                  --------      -----------     -----------    -----------   

<S>                                                 <C>            <C>               <C>          <C>        
Balance at December 31, 1997                    $  (12,052)    $  (92,015)       483,816      $ 8,357,529

     Net income (loss)                               5,916         46,021             --               -- 

     Unrealized gain on investment
        securities - affiliate                         131             --             --               -- 
                                                -----------     -----------    -----------     -----------

Comprehensive income                                 6,047         46,021             --               -- 
                                                -----------     -----------    -----------     -----------          

Cash distributions declared                         (7,352)       (60,654)            --         (395,508)

Acquisition of Treasury Interests, at Cost              --             --         (1,800)             --
                                                -----------     -----------    -----------     -----------

Balance at June 30, 1998                        $  (13,357)     $(106,648)       482,016        $7,962,021 
                                                -----------     -----------    -----------     -----------
                                                -----------     -----------    -----------     -----------
</TABLE>

<TABLE>
<CAPTION>
                                                     Class B Beneficiaries
                                                     ---------------------       Treasury
                                                  Interests        Amount        Interests        Total
                                                 -----------    -------------   -----------    -----------

<S>                                                   <C>         <C>            <C>              <C>         
Balance at December 31, 1997                       826,072     $ 3,728,691    $ (620,011)      $ 11,362,142

     Net income (loss)                                  --        (265,415)           --           (213,478)

     Unrealized gain on investment
        securities - affiliate                          --          12,975            --            13,106
                                                -----------     -----------    -----------     -----------

Comprehensive income                                    --        (252,440)           --          (200,372)
                                                -----------     -----------    -----------     -----------

Cash distributions declared                             --        (270,952)           --          (734,466)

Acquisition of Treasury Interests, at Cost              --              --       (14,400)          (14,400)
                                                -----------     -----------    -----------     -----------

Balance at June 30, 1998                           826,072     $ 3,205,299    $ (634,411)      $10,412,904
                                                -----------     -----------    -----------     -----------
                                                -----------     -----------    -----------     -----------
</TABLE>


                   The accompanying notes are an integral part
                         of these financial statements.

                                        5

<PAGE>

                             AFG Investment Trust A

                             STATEMENT OF CASH FLOWS
                 for the six months ended June 30, 1998 and 1997

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                           1998                   1997
                                                                                      ---------------          ----------

<S>                                                                                          <C>                     <C>
Cash flows from (used in) operating activities:
Net income (loss)                                                                       $  (213,478)          $   158,995

Adjustments  to  reconcile  net  income  (loss)  to  net  cash  from   operating
    activities:
         Depreciation and amortization                                                    1,263,921             1,794,021
         Loss on sale/exchange of equipment                                                  78,738               362,806

Changes in assets and liabilities Decrease (increase) in:
         rents receivable                                                                   231,894               (50,147)
         accounts receivable - affiliate                                                    240,387              (105,543)
    Increase (decrease) in:
         accrued interest                                                                   (13,820)              (17,442)
         accrued liabilities                                                                102,984                (8,250)
         accrued liabilities - affiliate                                                    (32,196)               (7,702)
         deferred rental income                                                             (67,706)               (6,598)
                                                                                    ---------------       ---------------

             Net cash from operating activities                                           1,590,724             2,120,140
                                                                                    ---------------       ---------------

Cash flows from investing activities:
    Proceeds from equipment sales                                                           445,042               115,532
                                                                                    ---------------       ---------------

             Net cash from investing activities                                             445,042               115,532
                                                                                    ---------------       ---------------

Cash flows used in financing activities:
    Principal payments - notes payable                                                     (818,228)           (1,005,133)
    Distributions paid                                                                     (735,204)             (495,658)
                                                                                    ---------------       ---------------

             Net cash used in financing activities                                       (1,553,432)           (1,500,791)
                                                                                    ---------------       ---------------

Net increase in cash and cash equivalents                                                   482,334               734,881

Cash and cash equivalents at beginning of period                                          3,176,850             1,832,248
                                                                                    ---------------       ---------------

Cash and cash equivalents at end of period                                          $     3,659,184       $     2,567,129
                                                                                    ---------------       ---------------
                                                                                    ---------------       ---------------

Supplemental disclosure of cash flow information:
      Cash paid during the period for interest                                      $        71,690       $       128,029
                                                                                    ---------------       ---------------
                                                                                    ---------------       ---------------

Supplemental disclosure of non-cash activity:
   See Note 5 to the financialstatements.

</TABLE>


                   The accompanying notes are an integral part
                         of these financial statements.

                                        6


<PAGE>


                             AFG Investment Trust A

                        Notes to the Financial Statements
                                  June 30, 1998

                                   (Unaudited)

NOTE 1 - BASIS OF PRESENTATION

     The financial  statements  presented herein are prepared in conformity with
generally accepted accounting principles and the instructions for preparing Form
10-Q  under  Rule  10-01  of  Regulation  S-X of  the  Securities  and  Exchange
Commission and are unaudited. As such, these financial statements do not include
all  information  and footnote  disclosures  required under  generally  accepted
accounting  principles for complete financial statements and,  accordingly,  the
accompanying  financial  statements  should  be read  in  conjunction  with  the
footnotes presented in the 1997 Annual Report. Except as disclosed herein, there
has been no material change to the information presented in the footnotes to the
1997 Annual Report.

     In the opinion of  management,  all  adjustments  (consisting of normal and
recurring  adjustments)  considered  necessary to present  fairly the  financial
position at June 30, 1998 and  December 31, 1997 and results of  operations  for
the three and six  months  ended  June 30,  1998 and 1997 have been made and are
reflected.

     As of  January  1, 1998,  the  Company  adopted  Statement  130,  Reporting
Comprehensive Income.  Statement 130 establishes new rules for the reporting and
display of  comprehensive  income and its components;  however,  the adoption of
this Statement had no impact on the Trust's net income or participants' capital.
Statement   130   requires   unrealized   gains  or   losses   on  the   Trust's
available-for-sale  securities, which prior to adoption were reported separately
in participants' capital, to be included in comprehensive income. During the six
months ended June 30, 1998, total comprehensive income amounted to $200,372.


NOTE 2 - CASH

     At June 30,  1998,  the Trust had  $6,144,104  invested  in federal  agency
discount notes and reverse repurchase  agreements secured by U.S. Treasury Bills
or interests in U.S. Government securities.  Such cash includes $2,592,096 which
is  classified  as  Restricted  Cash and  represents  the remaining net proceeds
realized  from the  offering of the Class B Interests  less the portion  thereof
used to pay a special  distribution to the Class A  Beneficiaries  and to redeem
Class A Interests (see Notes 9 and 10). A portion of these funds will be used to
pay a Class B Capital  Distribution  (see Note 12). The remainder is expected to
be used  according to terms  negotiated in  conjunction  with settling the Class
Action Lawsuit described in Note 8.


NOTE 3 - REVENUE RECOGNITION

     Rents are payable to the Trust monthly,  quarterly or semi-annually  and no
significant amounts are calculated on factors other than the passage of time. In
certain  instances,  the Trust  may  enter  primary-term,  renewal  or  re-lease
agreements which expire beyond the Trust's  anticipated  dissolution  date. This
circumstance  is not  expected  to prevent  the  orderly  wind-up of the Trust's
business  activities as the Managing  Trustee and the Advisor would seek to sell
the  then-remaining  equipment  assets either to the lessee or to a third party,
taking into  consideration the amount of future  non-cancelable  rental payments
associated  with  the  attendant  lease  agreements.  Future  minimum  rents  of
$1,448,721 are due as follows:

<TABLE>
<CAPTION>

<S>                                                        <C>
     For the year ending June 30,     1999             $  704,542
                                      2000                267,420
                                      2001                206,397
                                      2002                179,149
                                      2003                 91,213
                                                      -----------

                                     Total            $ 1,448,721
                                                      -----------
                                                      -----------
</TABLE>

                                       7
<PAGE>

                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)

NOTE 4 - EQUIPMENT

     The  following  is a summary  of  equipment  owned by the Trust at June 30,
1998.  Remaining  Lease Term (Months),  as used below,  represents the number of
months  remaining  from  June 30,  1998  under  contracted  lease  terms  and is
presented  as a range when more than one lease  agreement  is  contained  in the
stated  equipment  category.  A  Remaining  Lease  Term  equal to zero  reflects
equipment  either held for sale or re-lease or being leased on a  month-to-month
basis.  In the opinion of EFG, the  acquisition  cost of the  equipment  did not
exceed its fair market value.

