U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                     For the Quarter ended December 31, 1998

                                       OR

[  ]              TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                           OF THE SECURITIES EXCHANGE ACT OF 1934
         For the transition period from____________ to_____________

                                      Commission file number    1-11568

                              TADEO HOLDINGS, INC.
             (Exact Name of Registrant as Specified in its Charter)

          Delaware                                         95-4228470
(State or other jurisdiction of                        (I.R.S. Employer
 incorporation or organization)                       Identification No.)


                       42705 Grand River Avenue - Suite 20
                              Novi, Michigan 48375
               (Address of principal executive offices) (Zip code)


        Registrant's telephone number, including area code (248) 344-9599




         Check 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,  and (2) has been subject to such filing  requirements  for
the past 90 days. Yes X No

         The number of shares  outstanding of the issuer's Common Stock,  $.0001
par value, as of February 12, 1999 was 15,042,813.










                                     1 of 15

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                      TADEO HOLDINGS, INC. AND SUBSIDIARIES

                                      INDEX


PART I - FINANCIAL INFORMATION
                                                                          Page
                                                                          Number

Item 1 - Consolidated Financial Statements

Consolidated Balance Sheet - December 31, 1998
and June 30, 1998                                                           3

Consolidated Statement of Operations - For the three
and six months ended December 31, 1998 and 1997                             4

Consolidated Statement of Cash Flows - For the
six months ended December 31, 1998 and 1997                                 5

Notes to Consolidated Financial Statements                              6 - 10

Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operation                                     11 - 14
----------------------------------


PART II - OTHER INFORMATION                                                 14


SIGNATURE                                                                   15






                                     2 of 15

<PAGE>
<TABLE>
<CAPTION>
                                  TADEO HOLDINGS, INC. AND SUBSIDIARIES
                                        CONSOLIDATED BALANCE SHEET
                                              (Unaudited)

                                                                                              December 31,                  June 30,
                                                 ASSETS                                            1998                      1998
<S>                                                                            <C>                        <C>   
CURRENT ASSETS:
                                                                                               __________               ___________
     Cash                                                                       $               1,326,467 $               2,575,356
     Accounts receivable                                                                          241,800                    11,550
     Interest receivable                                                                          281,997                   276,005
     Note receivable - officer                                                                          0                   162,627
                                                                                               __________               ___________
            TOTAL CURRENT ASSETS                                                                1,850,264                 3,025,538

LONG--TERM NOTE RECEIVABLE ( face value $17,000,000)                                            6,000,000                 6,000,000

MARKETABLE SECURITIES                                                                           2,000,000                         0

PROPERTY AND EQUIPMENT
     net of accumulated depreciation of $36,383 and $25,976, respectively                          83,619                    79,966

CAPITALIZED SOFTWARE COSTS, net                                                                   902,378                   696,871

DEFERRED FINANCE COSTS                                                                             52,075                    67,079

DEPOSITS AND OTHER ASSETS                                                                          43,058                    43,058
                                                                                               __________               ___________
                                                                                $              10,931,394 $               9,912,512
                                                                                               ==========               ===========
                                   LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
     Accounts payable                                                           $                 415,525 $                 451,106
     Accrued expenses                                                                             131,196                   150,425
     Notes payable - current portion                                                               95,727                   163,260
     State audit reserves                                                                         700,000                   700,000
     Current portion of long-term debt                                                                  0                   640,593
     Accrued termination costs, short-term                                                        336,030                   784,053
                                                                                               __________               ___________
            TOTAL CURRENT LIABILITIES                                                           1,678,478                 2,889,437

ACCRUED TERMINATION COSTS, long-term                                                              225,000                   280,209
LONG TERM NOTES PAYABLE, net of current portion                                                   361,779                    23,260
REDEEMABLE PREFERRED STOCK, Series A                                                                    0                 1,219,141

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
     Preferred stock, Series B Cumulative Convertible, $.0001 par value,
         10,000,000 shares authorized, 1,000,000 shares issued and outstanding                   505,000                   505,000
     Common stock, $.0001 par value, 40,000,000 shares authorized, 15,042,813 shares
         issued and outstanding as of  December 31, 1998                                           1,504                       972
     Additional paid-in capital                                                               17,797,413                14,115,443
     Accumulated earnings/(deficit)                                                           (9,637,780)               (9,120,950)
                                                                                               __________               ___________
            TOTAL STOCKHOLDERS' EQUITY                                                         8,666,137                 5,500,465
                                                                                               __________               ___________
            TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                          $             10,931,394  $              9,912,512
                                                                                               ==========               ===========
                               See notes to consolidated financial statements.

