UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549
                                   FORM 10-K/A

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
                                     OF 1934
                  For the fiscal year ended September 30, 1999
                                       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: 0-27480

                           LAHAINA ACQUISITIONS, INC.
             (Exact name of Registrant as specified in its charter)

                               COLORADO 84-1325695
                (State or other jurisdiction of (I.R.S. Employer
               incorporation or organization) Identification No.)

                        5895 Windward Parkway, Suite 220

                            Alpharetta, Georgia 30005
                    (Address of principal executive offices)

Registrant's telephone number, including area code: (770) 754-6140

Securities registered pursuant to Section 12(b) of the Act: NONE

Securities registered pursuant to Section 12(g) of the Act: Common Stock, No
Par Value

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 ( )

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. (X)

Based on the  closing  price  for the  Registrant's  common  stock of  $2.593 on
January  3,  2000,  the  aggregate  market  value of the  voting  stock  held by
non-affiliates is approximately $15,763,742.

The  number  of  outstanding  shares  of  Common  Stock,  No Par  Value,  of the
Registrant as of January 3, 2000 was 16,332,945.

                       DOCUMENTS INCORPORATED BY REFERENCE

1.   Part IV - Current  Report on Form 8-K dated  August 23, 1999 and filed with
     the commission on September 7, 1999.

2.   Part IV - Registration Statement on Form 10, filed December 29, 1995.
3.   Part IV - Current Report on Form 8-K dated and filed with the commission
     on December 28, 1999.
4.   Part IV - Quarterly Report on Form 10-Q/A for the period ended December 31,
     1998, filed with the commission on October 29, 1999.

5.   Part IV - Post Effective Amendment No. 1 to Registration Statement on Form
     S-1 (Registration No. 333-74607) filed with the commission on October 22,
     1999.
6.   Part IV - Current  Report on Form 8-K dated  September  17,  1999 and filed
     with the commission on September 21, 1999.


<PAGE>


                           LAHAINA ACQUISITIONS, INC.
                              INDEX TO FORM 10-K/A

                                                                            Page

                                         PART I
   ITEM 1.         BUSINESS                                                    3
   ITEM 2.         PROPERTIES                                                  7
   ITEM 3.         LEGAL PROCEEDINGS                                           7
   ITEM 4.         SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS         8

                                         PART II
   ITEM 5.         MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
                   STOCKHOLDER MATTERS                                         9
   ITEM 6.         SELECTED FINANCIAL DATA                                    10
   ITEM 7.         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                   CONDITION AND RESULTS OF OPERATIONS                        11
   ITEM 7A.        QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
                   MARKET RISK                                                18
   ITEM 8.         FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                19
   ITEM 9.         CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
                   ACCOUNTING AND FINANCIAL DISCLOSURE                        38

                                        PART III
   ITEM 10.        DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT         39
   ITEM 11.        EXECUTIVE COMPENSATION                                     39
   ITEM 12.        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
                   MANAGEMENT                                                 41
   ITEM 13.        CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS             42

                                        PART IV
   ITEM 14.        EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
                   FORM 8-K                                                   43

                   SIGNATURES                                                 75




                           FORWARD-LOOKING STATEMENTS

With the  exception of  historical  information,  the matters  discussed in this
Annual Report on Form 10-K include forward-looking statements.  Those statements
relate to  dividends;  business  plans,  programs and trends;  results of future
operations;  uses of future earnings;  satisfaction of future cash requirements;
funding of future growth; acquisition plans; and other matters. Words or phrases
such as  "will,"  "hope,"  "expect,"  "intend,"  "plan" or  similar  expressions
generally are intended to identify forward-looking statements.  Those statements
involve  risks and  uncertainties  that  could  cause  actual  results to differ
materially  from  the  results  discussed   herein.   The  principal  risks  and
uncertainties  that may affect the Company's  actual  performance and results of
operations  include the  following:  general  economic  conditions  and interest
rates;  adverse weather;  changes in property taxes and energy costs; changes in
federal income tax laws and federal mortgage  financing  programs;  governmental
regulation;  changes in  governmental  and public  policy;  changes in  economic
conditions  specific to one or more of the  Company's  markets  and  businesses;
competition;   availability   of  raw  materials;   and  unexpected   operations
difficulties.  Other risks and  uncertainties may also affect the outcome of the
Company's  actual  performance and results of operations.  Readers are cautioned
not to place  undue  reliance  on the  forward-looking  statements  made in,  or
incorporated  by  reference  into,  this  Annual  Report  on Form 10-K or in any
document or statement referring to this Annual Report on Form 10-K.

                                        2
<PAGE>


                                Explanatory Note

This  Annual  Report on Form  10-K/A is filed to amend  certain  portions of our
Annual  Report on Form 10-K/A for the fiscal year ended  September  30,  1999,
as filed with the  Commission on April 25, 2000, in response to comments from
the Securities and Exchange Commission received on May 15, 2000.

                                     PART I

ITEM 1. BUSINESS

GENERAL

     Lahaina  Acquisitions,  Inc.  ("Lahaina" or the "Company") is a multi-state
provider  of  mortgage  brokerage  services  to  consumers  and also  operates a
multi-state  real estate  development  organization.  The  Company's  operations
consist of a mortgage financing  division ("Accent Mortgage  Services,  Inc." or
"AMSI"),  and a real estate development  division ("Accent Real Estate Group" or
"ARG").

     AMSI  is  a  residential  mortgage  broker,  providing  mortgage  brokerage
services  to  consumers  through  several  traditional  branch  offices  located
primarily  in the  Atlanta,  Georgia  metropolitan  area.  AMSI  recently  began
recruiting  activities aimed at adding additional mortgage brokerage  operations
to its branch operations,  utilizing a new branching concept, and as of the date
of  this  report  has  recruited  approximately  200  new  branches.  ARG  is  a
multi-state  real estate  development  organization  engaged in the acquisition,
development and sale of a wide variety of real estate projects.

BACKGROUND AND RECENT DEVELOPMENTS

     The  Company  was  incorporated  under  Colorado  law in April 1989 for the
purpose of  acquiring  an  interest  in one or more  business  opportunities  or
ventures.  Prior to  December  14,  1998,  the Company did not conduct an active
business.

     On December 14, 1998, the Company purchased all of the outstanding stock of
Beachside  Commons  I,  Inc.   ("Beachside")  from  Mongoose  Investments,   LLC
("Mongoose").  Beachside  is the owner of a commercial  real estate  development
located  in  Fernandina  Beach,  Florida  on Amelia  Island.  At the time of the
purchase,  Beachside's  assets  consisted of two buildings and  unimproved  real
estate, tenant leases and minimal operating capital.

     The purchase was  accounted  for as a reverse  acquisition  with  Beachside
being identified as the accounting  acquiror in accordance with Staff Accounting
Bulletin No. 97 ("SAB 97").  Beachside was deemed to be the accounting  acquiror
as its  shareholders  held the  majority  of the  outstanding  shares of Lahaina
following the merger. The acquisition was accounted for as a capital transaction
using the historical cost basis of the acquired  company,  Lahaina,  as it was a
shell company at December 7, 1998.

     On August 23, 1999, Lahaina merged with The Accent Group, Inc.  ("Accent"),
an Atlanta, Georgia based real estate development and mortgage financing entity.
The merger was  accounted  for as a reverse  acquisition  with Accent  being the
accounting  acquiror in accordance with SAB 97. Prior to the merger,  there were
1,321,500  shares of no par  value per share  Accent  common  stock  issued  and
outstanding  (the "Accent Common Stock").  The Accent Common Stock was issued in
exchange for the  contribution to Accent of (i) certain parcels of real property
owned by the holder of such shares (ii) options to purchase  certain  parcels of
real estate,  (iii) 100% interest in AMSI and (iv)  consulting  fees incurred in
connection with the merger. Upon the closing of the merger, each share of Accent
Common Stock was  surrendered  to the Company and the Company  issued a total of
13,251,000  shares of Common Stock to the prior  holders of Accent Common Stock.
Of the  13,251,000  shares of Common  Stock  issued,  4,301,000  were issued and
released  immediately to their holders. The remaining 8,950,000 shares of Common
Stock were issued  subject to certain  conditions of release as set forth in the
Merger Agreement, and are currently being held by the Company.

     The  conditions  of release  were  designed to ensure  that no  shareholder
received shares of Common Stock until they had fully conveyed the  consideration
for the Accent  Common Stock.  As of January 11, 2000,  conditions of release of
such shares have been  satisfied  or waived with respect to a total of 5,600,000
of the  8,950,000  shares of Common  Stock.  The  conditions  of  release of the
remaining  3,350,000  shares of Common  Stock have not, as of January 11,  2000,
been  satisfied.  There is no guarantee  that the remaining  shares will ever be
released.

     Prior to the merger,  the Company  redeemed  1,910,000  shares of Preferred
Stock held by the then-majority  shareholder Richard P. Smyth for 415,000 shares
of Common Stock, entered into consulting

                                        3

<PAGE>


agreements  with each of Gerald F.  Sullivan  and Gator  Glory,  LLC,  a limited
liability  company managed by Smyth, and issued a convertible note in the amount
of $500,000. The proceeds of the convertible note were primarily used to finance
the payment of the Company's  accounts payables incurred through the date of the
merger.

CHANGE IN CONTROL AND MANAGEMENT

     A change of control of the Company  occurred as a result of the Merger.  L.
Scott Demerau ("Demerau"),  directly, through his wife and through his ownership
of Eutopean  Enterprises,  LLC,  controls  approximately  38.6% of the Company's
issued and  outstanding  shares.  When Demerau's  shares are combined with those
held by Accent Associates,  LLC, and Kingdom Generals,  LLC, entities controlled
by relatives of Demerau,  Demerau  controls  approximately  52% of the Company's
issued and  outstanding  Common Stock.  After the conversion of all  convertible
securities,  it is likely that Demerau will remain in control of the Company for
the foreseeable future.

CHANGE IN BOARD OF DIRECTORS

     The board of directors of the Company, as well as the Company's management,
changed as a result of the merger with  Accent.  All  previous  directors of the
Company  resigned  as a result of the  merger  with  Accent,  but prior to their
resignation they elected L. Scott Demerau, Sherry Sagemiller,  Betty M. Sullivan
and Bart Siegel as directors of the Company.

     Each  of the  directors  above,  with  the  exception  of Bart  Siegel  are
employees  of the  Company.  Management  of the  Company's  operations  has been
transferred to the Atlanta, Georgia based Accent Group.

BUSINESS OPERATIONS

     As a result of the merger  with  Accent,  the Company  acquired  additional
assets,  primarily in the form of real estate and a mortgage  financing  entity.
The Company's  operations  consist of a mortgage  financing  division and a real
estate development division.

ACCENT MORTGAGE SERVICES (AMSI)

     AMSI is a residential mortgage broker providing mortgage brokerage services
to consumers through several traditional branch offices located primarily in the
Atlanta,  Georgia  metropolitan area. AMSI recently began recruiting  activities
aimed  at  adding  additional  mortgage  brokerage   operations  to  its  branch
operations, utilizing a new branching concept. Under this concept, AMSI recruits
mortgage  brokerage  professionals  to  originate  mortgage  loans under  AMSI's
license in those  states  where AMSI is licensed to provide  mortgage  brokerage
services.  All fees associated with  originating and closing  mortgage loans are
forwarded to AMSI, from which AMSI then distributes the appropriate  commissions
(net of AMSI's  fees).  AMSI  provides  training and  substantial  marketing and
administrative support to its branches.  Branches utilize AMSI's senior level of
licensing,  along with AMSI's access to a broader range of funding  sources,  to
originate  larger  numbers  of loans  than they  might  otherwise  be capable of
originating.

     AMSI branch offices  actively solicit the origination of a variety of types
of  residential  mortgage  loans,  through  personal  contact as well as via the
Internet.  Interested  consumers are  encouraged  to submit a  pre-qualification
application  via a branch  website,  after which a loan officer  will  establish
personal contact.  AMSI loan officers guide consumers through the entire process
of obtaining a mortgage loan, from the initial  application to the final closing
of the mortgage loan. AMSI has established relationships with multiple potential
funding  sources,  providing a wide  variety of mortgage  financing  options for
consumers.

     AMSI  provides  substantial  marketing  and  administrative  support to its
branch offices,  including access to a proprietary  Internet site for generating
loan application information, communicating with the Company's corporate office,
access  to loan  origination  software,  and  receiving  accounting  information
relating to loan  origination  activity.  Additionally,  AMSI  provides a senior
level of licensing under which its branch offices may originate mortgage loans.

                                        4

<PAGE>


     As of the date of this  report,  AMSI has  recruited  more than 200  branch
offices,  and is presently  licensed to originate  mortgage  loans in 21 states.
AMSI intends to pursue licenses in additional states.

     AMSI also brokers an interim financing product to the manufactured  housing
industry.  The manufactured housing industry is experiencing  significant growth
due to  certain  affordability  factors  associated  with this type of  housing.
AMSI's  interim  financing  product  is  designed  to bridge  the period of time
between the date that a housing  unit is shipped to its  permanent  site and the
date that permanent mortgage  financing is closed and funded.  Interim financing
allows the manufactured housing dealer to receive a staged revenue stream during
the process.  AMSI also offers  permanent  mortgage  brokerage  services to this
industry.

     AMSI  contributed  $837,803 or 90.4 percent to the  Company's  consolidated
revenue for the period from July 9, 1999 (date of  inception)  to September  30,
1999.

     The market for the  brokerage of mortgage  loans is rapidly  evolving,  and
competition  for borrowers is intense and is expected to increase  significantly
in the future.  AMSI  believes that the primary  factors  involved in choosing a
mortgage  broker  include  personalized  service,  availability  of  competitive
financing  rates and financing  programs,  and the ease with which the financing
can  be  completed,  among  others.  While  AMSI  believes  it is  an  effective
competitor,  there can be no assurance  that AMSI's  competitors  and  potential
competitors will not develop services and products that are equal or superior to
those of AMSI or that achieve  greater market  acceptance  than its products and
services.