<TABLE>
<CAPTION>
                                                               Remaining
                                                               Lease Term                       Equipment
        Equipment Type                                          (Months)                         at Cost

<S>                                                                <C>                             <C>         
Aircraft                                                           0-54                   $      6,814,662
Materials handling                                                 0-27                          2,686,098
Communications                                                        6                          1,802,423
Computers and peripherals                                           0-3                          1,334,312
Retail store fixtures                                               0-9                          1,261,032
Construction and mining                                            0-54                          1,206,181
Research and test                                                     0                            459,282
Manufacturing                                                         0                            442,590
Energy systems                                                        0                            108,975
Photocopying                                                         16                             11,050
                                                                                          ----------------

                                                   Total equipment cost                         16,126,605

                                               Accumulated depreciation                        (11,096,973)

                             Equipment, net of accumulated depreciation                   $      5,029,632
                                                                                          ----------------
                                                                                          ----------------

</TABLE>


     At June 30, 1998, the Trust's equipment portfolio included equipment having
a proportionate original cost of $5,484,216,  representing  approximately 34% of
total equipment cost.

     At June 30, 1998, the cost and net book value of equipment held for sale or
re-lease was approximately $2,439,000 and $902,000, respectively. This equipment
includes  the  Trust's  proportionate  interest  in a  McDonnell  Douglas  MD-82
aircraft formerly leased to Alaska Airlines, Inc. with a cost and net book value
of $1,153,983  and  $738,375,  respectively.  The Managing  Trustee is currently
holding  discussions  with a potential  lessee  regarding  the  re-lease of this
aircraft.  The Managing  Trustee is actively seeking the sale or re-lease of all
equipment not on lease. In addition,  the summary above includes equipment being
leased on a month-to-month basis.

NOTE 5 - INVESTMENT SECURITIES - AFFILIATE / NOTE RECEIVABLE - AFFILIATE

     On April 30, 1997, the vessel partnerships,  in which the Trust and certain
affiliated  investment programs are limited partners and through which the Trust
and the affiliated  investment programs shared economic interests in three cargo
vessels (the  "Vessels")  leased by Gearbulk  Shipowning Ltd (formerly  Kristian
Gerhard  Jebsen  Skipsrederi  A/S) (the  "Lessee"),  exchanged  their  ownership
interests in the Vessels for aggregate consideration of $11,565,375,  consisting
of 1,987,000  newly issued shares (at $1.50 per share) of common stock in Semele
Group,  Inc.  (formerly  Banyan  Strategic Land Fund II) ("Semele"),  a purchase
money note of $8,219,500 (the "Note") and cash of $365,375. Semele is a Delaware
corporation  organized  on April 14,  1987 and has its  common  stock  listed on
NASDAQ. At the date of the exchange transaction,  the common stock of Semele had
a net book value of  approximately  $1.50 per share and closing  market value of
$1.00 per share. Semele has one

                                       8
<PAGE>

                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)


principal real estate asset consisting of an undeveloped 274 acre parcel of land
near Malibu, California ("Rancho Malibu").

     The exchange was organized through an intermediary  company (Equis Exchange
LLC,  99% owned by Semele and 1% owned by EFG),  which was  established  for the
sole purpose of  facilitating  the  exchange.  There were no fees paid to EFG by
Equis Exchange LLC or Semele or by any other party that otherwise would not have
been paid to EFG had the  Trust  sold its  beneficial  interest  in the  Vessels
directly  to the Lessee.  The Lessee  prepaid  all of its  remaining  contracted
rental obligations and purchased the Vessels in two closings occurring on May 6,
1997 and May 12, 1997. The Note was repaid with  $3,800,000 of cash and delivery
of a $4,419,500 note from Semele (the "Semele Note").

     As a result of the exchange  transaction  and its  original 33%  beneficial
ownership  interest in Hato Arrow, one of the three Vessels,  the Trust received
$433,036 in cash, became the beneficial owner of 209,694 shares of Semele common
stock  (valued  at  $314,541  ($1.50  per  share)  at the  time of the  exchange
transaction) and received a beneficial  interest in the Semele Note of $462,353.
At June 30,  1998,  Semele  performed  both a reverse  stock split and a forward
stock split  resulting  in a change of the Trust's  beneficial  ownership in its
stock to 20,969 shares. The Semele Note bears an annual interest rate of 10% and
will be amortized over three years with mandatory principal  reductions,  if and
to the  extent  that  net  proceeds  are  received  by  Semele  from the sale or
refinancing of Rancho Malibu.  The Trust  recognized  interest income of $23,275
related  to the Semele  Note  during the six  months  ended June 30,  1998.  The
Trust's  interest in the Hato Arrow had an  original  cost and net book value of
$2,399,580 and $1,185,726,  respectively.  The proceeds realized by the Trust of
$777,326 resulted in a net loss, for financial statement purposes,  of $408,400.
In  addition,  as this  vessel was  disposed of prior to the  expiration  of the
related lease term, the Trust received a prepayment of the remaining  contracted
rent due under the vessel's lease agreement of $432,604.

     Pursuant to terms of the  exchange,  cash equal to the amount of the Semele
Note was placed in a segregated escrow account for the benefit of Semele pending
the  outcome  of certain  shareholder  proposals.  Specifically,  as part of the
exchange,  Semele agreed to seek consent  ("Consent")  from its shareholders to:
(1) amend its  certificate of  incorporation  and by-laws;  (2) make  additional
amendments to restrict the  acquisition  of its common stock in a way to protect
Semele's  net  operating  loss  carry-forwards,  and (3)  engage  EFG to provide
administrative  services to Semele,  which services EFG will provide at cost. On
October 21, 1997,  such Consent was obtained  from  Semele's  shareholders.  The
Consent also allowed for (i) the election of a new Board of Directors  nominated
by EFG for terms of up to three  years and an  increase in the size of the Board
to as many as nine  members,  provided a majority of the Board shall  consist of
members  independent  of Semele,  EFG or any  affiliate;  and (ii) an  amendment
extending Semele's life to perpetual and changing its name from Banyan Strategic
Land Fund II. Contemporaneously with the Consent being obtained, Semele declared
a  $0.20  per  share  dividend  to  be  paid  on  all  shares,  including  those
beneficially  owned by the Trust. A dividend of $41,939 was paid to the Trust on
November 17, 1997.  This  dividend  represented a return of equity to the Trust,
which  proportionately  reduced the Trust's investment in Semele.  Subsequent to
the exchange transaction,  Gary D. Engle,  President and Chief Executive Officer
of EFG,  was elected to the Board of Directors  and  appointed  Chief  Executive
Officer  of Semele  and James A.  Coyne,  Executive  Vice  President  of EFG was
appointed  Semele's  President and Chief Operating  Officer,  and elected to the
Board of Directors.

     In accordance with Financial  Accounting Standards Board Statement No. 115,
Accounting  for Certain  Investments in Debt and Equity  Securities,  marketable
equity securities classified as available-for-sale are required to be carried at
fair value. On June 30, 1998,  Semele  effected a 1-for-300  reverse stock split
followed by a 30-for-1  forward  stock  split  resulting  in a reduction  of the
number of shares of Semele  common  stock  owned by the Trust to 20,969  shares.
During the six months  ended June 30,  1998,  the Trust  increased  the carrying
value of its  investment  in Semele common stock to $8.125 per share (the quoted
price of the Semele stock on NASDAQ at June 30, 1998) resulting in an unrealized
gain in 1998 of $13,106.  This gain was reported as a component of comprehensive
income,  included in participants'  capital.  The split adjusted market price of
Semele's stock was $7.50 per share at December 31, 1997.