                                                Page 3 of 15
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                       TADEO HOLDINGS, INC. AND SUBSIDIARIES
                                        CONSOLIDATED STATEMENT OF OPERATIONS
                                                     (Unaudited)

                                                                      Three Months Ended December 31,  Six Months Ended December 31,
                                                                      -------------------------------  -----------------------------
                                                                               1998          1997            1998            1997
                                                                           ---------      ---------       ---------      ---------
<S>                                                                       <C>            <C>             <C>            <C>   
REVENUES                                                                     603,634        220,488         967,228        348,529

COST OF GOODS SOLD                                                           101,895         71,126         285,749        171,758
                                                                           ---------      ---------       ---------      ---------
     GROSS PROFIT                                                            501,739        149,362         681,479        176,771
                                                                           ---------      ---------       ---------      ---------
OPERATING EXPENSES:
     Selling, general and administrative                                     741,896        788,701       1,303,393      1,527,835
     Research and development                                                 31,248         14,460          62,496         29,460
     Depreciation and amortization                                             4,242          3,760          10,408          6,988
                                                                           ---------      ---------       ---------      ---------
     TOTAL OPERATING EXPENSES                                                777,386        806,921       1,376,297      1,564,283
                                                                           ---------      ---------       ---------      ---------
SETTLEMENT OF EMPLOYMENT CONTRACTS,
     (NON-CASH)                                                                    0              0         327,501              0

                                                                           ---------      ---------       ---------      ---------
INCOME (LOSS) FROM OPERATIONS                                               (275,647)      (657,559)     (1,022,319)    (1,387,512)

INTEREST INCOME, net                                                         274,669              0         532,777            929
                                                                           ---------      ---------       ---------      ---------
NET LOSS                                                                        (978)      (657,559)       (489,542)    (1,386,583)
                                                                            ========      =========       =========      =========
NET LOSS PER SHARE - basic and diluted                                          (0.0)          (0.7)           (0.4)         (0.15)
                                                                            ========      =========       =========      =========
WEIGHTED AVERAGE NUMBER OF SHARES
     USED IN COMPUTATION                                                  10,399,799       9,724,579     12,459,027      9,724,579
                                                                            ========      =========       =========      =========



                                           See notes to consolidated financial statements.

                                  Page 4 of 15
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                          TADEO HOLDINGS, INC. AND SUBSIDIARIES
                                           CONSOLIDATED STATEMENT OF CASH FLOWS
                                                       (Unaudited)
                                                                                                  Six Months Ended December 31,
                                                                                          ------------------------------------------
                                                                                                 1998                        1997
                                                                                           ---------------              ------------
<S>                                                                            <C>                          <C>    
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net income/( loss)                                                        $               (489,542)    $            (1,608,932)
                                                                                           ---------------              ------------
     Adjustments to reconcile net income/(loss)  to net cash from
          operating activities:
              Depreciation                                                                       10,408                     334,653
              Amortization of deferred finance costs and debt dsicount                           37,853                           0
              Amortization of Capitalized software costs                                        244,989                      19,212
              Settlement of employment contracts,
              (non-cash)                                                                        327,501                           0

     Changes in operating assets and liabilities:
          (Increase) decrease in accounts receivable                                           (230,250)                    765,680
          (Increase) in interest receivable                                                      (5,992)                          0
          Additions to capitalize software costs                                             (1,147,367)                   (288,573)
          Decrease in prepaid expenses                                                                0                       1,165
          (Increase) in deferred finance costs                                                 (108,000)                          0
          Decrease in other assets                                                                    0                       7,905
          (Decrease) Increase in accounts payable                                               (35,581)                    151,048
          (Decrease) Increase in accrued expenses                                               (19,229)                    422,935
          (Decrease) in accrued termination costs                                              (503,232)                          0
                                                                                           ---------------              ------------
              Total adjustments                                                              (1,428,900)                  1,414,025
                                                                                           ---------------              ------------
          NET CASH  (USED IN) OPERATING ACTIVITIES                                           (1,918,443)                   (194,907)
                                                                                           ---------------              ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
     Capital expenditures                                                                      (120,002)                   (131,984)
                                                                                           ---------------              ------------
          NET CASH (USED IN) INVESTING ACTIVITIES                                              (120,002)                   (131,984)
                                                                                           ---------------              ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
     Decrease in notes payable                                                                  (67,533)                          0
     Repayment/(Issuance) of related party loans                                                162,627                           0
     Proceeds from debt financing                                                               818,567                     343,306
     Borrowing of revolving credit line                                                               0                     197,819
     Net proceeds from (repayment of) long-term debt                                           (302,074)                   (107,021)
     Net proceeds from the sale of Common Stock                                                 205,256                       2,005
     Dividends paid on Series A Preferred Stock                                                 (27,288)                    (98,228)
     Redemption of Series A Preferred Stock                                                           0                    (240,103)
                                                                                           ---------------              ------------
          NET CASH PROVIDED BY FINANCING ACTIVITIES                                             789,555                      97,778
                                                                                           ---------------              ------------
NET INCREASE (DECREASE) IN CASH                                                              (1,248,889)                   (229,113)