     AMSI also holds a subsidiary, Beachside Commons I, Inc. ("Beachside
Commons"  or  "Beachside").   Beachside  Commons  is  an  oceanfront  mixed  use
commercial  development  located in Fernandina Beach,  Florida on Amelia Island.
Beachside  consisted  of a retail  building and an  oceanfront  lot suitable for
development. On December 30, 1999, Lahaina and AMSI sold Beachside Commons to NP
Holding,  LLC. The Company's former chairman is a member of NP Holding, LLC. The
terms of the sale called for the  purchaser to assume the first  mortgage on the
property  and to  issue  a  note  to the  Company  and  AMSI  in the  amount  of
$3,000,000. The note is secured by 660,000 shares of the Company's common stock;
such shares are held in escrow by a trustee.

     The financial information related to this segment can be found in the
footnotes to the Company's  consolidated financial statements found in Item 8 of
the annual report on Form 10-K.

ACCENT REAL ESTATE GROUP (ARG)

     ARG is a multi-state real estate  development  organization  engaged in the
acquisition,  development and sale of a wide variety of real estate projects. As
a result of the formation of Accent,  and the Company's  subsequent  merger with
Accent and  exercise  of options to acquire  land,  the Company now owns land or
options to acquire land, and has assumed and/or issued associated  indebtedness.
The Company may assume additional  indebtedness should it choose to exercise the
remaining options. A number of the Company's  development-ready projects are now
in various stages of development, including:

     SWISS AIR ESTATES - a lakefront gated residential community located at Lake
Sidney  Lanier,  just north of  metropolitan  Atlanta,  Georgia.  This  property
consists of 12 estate-sized lots priced from $350,000 to more than $900,000. The
property is zoned and is under development.

     CASTLEBERRY  RESIDENTIAL COMMUNITY - The Company holds an option to acquire
a 33 acre  parcel  in  Cumming,  Georgia.  The  Company  intends  to  develop  a
multi-family residential townhouse community. Plans call for the development and
sale of approximately 190 mid-level  townhomes in the $150,000 to $180,000 price
range. The property is zoned, and the project is in the design phase.

     PEACHTREE  INDUSTRIAL  BOULEVARD - a  commercial/industrial  tract totaling
approximately  50 acres  located on  Peachtree  Industrial  Boulevard  in Fulton
County,  Georgia.  This  tract  is in the  design  stages,  and  plans  call for
development of an industrial park.

     ATHENS,  TENNESSEE - The Company holds an option to acquire land in Athens,
Tennessee. Plans call for the development of an upscale residential modular home
community totaling approximately 65 lots on a 40 acre tract.

                                        5

<PAGE>


     In addition to the properties listed above, Demerau holds redeemable common
stock relating to options to purchase three family entertainment centers located
in Roswell,  Georgia, Cocoa Beach, Florida and Pensacola,  Florida. Such options
are to be delivered to the Company by Demerau.  Release of the redeemable Common
Stock to Demerau is contingent upon delivery of the options on or before July 9,
2000. The entertainment centers consist of miniature golf and game facilities.

     ARG competes with commercial  developers,  real estate  companies and other
real estate owners for development and acquisition  opportunities  in all of its
market  areas.  While ARG  believes it is an  effective  competitor  in the real
estate development  market,  certain of its competitors may have greater capital
and other resources than those of the Company.

     The  financial  information  related  to this  segment  can be found in the
footnotes to the Company's  consolidated financial statements found in Item 8 of
the annual report on Form 10-K.

GOVERNMENT REGULATION

     The  Company's  mortgage  brokerage  services  division and its real estate
development  division  are  subject to  various  laws and  regulations.  AMSI is
subject  to rules  and  regulations  promulgated  by  federal,  state  and local
regulatory agencies in connection with originating, processing, underwriting and
selling mortgage loans.  These rules and regulations,  among other things impose
licensing obligations on AMSI, prohibit  discrimination,  establish underwriting
guidelines and mandate disclosures and notices to borrowers.  ARG is required to
comply with various federal,  state and local  environmental,  zoning, land use,
licensing and other laws and regulations  which govern its operations.  Existing
regulations may have a material  adverse impact on the Company's  operations by,
among other things, imposing additional compliance costs and delaying the period
in which  mortgages  may be processed or real estate  projects may be brought to
market.

     To date, the Company has not expended significant  resources on lobbying or
related government affairs issues but may be required to do so in the future.

EMPLOYEES

     As of the date of this  report,  the Company  employs 25 people  within its
corporate division and has approximately 300 branch employees.

                                        6
<PAGE>



EXECUTIVE OFFICERS OF THE COMPANY

     Certain  information  about the  Company's  executive  officers is provided
below.

     L. Scott Demerau,  age 39, was elected as a director,  the Chief  Executive
Officer and  President of the Company  effective  August 23, 1999.  Mr.  Demerau
holds  a  B.A.  from  the  Ferris  State  University.   Mr.  Demerau  began  his
entrepreneurial career in 1986 by forming a family entertainment center company,
Mountasia.  Mountasia  held an Initial  Public  Offering in 1993 and merged with
Malibu  Entertainment  Worldwide in 1994 where he served as Chairman,  President
and CEO until 1997.  From 1997 to 1999,  Mr.  Demerau  served as a consultant to
Malibu. Mr. Demerau has served as a director of Malibu since 1993.

     Betty M.  Sullivan,  age 49, was elected as a director,  the Executive Vice
President -  Administration  and Secretary of the Company  effective  August 23,
1999. She is a graduate of the American  Institute of Banking,  Louisiana  State
University.  Ms. Sullivan was Assistant Vice President with Sun Banks of Florida
from 1968 to 1980.  She was owner and  operator  of two  Sonny's  Real Pit BarBQ
Restaurants,  and four Athletic  Attic  Sporting Goods Stores from 1981 to 1986.
She was employed with Malibu  Entertainment  Worldwide  (formerly  Mountasia) as
Vice President of Operations,  Vice President of Human Relations, Vice President
of Investors Relations and Secretary from 1987 to 1999.

     William A. Thurber,  age 46, was elected Executive Vice President - Finance
and Treasurer of the Company effective  September 28, 1999. From 1997 until June
1999, Mr. Thurber served as Treasurer of Vanstar Corporation,  a NYSE technology
services company.  From 1992 to 1997, Mr. Thurber served as Assistant  Treasurer
and Director of Finance for John H. Harland Company,  a NYSE financial  printing
company.  Mr.  Thurber was also  employed  by Harland  from  January  1988 until
November  1988.  From 1989 to 1992,  Mr.  Thurber served as Vice President for a
unit of  NationsBank  Corporation.  From  November  1988 until March  1989,  Mr.
Thurber served as Chief Financial Officer of StarTouch  Communications,  Inc., a
telecommunications  company.  From 1981 to 1988,  Mr.  Thurber  was  employed by
Contel Corporation,  a NYSE  telecommunications  company. From 1977 to 1981, Mr.
Thurber  was  employed  by  Grumman   Corporation,   a  NYSE  aerospace  defense
contractor.  Mr.  Thurber holds an MBA Degree in Corporate  Finance from Hofstra
University,  as well as a BS Degree in  Accounting  from New York  Institute  of
Technology.

ITEM 2.  PROPERTIES

     The  Company's  operations  are  principally  located in a two story office
building  in  Alpharetta,  Georgia,  a suburb of Atlanta.  The Company  occupies
approximately  9,000  square feet of office  space under a lease that expires in
August 2004.  Annual rent  associated  with this office  space is  approximately
$158,000 including  utilities.  ARG presently holds the following properties for
sale and/or development:

     SWISS AIR ESTATES - a lakefront gated residential community located at Lake
Sidney  Lanier,  just north of  metropolitan  Atlanta,  Georgia.  This  property
consists of 12 estate-sized lots priced from $350,000 to more than $900,000. The
property is zoned and is under development.

     PEACHTREE  INDUSTRIAL  BOULEVARD - a  commercial/industrial  tract totaling
approximately  50 acres  located on  Peachtree  Industrial  Boulevard  in Fulton
County,  Georgia.  This  tract  is in the  design  stages,  and  plans  call for
development of an industrial park.

ITEM 3.  LEGAL PROCEEDINGS

     In  July  and  August  1998,  AMSI  acquired  from  SGE  Mortgage   Funding
Corporation  and related  entities  ("SGE")  notes  secured  primarily  by first
security  interest in residences.  The selling  entity,  SGE, has been placed in
receivership  by  Order  of the  Superior  Court of Tift  County,  Georgia.  The
receiver is charged with the  responsibility  of settling  competing  claims, if
any,  to loans made and sold by SGE.  Many of the loans  acquired by the Company
from SGE were later sold to Matrix Bank for a total  purchase price of $623,032.
Matrix Bank  contends  some of the loans are subject to competing  claims or are
non-performing  assets, and has demanded that the Company reacquire these loans.
The Company is  negotiating  with Matrix to resolve these issues,  however,  the
ultimate  resolution  is unknown at this time.  The Company has not provided for
any loss which may result from the Matrix transaction.

                                        7

<PAGE>


     The Company is also subject to various litigation in the ordinary course of
business. In the opinion of management, resolution of such matters will not have
a significant effect on the financial position of the Company.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matter was submitted to a vote of security holders of the Company during
the fourth quarter of the fiscal year ended September 30, 1999.

                                        8

<PAGE>


                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     The Company's  Common Stock trades  over-the-counter  on the bulletin board
operated by the National  Association  of  Securities  Dealers,  Inc.  under the
symbol  "LAHA." The  following  table sets forth the high and low closing bid of
the  Company's  Common Stock for each quarter  during the past two fiscal years.
The prices reflect inter-dealer  quotations without retail mark-ups,  mark downs
and  commissions,  and do not necessarily  represent  actual  transactions.  The
Company's securities began trading in August 1996.


<TABLE>
<CAPTION>

                                                    High           Low
                                                 ----------     ----------
  <S>                                           <C>            <C>
   Fiscal Year Ended September 30, 1999:
      Fourth Quarter                             $    6.750     $    3.125
      Third Quarter                                   4.625          0.500
      Second Quarter                                  4.000          1.500
      First Quarter                                   4.000          0.031
   Fiscal Year Ended September 30, 1998:
      Fourth Quarter                             $    1.500     $    0.875
      Third Quarter                                   3.250          0.875
      Second Quarter                                  3.250          0.875
      First Quarter                                   3.250          0.875

</TABLE>



     As of January 3, 2000 there were approximately 260 holders of record of the
Company's common stock.

     The Company has never  declared  or paid any cash  dividends  on the Common
Stock and does not presently intend to pay cash dividends on the Common Stock in
the foreseeable future.

                                        9

<PAGE>


ITEM 6.  SELECTED FINANCIAL DATA

     As a result of the  merger  between  Lahaina  and  Accent,  the  historical
financial  statements of the Company for the period prior to August 23, 1999 are
the consolidated financial statements of Accent from its date of inception, July
9, 1999.  The operations of Lahaina and AMSI have been included in the Company's
financial  statements  from the date of acquisition.  The selected  consolidated
annual  financial  data presented  below was derived from the Company's  audited
consolidated  financial  statements  for the  period  from July 9, 1999 (date of
inception) to September 30, 1999. This selected  consolidated  annual  financial
data should be read in conjunction with "Management's Discussion and Analysis of
Financial  Condition and Results of Operations" and the  consolidated  financial
statements and notes thereto included elsewhere in this report.


                                                              LAHAINA
                                                         ACQUISITIONS, INC.
<TABLE>
<CAPTION>
                                                        From July 9, 1999 (date
                                                            of inception) to
                                                           September 30, 1999
                                                        -----------------------
<S>                                                       <C>
INCOME STATEMENT DATA:
Revenue                                                    $  1,076,566
Operating loss                                             $    880,443
Loss before income taxes                                   $  1,155,305
Net loss                                                   $  1,155,305
Basic and diluted loss per share                           $      (0.08)

                                                        At September 30, 1999
                                                        ---------------------
BALANCE SHEET DATA:
Total assets                                               $  9,005,426
Total debt                                                 $  9,280,931
Total liabilities                                          $ 11,642,691
Stockholders' deficit                                      $ (2,544,736)
Total liabilities and stockholders' deficit                $  9,005,426

</TABLE>



SELECTED PREDECESSOR FINANCIAL DATA

     The following table presents selected  predecessor  financial data for AMSI
on a historical basis for the periods indicated.  The financial  information for
AMSI for the years ended  December  31,  1998 and 1997 and the six month  period
ended June 30, 1999 are  derived  from the  financial  statements  of AMSI.  The
results for the interim  periods are not  necessarily  indicative of the results
for the full  fiscal  year or any future  period.  Interim  results  reflect all
adjustments,  which  are in  the  opinion  of  management,  necessary  to a fair
statement of these results.


<TABLE>
<CAPTION>

                                                                                                      SIX MONTH
                                                                                                       INTERIM
                                              ACCENT MORTGAGE SERVICES, INC.                            PERIOD
                                             FOR THE YEARS ENDED DECEMBER 31,                           ENDED
                                                                                                       JUNE 30,
                          -----------------------------------------------------------------------    -----------
INCOME STATEMENT DATA:        1994          1995           1996          1997            1998           1999
                          -----------   -----------    -----------    -----------    ------------    -----------
<S>                      <C>           <C>            <C>            <C>            <C>             <C>
Revenue (1)               $   265,996   $   629,854    $ 1,039,172    $ 1,082,090    $  1,211,246    $   236,875
Income (loss) from
operations                $    40,126   $    87,997    $   127,225    $  (149,171)   $ (1,162,610)   $  (200,003)
Income (loss) before
income taxes              $    41,896   $    82,707    $   116,082    $  (168,407)   $ (1,332,030)   $  (389,446)

</TABLE>


(1) Amounts are net of brokerage services expense.


                                       10

<PAGE>


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

     The  following  discussion  of the  results  of  operations  and  financial
condition of Lahaina  Acquisitions,  Inc. should be read in conjunction with the
Consolidated  Financial  Statements and Notes thereto included elsewhere in this
annual report on Form 10-K.

GENERAL

     Lahaina  Acquisitions,  Inc.  ("Lahaina" or the "Company") is a multi-state
provider  of  mortgage  brokerage  services  to  consumers  and also  operates a
multi-state  real estate  development  organization.  The  Company's  operations
consist of a mortgage financing  division ("Accent Mortgage  Services,  Inc." or
"AMSI"),  and a real estate development  division ("Accent Real Estate Group" or
"ARG").