                                       9
<PAGE>

                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)


NOTE 6 - RELATED PARTY TRANSACTIONS

     All operating  expenses  incurred by the Trust are paid by EFG on behalf of
the Trust and EFG is reimbursed at its actual cost for such  expenditures.  Fees
and other costs  incurred  during the six month  periods ended June 30, 1998 and
1997,  which were paid or accrued by the Trust to EFG or its Affiliates,  are as
follows:

<TABLE>
<CAPTION>

                                                              1998                   1997
                                                        ----------------         ----------
<S>                                                         <C>                    <C>
     Equipment management fees                          $        57,227      $         94,385
     Administrative charges                                      34,140                30,114
     Reimbursable operating expenses
         due to third parties                                   181,512                69,146
                                                        ---------------      ----------------

                                     Total              $       272,879      $        193,645
                                                        ---------------      ----------------
                                                        ---------------      ----------------
</TABLE>


     All rents and  proceeds  from the sale of  equipment  are paid  directly to
either  EFG or to a  lender.  EFG  temporarily  deposits  collected  funds  in a
separate  interest-bearing  escrow account prior to remittance to the Trust.  At
June 30, 1998, the Trust was owed $64,822 by EFG for such funds and the interest
thereon. These funds were remitted to the Trust in July 1998.

     Refer  to  Note 9  regarding  the  purchase  of  Class  B  Interests  by an
affiliate,  Equis II  Corporation  and a change  in  ownership  of the  Managing
Trustee.

NOTE 7 - NOTES PAYABLE

     Notes payable at June 30, 1998 consisted of installment notes of $1,524,696
payable  to banks and  institutional  lenders.  The notes  bear  interest  rates
ranging  between  5.7% and 8.9%,  except for one note which bears a  fluctuating
interest rate based on LIBOR (5.66% at June 30, 1998) plus a margin.  All of the
installment  notes are non-recourse and are  collateralized by the equipment and
assignment of the related lease payments.  Generally, the installment notes will
be fully amortized by  noncancellable  rents.  However,  the Trust has a balloon
payment  obligation  of $282,421  at the  expiration  of the primary  lease term
related to its  interest in an aircraft  leased to Reno Air,  Inc.  The carrying
amount of notes payable approximates fair value at June 30, 1998.

     The annual maturities of the notes payable are as follows:

<TABLE>

<S>                                     <C>                    <C>
     For the year ending June 30,      1999               $     821,293
                                       2000                     113,911
                                       2001                     123,188
                                       2002                     133,220
                                       2003                     333,084
                                                          -------------

                                      Total               $   1,524,696
                                                          -------------
                                                          -------------
</TABLE>

                                       10

<PAGE>


                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)



NOTE 8 - LEGAL PROCEEDINGS

     On or about January 15, 1998, certain plaintiffs (the "Plaintiffs") filed a
class and  derivative  action,  captioned  Leonard  Rosenblum,  et al. v.  Equis
Financial Group Limited Partnership, et al., in the United States District Court
for the Southern District of Florida (the "Court") on behalf of a proposed class
of investors in 28 equipment  leasing programs  sponsored by EFG,  including the
Trust (collectively, the "Nominal Defendants"),  against EFG and a number of its
affiliates,  including the Managing Trustee,  as defendants  (collectively,  the
"Defendants").  Certain of the Plaintiffs,  on or about June 24, 1997, had filed
an earlier  derivative  action,  captioned  Leonard  Rosenblum,  et al. v. Equis
Financial  Group  Limited  Partnership,  et al.,  in the  Superior  Court of the
Commonwealth of  Massachusetts on behalf of the Nominal  Defendants  against the
Defendants.  Both  actions  are  referred to herein  collectively  as the "Class
Action Lawsuit."

     The  Plaintiffs  have  asserted,  among other  things,  claims  against the
Defendants on behalf of the Nominal  Defendants for violations of the Securities
Exchange Act of 1934, common law fraud, breach of contract,  breach of fiduciary
duty, and violations of the partnership or trust  agreements that govern each of
the Nominal  Defendants.  The Defendants have denied, and continue to deny, that
any of them have  committed or  threatened  to commit any  violations  of law or
breached any fiduciary duties to the Plaintiffs or the Nominal Defendants.

     On July 16, 1998, counsel for the Defendants and the Plaintiffs  executed a
Stipulation of Settlement setting forth the terms pursuant to which a settlement
of the Class Action  Lawsuit is intended to be achieved  and which,  among other
things,  is expected to reduce the burdens and expenses  attendant to continuing
litigation.  The  Stipulation  of  Settlement  was based upon and  supersedes  a
Memorandum  of  Understanding  between  the  parties  dated  March 9, 1998 which
outlined the terms of a possible settlement.

     The Stipulation of Settlement was filed with the Court on July 23, 1998 and
remains pending.  Ultimately,  the Court must review and approve the Stipulation
of Settlement  prior to its becoming  effective.  Further,  the  Stipulation  of
Settlement prescribes certain conditions necessary to effecting a settlement and
contemplates  various  changes  that,  if  effected,   would  alter  the  future
operations  of the  Nominal  Defendants  (see Note 11).  To the extent  that the
Stipulation  of Settlement is approved by the Court,  the complete terms thereof
will be  communicated to all of the  beneficiaries  (or partners) of the Nominal
Defendants.

     There  can be no  assurance  that the  Stipulation  of  Settlement  will be
approved by the Court.  However,  the Managing  Trustee and its  affiliates,  in
consultation  with counsel,  concur that there is a reasonable  basis to believe
that the Stipulation of Settlement will be approved by the Court. In the absence
of a Stipulation of Settlement  approved by the Court, the Defendants  intend to
defend vigorously  against the claims asserted in the Class Action Lawsuit.  The
Managing Trustee and its affiliates  cannot predict with any degree of certainty
the ultimate outcome of such litigation.

     On July 27,  1995,  EFG,  on behalf  of the  Trust and other  EFG-sponsored
investment  programs,  filed an  action  in the  Commonwealth  of  Massachusetts
Superior  Court  Department of the Trial Court in and for the County of Suffolk,
for damages and declaratory relief against a lessee of the Trust, National Steel
Corporation  ("National Steel"),  under a certain Master Lease Agreement ("MLA")
for the lease of certain equipment. EFG is seeking the reimbursement by National
Steel of certain  sales and/or use taxes paid to the State of Illinois and other
remedies provided by the MLA. On August 30, 1995,  National Steel filed a Notice
of Removal which removed the case to the United States District Court,  District
of Massachusetts. On September 7, 1995, National Steel filed its Answer to EFG's
Complaint along with Affirmative Defenses and Counterclaims, seeking declaratory
relief and alleging breach of contract,  implied covenant of good faith and fair
dealing and specific performance. EFG filed its Answer to these counterclaims on
September 29, 1995. Though the parties discussed settlement with respect to this
matter for some time, the negotiations were unsuccessful.  Notwithstanding these
discussions,  EFG recently filed an Amended and Supplemental  Complaint alleging
further  default  under  the MLA and EFG  recently  filed a motion  for  Summary
Judgment  on all  claims  and  counterclaims.  The Court held a hearing on EFG's
motion in December  1997 and the Court  recently  entered a decision  dismissing
certain of National Steel's counterclaims and finding in 

                                       11
<PAGE>


                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)


favor of EFG on certain  issues and in favor of National  Steel on other issues.
The  parties  have  since  resumed  settlement  discussions.  The Trust does not
anticipate  that it will  experience  any  material  losses  as a result of this
action.