CASH AT BEGINNING OF PERIOD                                                                   2,575,356                     904,062
                                                                                           ---------------              ------------
CASH AT END OF PERIOD                                                          $              1,326,467     $               674,949
                                                                                           ===============              ============
                                                See notes to consolidated financial statements.
</TABLE>
<TABLE>
<CAPTION>
                                                                                                      Six Months Ended December 31,
                                                                                                     -------------------------------
                                                                                                          1998            1997
                                                                                                     -------------      ------------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
     INFORMATION:
<S>                                                                                               <C>              <C>  
     Cash paid during the period for interest and finance charges                                 $              0 $        260,119


     During the six months ended December 31, 1998, the Company paid 
approximately $390,000 in income taxes applicable to the year ended June 30,1998

                                  Page 5 of 15

</TABLE>
<PAGE>


                              TADEO HOLDINGS, INC.
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - December 31, 1998
                                   (UNAUDITED)



1.  Basis of Presentation

         Reference is made to the annual report on form 10-K of Tadeo  Holdings,
Inc. (the "Company") dated October 13, 1998 for the year ended June 30, 1998.

         The accompanying financial statements reflect all adjustments which, in
the opinion of management,  are necessary for a fair  presentation  of financial
position and the results of operations for the interim periods presented. Except
as  otherwise  disclosed,  all such  adjustments  are of a normal and  recurring
nature.  The results of operations  for any interim  period are not  necessarily
indicative of the results attainable for a full fiscal year.

2.  Loss Per Share

         Loss Per Share is based on the weighted average number of common shares
outstanding  during each  period.  Potential  common  shares are included in the
computation  of  diluted  per share  amounts  outstanding  during  each  period.
Potential  common  shares are not included  for loss  periods as such  inclusion
would be anti-dilutive.

3. Marketable Securities

         On  September  24,  1998,  the  Company   completed  a  Stock  Purchase
Agreement, between Multimedia Access Corporation (MMAC) and Tadeo (the "Purchase
Agreement").   MMAC  purchased  $2,000,000  worth  of  Tadeo  Common  Stock  for
$2,000,000  worth of MMAC Common Stock.  The Company issued  1,240,310 shares of
Tadeo Common Stock at the sale price of $1.6125 per share and received 1,000,000
shares of MMAC's  Common  Stock for the purchase  price of $2.00 per share.  The
Company is carrying MMAC's Common Stock at cost, approximately the market value.
In the case of each  corporation,  the number of shares issued was less than 20%
of the outstanding Common Stock of the issuer on September 24, 1998. The Company
plans on retaining the 1,000,000 shares of MMAC for investment purposes.

4. Business Acquisition

         On October 27, 1998, the Company completed the acquisition of Astratek,
Inc.,  a New  York  corporation  ("Astratek").  The  Company  acquired  Astratek
pursuant to a merger (the "Merger") of Astratek  Acquisition  Corp.  ("AAC"),  a
wholly-owned  subsidiary of the Company,  with and into Astratek,  with Astratek
becoming  the  wholly-owned   subsidiary  of  the  Company,   as  the  surviving
corporation  of the  Merger.  The Merger was  effected  in  accordance  with the
Agreement and Plan of Merger (the "Merger  Agreement"),  dated as of October 23,
1998, among the Company, AAC, Astratek, and the shareholders of Astratek.

                                     6 of 15

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Astratek  develops software tools and related products for Internet and intranet
technology and provides  consulting and professional  services for several major
companies. As the Merger Consideration  delivered to Astratek shareholders,  the
Company issued  2,294,900  shares of the Company's  common stock in exchange for
cancellation  of all the issued and  outstanding  shares of the capital stock of
Astratek  prior to the Merger and the issuance of 100 shares of Astratek  common
stock to the Company post-Merger.  The acquisition is accounted for as a pooling
of interests business combination.