     On August 23, 1999, Lahaina merged with The Accent Group, Inc.  ("Accent"),
an Atlanta, Georgia based real estate development and mortgage financing entity.
The merger was  accounted  for as a reverse  acquisition  with Accent  being the
accounting acquiror in accordance with SAB 97. As a result of the merger between
Lahaina and Accent, the historical  financial  statements of the Company for the
period prior to August 23, 1999 are the  consolidated  financial  statements  of
Accent from its date of inception,  July 9, 1999.  The operations of Lahaina and
AMSI have been included in the Company's  financial  statements from the date of
acquisition. The discussion of the results of operations and financial condition
of Lahaina  represents  the period from the date of inception  (July 9, 1999) to
September 30, 1999.

RESULTS OF OPERATIONS - LAHAINA ACQUISITIONS, INC.

FOR THE PERIOD FROM JULY 9, 1999 (DATE OF INCEPTION) TO SEPTEMBER 30, 1999

Revenues

     Revenues  for the  period  from the  date of  inception  (July 9,  1999) to
September  30, 1999  totaled  $1,076,566.  Broker fee income  generated  by AMSI
represented  $837,803 (or approximately  77.8 percent) of total revenues for the
period.  This broker fee income represents fees associated with the brokerage of
mortgage loans by AMSI branch offices.

     Revenues  for ARG totaled  $238,763 for the period (or  approximately  22.2
percent of total revenues). Revenues for ARG represented the sale of a parcel of
land  at the  Company's  Peachtree  Industrial  Boulevard  commercial/industrial
development.

Operating Expenses

     Operating expenses for the period from the date of inception (July 9, 1999)
to September 30, 1999 totaled $1,957,009.  The principal components of operating
expenses  for the period were broker  commissions  ($708,508  or 36.2 percent of
total operating expenses), general and administrative expenses ($479,308 or 24.5
percent  of total  operating  expenses),  professional  fees  ($294,819  or 15.1
percent of total operating  expenses),  salaries and employee benefits ($262,910
or 13.4  percent of total  operating  expenses),  and cost of real  estate  sold
($149,854 or 7.7 percent of total operating expenses).

     The principal  components of broker  commissions  ($708,508 for the period)
were  commissions  paid by AMSI to branch  offices  for loans  brokered  by each
branch  ($696,300 for the period).  Such expenses  represent  commissions due to
branch  offices  net of  applicable  fees due to  AMSI.  The  remaining  $12,208
represents  commissions  paid by ARG in connection  with the sale of a parcel of
land  at the  Company's  Peachtree  Industrial  Boulevard  commercial/industrial
development.

     General and  administrative  expense ($479,308 for the period) consisted of
$336,789 (or 70.3 percent of the total)  attributable to the mortgage  brokerage
segment,  $127,247  (or 26.5  percent of the total)  attributable  to  corporate
activities,  and $19,971 (or 4.1 percent of the total)  attributable to the real
estate development segment.

                                       11

<PAGE>


     The  principal  components  of the  $336,789 of general and  administrative
expense  attributable  to the mortgage  brokerage  segment were  advertising and
marketing  ($72,679),   travel  and  entertainment  ($32,927),   printing  costs
($30,631) and  telephone  expenses  ($23,539).  The mortgage  brokerage  segment
experienced significant expansion of its branch operation during the period, and
as a result experienced significant costs associated with this expansion.

     The  principal  components  of the  $127,247 of general and  administrative
expense  attributable to corporate  activities were supplies  ($26,076),  filing
fees ($17,193) and travel and entertainment ($32,927).

Other Expense (Income)

     Other expense  (income) for the period from the date of inception  (July 9,
1999) to September 30, 1999 totaled $274,862,  primarily  consisting of interest
expense  ($138,906  for the  period),  liquidated  damages  under the  Company's
convertible  notes  ($81,500 for the  period),  other  expense  ($55,804 for the
period) and other income ($1,348 for the period).

     Interest expense ($138,906) represents interest expense associated with the
Company's  borrowings.  Approximately  $38,832  of the  total  interest  expense
relates to the Company's warehouse line, which was suspended as of July 9, 1999.
Approximately  $78,536  of the total  interest  expense  relates  to  borrowings
associated  with the Company's real estate  holdings.  The remaining  $21,538 of
interest expense relates to general corporate indebtedness.

     Liquidated  damages of $81,500 were recorded  during the period relating to
the  Company's  convertible  notes.  During the period  the  Company  was not in
compliance with certain provisions of the note agreements, primarily relating to
maintaining  an effective  registration  statement for the  registration  of the
conversion shares and non-payment of interest and liquidated damages.

Net Loss

     The Company recorded a net loss of $1,155,305 for the period from inception
(July 9, 1999) to  September  30,  1999.  This net loss  represents  a basic and
diluted loss per common share of $0.08.

RESULTS OF OPERATIONS - ACCENT MORTGAGE SERVICES, INC. HISTORICAL

     The following table sets forth the operating results for AMSI for the years
ended  December 31,  1996,  1997 and 1998 and for the nine months ended June 30,
1999.

<TABLE>
<CAPTION>

                                                          YEAR ENDED DECEMBER 31,                  SIX MONTHS ENDED JUNE 30,
                                                ---------------------------------------------     ---------------------------
                                                    1996            1997            1998             1998            1999
                                                ------------     ------------    ------------     -------------   -----------
<S>                                            <C>                 <C>          <C>              <C>             <C>
Revenue (1)                                     $  1,039,172     $  1,082,090    $  1,211,246     $   631,518     $   236,875
Selling, general and administrative expenses         911,947        1,231,261       2,373,856         723,183         436,878

Other - net                                           11,143           19,236         169,420          65,133         189,443
                                                ------------     ------------    ------------     -----------     -----------
Operating income (loss)                         $    116,082     $   (168,407)   $ (1,332,030)    $  (156,798)    $  (389,446)
                                                ============     ============    ============     ===========     ===========
</TABLE>



(1) Amounts are net of brokerage services expense.

FOR THE YEAR ENDED DECEMBER 31, 1997 COMPARED WITH 1996

Revenues

     AMSI generated  revenues of $1,082,090 for the year ended December 31, 1997
compared  with  $1,039,172  for the 1996  period,  representing  an  increase of
$42,918 (or 4.1%).  The  increase in revenues is  primarily  attributable  to an
increase in loan origination volume.

                                       12

<PAGE>


Expenses

     Selling,  general and  administrative  expenses totaled  $1,231,261 for the
year ended  December  31,  1997  compared  with  $911,947  for the 1996  period,
representing  an  increase  of $319,314  (or  35.0%).  The  increase in selling,
general  and  administrative  expenses  is  primarily  attributable  to expenses
associated with efforts to grow the business.  Interest  expense and other - net
totaled  $19,236 for the year ended  December 31, 1997 compared with $11,143 for
the comparable 1996 period,  representing an increase of $8,093 (or 72.6%). This
increase  is  primarily  attributable  to  higher  borrowing  levels  in 1997 as
compared with 1996.

Operating Income (Loss)

     AMSI recorded a net operating  loss of $168,407 for the year ended December
31, 1997  compared with  operating  income of $116,082 for the  comparable  1996
period.

FOR THE YEAR ENDED DECEMBER 31, 1998 COMPARED WITH 1997

Revenues

     AMSI generated  revenues of $1,211,246 for the year ended December 31, 1998
compared with  $1,082,090 for the year ended December 31, 1997,  representing an
increase  of  $129,156  (or  11.9%).  This  increase  in  revenue  is  primarily
attributable to an increase in the volume of mortgage loans  originated  through
AMSI's branch operations.

Expenses

     Selling,  general  and  administrative  expenses  totaled  $2,373,856,   as
compared with  $1,231,261 for the  comparable  period in 1997,  representing  an
increase of $1,142,595 (or 92.8%). The principal components of selling,  general
and administrative  expenses for the year ended December 31, 1998 were Provision
for Losses ($853,056) and General and Administrative expenses ($1,520,800).  The
provision  for  loan  losses  is due to a large  portfolio  of loans  that  were
purchased  during 1998.  After the loans were purchased,  it was determined that
the loans had also been sold to others by the seller.  For the  comparable  1997
period,   the  principal   component  of  operating  expenses  was  General  and
Administrative expense. Interest expense and Other - Net totaled $19,236 for the
year ended December 31, 1998, versus $169,420 for the comparable period in 1997.
The  increase  in  interest  expense is due to  increased  borrowings  under the
warehouse lines of credit during 1998.

Operating Loss

     AMSI  recorded  a net  operating  loss of  $1,332,030  for the  year  ended
December  31,  1998,  compared  with a net  operating  loss of $168,407  for the
comparable period in 1997.

FOR THE SIX MONTHS ENDED JUNE 30, 1999 COMPARED WITH 1998

Revenues

     For the six month period ended June 30, 1999, AMSI generated total revenues
of $236,875,  principally related to brokerage service  operations.  For the six
month period ended June 30, 1998,  AMSI  generated  total  revenues of $631,518.
Total revenues  decreased by $394,643,  principally the result of a lower volume
of mortgage loan originations.

Expenses

     Selling,  general and  administrative  expenses totaled $436,878,  compared
with  $723,183  in the  comparable  period in 1998,  representing  a decrease of
$286,305.  The  principal  components  of  operating  expenses for the six month
period ended June 30, 1999 were Provision for Losses ($50,000),  and General and
Administrative  expenses  ($386,878).   The  principal  component  of  operating
expenses  for the  comparable  period  in 1998 was  General  and  Administrative
expense.  A  decrease  of  $286,305  in  General  and   Administrative   expense
represented  the most  significant  change  during the period.  The  decrease is
primarily  due to  consulting  fees of  approximately  $240,000  which were paid
during the first six months of 1998 but not in 1999.  Interest expense and other
- net totaled  $65,133 for the six months ended June 30, 1998,  versus  $189,443
for the comparable  period in 1999. The increase is primarily due to the loss on
disposal of property and equipment ($167,645) that occurred during 1999.

                                       13
<PAGE>



Operating Loss

     AMSI  recorded a net  operating  loss of $389,446  for the six month period
ended June 30, 1999 as compared  with a net  operating  loss of $156,798 for the
comparable period in 1998.

LIQUIDITY AND CAPITAL RESOURCES

     For the period from July 9, 1999 (date of inception) to September 30, 1999,
the Company used $2,433,439 in net cash in operating  activities,  a significant
portion of which is represented by the Company's net loss of $1,155,305. A total
of  $2,250,187  of net cash was used for the  purchase and  development  of real
estate held for development. Increases in accounts payable ($1,108,416), accrued
interest payable ($103,815) and proceeds from the sale of real estate ($238,763)
served to offset a portion of the net cash used in operating activities.

     The Company used  $159,750 in net cash in investing  activities  during the
period from July 9, 1999 (date of inception) to September 30, 1999,  principally
for the merger with Lahaina  Acquisitions,  Inc. and the  acquisition  of Accent
Mortgage  Services,  Inc. The Company  acquired cash totaling  $248,245 in these
acquisitions.  Purchases  of  property  and  equipment  totaled  $87,774 for the
period,  while  proceeds from the sale of property and equipment  totaled $4,779
for the period from July 9, 1999 (date of inception) to September 30, 1999.

     The  Company  generated  $2,608,489  in  net  cash  provided  by  financing
activities for the period from the date of inception (July 9, 1999) to September
30, 1999, principally in the form of additional  borrowings.  The primary source
of new borrowings  (approximately  $2,100,000) was associated with the Company's
purchase of a parcel of land located on Peachtree Industrial Boulevard in Fulton
county,  Georgia,  north of metropolitan  Atlanta.  Additionally,  approximately
$525,000 of the increase in borrowings was associated with general corporate and
working capital  activities.  Repayments of notes payable totaled $16,511 during
the period.

     Historically,  the Company and its subsidiaries have not generated positive
cash flow. The Company has  restructured  several of its borrowing  arrangements
subsequent to September 30, 1999. The convertible  note  arrangement was amended
to provide  for an  extended  cure  period  with  respect  to certain  events of
default.  There is no cash flow  impact  with  respect  to curing  the events of
default as the cure can be achieved by issuing and  delivering  common  stock of
the Company.

     The warehouse line of credit has been  restructured  to accept certain real
estate  owned as a reduction  in the  warehouse  line of credit.  The  remaining
outstanding  amounts are interest only with  principal  payments  subject to the
resolution of the SGE Mortgage Funding  Corporation  matter described in notes 7
and 9 to the Company's  financial  statements  included in this annual report on
Form 10-K.

     Management's  plan is to continue to  restructure or refinance its existing
obligations, increase the volume of mortgage loans brokered through its mortgage
operations, develop and sell its various parcels of real estate and, ultimately,
to achieve profitable operations and positive cash flow.

     The  Company  intends to pursue  selected  acquisition  opportunities.  The
timing or success of any acquisition efforts is unpredictable.  Accordingly, the
Company is unable to  accurately  estimate  its  expected  capital  commitments.
Funding  for  future  acquisitions  will  likely  come  from  a  combination  of
additional borrowings and the issuance of additional equity.

     On January 11, 2000, the Company announced that it had executed a letter of
intent to acquire  all of the issued and  outstanding  common  stock of Paradigm
Mortgage Associates, Inc. ("Paradigm") of Jacksonville, Florida. Paradigm is one
of the largest  cooperative  branch mortgage  companies in the country with more
than 250 branch offices. In its announcement,  the Company stated that a plan of
acquisition  should be defined by January 31, 2000 and that the  transaction  is
expected  to close  within 60 days.  Closing of the  transaction  is subject to,
among other things,  negotiation  of a definitive  agreement and plan of merger,
satisfactory  completion of a due diligence review,  approval by both companies'
boards of directors, and appropriate regulatory approvals.

YEAR 2000 READINESS


                                       14

<PAGE>


     We have  not  incurred  any  material  costs  nor have we  experienced  any
operational problems as a result of Year 2000 issues.

NEW ACCOUNTING STANDARDS

     In June 1998,  the  Financial  Accounting  Standards  Board  (FASB)  issued
Statement of Accounting  Standard  ("SFAS") No. 133,  Accounting  for Derivative
Instruments  and Hedging  Activities,  which will  require  that all  derivative
financial  instruments  be  recognized as either  assets or  liabilities  on the
balance  sheet.  In June 1999,  the FASB  issued SFAS No.  137,  Accounting  for
Derivative  Instruments and Hedging  Activities - Deferral of the Effective Date
of SFAS No. 133,  which deferred the  implementation  of SFAS No. 133 until June
15, 2000.  SFAS No. 133 will be effective  for the  Company's  first  quarter of
fiscal 2001.  The Company is evaluating the effects of the new statement and how
to implement the new requirements.