NOTE 9 - ISSUANCE OF CLASS B INTERESTS

     On October 26,  1996,  the Trust filed a  Solicitation  Statement  with the
United States Securities and Exchange  Commission (the "SEC") which subsequently
was sent to the  Beneficiaries  pursuant to Regulation  14A of Section 14 of the
Securities  Exchange Act. The  Solicitation  Statement sought the consent of the
Beneficiaries  to a proposed  amendment  (the  "Amendment")  to the  Amended and
Restated  Declaration of Trust (the "Amended Trust  Agreement")  which would (i)
amend the provisions of the Amended Trust Agreement  governing the redemption of
Beneficiary  Interests  to  permit  the  Trust to offer  to  redeem  outstanding
Beneficiary Interests at such times, in such amounts, in such manner and at such
prices as the Managing  Trustee might determine from time to time, in accordance
with  applicable  law; and (ii) add a provision to the Amended  Trust  Agreement
that would permit the Trust to issue, at the discretion of the Managing  Trustee
and without  further  consent or approval of the  Beneficiaries,  an  additional
class  of  security   with  such   designations,   preferences   and   relative,
participating,  optional  or other  special  rights,  powers  and  duties as the
Managing  Trustee might affix. The funds obtained through the issuance of such a
security  were  intended  to be  used  by the  Trust  to (a)  expand  redemption
opportunities for Beneficiaries  without using Trust funds which might otherwise
be  available  for cash  distributions;  and (b) make a  special  one-time  cash
distribution to the Class A Beneficiaries.

     Pursuant to the Amended  Trust  Agreement,  the  adoption of the  Amendment
required the consent of the Beneficiaries holding more than 50% in the aggregate
of the Class A Interests held by all Class A Beneficiaries.  A majority of Class
A Interests,  representing  286,868 Interests or 52.2% of all Class A Interests,
voted  in  favor  of the  Amendment;  49,019  Interests  or 8.9% of all  Class A
Interests voted against the Amendment; and 16,104 Interests or 2.9% of all Class
A Interests abstained.  Approximately 64% of all Class A Interests  participated
in the vote. Accordingly, the Amendment was adopted.

     On February 12, 1997, the Trust filed a Registration  Statement on Form S-1
with the SEC, which became effective June 10, 1997. The  Registration  Statement
covered the  issuance  and sale of a new class of  beneficiary  interests in the
Trust (the "Class B Interests").  The  characteristics of the Class B Interests,
associated risk factors and other matters of importance to the Beneficiaries and
purchasers of the Class B Interests  were set forth in a Prospectus  sent to the
Beneficiaries.  On July 17, 1997,  the offering  closed and on July 18, 1997 the
Trust issued 826,072 Class B Interests at $5.00 per interest, thereby generating
$4,130,360 in aggregate  Class B capital  contributions.  Class A  Beneficiaries
purchased 3,209 Class B Interests,  generating $16,045 of such aggregate capital
contributions,  and the Special  Beneficiary,  EFG,  purchased  822,863  Class B
Interests,  generating $4,114,315 of such aggregate capital  contributions.  The
Trust incurred offering costs in the amount of $41,304 and professional  service
costs of $54,186 in connection with this offering.

     Subsequently,  EFG transferred  its Class B Interests to a  special-purpose
company, Equis II Corporation, a Delaware corporation.  EFG also transferred its
ownership of AFG ASIT  Corporation,  the Managing Trustee of the Trust, to Equis
II  Corporation.  As a result,  Equis II  Corporation  has voting control of the
Trust  through its  ownership of the majority of all of the Trust's  outstanding
voting  interests,  as well as its ownership of AFG ASIT  Corporation.  Equis II
Corporation is controlled by EFG's President and Chief Executive  Officer,  Gary
D.  Engle.  Accordingly,  control of the  Managing  Trustee  did not change as a
result of the foregoing transactions.

     As described in the  Prospectus  for the offering of the Class B Interests,
the Managing  Trustee used a portion of the net cash proceeds  realized from the
offering of the Class B Interests to pay a one-time special cash distribution of
approximately  $1.47 per Class A Interest  to the Class A  Beneficiaries  of the
Trust. The Managing  Trustee  declared and paid this special cash  distribution,
aggregating  $808,363,  to Class A Beneficiaries on August 15, 1997. See Note 10
regarding the redemption of Class A Interests.

                                      12
<PAGE>


                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)


NOTE 10 - REDEMPTION OF CLASS A INTERESTS

     On August 7, 1997,  the Trust  commenced  an offer to purchase up to 45% of
the  outstanding  Class A  Beneficiary  Interests  of the Trust by filing a Form
13E-4, Issuer Tender Offer Statement, with the SEC and distributing to the Class
A Beneficiaries information concerning the offer. On October 10, 1997, the Trust
used  $620,011 of the net  proceeds  realized  from the  issuance of the Class B
Interests  to purchase  65,402 of the Class A Interests  tendered as a result of
the offer. The Tender Documents described,  among other things, the terms of the
offer and the purchase price per Class A Interest being offered by the Trust. On
April 28,  1998,  the Trust  used an  additional  $14,400  of such  proceeds  to
purchase 1,800 of the remaining Class A Interests.


NOTE 11 - SOLICITATION STATEMENT

     On May 5, 1998,  the Trust filed a definitive  Solicitation  Statement with
the United States  Securities  and Exchange  Commission  in connection  with the
solicitation  by the Trust of the  consent  of the  Beneficiaries  to a proposed
amendment (the  "Amendment")  to the Second Amended and Restated  Declaration of
Trust  (the  "Trust  Agreement").  The  Solicitation  Statement  and  Consent of
Beneficiary were mailed to all of the Beneficiaries of the Trust on May 6, 1998.
The  Beneficiaries  were  requested to use the Consent of Beneficiary to vote on
seven  proposals  and return  their  votes on or before  June 5, 1998.  Equis II
Corporation,  which has voting  control of the Trust,  agreed to vote all of its
Class B  Interests  in the same  manner  in which  the  majority  of the Class A
Interests were actually  voted.  Accordingly,  the Amendment would be adopted or
rejected based upon the voting results of the majority of Class A Interests that
were actually voted  (including  1,702 Class A Interests  owned by affiliates of
EFG), regardless of how few Class A Interests were actually voted.

     The results of the voting are presented  herein and reflect that a majority
of Class A Interests  were voted in favor of each of the  proposals.  Therefore,
the Trust Agreement will be amended to (i) broaden the Trust's stated investment
policies  and  objectives  and permit  the Trust to invest in assets  other than
leased equipment and (ii) modify the Trust's  financing  provisions to eliminate
any cap on the amount of aggregate  Trust  indebtedness  and permit the Trust to
use cross-collateralized and other recourse debt structures.

     In addition,  subject to attaining a settlement in the Class Action Lawsuit
described  in  Note 8  herein,  the  Trust  Agreement  will be  modified  in the
following principal respects: (i) the Trust will pay a Special Cash Distribution
to the Class A  Beneficiaries  of record as of  September  1, 1997,  or to their
successors or assigns,  totaling  $413,247 (or  approximately  $0.75 per Class A
Beneficiary  Interest) using a portion of the Class B capital contributions that
otherwise  would be  distributed as a Class B Capital  Distribution  to Equis II
Corporation, the parent company of the Managing Trustee and an affiliate of EFG;
(ii) Equis II  Corporation  will be required to reduce its  prospective  Class B
Capital  Distributions  by $929,806 and treat such amount as a long-term  equity
investment in the Trust;  (iii) certain voting  restrictions will be placed upon
the  Class  B  Interests  owned  by  Equis  II  Corporation;  (iv)  the  Trust's
reinvestment  period,  which  originally  expired  on  May  29,  1996,  will  be
reinstated  until  December 31, 2001;  and (v)  acquisition  fees paid to EFG in
connection  with  reinvestment  assets acquired after the Amendment date will be
reduced from a maximum of 3% to 1% and management fees earned in connection with
such assets will be reduced from a maximum of 5% to 2%.