5. Note Receivable - Officer

         On November 25,  1998,  the Note due from an Officer of the Company was
repaid, together with interest at 12% per annum.

6. Note Receivable - Other

         On September 9, 1998,  the Company loaned  $250,000 to Azurel,  LTD., a
Delaware  corporation,  in  consideration  for a $250,000  promissory  Note from
Azurel,  LTD with  interest  at 20.8% per annum.  The Note was due on October 9,
1998,  but was verbally  extended until November 19, 1998. On November 19, 1998,
$200,000 of the Note due from Azurel,  LTD was repaid  together with interest at
20.8 per annum. On November 30, 1998, the Company loaned an additional  $100,000
to Azurel, LTD in consideration for a $150,000  promissory Note from Azurel, LTD
with interest at 20.8% per annum. (which Note replaced the Note from Azurel, LTD
dated September 9, 1998).

7. Contingencies

Department of Health Services

         The  Company's  wholly-owned  subsidiary  has  undergone  an  audit  by
representatives of the State of California,  State Controller's Office, Division
of Audits.  The purpose of the audit was to determine the level of the Company's
wholly-owned  subsidiary's  compliance  with the  guidelines  of the  California
Department  of Health  Services  (Medi-Cal)  and the  California  State Board of
Equalization. Representatives from the State Controller's Office have raised the
issue of  whether  the  Company's  wholly-owned  subsidiary  may have  practiced
two-tier  pricing  policies  in the charges to it's  customers  which are not in
conformance with Medi-Cal regulations. Under such regulations, a company may not
charge any  customer  prices less than those  charged to the  Medi-Cal  program.
Based  upon  Management's   independent   review,  the  Company's   wholly-owned
subsidiary  maintains that it has conformed with pricing regulations because its
prices are consistent within each of its operating subsidiaries,  Sugar Free and
Home  Therapy,  and  because  these  two  subsidiaries  are  offering  different
services.  The Company's  Management  further believes that the Medi-Cal program
was charged the "prevailing prices" charged for supplies, and that those charges
were in compliance with current  regulations,  and that the Representatives from
the  Controller's  Office compared prices for different  services with different
delivery methods.  The State Controller's Office contends that the reimbursement
was paid for products,  and not for services,  so the  difference in pricing was
not warranted based upon the services  rendered in conjunction with the products
delivered. In July 1994, the State Controller's Office issued

                                     7 of 15

<PAGE>



an Auditor's  Report with findings to the Department of Health Services  ("DHS")
for the  period  beginning  July 1,  1990  through  June 30,  1993.  The  Report
recommends a recovery of approximately $1.3 million due to such alleged two-tier
pricing.  In November 1994 the State Controller's Office issued Letter of Demand
for  the  recovery  of  such  amounts  due.  In  November  1994,  the  Company's
wholly-owned  subsidiary  appealed  the  audit  determination  made by the State
Controller's Office. In January 1996 a hearing was held before an Administrative
Law Judge. In July 1996 the Judge recommended that the overpayment determination
be upheld. In August 1996 the DHS adopted the recommendation of the Law Judge as
the final  decision  of the  Director  of DHS.  In  January  1997 the  Company's
wholly-owned  subsidiary filed an appeal to the decision with the Superior Court
for the County of Los Angeles.  On January 4, 1999,  the  Superior  Court held a
hearing on the issue and ruled at that time.  On January 20, 1999,  the Superior
Court  recommended that the overpayment  determination be upheld.  In March 1999
the  Company's  wholly-owned  subsidiary  will file an  appeal  to the  Superior
Court's   decision  with  the  California   Court  of  Appeals.   The  Company's
wholly-owned  subsidiary intends to vigorously contest any recovery by the State
with respect to such alleged improper pricing practices for services rendered.

         Based upon the above contingency, the Company's wholly-owned subsidiary
has  provided a reserve,  in the event that a defense of its  position  does not
prevail,  of $700,000.  Management  believes that a total  estimated  settlement
amount of $700,000,  or 54% of the maximum amount demanded,  is reasonable under
the circumstances  with respect to this matter.  Unless the California  two-tier
pricing controversy is either settled or the related claims made by the State of
California  otherwise  released prior to the maturity date of the Note delivered
to the Company in partial  consideration  for the sale of assets pursuant to the
terms of the  Transaction  (see Note 1 above),  then the  principal  of the Note
payable to the Company  will be reduced by the amount then alleged to be owed to
the State of California with respect to such controversy.