     In December  1999,  the  Securities  and Exchange  Commission  issued Staff
Accounting  Bulletin  No.  101 (SAB  101).  SAB 101  provides  clarification  in
applying  generally  accepted  accounting  principles to revenue  recognition in
financial statements.  Management does not anticipate that the implementation of
SAB 101 will have a material effect on the Company's financial statements.

RISK FACTORS

     In evaluating  the Company and its lines of business,  the  following  risk
factors should be considered:

MORTGAGE BROKERAGE SERVICES RISKS

IF INTEREST RATES RISE OR GENERAL ECONOMIC CONDITIONS DETERIORATE, IT COULD HARM
OUR BUSINESS

     AMSI will likely  originate fewer mortgage loans if interest rates rise. In
periods of rising interest rates,  demand for mortgage loans typically declines.
During those periods,  AMSI will likely  originate  fewer mortgage loans and its
revenues  will  decline.   Demand  for  refinancing   mortgages   declines  more
significantly  than for new home  purchase  mortgages  during  periods of rising
interest  rates.  AMSI's  business  would be  adversely  affected  by  declining
economic  conditions  in  those  states  where  it  originates  mortgage  loans,
particularly in their residential real estate markets.

AMSI HAS BEGUN A NEW  BUSINESS  STRATEGY TO INCREASE ITS BRANCH  OPERATIONS.  IF
THIS STRATEGY IS UNSUCCESSFUL, IT COULD HARM OUR BUSINESS

     AMSI,  which has been primarily  involved in providing  mortgage  brokerage
services to consumers through several  traditional branch offices located in the
metropolitan Atlanta, Georgia area, has begun to aggressively recruit additional
mortgage brokerage  operations to its branch operations.  AMSI believes that the
implementation  of this strategy will increase its share of the domestic  market
for mortgage  origination.  However,  the Company may not be  successful  in its
attempts to recruit new branch offices.

IF WE DO NOT  COMPLY  WITH  MORTGAGE  BANKING  RULES  AND  REGULATIONS  OR OTHER
REGULATORY REQUIREMENTS, OUR BUSINESS MAY BE HARMED

     AMSI's business is subject to the rules and regulations of various federal,
state and local regulatory agencies in connection with originating,  processing,
underwriting  and selling  mortgage loans.  These rules and  regulations,  among
other things,  impose licensing  obligations on AMSI,  prohibit  discrimination,
establish  underwriting  guidelines  and  mandate  disclosures  and  notices  to
borrowers.  AMSI is also  required  to  comply  with  each  regulatory  entity's
financial  requirements.  If AMSI does not comply with these rules,  regulations
and requirements,  the regulatory agencies may restrict its ability to originate
mortgage loans.  Regulatory and legal requirements are subject to change and may
become more  restrictive,  making  compliance  more  difficult  or  expensive or
otherwise  restricting  AMSI's  ability to  conduct  its  business  as it is now
conducted.  As of June 30, 1999,  AMSI was not in compliance with the Department
of Housing and Urban Development ("HUD") net worth requirements. As of September
21, 1999, AMSI took corrective action to resolve this matter. AMSI believes that
it is currently in material  compliance with all applicable laws and regulations
to which it is currently  subject.  However,  no assurance can be given that the
costs of future  compliance  will not be  significant or that AMSI is in fact in
compliance with all applicable laws and regulations.

                                       15


<PAGE>


THE  MARKET  IN WHICH  WE  OPERATE  IS  INTENSELY  COMPETITIVE  AND  ACTIONS  BY
COMPETITORS COULD HARM OUR BUSINESS

     AMSI competes with other mortgage  brokerage  companies,  many of which are
larger,  are more  experienced  and have greater  financial  resources  than the
Company.  Accordingly,  AMSI  may  not be able to  successfully  compete  in the
mortgage  brokerage  market.  Competitors may be able to respond more quickly to
take  advantage  of new or changing  opportunities,  technologies  and  customer
requirements.  They also may be able to  undertake  more  extensive  promotional
activities,  offer more attractive  terms to borrowers and adopt more aggressive
pricing policies.

REAL ESTATE DEVELOPMENT RISKS

IF THE REAL ESTATE INDUSTRY OR GENERAL ECONOMIC CONDITIONS DETERIORATE, IT COULD
HARM OUR BUSINESS

     Real estate markets are cyclical in nature and highly  sensitive to changes
in national and regional economic  conditions,  including,  among other factors,
levels of employment and discretionary  disposable income,  consumer confidence,
available  financing and interest rates. A downturn in the economy in general or
in the market for  residential  or commercial  real estate could have a material
adverse effect on ARG's business,  operating results and financial condition. In
addition,  concentration in a given region may increase ARG's  susceptibility to
an economic downturn. Most of the real estate owned or held by ARG is located in
the southeastern United States, thus increasing the Company's  susceptibility to
the economic conditions of the southeast.

IF THE REAL  ESTATE  INDUSTRY  OR GENERAL  ECONOMIC  CONDITIONS  DETERIORATE  IN
METROPOLITAN  ATLANTA,  GEORGIA AND FERNANDINA BEACH, FLORIDA, IT COULD HARM OUR
BUSINESS

     The majority of ARG's real estate is located in and around the metropolitan
Atlanta, Georgia area and Fernandina Beach, Florida. There are substantial risks
associated with a large  investment in real estate.  These include the following
risks:

     - real  property  may decline in value due to changing  market and economic
conditions;

     - development and carrying costs may exceed  anticipated costs;

     - there may be delays in bringing inventories to market due to, among other
things,  changes in regulations,  adverse  weather  conditions or changes in the
availability of development financing on terms acceptable to the Company; or

     - interest rates may increase  which will  adversely  affect the ability of
the Company to sell their properties.

WE ARE SUBJECT TO CERTAIN  REGULATIONS  RELATED TO REAL ESTATE, AND IF WE DO NOT
COMPLY OUR BUSINESS MAY BE HARMED

     ARG's real estate business is subject to certain  federal,  state and local
regulations  and is  required to comply with  various  federal,  state and local
environmental,  zoning,  land use,  land  sales,  licensing  and other  laws and
regulations which govern its operations. Existing or future regulations may have
a material adverse impact on ARG's  operations by, among other things,  imposing
additional  compliance  costs and delaying  the period in which the  development
projects are brought to market.  ARG believes that it is in material  compliance
with all  applicable  laws and  regulations  to which it is  currently  subject.
However,  no assurance can be given that the costs of future compliance will not
be significant or that ARG is in fact in compliance with all applicable laws and
regulations.  In addition,  there can be no assurance that laws and  regulations
applicable to ARG in any specific jurisdiction will not be revised or that other
laws or  regulations  will not be adopted  which could  increase  ARG's costs of
compliance or prevent ARG from marketing or selling its properties.  Any failure
of ARG to comply with  applicable  laws or  regulations  or any  increase in the
costs of  compliance  could have a material  adverse  effect on ARG's  business,
operating results and financial condition.

                                       16

<PAGE>


IF OUR INVENTORY IS FOUND TO BE ENVIRONMENTALLY CONTAMINATED OUR BUSINESS MAY
BE HARMED

     Under various  federal,  state and local laws,  ordinances and regulations,
the current or previous  owner,  manager or  operator  of real  property  may be
liable for the costs of removal or  remediation  of certain  hazardous  or toxic
substances  located  on or in, or  emanating  from,  such  property,  as well as
related  costs of  investigation  and property  damage.  These laws often impose
liability  without regard to whether the owner,  manager or operator knew of, or
was  responsible  for, the presence of the  hazardous or toxic  substances.  ARG
believes  that it is in  compliance  in all material  respects  with all federal
state and local laws,  ordinances and regulations  regarding  hazardous or toxic
substances,  but no assurance  can be given that  hazardous or toxic  substances
will not be found on its property or properties that it previously owned.

THE  MARKET  IN WHICH  WE  OPERATE  IS  INTENSELY  COMPETITIVE  AND  ACTIONS  BY
COMPETITORS COULD HARM OUR BUSINESS

     The real estate industry is highly competitive. ARG competes with builders,
developers and others for the acquisition of desirable properties and financing.
Many of ARG's competitors are larger and possess greater  financial,  marketing,
personnel and other resources.  Although ARG believes it can effectively compete
in its market areas,  no assurances  can be given as to ARG's future  ability to
locate,  develop and sell attractive properties in the market in which it wishes
to operate. Further, the entrance of high profile and well-established operators
into ARG's market areas may have a material adverse effect on ARG's operations.

GENERAL BUSINESS RISKS

WE HAVE A LIMITED OPERATING HISTORY AND THEREFORE  HISTORICAL RESULTS MAY NOT BE
INDICATIVE OF FUTURE PERFORMANCE

     The merger with Accent resulted in a change of control of the Company and a
change in the Company's management. The Company has a limited operating history,
and its  historical  results  of  operations  are  not  useful  as a  basis  for
predicting  future operating  results of the Company.  No assurance can be given
that the future operations of the Company will be successful.

WE MAY BE UNABLE TO RAISE ADDITIONAL  FUNDING TO PURSUE OUR STRATEGIES WHICH MAY
HARM OUR BUSINESS

     The Company  anticipates the need for additional  capital as it pursues its
business  strategy.  The Company expects to raise  additional  capital through a
combination  of new debt  issuances  and equity  sales,  from private as well as
public sources.  Issuance of new debt and/or the sale of equity will likely have
a dilutive  effect on the Company and its  shareholders.  Implementation  of the
Company's strategy and its business plans is contingent upon the availability of
such funding sources. No assurance can be given that the Company will be able to
raise debt or equity capital, at terms that are acceptable to the Company, or at
all, in order to fund its operations as set forth above.

THE  UNPREDICTABILITY  OF OUR  QUARTER-TO-QUARTER  RESULTS  MAY HARM THE TRADING
PRICE OF OUR COMMON STOCK

     Because the Company has a limited  operating  history,  it lacks sufficient
historical  operating  data on which to base its future  operating  results  and
financial performance.  General economic conditions, as well as competition from
other  competing  businesses,  may adversely  affect the Company's  performance.
Because of these and other  factors,  the Company's  financial  performance  may
fluctuate from period to period, which could result in a material fluctuation in
the trading price of the Company's common stock.

WE ARE A GROWTH COMPANY, WHICH ENTAILS RISKS THAT COULD HARM OUR BUSINESS

     Inability of management to adequately manage the operations of the business
may subject the business of the Company to certain  risks,  in addition to those
commonly found in a growing company. These risks include:

     - obtaining additional financing;

     - providing adequate working capital to pay salaries for personnel hired to
acquire and develop  properties before revenue from the properties is sufficient
to pay their salaries;

     - the inability of management to recognize  potential  problems before they
become serious problems;


                                       17


<PAGE>


     - the lack of  sufficient  experience  in the staff to solve  problems once
they are identified; and

     - the risk from competitors.

THE  ISSUANCE OF  ADDITIONAL  SHARES OF COMMON  STOCK IN THE FUTURE MAY HARM THE
BOOK VALUE OF THE OUTSTANDING SHARES OF COMMON STOCK

     To the extent the future funding  requirements  of the Company  require the
issuance of  convertible  securities  or securities or debt having a priority to
the shares of Common  Stock,  the shares of Common Stock may suffer a decline in
book value.

WE DO NOT  ANTICIPATE  PAYING  DIVIDENDS ON OUR COMMON STOCK IN THE  FORESEEABLE
FUTURE

     The  Company  intends  to  retain  all  future  earnings  for  use  in  the
development  of its business.  The Company has never paid and does not currently
anticipate  paying any cash  dividends  on its Common  Stock in the  foreseeable
future.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The  Company is exposed to market risk from  changes in  interest  rates on
variable  rate debt.  At September  30, 1999,  approximately  2.7 percent of the
Company's  total  indebtedness  of $9,280,931 is subject to changes in the prime
rate of  interest.  Additionally,  the  short-term  nature of a  portion  of the
Company's  indebtedness  will  require  that  portions  of the  Company's  total
indebtedness  be  renegotiated.  The  Company  will be subject to any changes in
general interest rates at the time any of such debt is renegotiated.

     The table below  presents  the  principal  cash flows and related  weighted
average  interest  rates on debt by expected  maturity dates as of September 30,
1999. Debt that is presently in default is considered to be current for purposes
of this table:

<TABLE>
<CAPTION>

                                           FISCAL YEAR ENDING SEPTEMBER 30,
                           -----------------------------------------------------------------
                                                                                                      FAIR
                              2000              2001              2002             TOTAL              VALUE
                           -----------        ---------       -----------        -----------       ----------
<S>                       <C>                <C>             <C>                <C>               <C>
Fixed rate debt            $ 6,483,893        $      --       $ 2,542,038        $ 9,025,931       $9,025,931
Average interest rate              8.9%             0.0%              9.3%               9.0%

Variable rate debt         $   255,000        $      --       $        --        $   255,000       $  255,000
Average interest rate              9.0%             0.0%              0.0%               9.0%

</TABLE>



                                       18

<PAGE>



ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA



                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders
Lahaina Acquisitions, Inc.


     We have  audited the  accompanying  consolidated  balance  sheet of Lahaina
Acquisitions,  Inc. and subsidiaries (formerly The Accent Group, Inc. - see Note
1) (the  "Company")  as of  September  30,  1999,  and the related  consolidated
statements of  operations,  stockholders'  deficit and cash flows for the period
from July 9, 1999 (date of  inception) to September  30, 1999.  These  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

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

     In our opinion,  such consolidated  financial statements present fairly, in
all  material   respects,   the  consolidated   financial  position  of  Lahaina
Acquisitions, Inc. and subsidiaries (formerly The Accent Group, Inc. see Note 1)
as of September 30, 1999, and the  consolidated  results of their operations and
their  cash  flows  for the  period  from July 9, 1999  (date of  inception)  to
September 30, 1999, in conformity with generally accepted accounting principles.