     The  voting  results  submitted  by the  Beneficiaries  on the  Consent  of
Beneficiary  forms  returned  to the  Managing  Trustee in  connection  with the
Solicitation Statement are summarized below:

                                       13
<PAGE>


                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)


Proposal 1.  Subject to  attaining a  settlement  in the Class  Action  Lawsuit,
provide for a special cash distribution to Class A Beneficiaries.

<TABLE>
<CAPTION>
                                                                 Class A Interests         Class B Interests

<S>                                                                        <C>                       <C>    
Total Interests of record                                                  483,816                   826,072
Total votes returned                                                       216,195                   825,906
Percentage returned                                                          44.7%                     99.9%
Votes in favor                                                             193,758                   825,075
Percentage (of total returned) in favor                                      89.6%                     99.9%
Votes against                                                               14,920                       831
Percentage (of total returned) against                                        6.9%                      0.1%
Votes abstaining                                                             7,517                         0
Percentage (of total returned) abstaining                                     3.5%                         0

</TABLE>

Proposal 2.  Subject to  attaining a  settlement  in the Class  Action  Lawsuit,
provide  for an  additional  commitment  of  funds  to the  Trust  by  Equis  II
Corporation.

<TABLE>
<CAPTION>
                                                                 Class A Interests         Class B Interests

<S>                                                                        <C>                       <C>    
Total Interests of record                                                  483,816                   826,072
Total votes returned                                                       216,195                   825,906
Percentage returned                                                          44.7%                     99.9%
Votes in favor                                                             192,558                   825,075
Percentage (of total returned) in favor                                      89.1%                     99.9%
Votes against                                                               14,920                       831
Percentage (of total returned) against                                        6.9%                      0.1%
Votes abstaining                                                             8,717                         0
Percentage (of total returned) abstaining                                     4.0%                         0

</TABLE>

Proposal 3. Permit the Trust to acquire property in addition to equipment.

<TABLE>
<CAPTION>
                                                                 Class A Interests         Class B Interests

<S>                                                                        <C>                       <C>    
Total Interests of record                                                  483,816                   826,072
Total votes returned                                                       216,195                   825,906
Percentage returned                                                          44.7%                     99.9%
Votes in favor                                                             183,598                   825,075
Percentage (of total returned) in favor                                      84.9%                     99.9%
Votes against                                                               22,680                       831
Percentage (of total returned) against                                       10.5%                      0.1%
Votes abstaining                                                             9,917                         0
Percentage (of total returned) abstaining                                     4.6%                         0

</TABLE>


                                       14
<PAGE>


                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)



Proposal 4.  Extend the Trust's reinvestment period.

<TABLE>
<CAPTION>

                                                                 Class A Interests         Class B Interests

<S>                                                                        <C>                       <C>    
Total Interests of record                                                  483,816                   826,072
Total votes returned                                                       216,195                   825,906
Percentage returned                                                          44.7%                     99.9%
Votes in favor                                                             182,798                   825,075
Percentage (of total returned) in favor                                      84.5%                     99.9%
Votes against                                                               24,600                       831
Percentage (of total returned) against                                       11.4%                      0.1%
Votes abstaining                                                             8,797                         0
Percentage (of total returned) abstaining                                     4.1%                         0

</TABLE>


Proposal 5. Modify certain fees payable to the Managing Trustee and EFG.

<TABLE>
<CAPTION>

                                                                 Class A Interests         Class B Interests

<S>                                                                    <C>                        <C>
Total Interests of record                                                  483,816                   826,072
Total votes returned                                                       216,195                   825,906
Percentage returned                                                          44.7%                     99.9%
Votes in favor                                                             186,078                   825,075
Percentage (of total returned) in favor                                      86.1%                     99.9%
Votes against                                                               20,280                       831
Percentage (of total returned) against                                        9.4%                      0.1%
Votes abstaining                                                             9,837                         0
Percentage (of total returned) abstaining                                     4.5%                         0

</TABLE>

Proposal 6.  Subject to  attaining a  settlement  in the Class  Action  Lawsuit,
impose voting restrictions on Class B Interests.

<TABLE>
<CAPTION>

                                                                 Class A Interests         Class B Interests

<S>                                                                        <C>                       <C>    
Total Interests of record                                                  483,816                   826,072
Total votes returned                                                       216,195                   825,906
Percentage returned                                                          44.7%                     99.9%
Votes in favor                                                             188,758                   825,075
Percentage (of total returned) in favor                                      87.3%                     99.9%
Votes against                                                               17,520                       831
Percentage (of total returned) against                                        8.1%                      0.1%
Votes abstaining                                                             9,917                         0
Percentage (of total returned) abstaining                                     4.6%                         0

</TABLE>
                                       15

<PAGE>


                             AFG Investment Trust A

                        Notes to the Financial Statements

                                   (Continued)



Proposal 7. Remove the current  limitations  on the amount and terms of the debt
the Trust may incur and modify the requirements with respect to joint ventures.

<TABLE>
<CAPTION>
                                                                 Class A Interests         Class B Interests

<S>                                                                        <C>                       <C>    
Total Interests of record                                                  483,816                   826,072
Total votes returned                                                       216,195                   825,906
Percentage returned                                                          44.7%                     99.9%
Votes in favor                                                             179,531                   825,075
Percentage (of total returned) in favor                                      83.1%                     99.9%
Votes against                                                               27,947                       831
Percentage (of total returned) against                                       12.9%                      0.1%
Votes abstaining                                                             8,717                         0
Percentage (of total returned) abstaining                                     4.0%                         0

</TABLE>


NOTE 12 - SUBSEQUENT EVENT

     The Managing Trustee and certain of its affiliates were named as defendants
in the Class Action Lawsuit  discussed in Note 8 herein. In connection with this
litigation and subject to a settlement being effected,  the Managing Trustee has
agreed to adopt certain modifications to the Trust Agreement as described in the
Solicitation Statement referred to in Note 11 herein. One aspect of the proposed
settlement would result in using of a portion of Equis II Corporation's  Class B
Capital  Contribution to the Trust to (i) pay a second special cash distribution
to Class A  Beneficiaries  totaling  $413,247,  approximately  $.75 per  Class A
Benficiary Interest,  and (ii) invest $929,806 in the Trust's long-term business
activities.  The remainder of the Class B Capital  Contributions  (not otherwise
used to  repurchase  Class A Interests in the Tender Offer closed on October 10,
1997 or to pay for  offering  and  related  costs  associated  with the  Class B
Interests or to pay the first special cash  distribution),  $1,263,443 in total,
was returned to Equis II  Corporation  and the other third party Class B capital
contributors on July 6, 1998.


                                       16
<PAGE>


                             AFG Investment Trust A

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION


Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations.

     Certain  statements in this quarterly report of AFG Investment Trust A (the
"Trust") that are not historical  fact constitute  "forward-looking  statements"
within the meaning of the Private  Securities  Litigation Reform Act of 1995 and
are  subject  to a  variety  of risks and  uncertainties.  There are a number of
important  factors that could cause  actual  results to differ  materially  from
those expressed in any  forward-looking  statements  made herein.  These factors
include,  but are not  limited  to,  the  outcome  of the Class  Action  Lawsuit
described in Note 8 to the accompanying financial statements, and the ability of
Equis  Financial Group Limited  Partnership  (formerly  American  Finance Group)
("EFG"),  to collect all rents due under the attendant  lease  agreements and to
successfully remarket the Trust's equipment, upon the expiration of such leases.