         On December 18, 1997, the Company's  wholly-owned  subsidiary underwent
an audit by the  Medi-Cal  program.  The  purpose  and scope of the audit was to
determine if the Company's  wholly-owned  subsidiary's  documentation  supported
reimbursement  of the $653,990 in various sizes of disposable  insulin  syringes
and  $1,975,588  for blood  glucose  test strips that  Medi-Cal  had made to the
Company's wholly-owned subsidiary from November 1, 1994 to April 30, 1996. As of
June 9,  1998,  DHS  reported  that  its  audit  disputed  reimbursement  for an
aggregate  of  $75,356.  The  Company's  wholly-owned   subsidiary  has  made  a
counteroffer of $50,000 to settle the case, but the DHS has rejected that offer.
The formal  hearing on this matter has been  scheduled for December 8, 1998. The
Company  withdrew  its appeal  prior to the  hearing  based upon the  settlement
amount, and has accepted the $75,356 as the final administrative decision.

Medicare Part B

         The  Company's  wholly-owned  subsidiary  has  undergone  an  audit  by
Medicare  covering the charges submitted for reimbursement in the Western region
(Region D) during the period January 1, 1994 through December 31, 1995. Medicare
determined that an overpayment to the Company's wholly-owned subsidiary may have
occurred  as a  result  of the use of a  superseded  diagnosis  code  on  claims
submitted. The claims in question were

                                     8 of 15

<PAGE>



originally submitted to Medicare in order to gain a denial of charges so that an
alternative  carrier  could be validly  billed,  since a denial is  required  by
certain  intermediaries prior to billing for certain charges.  Medicare may have
inappropriately  made reimbursements on these charges. In November 1996 Medicare
issued a demand for refund of $795,702 plus  interest of $35,475.  As of January
28,  1998  Medicare  offset a total of $ 630,918  of the  Company's  claims  for
payment. In the most recent correspondence from Medicare on this subject, it was
claimed  that on March 31, 1997 the  Company's  wholly-owned  subsidiary  owed a
refund of  $808,887,  of which  $795,701 was  principal  and $22,290 was accrued
interest. The Company rebilled Medi-Cal $732,853 in February 1997 and $62,849 in
March 1997.

         The Company's wholly-owned subsidiary was previously the subject of an
investigation by Medicare for (I) Medicare's alleged overpayment for products 
and services provided by the wholly-owned subsidiary and (ii) Medicare's payment
to the Company's wholly-owned subsidiary for claims which were allegedly not 
properly subject to Medicare reimbursement.  During fiscal 1995, Medicare 
withheld $300,766 of payments due for claims reimbursement to cover previously  
estimated liabilities resulting from this investigation.  A further assessment 
in the amount of $78,500 resulting from a continuation of this investigation has
been made, and that amount withheld in July 1996.  The Company's wholly-owned 
subsidiary went through an in-person hearing on May 28, 1997 to contest 
Medicare's aggregate $379,000 of withheld reimbursements, and on July 28, 1997 
the Company received a partially favorable Hearing Decision.  The Company's 
wholly-owned subsidiary received a refund on October 31, 1997, for $30,314 from
Medicare Part B based upon the partially favorable Hearing Decision.  The 
Company's wholly-owned subsidiary intends to appeal the partially unfavorable 
amount of $348,686 from the Hearing Officer's decision and has retained counsel
to contest the decision in proceedings before an administrative law judge, where
it is now pending.

8.  Termination Agreements

         The Company  entered into the  following  contracts  subsequent  to the
disposal of its business:

         A. With a former operating officer  commencing March 1998,  aggregating
         $485,000, payable in monthly installments of $7,633 through March 2003.
         The  Company  has  recorded  the  present  value  of this  contract  at
         $359,265, with the balance being $311,092 at December 31, 1998.

         B. With a former operating officer  commencing March 1998,  aggregating
         $151,000,  payable in monthly  installments of $12,625 through February
         1999.  The Company has recorded the present  value of this  contract at
         $143,603, with the balance being $24,938 at December 31, 1998.

         C.  With  three   former   officers   dated   July  1998,   aggregating
         consideration of $862,498,  with $385,000 paid in August 1998, $225,000
         settled through the issuance of notes payable due January 2000, bearing
         interest at 7% per annum and the $252,490 balance settled by exchanging
         cash severance payments for the direct

                                     9 of 15

<PAGE>



         issuance of 168,332  shares of Common  Stock (at $1.00 value per share)
         and the  exercise  price of  concurrently  granted  options  to acquire
         84,167 shares of Common Stock at $1 per share.  The Company has accrued
         the amounts related to theses contracts as of September 30, 1998.