/s/  DELOITTE & TOUCHE LLP


Atlanta, Georgia
January 11, 2000

                                       19

<PAGE>




                           LAHAINA ACQUISITIONS, INC.
                           CONSOLIDATED BALANCE SHEET
                               SEPTEMBER 30, 1999

                                     ASSETS
<TABLE>
<S>                                                                        <C>
Cash and cash equivalents                                                   $     15,300
Restricted cash                                                                   77,352
Restricted certificates of deposit                                               126,249
Real estate held for sale                                                      3,650,000
Real estate held for development                                               2,958,143
Foreclosed real estate                                                           593,960
Mortgage loans held for sale, net                                                     --
Options to acquire real estate                                                   122,893
Property and equipment, net                                                       87,101
Goodwill, net                                                                    903,042
Other assets                                                                     471,386
                                                                            ------------
         Total assets                                                       $  9,005,426
                                                                            ============

        LIABILITIES AND STOCKHOLDERS' DEFICIT

Liabilities:
   Accounts payable and accrued expenses                                    $  1,837,328
   Accrued interest payable                                                      298,432
   Notes payable - warehouse line                                              1,132,442
   Notes payable                                                               7,537,432
   Due to related parties and stockholders                                       611,057
   Deferred revenue                                                              216,500
   Other liabilities                                                               9,500
                                                                            ------------
         Total liabilities                                                    11,642,691
                                                                            ------------

Commitments and contingencies

Redeemable stock:
   Common stock, no par value; 3,250,000 shares issued and
     outstanding entitled to redemption under certain circumstances              (92,529)
                                                                            ------------


Stockholders' deficit:
   Preferred series A convertible stock, 10,000,000 shares authorized,                --
     no shares issued or outstanding
   Common stock, no par value; 800,000,000 shares authorized,                         --
     12,967,343 shares issued and outstanding

   Additional paid-in capital                                                 (1,389,431)
   Accumulated deficit                                                        (1,155,305)
                                                                            ------------
                                                                              (2,544,736)

                                                                            ------------
         Total liabilities and stockholders' deficit                        $  9,005,426
                                                                            ============
</TABLE>



          See accompanying notes to consolidated financial statements


                                       20

<PAGE>



                           LAHAINA ACQUISITIONS, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
       PERIOD FROM JULY 9, 1999 (DATE OF INCEPTION) TO SEPTEMBER 30, 1999



<TABLE>
<S>                                             <C>
Revenue:
 Broker fee income                               $    837,803
 Sales of real estate                                 238,763
                                                 ------------
  Total revenue                                     1,076,566
                                                 ------------

Operating expenses:
 Broker commissions                                   708,508
 General and administrative                           479,308
 Professional fees                                    294,819
 Salaries and employee benefits                       262,910
 Cost of real estate sold                             149,854
 Amortization of goodwill                              18,609
 Occupancy expense                                     18,600
 Property taxes                                        16,253
 Depreciation and amortization                          8,148
                                                 ------------
  Total operating expenses                          1,957,009
                                                 ------------

Operating loss                                        880,443

Other expense (income):

 Other income                                          (1,348)
 Interest expense                                     138,906
 Liquidated damages under convertible notes            81,500
 Other expense                                         55,804
                                                 ------------
                                                      274,862

Loss before income taxes                            1,155,305

Income taxes                                               --

                                                 ------------
Net loss                                         $  1,155,305
                                                 ============

Basic and diluted loss per share                 $      (0.08)
                                                 ============

Weighted average shares outstanding                14,592,917
                                                 ============
</TABLE>



          See accompanying notes to consolidated financial statements


                                       21

<PAGE>



                           LAHAINA ACQUISITIONS, INC.
                CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT
       PERIOD FROM JULY 9, 1999 (DATE OF INCEPTION) TO SEPTEMBER 30, 1999


<TABLE>
<CAPTION>
                                                      Common Stock           Additional
                                                ------------------------       Paid-in         Accumulated
                                                  Shares        Amount         Capital            Deficit            Total
                                                ----------    ----------    -------------     -------------     -------------

<S>                                            <C>           <C>           <C>               <C>               <C>
Balance at July 9, 1999 (date of inception)             --    $       --    $          --     $          --     $          --

Issuance of common stock - formation            10,001,000            --       (1,571,840)               --        (1,571,840)

Issuance of common stock - merger with
Lahaina Acquistions, Inc.                        2,966,343            --          182,409                --           182,409

Net loss                                                --            --               --        (1,155,305)       (1,155,305)
                                               -----------    ----------    -------------     -------------     -------------

Balance at September 30, 1999                   12,967,343    $       --    $  (1,389,431)    $  (1,155,305)    $  (2,544,736)
                                               ===========    ==========    =============     =============     =============

</TABLE>


          See accompanying notes to consolidated financial statements


                                       22

<PAGE>



                           LAHAINA ACQUISITIONS, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
       PERIOD FROM JULY 9, 1999 (DATE OF INCEPTION) TO SEPTEMBER 30, 1999


<TABLE>
<S>                                                                                <C>
Cash Flows from Operating Activities:
  Net loss                                                                          $ (1,155,305)
  Adjustments:
   Depreciation and amortization                                                          26,748
   Gain on sale of real estate held for development                                      (88,909)
   Loss on sale of property and equipment                                                 20,727
   Issuance of common stock in lieu of cash for consulting services                       96,000
  Changes other than changes resulting from  acquisitions:  (Increase)  decrease
   in:

     Restricted cash                                                                     (71,016)
     Restricted certificates of deposit                                                     (814)
     Other assets                                                                       (467,891)
   (Decrease) increase in:
     Accounts payable                                                                  1,108,416
     Accrued interest payable                                                            103,815
     Deferred revenue                                                                    216,500
   Proceeds from the sale of real estate held for development                            238,763
   Purchase of real estate held for development                                       (2,143,294)
   Purchase of options to acquire real estate                                           (106,893)
   Costs associated with development of real estate                                     (200,703)
   Increase in amounts due from former shareholders of Accent
     Mortgage Services, Inc. under indemnity                                             (63,106)
   Increase in amounts due to related parties                                             53,523
                                                                                    ------------
Net cash used in operating activities                                                 (2,433,439)
                                                                                    ------------

Cash Flows from Investing Activities:
  Purchase of property and equipment                                                     (87,774)
  Proceeds from sale of property and equipment                                             4,779
  Cash acquired in acquisitions                                                          248,245
  Costs associated with the acquisition of Lahaina Acquisitions, Inc.                   (152,500)
  Costs associated with the acquisition of Accent Mortgage Services, Inc.               (172,500)
                                                                                    ------------
Net cash used in investing activities                                                   (159,750)
                                                                                    ------------

Cash Flows from Financing Activities:
  Proceeds from issuance of notes payable                                              2,625,000
  Repayment of notes payable                                                             (16,511)
                                                                                    ------------
Net cash provided by financing activities                                              2,608,489
                                                                                    ------------

Net increase in cash and cash equivalents                                                 15,300
Cash and cash equivalents at beginning of the period                                          --
                                                                                    ------------
Cash and cash equivalents at end of the period                                      $     15,300
                                                                                    ============
                                                                                     (continued)
</TABLE>



          See accompanying notes to consolidated financial statements


                                       23
<PAGE>




                           LAHAINA ACQUISITIONS, INC.
                CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
       PERIOD FROM JULY 9, 1999 (DATE OF INCEPTION) TO SEPTEMBER 30, 1999


<TABLE>
<S>                                                                               <C>
Supplemental disclosure of cash flow information:
  Cash paid during the period from July 9, 1999 (date of
  inception) to September 30, 1999 for interest                                    $     35,091
                                                                                   ============

Supplemental disclosure of non-cash transactions:
  Issuance of common stock related to the purchase of Accent Mortgage
    Services, Inc.                                                                 $    348,160
                                                                                   ============

  Issuance of common stock related to the purchase of Lahaina
    Acquisitions, Inc.                                                             $    182,409

                                                                                   ============

  Issuance of common stock related to the purchase of real estate from the
    Majority shareholder in conjunction with the formation                         $ (2,000,000)
                                                                                   ============

  Issuance of common stock related to the purchase of various options
    to acquire real estate                                                         $     80,000
                                                                                   ============

  Transfer of loans receivable to satisfy warehouse line of credit                 $     80,000
                                                                                   ============
</TABLE>


                                       24

<PAGE>


                           LAHAINA ACQUISITIONS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 1999

1. MERGER TRANSACTIONS

     On  August  23,  1999,  Lahaina   Acquisitions,   Inc.  ("Lahaina"  or  the
"Company"),  merged with The Accent Group,  Inc.  ("Accent"),  such merger being
accounted for as a reverse acquisition with Accent being the accounting acquiror
in  accordance  with  Staff  Accounting  Bulletin  No.  97  ("SAB  97")  as  its
stockholders  received the largest  portion of the voting rights in the combined
company.  For accounting purposes Accent issued 2,966,343 shares in exchange for
the  outstanding  2,966,343  shares  of  Lahaina.  Such  shares  were  valued at
$1,008,557  ($.34 per share) based upon an  independent  appraisal of the Accent
Group common stock.  Additionally the Company  incurred  expenses of $152,500 in
conjunction  with the transaction for a total  consideration  of $1,161,057 plus
liabilities  assumed  of  $3,347,417.  Accent  applied  the  purchase  method of
accounting  to this  acquisition  and  "pushed  down" its basis in the  acquired
assets and  liabilities  to  Lahaina.  The  assignment  of fair values to assets
acquired  and  liabilities  assumed  for Lahaina is  preliminary  and subject to
revision based on the resolution of certain pre-acquisition  contingencies.  The
purchase price was allocated principally to the real estate held for sale in the
amount of $3,650,000  which  represents its expected net realizable value at the
date of purchase.  In addition, an allocation was made to cash and miscellaneous
asset  items in the  amount of  $32,326.  The  remaining  amount  available  for
allocation of $826,148  represents the excess purchase price attributable to the
public shell company acquired and, therefore, was offset against additional paid
in capital in the course of  recording  the  purchase  accounting  for  Lahaina.
Values assigned to the assets and liabilities of Lahaina are as follows:

<TABLE>

           <S>                                        <C>
            Cash and cash equivalents                  $    8,326
            Real estate held for sale                   3,650,000
            Other assets                                   24,000
            Notes payable                              (2,825,000)
            Other liabilities                            (522,417)
                                                       ----------
                                                       $  334,909
                                                       ==========

</TABLE>


     Accent was  formed on July 9, 1999  through a series of  transactions  (the
"Formation Transactions") as follows:

-  The  majority  stockholder  and his family  contributed  land and  options to
   acquire land to Accent and Accent assumed $2,700,000 in related notes payable
   in exchange for 8,525,000 shares of common stock. Due to common ownership and
   control,  the  contributed  land and options  were  recorded by Accent at the
   majority  stockholder and his family's cost basis  ($700,000).  Of the shares
   issued to the majority stockholder,  1,200,000 shares are contingent upon the
   majority stockholder delivering options to acquire three family entertainment
   centers  located in Roswell,  Georgia,  Cocoa Beach,  Florida and  Pensacola,
   Florida  (collectively  the "Family  Facilities").  In the event the majority
   stockholder fails to make available for acquisition by Accent any one or more
   of the Family Facilities for a total consideration  (including the assumption
   of all  debts) not in excess of $1  million  by July 9,  2000,  the  majority
   stockholder  will  forfeit  and convey to Accent,  (i) 60% of the  contingent
   shares  in  the  event  the  Roswell  facility  is  not  made  available  for
   acquisition,  (ii) 35% of the contingent  shares in the event the Cocoa Beach
   facility is not made  available for  acquisition,  (iii) 5% of the contingent
   shares  in the  event  the  Pensacola  facility  is not  made  available  for
   acquisition.  If the majority stockholder makes any one or more of the Family
   Facilities  available for  acquisition for a cost in excess of $1 million and
   fails to  contribute  to the  capital of Accent  cash or other  consideration
   equal to the  amount of such  excess,  then the  majority  stockholder  shall
   forfeit and convey to Accent a fraction of the 1,200,000 shares calculated as
   the  consideration  paid in excess of $1 million  divided by $1 million.  The
   1,200,000 shares of common stock has been recorded as redeemable common stock
   as it is redeemable by Accent for conditions  outlined  above,  which are not
   solely within the control of Accent.

-  Accent acquired Accent Mortgage Services,  Inc. ("AMSI") for 3,626,000 shares
   of its common  stock,  plus the  assumption of certain  outstanding  debt and
   other liabilities.  The stock was valued at $580,160 or $0.16 per share based
   on an independent  appraisal of Accent's stock at the date of formation.  For
   the purposes of securing certain of the AMSI shareholders'  performance under
   the  obligations  imposed under the purchase  agreement,  certain of the AMSI
   shareholders  have pledged  1,450,000  shares of Accent's  common stock.  The
   1,450,000 shares of common stock has been recorded as redeemable common stock
   as it is redeemable by

                                       25
<PAGE>



   Accent for conditions  which are not solely within the control of Accent.  If
   AMSI  either  (i)  during the one year  period  ending  July 9, 2000 fails to
   produce  $500,000 or more of total pre-tax income  including an allocation of
   Accent's  overhead or (ii)  during the two year  period  ending July 9, 2001,
   fails to produce $1.5 million or more of total  pre-tax  income  including an
   allocation of Accent's overhead,  then certain of the AMSI shareholders shall
   forfeit 500,000 of the 1,450,000 shares. The remaining 950,000 pledged shares
   are pledged to secure obligations  against an indemnity provided to Accent by
   certain of the AMSI  shareholders.  These  shares will remain  pledged  until
   Accent is satisfied that all obligations of certain of the AMSI  shareholders
   have been fully satisfied. At July 9, 1999, the former AMSI shareholders owed
   Accent  $257,423 under the indemnity,  which has been recorded as a reduction
   of the redeemable common stock. In addition,  such shareholders  assumed from
   AMSI the  obligation to repay certain notes payable to banks in the amount of
   $247,821;   such  notes  continue  to  be   collateralized   by  $125,435  of
   certificates  of deposit  owned by AMSI.  The  assignment  of fair  values to
   assets acquired and  liabilities  assumed for AMSI is preliminary and subject
   to revision based on the resolution of certain pre-acquisition contingencies.
   Accent  applied the purchase  method of  accounting to this  acquisition  and
   "pushed down" its basis in the acquired  assets and  liabilities to AMSI. The
   net purchase price allocated consisted of common stock valued at $580,160 and
   professional  costs  associated  with the  acquisition  of  $172,500,  net of
   $257,423 due under the indemnity  from the former AMSI  Shareholders.  Values
   assigned to the assets and liabilities of AMSI is as follows:



         Cash and cash equivalents                           $   246,255
         Certificates of deposit                                 125,435
         Loans receivable                                        531,692
         Foreclosed real estate                                  593,960
         Goodwill                                              1,171,651
         Other assets                                             33,666
         Due to related parties and stockholders, net           (135,477)
         Note payable - warehouse line                        (1,132,442)
         Note payable - stage funding line                      (528,891)
         Other liabilities                                      (410,612)
                                                             -----------
                                                             $   495,237
                                                             ===========



     The Company has revised its allocation of fair value to assets acquired and
liabilities  assumed.  As a result, the Company has recorded a reduction in both
goodwill and due to related parties and stockholders of $250,000.