     The Year 2000 Issue is the result of computer  programs being written using
two digits rather than four digits to define the applicable year. EFG's computer
programs were  designed and written  using four digits to define the  applicable
year. As a result,  EFG does not anticipate  system  failure or  miscalculations
causing disruptions of operations.  Based on recent assessments,  EFG determined
that minimal  modification of software is required so that its network operating
system  will  function  properly  with  respect  to dates  in the year  2000 and
thereafter. EFG believes that with these modifications to the existing operating
system, the Year 2000 Issue will not pose significant  operational  problems for
its computer  systems.  EFG will utilize internal  resources to upgrade software
for Year 2000 modifications and anticipates  completing the Year 2000 project by
December 31, 1998,  which is prior to any  anticipated  impact on its  operating
system.  The total cost of the Year 2000 project is expected to be insignificant
and have no effect on the results of operations of the Trust.

Three and six months  ended June 30,  1998  compared to the three and six months
ended June 30, 1997:

Overview

     As an  equipment  leasing  trust,  the Trust  was  organized  to  acquire a
diversified  portfolio of capital  equipment  subject to lease  agreements  with
third  parties.  The Trust was  designed to  progress  through  three  principal
phases: acquisitions,  operations, and liquidation. During the operations phase,
a period of approximately six years, all equipment in the Trust's portfolio will
progress through various stages.  Initially,  all equipment will generate rental
revenues  under  primary  term lease  agreements.  During the life of the Trust,
these  agreements  will  expire  on an  intermittent  basis and  equipment  held
pursuant to the related leases will be renewed,  re-leased or sold, depending on
prevailing  market  conditions and the  assessment of such  conditions by EFG to
obtain the most advantageous  economic benefit.  Over time, a greater portion of
the Trust's original  equipment  portfolio will become available for remarketing
and  cash  generated  from  operations  and  from  sales  or  refinancings  will
fluctuate.  Presently,  the  Trust  is a  Nominal  Defendant  in a Class  Action
Lawsuit. The outcome of the Class Action Lawsuit could alter the future business
operations of the Trust.  See Note 8 to the accompanying  financial  statements.
The Trust's operations commenced in 1992.

Results of Operations

     For the three and six months  ended  June 30,  1998,  the Trust  recognized
lease revenue of $549,647 and $1,281,535,  respectively,  compared to $1,477,298
and  $2,567,135 for the same periods in 1997. The decrease in lease revenue from
1997 to 1998  resulted  principally  from the exchange in the second  quarter of
1997  of the  Trust's  interest  in a  vessel,  as  described  in  Note 5 to the
accompanying  financial  statements.  During the six months ended June 30, 1997,
the Trust  recognized  lease revenue of $565,318  related to this vessel.  Other
reductions  in lease  revenue from 1997 to 1998 occurred from primary lease term
expirations  and the  sale of  equipment.  The  level  of  lease  revenue  to be
recognized  by the Trust in the future may be impacted by the  Amendment  to the
Trust Agreement  described in Note 9 to the accompanying  financial  statements;
however, the extent of such impact cannot be determined at this time.

                                       17

<PAGE>

                             AFG Investment Trust A

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION

     The Trust's equipment  portfolio includes certain assets in which the Trust
holds a proportionate ownership interest. In such cases, the remaining interests
are owned by EFG or an affiliated  equipment  leasing program  sponsored by EFG.
Proportionate  equipment  ownership  enables the Trust to further  diversify its
equipment  portfolio  by  participating  in the  ownership  of selected  assets,
thereby  reducing  the  general  levels  of  risk  which  could  result  from  a
concentration  in any single equipment type,  industry or lessee.  The Trust and
each affiliate  individually report, in proportion to their respective ownership
interests,  their  respective  shares  of  assets,  liabilities,  revenues,  and
expenses associated with the equipment.

     For the three and six months ended June 30, 1998, the Trust earned interest
income of $87,965 and  $178,395,  respectively,  compared to $27,119 and $52,919
for the same  periods  in 1997.  Interest  income is  typically  generated  from
temporary  investment  of  rental  receipts  and  equipment  sales  proceeds  in
short-term  instruments.  Interest  income during the three and six months ended
June 30, 1998  included  $11,716 and  $23,275,  respectively  earned on the note
receivable  from Semele and  interest  earned on  unexpended  proceeds  from the
issuance of Class B Interests (see below).  The amount of future interest income
is  expected  to  fluctuate  in  relation  to  prevailing  interest  rates,  the
collection of lease revenue, and the proceeds from equipment sales.

     During  the  three and six  months  ended  June 30,  1998,  the Trust  sold
equipment  having a net book value of $384,582 and $523,780 to existing  lessees
and third parties.  These sales resulted in a net loss, for financial  statement
purposes, of $77,440 and $78,738, respectively.

     During the three and six  months  ended  June 30,  1997,  the Trust sold or
exchanged  equipment  having a net  book  value of  $1,244,327  and  $1,255,232,
respectively, to existing lessees and third parties. These transactions resulted
in a net loss,  for  financial  statement  purposes,  of $364,901 and  $362,806,
respectively.  The  equipment  transactions  included the Trust's  interest in a
vessel with an original  cost and net book value of $2,399,580  and  $1,185,726,
respectively.  In connection with this transaction,  the Trust realized proceeds
of $777,326,  which resulted in a net loss, for financial statement purposes, of
$408,400. In addition, as this vessel was disposed of prior to the expiration of
the  related  lease  term,  the Trust  received a  prepayment  of the  remaining
contracted  rent due  under  the  vessel's  lease  agreement  in the  amount  of
$432,604.

     It cannot be determined  whether future sales of equipment will result in a
net gain or a net loss to the Trust, as such transactions will be dependent upon
the condition and type of equipment being sold and its marketability at the time
of  sale.  In  addition,  the  amount  of gain or loss  reported  for  financial
statement   purposes  is  partly  a  function  of  the  amount  of   accumulated
depreciation associated with the equipment being sold.

     The  ultimate  realization  of residual  value for any type of equipment is
dependent  upon many  factors,  including  EFG's  ability  to sell and  re-lease
equipment. Changing market conditions,  industry trends, technological advances,
and many other  events can  converge to enhance or detract  from asset values at
any given  time.  EFG  attempts  to monitor  these  changes in order to identify
opportunities  which may be  advantageous  to the Trust and which will  maximize
total cash returns for each asset.

     The total economic  value realized upon final  disposition of each asset is
comprised of all primary lease term revenue generated from that asset,  together
with its residual value. The latter consists of cash proceeds  realized upon the
asset's sale in addition to all other cash  receipts  obtained  from renting the
asset on a re-lease,  renewal or month-to-month basis. The Trust classifies such
residual rental payments as lease revenue.  Consequently,  the amount of gain or
loss reported in the financial  statements is not necessarily  indicative of the
total residual value the Trust achieved from leasing the equipment.

     Depreciation and  amortization  expense was $610,333 and $1,263,921 for the
three and six months ended June 30, 1998, respectively, compared to $861,524 and
$1,794,021 for the same periods in 1997. For financial  reporting  purposes,  to
the extent that an asset is held on primary  lease term,  the Trust  depreciates
the difference between (i) the cost of the asset and (ii) the estimated residual
value of the asset on a straight-line basis over 

                                       18
<PAGE>

                             AFG Investment Trust A

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION

such term.  For purposes of this policy,  estimated  residual  values  represent
estimates of equipment  values at the date of primary lease  expiration.  To the
extent that an asset is held beyond its primary lease term, the Trust  continues
to depreciate the remaining net book value of the asset on a straight-line basis
over the asset's remaining economic life.

     Interest expense was $25,734 and $57,870 or 4.7% and 4.5 % of lease revenue
for the three and six months  ended June 30,  1998,  respectively,  compared  to
$67,229 and  $110,587 or 4.6% and 4.3% of lease  revenue for the same periods in
1997. Interest expense is expected to decrease as the principal balance of notes
payable is reduced through the application of rent receipts to outstanding debt.