9.       Note Receivable

         The  Note  is due  from  Gainor  in  connection  with  the  sale of the
Company's  business in January 1998.  The Note has a face amount of  $17,000,000
and is due in January  2003.  The Note bears  interest at the rate of 7% for the
first year and 8% per annum thereafter, with interest payable quarterly.

         The  Asset  Purchase  Agreement  states  that  the Note is  subject  to
reduction by Gainor under each of the following circumstances:

         A)  A failure to obtain the requisite number of assignments of benefits
         form former patients, with a maximum adjustment of $2,000,000.

         B) The failure of Gainor to collect a minimum of $5.75 million of 
         purchased accounts receivable with the principal on the Note reduced by
         any short-fall.

         C) If 75% of the  revenues  achieved by the  acquired  business for the
         year subsequent to closing (the "Post Closing  Revenue") does not equal
         at  least  $17,000,000  (the  "Minimum  Post  Closing  Revenues"),  the
         principal  of the Note will be reduced by any  short-fall  between Post
         Closing Revenue and the Minimum Post Closing Revenue.

         In September  1998,  Gainor notified the Company that the assignment of
benefits  provision is currently at the maximum  adjustment level of $2,000,000.
Gainor made a $559,800 downward adjustment to the Note principal, and granted an
extension  until  November  21,  1998 of the time  for a  sufficient  number  of
assignments  of  benefits  to be  received  by Gainor in order to avoid  further
downward  adjustment to the Note  principal.  Gainor had previously  reduced the
Note balance by approximately  $145,000,  for what were claimed to be unrecorded
purchase date accruals,  as an adjustment to the closing balance sheet under the
Asset Purchase  Agreement.  In addition,  Gainor notified the Company that as of
August 31, 1998, (I) its  collection of  receivables  purchased from the Company
pursuant to the Asset Purchase  Agreement were behind  schedule such that, on an
annualized  basis,  collection  would result in less than $5.75 million for such
account,  and (ii) its  generation of revenues  from  operation of the purchased
business was not as anticipated,  both of which resulted in additional  downward
adjustments  to the  Note  principal  under  the  terms  of the  Asset  Purchase
Agreement.

         As a result of the aforementioned, the Company has reduced the carrying
basis of the Note to $6,000,000  based on what management  believes would be the
value  of the  Note if it were to be sold  to an  unrelated  third  party  in an
arms-length  transaction.  The  Company  has  therefore  reduced the gain on the
disposal of the discontinued business by $11,000,000.  However, the Company will
continue to vigorously pursue the full collection of the face amount of the Note
as well as all interest accrued.

                                    10 of 15

<PAGE>



ITEM 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS
                  OF FINANCIAL CONDITION AND RESULTS OF
                  OPERATIONS

Year 2000

         The Company  had no going  operations  during the first  quarter of the
fiscal year. In October 1998, the Company acquired Astratek,  Inc. ("Astratek").
Astratek, a wholly-owned subsidiary of the Company,  develops software tools and
related  products for Internet and Intranet  technology and provides  consulting
and professional services for several major companies.  The Company will jointly
develop a business plan with Astratek's management to address potential problems
relating  to year 2000  issues.  The Company  plans to work with its  customers,
suppliers  and third party service  providers to identify  external and internal
weaknesses and provide solutions which will prevent the disruption of Astratek's
business operations.  Astratek is currently implementing a new accounting system
which  is  year  2000  compliant.  The  Company  does  not  expect  the  cost of
implementation  to have a  material  adverse  effect on its  future  results  of
operations, liquidity or capital resources.

Forward-Looking Statements

         When used in the Form 10-Q and in future  filings by the  Company  with
the  Securities  and  Exchange  Commission,  the words or phrases  "will  likely
result"  and  "the  Company   expects,"  "will   continue,"  "is   anticipated,"
"estimated,"  "project,"  or  "outlook" or similar  expressions  are intended to
identify  "forward-looking   statements"  within  the  meaning  of  the  Private
Securities  Litigation Reform Act of 1995. The Company wishes to caution readers
not to place undue  reliance  on any such  forward-looking  statements,  each of
which  speak only as of the date made.  Such  statements  are subject to certain
risks and  uncertainties  that could cause actual  results to differ  materially
from  historical  earnings and those  presently  anticipated  or projected.  The
Company has no obligation to publicly  release the result of any revisions which
may  be  made  to any  forward-looking  statements  to  reflect  anticipated  or
unanticipated  events  or  circumstances   occurring  after  the  date  of  such
statements.