     As a result of the  merger,  the  historical  financial  statements  of the
Company for the period prior to August 23, 1999 are the  consolidated  financial
statements of Accent from its date of inception, July 9, 1999. The operations of
the acquired companies have been included in the Company's financial  statements
from the date of acquisition.

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

     Lahaina Acquisitions, Inc. and subsidiaries ("Lahaina" or the "Company") is
a  multi-state  provider of mortgage  brokerage  services to consumers  and also
operates a  multi-state  real estate  development  organization.  The  Company's
operations  consist of a mortgage brokerage division ("Accent Mortgage Services,
Inc." or "AMSI"),  and a real estate  development  division ("Accent Real Estate
Group" or "ARG").  AMSI is a residential  mortgage  broker,  providing  mortgage
brokerage  services to consumers  through  several  traditional  branch  offices
located primarily in the Atlanta, Georgia metropolitan area. AMSI recently began
recruiting  activities aimed at adding additional mortgage brokerage  operations
to its branch operations,  utilizing a new branching concept, and as of the date
of  this  report  has  recruited  approximately  200  new  branches.  ARG  is  a
multi-state  real estate  development  organization  engaged in the acquisition,
development and sale of a wide variety of real estate projects.

Principles of Consolidation

     The consolidated  financial  statements of the Company include the accounts
of its wholly owned  subsidiaries.  All  intercompany  transactions and balances
have been eliminated in consolidation.

                                       26

<PAGE>

Basis of Presentation and Use of Estimates

     The  consolidated  balance  sheet  has been  prepared  in  conformity  with
generally  accepted  accounting   principles.   In  preparing  the  consolidated
financial  statements,  management is required to make estimates and assumptions
that  affect the  reported  amounts in the  consolidated  financial  statements.
Actual results could differ significantly from those estimates.

Revenue Recognition

     AMSI's revenues are primarily derived from fee income from the brokerage of
residential  mortgage  loans,  and such revenues are  recognized at the time the
mortgage  loan  closes and fees are  remitted  to the  Company  from the closing
agent.  The Company  does not take title to any loans  originated  by its branch
offices,  and fees are earned at the time of closing and are non-refundable.  At
the time that the Company executes an agreement to license a new branch, the new
branch agrees to pay a set-up fee to the Company. A portion of the set-up fee is
received upon receipt of the executed  branch  agreement,  with the remainder of
the set-up fee being paid to the Company as the branch  closes  mortgage  loans.
The  portion  of set-up  fees  received  upon  receipt  of the  executed  branch
agreement is recognized as revenue up[on receipt,  and the portion of set-up fee
revenues not  received at the time the branch  agreement is executed is deferred
until it is paid by the branch to the  Company  through its loan  closings.  ARG
owns  parcels of land that it intends  to  develop  and sell.  Sales of lots are
recognized when the required down payments are received,  continuing  investment
and continuing involvement criteria are met, and title is conveyed to the buyer.

Cash and Cash Equivalents

     The Company  considers its  highly-liquid  investments  with  maturities of
three months or less to be cash equivalents.

Restricted Cash

     The Company  receives  cash from its branch  offices as mortgage  loans are
closed and funded,  representing  amounts  that will  ultimately  be paid to its
branches  in the form of  commissions  or  reimbursement  of  certain  operating
expenses.  The Company's policy is to hold such cash in an internally restricted
cash account until such time as payments are made to its branch offices.

Restricted Certificates of Deposit

     As an accommodation to a financial institution holding certain indebtedness
of the former AMSI shareholders, the Company has pledged certificates of deposit
to secure such indebtedness.  The Company has been released from any obligations
pertaining  to the  obligation  to which the  certificates  of  deposit  relate,
through an indemnity agreement executed by the former AMSI shareholders.

Financial Instruments

     The provisions of Statement of Financial  Accounting Standards ("SFAS") No.
107,  Disclosure  About  Fair  Value  of  Financial  Instruments,  requires  the
disclosure  of fair  value  information  about  both on and  off  balance  sheet
financial  instruments  where it is  practicable  to estimate  such values.  For
certain  instruments  that  are  short-term  in  nature,  such as cash  and cash
equivalents and due to related parties,  carrying values  approximate fair value
due to the short-term maturities of the instruments.  The carrying value of debt
approximates  fair value because interest rates applicable to the Company's debt
approximates market interest rates.

Mortgage Loans Held for Sale

     Mortgage loans originated and intended for sale in the secondary market are
carried at the lower of cost or  estimated  market value in the  aggregate.  Net
unrealized  losses are  recognized  through a valuation  allowance by charges to
income.

Concentration and Credit Risk

     The Company is subject to  concentration of credit risk with respect to the
portfolio of mortgages  receivable as changes in the economic  environment might
adversely  impact the borrowers  ability or willingness to repay such mortgages.
Additionally,  the value of such  mortgages can be impacted by  fluctuations  in
interest rates and the credit markets.

Valuation of Real Estate

     The Company has adopted  SFAS No. 121,  Accounting  for the  Impairment  of
Long-Lived  Assets and for  Long-Lived  Assets to be Disposed of. This statement
requires that long-lived assets and certain identifiable intangibles be reviewed
for impairment  whenever  events or changes in  circumstances  indicate that the
carrying amount of an asset may not be recoverable.  Recoverability of assets to
be held and used is measured by a comparison of the carrying  amount of an asset
to future net cash flows  expected to be generated by the asset.  If such assets
are  considered to be impaired,  the  impairment to be recognized is measured by
the amount by which the  carrying  amount  exceeds the fair value of the assets.
Assets to be disposed of are  reported  at the lower of the  carrying  amount or
fair value less costs to sell.

                                       27

<PAGE>


Real Estate Held for Sale

     The Beachside  Commons shopping center is classified as held for sale under
SFAS 121.  When an asset is  identified  by  management  as held for  sale,  the
Company discontinues depreciating the asset and estimates the fair value of such
asset.  If in  management's  opinion the net realizable  fair value of the asset
that has been identified as held for sale is less than the net book value of the
asset, a reserve for losses is established.  Fair value is determined based upon
current estimated sales proceeds from a pending offer.

Property and Equipment

     Property and equipment are carried at cost.  Depreciation is computed using
the  straight-line  method  over  the  estimated  useful  lives  of the  assets.
Furniture  and  fixtures are  depreciated  over 3 to 5 years and  computers  and
equipment are depreciated  over 3 years.  Property and equipment is reviewed for
impairment  if events or changes in  circumstances  indicate  that the  carrying
value of the property and equipment may not be recoverable.  In such an event, a
comparison  is made of the current and projected  operating  cash flows into the
foreseeable future on an undiscounted basis to the carrying value of such asset.
Such carrying value would be adjusted, if necessary,  to estimated fair value to
reflect an impairment in the value of the asset.

Foreclosed Real Estate

     Foreclosed  real estate is reported at the lower of cost or fair value less
estimated  disposal  costs,  determined  on the  basis  of  current  appraisals,
comparable  sales,  and  other  estimates  of value  obtained  principally  from
independent sources.

Goodwill

     Goodwill  represents  the  excess of cost over the net  assets of  acquired
businesses and is amortized using the  straight-line  method over fifteen years.
Amortization  expense on  goodwill  was $18,609 for the period from July 9, 1999
(date of  inception)  to  September  30,  1999.  In the  event  that  facts  and
circumstances  indicate that the carrying value of goodwill may be impaired,  an
evaluation of recoverability would be performed in accordance with SFAS No. 121.
If an  evaluation  is required,  the estimated  future  undiscounted  cash flows
associated  with the asset would be compared  to the asset's  carrying  value to
determine if a write-down to fair market value is required.

Deferred Revenue

     At the time that the Company executes an agreement to license a new branch,
the new  branch  agrees to pay a set-up  fee to the  Company.  A portion  of the
set-up fee is received upon receipt of the executed branch  agreement,  with the
remainder  of the  set-up fee being  paid to the  Company  as the branch  closes
mortgage  loans.  Therefore,  the portion of set-up fee revenues not received at
the time the branch  agreement  is executed is deferred  until it is paid by the
branch to the Company through its loan closings.

Loss Per Share

     Basic loss per common share (EPS) is computed  based on net loss divided by
the  weighted  average  number  of common  shares  outstanding.  Diluted  EPS is
computed based on net loss divided by the weighted  average number of common and
potential common shares.  The only potential common share  equivalents are those
related to stock options convertible notes and warrants; however, such potential
common share equivalents were antidilutive,  so diluted EPS is the same as basic
EPS.

Stock Option Plan

     The Company accounts for its stock option and employee stock purchase plans
in  accordance  with  Accounting   Principles  Board  ("APB")  Opinion  No.  25,
Accounting  For  Stock  Issued  to  Employees   ("APB  25");   accordingly,   no
compensation  expense has been  recognized.  Under APB 25,  because the exercise
price of the Company's  stock options  equals the market value of the underlying
stock on the date of the  grant,  no  compensation  expense is  recognized.  The
Company has adopted the disclosure only  provisions of SFAS No. 123,  Accounting
For Stock-Based  Compensation.  Note 8 to the consolidated  financial statements
contains a summary of the pro forma  effects to  reported  net loss and net loss
per share for the period from July 9, 1999 (date of  inception) to September 30,
1999 as if the Company had elected to recognize  compensation  cost based on the
fair value of the options granted as prescribed by SFAS No. 123.

                                       28


<PAGE>

Income Taxes

     The  Company has adopted the  provisions  of SFAS No. 109,  Accounting  for
Income  Taxes.  SFAS 109 is an asset and  liability  approach  that requires the
recognition of deferred tax assets and  liabilities  for the expected future tax
consequences  of events that have been  recognized  in the  Company's  financial
statements  or tax  returns.  In  estimating  future tax  consequences,  FAS 109
generally  considers all expected  future events other than proposed  changes in
the tax law or rates.

New Accounting Standards

     In June 1998, the Financial  Accounting  Standards Board (FASB) issued SFAS
No. 133,  Accounting for Derivative  Instruments and Hedging  Activities,  which
will require that all derivative  financial  instruments be recognized as either
assets or liabilities  on the balance sheet.  In June 1999, the FASB issued SFAS
No. 137, Accounting for Derivative Instruments and Hedging Activities - Deferral
of the Effective Date of SFAS No. 133, which deferred the implementation of SFAS
No. 133.  SFAS No. 133 will be  effective  for the  Company's  first  quarter of
fiscal 2001.  The Company is evaluating the effects of the new statement and how
to implement the new requirements.

     In December  1999,  the  Securities  and Exchange  Commission  issued Staff
Accounting  Bulletin  No.  101 (SAB  101).  SAB 101  provides  clarification  in
applying  generally  accepted  accounting  principles to revenue  recognition in
financial statements.  Management does not anticipate that the implementation of
SAB 101 will have a material effect on the Company's financial statements.

3.   MORTGAGE LOANS HELD FOR SALE - NET

     Mortgage  loans held for sale at  September  30, 1999  consist of a pool of
non-performing  loans that were  purchased  by AMSI in July and August 1998 from
SGE Mortgage Funding Corporation and related parties ("SGE").  Many of the loans
that were acquired were also sold by SGE to other institutions, thereby, putting
the ownership of the loans in question.  Management believes that the collection
of these  amounts is unlikely and  therefore a valuation  allowance of $843,869,
representing  AMSI's  investment,  has been recorded  against  these loans.  The
Company has also  discontinued  accrual of interest on these loans. A summary of
activity  in the  valuation  reserve  for the period  from July 9, 1999 (date of
inception) to September 30, 1999 follows:

<TABLE>
     <S>                                                       <C>
      Balance at July 9, 1999 (date of inception)               $        --
      Reserve acquired in conjunction with purchase of
         Accent Mortgage Services, Inc.                              845,591
      Recoveries                                                      (1,722)
                                                                  ------------
      Balance at September 30, 1999                             $    843,869
                                                                  ============
</TABLE>

4.   REAL ESTATE HELD FOR DEVELOPMENT

     Real estate held for  development  at  September  30, 1999  consists of the
following:
<TABLE>
     <S>                                                        <C>
      Land held for development                                  $  2,757,440
      Costs to develop land                                           200,703
                                                                 ------------
                                                                 $  2,958,143
                                                                 ============
</TABLE>


5.   OPTIONS TO ACQUIRE REAL ESTATE

     The Company  acquired an option to purchase  certain real estate located in
Tennessee for 100,000 shares of common stock. The Company recorded the option at
$16,000 or $0.16 per share based on an  independent  appraisal of the fair value
of the Company's  stock at the date of formation.  In the event that the Company
does not exercise the option to acquire real estate, the shares will be returned
to the Company. The Company has made additional cash investments associated with
this option of approximately $40,000 as of September 30, 1999.

     The Company  acquired an option to purchase  certain real estate located in
Georgia for 400,000 shares of common stock.  The Company  recorded the option at
$64,000 or $0.16 per share based on an  independent  appraisal of the fair value
of the Company's  stock at the date of formation.  As of September 30, 1999, the
Company had exercised this option and recorded its value as part of the basis in
the real estate acquired.


                                       29

<PAGE>


     The  Company  has  made  cash  payments  totaling   approximately   $66,000
associated  with an option  to  acquire a parcel  of land  located  in  Cumming,
Georgia.  Such  payments  include  payment of interest on existing  indebtedness
associated  with the parcel of land. The Company intends to exercise this option
and to develop the parcel of land.

     The options to acquire real estate do not contain any  features  other than
those  providing the Company the ability to acquire the specific real estate for
a negotiated  price. The Company has accounted for the options at cost, which is
represented  by an  independent  appraisal  of the fair  value of the  Company's
common stock at July 9, 1999.

6.   PROPERTY AND EQUIPMENT

     Property and equipment at September 30, 1999 consists of the following:

<TABLE>
      <S>                                            <C>
       Furniture and fixtures                         $  45,140
       Computers and equipment                           49,294
                                                      ---------
       Property and equipment, at cost                   94,434
       Less accumulated depreciation                      7,333
                                                      ---------
       Property and equipment, net                    $  87,101
                                                      =========
</TABLE>

     Depreciation  expense for property and  equipment was $7,333 for the period
from July 9, 1999 (date of inception) to September 30, 1999.