     Management  fees were 4.4% and 4.5% of lease  revenue for the three and 
six month  periods ended June 30, 1998 compared to 3.4% and 3.7% of lease 
revenue for each of the same periods in 1997. Management fees are based on 5% 
of gross lease revenue generated by operating leases and 2% of gross lease 
revenue generated by full payout leases.

     Operating   expenses  consist   principally  of   administrative   charges,
professional  service costs,  such as audit and legal fees, as well as printing,
distribution  and  remarketing  expenses.  Operating  expenses were $165,419 and
$215,652  for the  three  and six  months  ended  June 30,  1998,  respectively,
compared to $60,403 and $99,260 for the same  periods in 1997.  During the three
months  ended June 30,  1998,  the Trust  accrued  $108,000  for  certain  legal
expenses  related  to  the  Class  Action  Lawsuit  described  in  Note 8 to the
financial  statements.  The  amount  of  future  operating  expenses  cannot  be
predicted with certainty;  however,  such expenses are usually higher during the
acquisition and liquidation phases of a trust.

Liquidity and Capital Resources and Discussion of Cash Flows

     The Trust by its nature is a limited life entity which was  established for
specific purposes described in the preceding "Overview". As an equipment leasing
program,  the Trust's  principal  operating  activities derive from asset rental
transactions.  Accordingly, the Trust's principal source of cash from operations
is provided by the collection of periodic rents.  These cash inflows are used to
satisfy debt service  obligations  associated with leveraged leases,  and to pay
management fees and operating  costs.  Operating  activities  generated net cash
inflows of $1,590,724  and $2,120,140 for the six months ended June 30, 1998 and
1997, respectively.  Future renewal, re-lease and equipment sale activities will
cause a decline in the Trust's  primary-term  lease  revenue  and  corresponding
sources of operating cash. Overall,  expenses associated with rental activities,
such as management  fees, and net cash flow from operating  activities will also
decline as the Trust experiences a higher frequency of remarketing events.

     The   Trust's   equipment   is  leased   by  a  number   of   creditworthy,
investment-grade  companies  and,  to date,  the Trust has not  experienced  any
material  collection  problems and has not considered it necessary to provide an
allowance for doubtful accounts.  Notwithstanding a positive collection history,
there is no assurance that all future contracted rents will be collected or that
the credit quality of the Trust's  lessees will be maintained.  Collection  risk
could increase in the future,  particularly as the Trust remarkets its equipment
and enters re-lease agreements with different lessees. The Managing Trustee will
continue to evaluate and monitor the Trust's  experience in collecting  accounts
receivable to determine  whether a future  allowance  for doubtful  accounts may
become appropriate.

     Ultimately,  the Trust will dispose of all assets  under  lease.  This will
occur principally  through sale transactions  whereby each asset will be sold to
the  existing  lessee  or to a third  party.  Generally,  this will  occur  upon
expiration  of  each  asset's  primary  or  renewal/re-lease  term.  In  certain
instances, casualty or early termination events may result in the disposal of an
asset. Such circumstances are infrequent and usually result in the collection of
stipulated cash  settlements  pursuant to terms and conditions  contained in the
underlying lease agreements.

                                       19
<PAGE>

                             AFG Investment Trust A

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION

     Cash realized from asset disposal  transactions is reported under investing
activities on the  accompanying  Statement of Cash Flows.  During the six months
ended June 30, 1998, the Trust realized net cash proceeds of $445,042,  compared
to  $115,532,  for the same  period in 1997.  Future  inflows of cash from asset
disposals  will vary in timing and amount and will be influenced by many factors
including,  but not limited to, the frequency  and timing of lease  expirations,
the type of equipment  being sold,  its  condition  and age,  and future  market
conditions.

     As a result of the vessel exchange (see Results of  Operations),  the Trust
became the beneficial  owner of 209,694 shares of Semele common stock (valued at
$314,541 ($1.50 per share) at the time of the exchange  transaction).  The Trust
also received a beneficial interest in the Semele Note of $462,353 in connection
with the exchange.

     In accordance with Financial  Accounting Standards Board Statement No. 115,
Accounting  for Certain  Investments in Debt and Equity  Securities,  marketable
equity securities classified as available-for-sale are required to be carried at
fair value. On June 30, 1998,  Semele  effected a 1-for-300  reverse stock split
followed by a 30-for-1  forward  stock  split  resulting  in a reduction  of the
number of shares of Semele  common  stock  owned by the Trust to 20,969  shares.
During the six months  ended June 30,  1998,  the Trust  increased  the carrying
value of its  investment  in Semele common stock to $8.125 per share (the quoted
price of the Semele stock on NASDAQ at June 30, 1998) resulting in an unrealized
gain in 1998 of $13,106.  This gain was reported as a component of comprehensive
income,  included in participants'  capital.  The Managing Trustee believes that
the  underlying  tangible  assets of  Semele,  particularly  the  Rancho  Malibu
property,  can be sold or  developed  on a tax free  basis due to  Semele's  net
operating loss  carryforwards  and can provide an attractive  economic return to
the Trust.

     The Trust obtained long-term financing in connection with certain equipment
leases. The repayments of principal related to such indebtedness are reported as
a component of financing  activities.  Each note payable is recourse only to the
specific equipment financed and to the minimum rental payments  contracted to be
received during the debt amortization  period (which period generally  coincides
with the lease rental term). As rental payments are collected,  a portion or all
of the rental  payment is used to repay the associated  indebtedness.  In future
periods,  the amount of cash used to repay debt  obligations will decline as the
principal  balance of notes  payable  is  reduced  through  the  collection  and
application of rents.  However,  the Trust has a balloon  payment  obligation of
$282,421 at the  expiration of the primary lease term related to its interest in
an aircraft leased to Reno Air, Inc.

     For  financial  reporting  purposes,  the Managing  Trustee and the Special
Beneficiary each has accumulated a capital deficit at June 30, 1998. This is the
result of aggregate cash  distributions to these Participants being in excess of
their  aggregate  capital  contributions  ($1,000  each)  and  their  respective
allocations of financial statement net income or loss. Ultimately, the existence
of a capital  deficit for the Managing  Trustee or the Special  Beneficiary  for
financial   reporting   purposes  is  not  indicative  of  any  further  capital
obligations  to the  Trust  by  either  the  Managing  Trustee  or  the  Special
Beneficiary. However, for income tax purposes, the Trust Agreement requires that
income be  allocated  first to those  Participants  having  negative tax capital
account  balances so as to eliminate any such balances.  In accordance  with the
Trust Agreement, upon the dissolution of the Trust, the Managing Trustee will be
required to  contribute  to the Trust an amount  equal to any  negative  balance
which may exist in the Managing  Trustee's tax capital account.  At December 31,
1997, the Managing Trustee had a positive tax capital account  balance.  No such
requirement exists with respect to the Special Beneficiary.

     At June 30, 1998, the Trust had aggregate  future minimum lease payments of
$1,448,721  from  contractual  lease  agreements  (see  Note 3 to the  financial
statements),  a portion of which will be used to amortize the principal  balance
of  notes  payable  of  $1,524,696  (see  Note 7 to the  financial  statements).
Additional  cash inflows will be realized  from future  remarketing  activities,
such as lease  renewals  and  equipment  sales,  the  timing and extent of which
cannot be  predicted  with  certainty.  This is because the timing and extent of
equipment  sales is often dependent upon the needs and interests of the existing
lessees.  Some lessees may choose to renew their lease  contracts,  while others
may elect to return the equipment. In the latter instances,  the equipment could
be 

                                       20
<PAGE>

                             AFG Investment Trust A

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION

re-leased to another  lessee or sold to a third  party.  Accordingly,  as the
Trust matures and a greater level of its equipment  assets become  available for
remarketing,  the cash  flows of the Trust  will  become  less  predictable.  In
addition,  the Trust will have cash outflows to satisfy interest on indebtedness
and to pay  management  fees and operating  expenses.  Ultimately,  the Trust is
expected  to meet its future  disbursement  obligations  and to  distribute  any
excess of cash inflows over cash outflows to the Participants in accordance with
the Trust Agreement.  However,  several factors,  including month-to-month lease
extensions,   lessee  defaults,  equipment  casualty  events,  and  early  lease
terminations could alter the Trust's  anticipated cash flows as described herein
and in the accompanying  financial  statements and result in fluctuations to the
Trust's periodic cash distribution payments.