General

         On October 27, 1998, the Company completed the acquisition of Astratek,
Inc.,  a New  York  corporation  ("Astratek").  The  Company  acquired  Astratek
pursuant to a merger (the "Merger") of Astratek  Acquisition  Corp.  ("AAC"),  a
wholly-owned  subsidiary of the Company,  with and into Astratek,  with Astratek
becoming  the  wholly-owned   subsidiary  of  the  Company,   as  the  surviving
corporation  of the  Merger.  The Merger was  effected  in  accordance  with the
Agreement and Plan of Merger (the "Merger  Agreement"),  dated as of October 23,
1998,  among the  Company,  AAC,  Astratek,  and the  shareholders  of Astratek.
Astratek  develops software tools and related products for Internet and intranet
technology and provides  consulting and professional  services for several major
companies. As the Merger Consideration  delivered to Astratek shareholders,  the
Company issued  2,294,900  shares of the Company's  common stock in exchange for
cancellation  of all the issued and  outstanding  shares of the capital stock of
Astratek  prior to the Merger and the issuance of 100 shares of Astratek  common
stock to the Company post-Merger.

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         As a  result  of the  Astratek  acquisition  being  accounted  for as a
pooling  of  interest  business  combination,   the  historical  pre-acquisition
financial  results of Astratek are compared below with the Company's  results of
operations for the three and six month periods ended December 31, 1998.

Results of Operations

         The three  months  ended  December  31,  1998 (the  "1998  Three  Month
Period") as  compared to the three  months  ended  December  31, 1997 (the "1997
Three Month Period")

         Revenue for the 1998 Three Month  Period was  $603,634,  an increase of
$383,146,  or 173%,  from the 1997  Three  Month  Period.  Several  factors  are
contributing to this increase.  Revenue associated with the Visual Audit product
that is sold by Viasoft  increased  $121,834 during the 1998 Three Month Period,
or a 100% increase over the 1997 Three Month Period, and revenue associated with
professional  services  provided to various clients increased by $261,313 during
the 1998 Three  Month  Period,  or a 260%  increase  over the 1997  Three  Month
Period.


         Total  cost of goods  sold  during the 1998  Three  Month  Period  were
$101,895,  representing  costs of  approximately  17% of revenue for the period,
while total cost of goods sold for the 1997 Three Month  Period were  $71,126 or
approximately  32% of  revenue.  This 15%  favorable  variance  as a percent  of
revenue is in part the result of increased Visual Audit product sales by Viasoft
and an increased operational awareness of recognizing capitalized software costs
and improving the process by which costs are tracked.

         Selling,  general  and  administrative  expenses  during the 1998 Three
Month  Period  decreased to $ 741,896,  as compared to $788,701  during the 1997
Three Month  Period.  Contributing  to the Company's  favorable  variance is the
capturing of capitalized  software  costs that were once  recognized as expenses
aggregating $83,000.

         Other income and expenses include interest income aggregating  $293,213
and interest  expense  totaling  $18,544,  during the 1998 Three Month Period as
compared to the 1997 Three Month Period in which these items did not exist.

         Net  loss  for the  1998  Three  Month  Period  of  $978  is  primarily
attributable to the existence of total operating  expenses without the increased
generation of operating revenues to offset such expenses.

The six months ended December 31, 1998 (the "1998 Six Month Period") as compared
to the six months ended December 31, 1997 (the "1997 Six Month Period")

         Revenue  for the 1998 Six Month  Period was  $967,228,  an  increase of
$618,699,  or 178 percent from the 1997 Six Month Period.  Several  contributing
factors favorably  impacted  revenue:  an increase of $178,835 in revenue during
the 1998 Six Month Period,  or 149% increase from the 1997 Six Month Period from
Visual  Audit sales and an increase of $439,864 in  professional  services  fees
from clients during the 1998 Six Month Period.(a

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192% increase from the 1997 Six Month Period)

         Total  cost of  goods  sold  during  the  1998 Six  Month  Period  were
$285,749,  representing  costs of  approximately  30% of revenue for the period,
while total cost of goods sold for the 1997 Six Month  Period  were  $171,758 or
approximately  49% of revenue.  A  contributing  factor  relates to the improved
process by which operations record and capture capitalized  software costs as it
relates to consultants expenses during the 1998 Six Month Period.  Additionally,
the  favorable  revenue  realized  during the 1998 Six Month Period as mentioned
above, contributes to lowering cost of goods sold by 3% for every $100,000 above
the revenue generated during the 1997 Six Month Period.