                                       30
<PAGE>



7.   NOTES PAYABLE

     The Company has the following notes payable at September 30, 1999:
<TABLE>
<CAPTION>
Real estate indebtedness:
<S>                                                                                       <C>
Note payable secured by certain parcels of land held for development,                      $     2,085,595
due September 1, 2002. Interest only is payable monthly at a rate of 9.5%.

Note payable secured by first mortgage on Beachside, due December 1, 2001.                       1,547,894
Interest only is payable monthly at a rate of 13%.

Note payable secured by certain parcels of land held for development,                              992,500
due March 23, 2000. Interest only is payable quarterly at a rate of 8.25%.

Note payable secured by certain parcels of land held for development,                              456,443
due March 20, 2002. Interest only is payable quarterly at a rate of 8.25%.

Note payable secured by certain parcels of land held for development,                              400,000
due June 1, 2000. Interest only is payable quarterly at a rate of 8.25%.

Note payable secured by certain parcels of land held for development, due                          255,000
March 1, 2000. Interest only is payable quarterly at a rate equal to
prime plus 75 basis points (9% at September 30, 1999)

                                                                                             --------------
Total real estate indebtedness                                                                   5,737,432
                                                                                             --------------

General corporate indebtedness:
9% Convertible Note, secured by a second mortgage on certain parcels of                            775,000
real estate, due January 31, 2001. Interest only payable quarterly in arrears.

9% Convertible Note, secured by a second mortgage on certain parcels of                            500,000
real estate, due August 18, 2001. Interest only payable quarterly in arrears.

Various unsecured notes payable, bearing interest at rates of 9% and 10%,                           525,000
due from Januray 31, 2000 to March 14, 2000.

                                                                                             --------------
Total general corporate indebtedness                                                             1,800,000
                                                                                             --------------

     Total notes payable                                                                   $     7,537,432
                                                                                             ==============

Due to related parties and stockholders:
Note payable to related party secured by certain parcels of land held for development,             596,057
due July 1, 2000. Interest only is payable quarterly at a rate of 8.25%.

Unsecured note payable to the majority shareholder, with no stated interest rate,                   15,000
due on demand. Interest is accrued at 10.25% per annum.
                                                                                             --------------
Total due to related parties and stockholders                                              $       611,057
                                                                                             ==============
</TABLE>



                                       31

<PAGE>


     Scheduled maturities of the Company's notes payable and amounts due to
related parties and stockholders at September 30, 1999 are as follows:


<TABLE>
<CAPTION>
      YEAR ENDING SEPTEMBER 30,
      -------------------------
      <S>                                              <C>
      2000                                              $  2,783,557
      2001                                                 2,822,894
      2002                                                 2,542,038
                                                        ------------
            Total                                       $  8,148,489
                                                        ============

</TABLE>

Conversion Provisions on the Convertible Notes

     The terms of the  convertible  notes  issued by the Company  state that the
notes may be  converted  by the holder at any time,  and contain  certain  other
conversion provisions.  The $775,000 convertible note is convertible into common
stock of the Company at a conversion price of $0.875 per share (or approximately
885,714 shares).  The $500,000 convertible note is convertible into common stock
of the  Company  at a  conversion  price of $3.50 per  share  (or  approximately
142,857 shares).

     At  September  30,  1999 the  Company was not in  compliance  with  certain
provisions  of the  convertible  notes and their  related  agreements,  and as a
result the notes are  callable by the holder.  The events of default are failure
to maintain an effective  registration  statement for the  conversion  shares on
Form S-1 because of the aging of the financial information included therein, and
failure to pay interest on the notes in either cash or common shares in a timely
fashion.  The holder of the notes has  provided  an  extended  cure  period with
respect to certain events of default.  There is no cash flow impact with respect
to curing  the  events of default  as the cure can be  achieved  by issuing  and
delivering  shares of the Company's common stock. The Company recorded  expenses
associated with potential  liquidated  damages of $81,500 during the period.  At
September 30, 1999 the Company has provided  reserves  totaling $200,783 for the
potential  liquidated  damages that might result from it not being in compliance
with those provisions. Such potential liquidated damages may be satisfied though
issuance and delivery of common stock of the Company.

Warehouse Line of Credit

     At  September  30, 1999,  the Company had  $1,132,442  outstanding  under a
$2,000,000 warehouse line of credit. The warehouse line of credit had previously
been used to fund mortgage loans that ultimately would be sold to third parties.
The warehouse line of credit is secured by the underlying  mortgages  originated
using proceeds from draws on the warehouse line and foreclosed real estate.  The
warehouse line was suspended as of July 9, 1999 due to violation of certain debt
covenants and failure to repurchase or otherwise  remove aged loans  pursuant to
the line of credit agreement. The lender has agreed to accept certain foreclosed
properties in partial  satisfaction  of the line of credit.  The lender has also
agreed to allow the Company to make  interest  only  payments  on the  remaining
principal amount while the underlying loans are in receivership (see note 9).

8.    STOCK OPTIONS

     The Company has adopted the 1999 Stock  Option Plan of Accent which is open
to participation of all directors,  employees and key consultants to the Company
or any subsidiary or affiliate of the Company.  Under the terms of the plan, not
more than  2,000,000  shares of the Company are available to be optioned and not
more than 200,000 shares of the Company may be subject to options granted to any
one  individual in the aggregate in any one fiscal year of the Company.  Options
are granted at not less than fair market value of the  underlying  stock at date
of grant and generally  vest ratably over periods  specified in each  individual
option grant.  Such options  expire five years from date of grant.  Compensation
expense will be recorded for grants to non-employees, directors and consultants.
Employee  stock  options will be accounted  for under APB 25 using the intrinsic
value method. No compensation expense will be recorded for employee options.

                                       32

<PAGE>


     A summary of the Company's stock option activity,  and related  information
for the period  from July 9, 1999 (date of  inception)  to  September  30,  1999
follows:

<TABLE>
<CAPTION>
                                                                                   Weighted
                                                                                    Average
                                                               Number of           Exercise
                                                                Options              Price
                                                               ---------           --------
<S>                                                          <C>                   <C>
 Balance at July 9, 1999 (date of inception)                          --            $    --
   Granted                                                       400,000               0.35
   Exercised                                                          --                 --
   Canceled                                                           --                 --
                                                               ---------

 Balance at September 30, 1999                                   400,000            $  0.35
                                                               =========

 Exercisable at September 30, 1999                               300,000            $  0.35
                                                               =========

 Shares Available for Grant at September 30, 1999              1,600,000
                                                               =========
</TABLE>

     The 400,000  options granted during the period were granted at July 9, 1999
(date of  inception),  and the exercise price of $0.35 per share was based on an
independent  appraisal of the value of the  Company's  common stock  immediately
prior to the merger with Accent.

     The  following  table  summarizes  information  about the  Company's  stock
options outstanding and exercisable by price range at September 30, 1999:

<TABLE>
<S>                                                        <C>
Number outstanding at September 30, 1999                     400,000

Weighted-average remaining
  contractual life                                           5 years

Weighted-average exercise price for
  options outstanding                                       $   0.35

Number exercisable at September 30, 1999                     300,000

Weighted-average exercise price for
  options exercisable                                       $   0.35
</TABLE>

Pro Forma Information

     Pro forma disclosure  information  regarding net loss and loss per share is
required  by  Statement  123,  and has been  determined  as if the  Company  had
accounted for its stock options and the Stock Purchase Plan under the fair value
method of that Statement.

     For purposes of pro forma disclosures only, the estimated fair value of the
options is amortized to expense over the options' vesting period. The fair value
for all  options  was  estimated  at the date of grant  using the  Black-Scholes
multiple option pricing model with the following assumptions:

                                       33
<PAGE>



<TABLE>
  <S>                                                 <C>
   Expected volatility                                    211%
   Risk-free interest rate                                6.4%
   Expected life of options                            5 years
   Expected dividend yield                                0.0%
</TABLE>

     The fair value per share of options  granted during the period from July 9,
1999 (date of inception)  to September  30, 1999 was $0.16 per share.  The Black
Scholes  option  valuation  model was developed  for use in estimating  the fair
value of  traded  options  which  have no  vesting  restrictions  and are  fully
transferable.  Option  valuation  models require the input of highly  subjective
assumptions,   including  the  expected  stock  price  volatility.  Because  the
Company's employee stock options have  characteristics  significantly  different
from  those of traded  options,  and  because  changes  in the  assumptions  can
materially affect the fair value estimate, in management's opinion, the existing
models do not necessarily provide a reliable single measure of the fair value of
its employee stock options.

     Pro  forma net loss and loss per  share  for the  period  from July 9, 1999
(date of inception) to September 30, 1999 are as follows:

<TABLE>
  <S>                                  <C>               <C>
   Net loss                             As reported       $  (1,155,305)
                                        Pro forma            (1,217,817)

   Basic and diluted loss per share     As reported       $       (0.08)
                                        Pro forma                 (0.08)
</TABLE>

9.    COMMITMENTS AND CONTINGENCIES

Leases

     The Company leases office space under an operating lease agreement.  Future
minimum lease  payments on this  noncancelable  operating  lease in effect as of
September 30, 1999 are as follows:

<TABLE>
<CAPTION>
    YEAR ENDING SEPTEMBER 30,
     <S>                                                  <C>
      2000                                                 $  158,038
      2001                                                    162,820
      2002                                                    167,691
      2003                                                    172,668
      2004                                                    162,669
                                                           ----------
                                                           $  823,886
                                                           ==========
</TABLE>

     This lease  provides  for the payment of certain  expenses by the  Company.
Rental  expense  charged to  operations  was $18,600 for the period from July 9,
1999 (date of inception) to September 30, 1999.

Legal Proceedings

     In July and August 1998, AMSI acquired from SGE and related  entities notes
secured primarily by first security interest in residences.  The selling entity,
SGE,  has been placed in  receivership  by Order of the  Superior  Court of Tift
County,  Georgia.  The receiver is charged with the  responsibility  of settling
competing  claims,  if any,  to loans  made and sold by SGE.  Many of the  loans
acquired  by the  Company  from SGE were later  sold to Matrix  Bank for a total
purchase  price of $623,032.  Matrix Bank contends some of the loans are subject
to competing  claims or are  non-performing  assets,  and has demanded  that the
Company reacquire these loans. The Company is negotiating with Matrix to resolve
these issues,  however,  the ultimate  resolution  is unknown at this time.  The
Company  has not  provided  for any  loss  which  may  result  from  the  Matrix
transaction,  however  should the  ultimate  resolution  be  unfavorable  to the
Company, any losses would be subject to the indemnification from the former AMSI
shareholders.

                                       34

<PAGE>

     The Company is also subject to various litigation in the ordinary course of
business. In the opinion of management, resolution of such matters will not have
a significant effect on the financial position of the Company.

10.   SEGMENT INFORMATION

     The Company operates in two business segments:  Mortgage Brokerage and Real
Estate  Development.  A further  description of each business segment along with
the Corporate services area follows:

     Mortgage   Brokerage  -  Mortgage  Brokerage  provides  mortgage  brokerage
services  to  consumers  through  several  traditional  branch  offices  located
primarily in the Atlanta,  Georgia  metropolitan  area.  The Mortgage  Brokerage
segment also includes one real estate  asset,  Beachside  Commons,  a commercial
real estate development  located in Fernandina Beach,  Florida on Amelia Island,
which is classified as held for sale at September 30, 1999.

     Real Estate  Development - Real Estate  development  is a multi-state  real
estate development organization engaged in the acquisition, development and sale
of a wide variety of real estate projects.

     Corporate - Corporate services include human resources,  legal,  accounting
and various other of the Company's unallocated overhead charges.

     The accounting  policies of the segments are the same as those described in
Note 2, "Summary of  Significant  Accounting  Policies".  The Company  evaluates
performance  based on revenues and  operating  income  (loss) of the  respective
segments. There are no intersegment revenues.

     The following sets forth certain financial information  attributable to the
Company's business segments as of September 30, 1999 and for the period from the
date of inception (July 9, 1999) to September 30, 1999:

<TABLE>
<CAPTION>
                                MORTGAGE        REAL ESTATE
                                BROKERAGE       DEVELOPMENT        CORPORATE         TOTAL
<S>                          <C>              <C>               <C>              <C>
Revenues                      $    837,803     $    238,763      $         --     $  1,076,566

Operating loss                $   (338,812)    $    (22,385)     $   (519,246)    $   (880,443)

Indentifiable assets          $  5,588,963     $  3,023,697      $    392,766     $  9,005,426

Capital expenditures          $         --     $         --      $     87,774     $     87,774
</TABLE>

                                        35

<PAGE>


11.   STOCKHOLDERS' EQUITY

Preferred Stock, Common Stock, Rights and Warrants

     Prior to the merger  with  Accent,  the  Company  issued  warrants  for the
purchase of the  Company's  common  stock.  In  connection  with the issuance of
convertible  notes by the Company for $775,000 and $500,000,  the Company issued
certain  warrants for the purchase of shares of the Company's  common stock.  At
September  30,  1999  warrants  to  acquire  a total of  250,000  shares  of the
Company's  common stock were  outstanding.  The weighted  average exercise price
relating to 200,000 of such warrants is approximately $2.40 per share, while the
remaining 50,000 warrants may be exercised in accordance with a formula price as
set forth in the warrant. The formula price relating to the 50,000 share warrant
is equal to 102% of the simple  average of the weighted  average  sales price as
published by Bloomberg of the Common Stock on the NASDAQ Stock Market or, if the
NASDAQ Market is not the principal trading market for such security,  the simple
average  sales price of such security on the  principal  securities  exchange or
trading market where such security is listed or traded as reported by Bloomberg,
or if the  foregoing  do not  apply,  the  simple  average  sales  price of such
security in the  over-the-counter  market on the  electronic  bulletin board for
such security as reported by Bloomberg. At September 30, 1999, the formula price
was approximately $4.47 per share.

     Accent issued 600,000  shares of common stock to two consulting  firms that
aided Accent in  structuring  the  formation of Accent.  Accent has recorded the
issuance of the shares as consulting expense at $0.16 per share. If on or before
July 1, 2001  either  (i) the  common  stock of Accent is not being  traded in a
public market at a  price-to-projected  earnings (as  determined by the Board of
Directors)  multiple  of at least 15 or (ii)  Accent  has not  received  capital
contributions  or financings in connection  with the new capital stock issuances
and sales  totaling  more than $7.5 million  ($1,015,000  being  procured by the
consulting  firms),  then the consulting firms will forfeit and convey to Accent
all of its stock. The common stock has been recorded as redeemable  common stock
as it is  redeemable  by Accent for  conditions  which are not solely within the
control of Accent.