     On July 18, 1997,  the Trust issued  826,072 Class B Interests at $5.00 per
interest,   thereby   generating   $4,130,360  in  aggregate   Class  B  capital
contributions.   Class  A  Beneficiaries  purchased  3,209  Class  B  Interests,
generating  $16,045 of such  aggregate  capital  contributions,  and the Special
Beneficiary, EFG, purchased 822,863 Class B Interests,  generating $4,114,315 of
such aggregate capital  contributions.  The Trust incurred offering costs in the
amount of $41,304 and  professional  service costs of $54,186 in connection with
this  offering.  Subsequently,  EFG  transferred  its  Class  B  Interests  to a
special-purpose company, Equis II Corporation, a Delaware corporation.  EFG also
transferred its ownership of AFG ASIT  Corporation,  the Managing Trustee of the
Trust,  to Equis II  Corporation.  As a result,  Equis II Corporation has voting
control of the Trust through its ownership of the majority of all of the Trust's
outstanding voting interests,  as well as its ownership of AFG ASIT Corporation.
Equis II  Corporation  is  controlled  by EFG's  President  and Chief  Executive
Officer,  Gary D. Engle.  Accordingly,  control of the Managing  Trustee did not
change  as a  result  of the  foregoing  transactions  (see  also  Note 9 to the
accompanying financial statements).

     As described in the  Prospectus  for the offering of the Class B Interests,
the Managing  Trustee used a portion of the net cash proceeds  realized from the
offering of the Class B Interests to pay a one-time special cash distribution to
the Class A Beneficiaries  of the Trust.  The Managing Trustee declared and paid
this  special cash  distribution  of  approximately  $1.47 per Class A Interest,
aggregating $808,363, to Class A Beneficiaries on August 15, 1997.

     On August 7, 1997,  the Trust  commenced  an offer to purchase up to 45% of
the outstanding Class A Beneficiary Interests of the Trust. On October 10, 1997,
the Trust used $620,011 of the net proceeds  realized from issuance of the Class
B Interests to purchase 65,402 of the Class A Interests  tendered as a result of
the  offer.  On April 28,  1998,  the Trust used an  additional  $14,400 of such
proceeds to purchase 1,800 of the remaining Class A Interests. The remaining net
proceeds from the Class B offering of  $2,592,096  will be used to pay a Class B
Capital  Distribution  and  according to terms  negotiated  in  connection  with
settling the Class Action Lawsuit described in Note 8 (see also Notes 10, 11 and
12 to the accompanying financial statements).

     Cash distributions paid to the Participants consist of both a return of and
a return on capital.  Cash distributions do not represent and are not indicative
of yield on investment. Actual yield on investment cannot be determined with any
certainty  until  conclusion  of the  Trust  and  will  be  dependent  upon  the
collection of all future  contracted  rents,  the  generation of renewal  and/or
re-lease  rents,  and the residual value realized for each asset at its disposal
date. Future market  conditions,  technological  changes,  the ability of EFG to
manage and remarket the assets, and many other events and  circumstances,  could
enhance or detract from individual  asset yields and the collective  performance
of the Trust's equipment portfolio.

     It is the intention of the Managing Trustee to maintain a cash distribution
level  that is  consistent  with the  operating  cash  flows of the Trust and to
optimize the long-term  value of the Trust. A distribution  level that is higher
than the Trust's  operating  cash flows  could  compromise  the Trust's  working
capital  position,  as well as its ability to refurbish or upgrade  equipment in
response to lessee requirements or other market circumstances.  Accordingly,  in
order to better align monthly cash distributions with the Trust's operating cash
flows, the Managing Trustee reduced the level of monthly cash distributions from
an annualized rate of $2.52 per Class A Interest (the rate  established and paid
from the Trust's  inception  through  September  1995) to an annualized  rate of
$1.26 per Class A Interest  commencing in October  1995.  In October  1996,  the
Managing Trustee increased the annualized 

                                       21
<PAGE>

                             AFG Investment Trust A

                                    FORM 10-Q

                          PART I. FINANCIAL INFORMATION

distribution  rate  to  $1.64  per  Class A  Interest  and  has  sustained  this
distribution  rate  throughout  1997 and the six months ended June 30, 1998. For
the Class B Beneficiaries,  the Managing Trustee  established and paid, from the
Trust, an annualized  distribution of $0.66 per Class B Interest commencing July
18,  1997.  Future  distributions  with  respect to Class B  Interests,  will be
subordinate to certain distributions with respect to Class A Interests.

     Cash distributions to the Managing Trustee, the Special Beneficiary and the
Beneficiaries  are declared and generally  paid within 45 days following the end
of each  calendar  month.  The payment of such  distributions  is presented as a
component of financing  activities.  For the six months ended June 30, 1998, the
Trust declared total cash distributions of $734,466. Of the total distributions,
the Beneficiaries  were allocated  $666,460  ($395,508 for Class A Beneficiaries
and $270,952 for Class B Beneficiaries);  the Special  Beneficiary was allocated
$60,654, and the Managing Trustee was allocated $7,352.

     The nature of the Trust's  principal  cash flows  gradually will shift from
rental receipts to equipment sale proceeds as the Trust matures. As this occurs,
the Trust's cash flows will become more  volatile in that certain of the Trust's
equipment leases will be renewed and certain of its assets will be sold. In some
cases,  the Trust may be  required to expend  funds to  refurbish  or  otherwise
improve the equipment  being  remarketed in order to make it more desirable to a
potential  lessee or  purchaser.  The Trust's  Advisor,  EFG,  and the  Managing
Trustee will attempt to monitor and manage these events to maximize the residual
value of the Trust's  equipment and will consider these factors,  in addition to
the collection of contractual  rents,  the retirement of scheduled  indebtedness
and  the  Trust's  future  working  capital  and  equipment   requirements,   in
establishing  future cash  distribution  rates.  Ultimately,  the  Beneficiaries
should expect that cash distribution  rates will fluctuate over the long term as
a result of future remarketing activities.

                                       22

<PAGE>

                             AFG Investment Trust A

                                    FORM 10-Q

                           PART II. OTHER INFORMATION


        Item 1.              Legal Proceedings
                             Response:

                             Refer to Note 8 to the  financial
                             statements herein.

        Item 2.              Changes in Securities
                             Response:  None

        Item 3.              Defaults upon Senior Securities
                             Response:  None

        Item 4.              Submission of Matters to a Vote of Security Holders
                             Response:

                             Refer to Note 11 to the financial
                             statements herein.

        Item 5.              Other Information
                             Response:  None

        Item 6(a).           Exhibits
                             Response:  None

        Item 6(b).           Reports on Form 8-K
                             Response:  None


                                       23

<PAGE>

                                 SIGNATURE PAGE

     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
report has been signed below on behalf of the registrant and in the capacity and
on the date indicated.



                             AFG Investment Trust A


           By:      AFG ASIT Corporation, a Massachusetts
                    corporation and the Managing Trustee of
                    the Registrant.


           By:      /s/  Michael J. Butterfield
                    --------------------------------------------------
                    Michael J. Butterfield
                    Treasurer AFG ASIT Corporation
                    (Duly Authorized Officer and
                    Principal Accounting Officer)


           Date:    August 14, 1998


           By:      /s/  Gary Romano
                    --------------------------------------------------
                    Gary M. Romano
                    Clerk of AFG ASIT Corporation
                    (Duly Authorized Officer and
                    Principal Financial Officer)


           Date:    August 14, 1998




                                       24