         Total operating  expenses during the 1998 Six Month Period decreased to
$1,376,297,  or 142% of revenue, as compared to $1,564,283,  or 449% of revenue,
during the 1997 Six Month Period.  As mentioned  above,  a  contributing  factor
relates  to  the  improved  process  by  which  operations  record  and  capture
capitalized  software costs as it relates to salary expenses during the 1998 Six
Month Period.

         Other income and expenses  include  interest  income of $570,630 during
the 1998 Six Month  Period  compared to $929  during the 1997 Six Month  Period.
Interest  expense  was $37,853  during the 1998 Six Month  Period and during the
1997 Six Month Period the expense did not exist.

         Net loss for the  1998  Six  Month  Period  of  $489,542  is  primarily
attributable to the losses from operations,  in the amount of $694,818,  and the
non-cash transaction of $327,501.

Liquidity and Capital Resources

         As of December 31, 1998,  the Company had working  capital of $171,786,
compared  to working  capital of  $136,101  at June 30,  1998.  The  increase in
working capital during the 1998 Six Month Period is primarily due to an increase
in interest receivable and accounts receivable.

         Cash used in operations during the 1998 Six Month Period was $1,918,443
as compared  to cash used by  operations  of $194,907  during the 1997 Six Month
Period. This increase is partially  attributable to a combination of: a lump sum
payment  aggregating  $385,000,  a $252,490  balance  settled by exchanging cash
severance payments for the direct issuance of 168,332 shares of Common Stock (at
$1.00 value per share) and the exercise price of concurrently granted options to
acquire  84,167  shares  of  Common  Stock  at $1 per  share  to  Messrs.  Brian
Bookmeier, Alan Korby and Matthew B. Gietzen; and severance payments aggregating
$53,433 to Edward Buchholz and $75,750 to Tod Robinson during the 1998 Six Month
Period.

         An aggregate  sum of 229,950  shares of Series A  Redeemable  Preferred
Stock, $.0001 par value per share (the "Series A Preferred Stock") was redeemed,
evidencing all  outstanding  shares of Series A preferred  Stock during the 1998
Six Month  Period.  The  Company  was able to redeem  the  outstanding  Series A
Preferred Stock due to an amendment

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of its  certificate of  designations  relating to the Series A Preferred  Stock,
which outstanding  shares without redemption would have obligated the Company to
pay  $1,149,745  in  aggregate  redemption  payments  through  March 2001.  This
redemption  has  improved  the  Company's  cash flow  during  the 1998 Six Month
Period.

         The Company  acquired  Astratek,  Inc.  by merger on October 27,  1998.
Prior to consummation of this acquisition,  the Company advanced working capital
funds to Astratek in the form of loans.  The  Company  anticipates  that it will
continue to supply working capital  funding to Astratek in the future.  Although
the Company and Astratek  management are currently  working to develop operating
budgets  with  respect  to  Astratek's   future  operations  and  its  financing
requirements,  at this time the amount and the timing of any future financing of
Astratek by the Company has not been finally determined.


PART II - OTHER INFORMATION

Item. 5.  Other Information

         On October 27, 1998, the Company completed the acquisition of Astratek,
Inc.,  a New  York  corporation  ("Astratek").  The  Company  acquired  Astratek
pursuant to a merger (the "Merger") of Astratek  Acquisition  Corp.  ("AAC"),  a
wholly-owned  subsidiary of the Company,  with and into Astratek,  with Astratek
becoming  the  wholly-owned   subsidiary  of  the  Company,   as  the  surviving
corporation  of the  Merger.  The Merger was  effected  in  accordance  with the
Agreement and Plan of Merger (the "Merger  Agreement"),  dated as of October 23,
1998,  among the  Company,  AAC,  Astratek,  and the  shareholders  of Astratek.
Astratek  develops software tools and related products for Internet and intranet
technology and provides  consulting and professional  services for several major
companies. As the Merger Consideration  delivered to Astratek shareholders,  the
Company issued  2,294,900  shares of the Company's  common stock in exchange for
cancellation  of all the issued and  outstanding  shares of the capital stock of
Astratek  prior to the Merger and the issuance of 100 shares of Astratek  common
stock to the Company post-Merger.  The acquisition is accounted for as a pooling
of interests business combination.

Item. 6.  Exhibits and reports on form 8-K

                  (a) Exhibits

                  27.0     Financial data schedule.










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                                    SIGNATURE


         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
it's behalf by the undersigned, thereunto duly authorized.



                              TADEO HOLDINGS, INC.





                                      By:/s/Mike Niles
                                            Mike Niles
                                            Corporate Controller


Date: February 16, 1999



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