     At September 30, 1999,  the Company had 10,000,000  shares of  undesignated
Preferred  Stock  authorized.  At September 30, 1999, no shares of the Company's
undesignated Preferred Stock were outstanding.

12.   EMPLOYEE BENEFIT PLANS

     The Company utilizes a third-party  Professional  Employer Organization (or
"PEO") to provide  certain  employee  benefits plans to its employees.  Benefits
available to employees  include  medical,  dental,  life insurance  coverage and
participation in a 401(k) savings plan. The PEO is the  administrative  employer
of  record  and  relieves  the  Company  of many of the  administrative  burdens
typically associated with the human resources  management  function.  Under this
co-employer relationship, the PEO acts as the administrative employer, while the
Company remains the on-site  employer and retains the decision making  authority
associated with day to day employment decisions. The Company, at its discretion,
will match employee contributions to the 401(k) plan up to specified levels. For
the period ended September 30, 1999, no contributions were made by the Company.

13.   INCOME TAXES

     The Company files a consolidated return with its subsidiaries and allocates
income  tax  benefits  and  expenses  based  upon  the  income  or  loss of each
subsidiary  computed on a stand-alone basis.  During the period, the Company did
not record a provision  for income taxes as it was in a net loss  position and a
full valuation allowance was recorded against the related net operating losses.

     Temporary differences that give rise to the deferred tax asset at September
30, 1999 consist  primarily of net operating loss  carryforwards  ($855,532) and
the allowance for loan losses  ($329,109).  Deferred tax assets at September 30,
1999 of  $1,385,642  are offset by a valuation  allowance as the Company has not
demonstrated the sustained profitability necessary to record such asset.

     At December 31, 1999, the Company had net operating loss  carryforwards  of
approximately $2.2 million which expire at various dates through 2019.

                                       36

<PAGE>

14. LOSS PER SHARE

     The following  table sets forth the  computation  of basic and diluted loss
per share:
<TABLE>
    <S>                                                                     <C>
     Numerator:
         Net loss                                                             $     (1,155,305)
                                                                               =================
    Denominator:
         Denominator for basic loss per share-weighted average shares
         (including outstanding shares of redeemable common stock)                  14,592,917

         Effect of dilutive securities:
           Employee stock options                                                          -
           Stock purchase warrants                                                         -
                                                                               -----------------
         Denominator for diluted loss per share-adjusted weighted                   14,592,917
                                                                               =================

    Net loss per share - basic and diluted                                    $          (0.08)
                                                                               =================
</TABLE>


     The Company had 400,000 stock options and 250,000 stock  purchase  warrants
outstanding at September 30, 1999. The effect of these common stock  equivalents
has not been included in the diluted weighted average shares outstanding as they
would be anti-dilutive.

15.   SUBSEQUENT EVENTS

     Effective  December 30, 1999,  the Company sold its  subsidiary,  Beachside
Commons I, Inc.  ("Beachside") to NP Holding, LLC in exchange for the assumption
of the existing  first  mortgage of  approximately  $1,550,000 and a note in the
amount of $3,000,000  that is secured by 660,000 shares of the Company's  common
stock.  The Company's former chairman is a member of NP Holding,  LLC.  Selected
financial data related to Beachside as of September 30, 1999 is as follows:

<TABLE>
            <S>                                      <C>
             Real estate held for sale                $   3,650,000
             Total assets                             $   3,638,063
             Notes payable                            $   1,547,894
             Total liabilities                        $   1,726,725
</TABLE>

     The  Company  does not expect to record a  significant  gain or loss on the
sale of Beachside.

     On January 11, 2000, the Company announced that it had executed a letter of
intent to acquire  all of the issued and  outstanding  common  stock of Paradigm
Mortgage Associates, Inc. ("Paradigm") of Jacksonville, Florida. Paradigm is one
of the largest  cooperative  branch mortgage  companies in the country with more
than 250 branch offices. In its announcement,  the Company stated that a plan of
acquisition  should be defined by January 31, 2000 and that the  transaction  is
expected  to close  within 60 days.  Closing of the  transaction  is subject to,
among other things,  negotiation  of a definitive  agreement and plan of merger,
satisfactory  completion of a due diligence review,  approval by both companies'
boards of directors, and appropriate regulatory approvals.

                                       37


<PAGE>

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
         AND FINANCIAL DISCLOSURE

     Prior to July 9, 1999, the Company's principal  accountants were Kenneth A.
Walters,  P.A.  As a result of the merger with  Accent,  the Company has engaged
Deloitte & Touche LLP as its principal  accounting  firm. On September 22, 1999,
the Company filed a current  report on Form 8-K with the Securities and Exchange
Commission  notifying the  commission of the change in the Company's  certifying
accountants. The Company had no disagreements with Kenneth A. Walters, PA on any
substantive matters prior to his resignation.

                                       38
<PAGE>


                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The  following  table sets forth  certain  information  with respect to the
executive officers and Directors of the Company.

<TABLE>
<CAPTION>
DIRECTORS AND OFFICERS AGE    POSITION

<S>                   <C>    <C>
L. Scott Demerau       39     Chief Executive Officer, President and Director
William A. Thurber     46     Executive Vice President - Finance and Treasurer
Betty M. Sullivan      49     Executive Vice President - Administration,
                              Secretary and Director

Bart Siegel            51     Director
Sherry Sagemiller      46     Assistant Secretary and Director
</TABLE>

     Certain  information  regarding  executive  officers  of the Company can be
found under the heading  "Executive  Officers of the  Company" in Part I of this
Annual  Report  on  Form  10-K.  Information  regarding  non-employee  directors
follows:

     Bart Siegel was elected as a director of the Company  effective  August 23,
1999.  Mr. Siegel holds a B.S. from the Virginia  Commonwealth  University.  Mr.
Siegel  is the  owner  and  President  of Allen  Enterprises,  a  manufacturing,
technology,  product  development and technical  service  industry.  He has also
served as Chief Operations  Officer for Oak Brook  Management,  a management and
operational reporting company for over twenty diverse companies from 1995 to the
present.  Mr.  Siegel also serves as a strategic  partner for the  Institute  of
Financial Management.

     Sherry Sagemiller was elected as a director and the Assistant  Secretary of
the Company  effective  August 23, 1999. Ms.  Sagemiller was employed as a legal
assistant for real estate law firms from 1976 to 1982.  She was the assistant to
the President of Washington  Mortgage & Development  Co. from 1982 to 1988.  Ms.
Sagemiller was Director of Marketing for Sagemiller & Associates, Inc. from 1988
to January 1990. She was President/Owner of Accent Mortgage Services,  Inc. from
February 1990 to July 1996.  She is currently the manager of an Accent  Mortgage
Services branch in Cumming, Ga.

ITEM 11. EXECUTIVE COMPENSATION

     The following tables set forth certain information concerning  compensation
for the Company's named  executive  officers for the period from inception (July
9, 1999) through September 30, 1999:


                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                                             LONG-TERM
                                                            ANNUAL COMPENSATION             COMPENSATION
                                                       ---------------------------------------------------
                                                                                             SECURITIES
                                                                           SALARY            UNDERLYING
NAME AND PRINCIPAL POSITION                                YEAR              ($)           OPTIONS/SARS(#)
----------------------------------------------------------------------------------------------------------
<S>                                                       <C>             <C>                  <C>
L. Scott Demerau, President & Chief Executive              1999            46,430                   --
Officer(1)
----------------------------------------------------------------------------------------------------------
William A. Thurber, Executive Vice President,              1999             5,538                   --
Finance & Treasurer(2)
----------------------------------------------------------------------------------------------------------
Betty M. Sullivan, Executive Vice President,               1999            19,057               75,000
Administration & Secretary(1)
----------------------------------------------------------------------------------------------------------
</TABLE>

1) Annual  compensation  represents  salary  earned  from July 9, 1999  (date of
   inception) through September 30, 1999.

2) Mr.  Thurber  joined  the  Company  on  September  15,  1999,  and his annual
   compensation  represents  salary  earned  from  September  15,  1999  through
   September 30, 1999.

                                       39

<PAGE>


                     OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>

                                                                          POTENTIAL REALIZABLE VALUE AT ASSUMED
                                                                          RATES OF STOCK PRICE APPRECIATION FOR
                           INDIVIDUAL GRANTS                                           OPTION TERM
------------------------------------------------------------------------------------------------------------------
                                             PERCENT OF
                           NUMBER OF           TOTAL
                           SECURITIES       OPTIONS/SARS
                           UNDERLYING        GRANTED TO      EXERCISE
                          OPTIONS/SARS      EMPLOYEES IN       PRICE      EXPIRATION
NAME                      GRANTED (#)       FISCAL YEAR      ($/SHARE)       DATE           5%           10%
------------------------------------------------------------------------------------------------------------------
<S>                         <C>               <C>            <C>          <C>           <C>           <C>
L. Scott Demerau                 --               --              --            --            --            --
------------------------------------------------------------------------------------------------------------------
William A. Thurber               --               --              --            --            --            --
------------------------------------------------------------------------------------------------------------------
Betty M. Sullivan            75,000             18.8%          $0.35        7/9/04        $7,275       $16,050
------------------------------------------------------------------------------------------------------------------
</TABLE>

     The  options  granted  during the period from  inception  (July 9, 1999) to
September 30, 1999 were issued with an exercise price of $0.35 per share,  based
on an independent  appraisal of the fair value of the Company's  common stock at
the date of inception.

                                       40
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The  following  table sets forth  certain  information  with respect to the
beneficial  ownership of the  Company's  Common Stock and its Series A Preferred
Stock as of  January  3, 2000 for (i) each  person or entity who is known by the
Company to beneficially own five percent or more of the outstanding Common Stock
of the Company,  (ii) each of the Company's  directors,  (iii) each of the Named
Executive  Officers (as defined  above),  and (iv) all  directors  and executive
officers of the Company as a group:
<TABLE>
<CAPTION>
                                                                NUMBER                        PERCENT OF CLASS
                                              ----------------------------------------------------------------------
                                                                            SERIES A                     SERIES A
BENEFICIAL OWNER                                       COMMON               PREFERRED       COMMON      PREFERRED
--------------------------------------------------------------------------------------------------------------------
<S>                                                   <C>                     <C>            <C>          <C>
L. Scott Demerau                                       6,297,000(1)            --             38.6%         --
8645 Swiss Air Road
Gainesville, Georgia 30506
--------------------------------------------------------------------------------------------------------------------
Julia Demerau                                          6,297,000(1)            --             38.6%         --
8645 Swiss Air Road
Gainesville, Georgia 30506
--------------------------------------------------------------------------------------------------------------------
Accent Associates, LLC                                 1,400,000               --              8.6%         --
7310 Pine Valley Road
Cumming, Georgia 30041
--------------------------------------------------------------------------------------------------------------------
Eutopean Enterprises, LLC                              1,200,000               --              7.3%         --
8645 Swiss Air Road
Gainesville, Georgia 30506
--------------------------------------------------------------------------------------------------------------------
Kingdom Generals, LLC                                    850,000               --              5.2%         --
7310 Pine Valley Road
Cumming, Georgia 30041
--------------------------------------------------------------------------------------------------------------------
Sherry Sagemiller                                        833,330(2)            --              5.1%         --
1460 Squire Lane
Cumming, Georgia 30041
--------------------------------------------------------------------------------------------------------------------
GCA Strategic Investment Fund Limited                  1,628,047(3)            --             10.0%         --
Mechanics Building
12 Church Street
Hamilton HM 11 Bermuda
--------------------------------------------------------------------------------------------------------------------
L. Scott Demerau                                       6,297,000               --             38.6%         --
William A. Thurber                                            --               --               --          --
Betty M. Sullivan                                         75,000(4)            --              0.4%         --
Sherry Sagemiller                                        833,330               --              5.1%         --
Bart Siegel                                                   --               --               --          --

All directors and officers as a group (5               7,205,330               --             44.1%         --
people)
--------------------------------------------------------------------------------------------------------------------
</TABLE>
     For purposes of this table,  beneficial  ownership  has been  determined in
accordance with the provisions of Rule 13(d)-3 of the Securities Exchange Act of
1934,  as  amended,  under  which,  in  general,  a person  is  deemed to be the
beneficial owner of a security if such person has or shares the power to vote or
to direct  the voting of the  security  or the power to dispose or to direct the
disposition  of the  security,  or if such  person  has  the  right  to  acquire
beneficial ownership of the security within sixty days.

1)   Includes  1,200,000  shares of common stock which are held in escrow by the
     Company  pursuant to the merger with Accent.  These shares will be released
     upon the satisfaction of certain  conditions  involving the full conveyance
     of the consideration for the Accent Common Stock. No assurance can be given
     that these shares will ever be released.

2)   Includes  766,666  shares of common  stock  which are held in escrow by the
     Company  pursuant to the merger with Accent.  These shares will be released
     upon the satisfaction of certain conditions involving the full conveyance
     of the consideration for the Accent Common Stock. No assurance can be
     given that these shares will ever be released.

3)   Represents  current  holdings  plus an  estimate of the number of shares of
     common stock into which the Company's  convertible notes will be converted,
     and an estimate  of the number of shares of common  stock to be issued upon
     exercise of certain warrants.

4)   Represents  shares that may be  acquired  upon  exercise of employee  stock
     options.
                                       41
<PAGE>

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     At  September  30,  1999,  the Company  owed  $15,000 to its  chairman  and
president,  L. Scott  Demerau,  ("Demerau")  under the terms and conditions of a
master note  agreement  executed by and between the Company and  Demerau.  Notes
issued under the master note agreement are due on demand,  do not bear interest,
and are generally used to bridge  short-term  funding  requirements  for working
capital.

     At  September  30, 1999,  the Company  owed  $596,057 in the form of a note
payable to  Kingdom  Generals,  LLC, a related  party.  The note  payable  bears
interest  at a rate of 8.25%,  is secured  by  certain  parcels of land held for
development, and is due and payable July 1, 2000.

                                       42


<PAGE>
                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K




      (a)    The following documents are filed as part of this report:

        (1)
          (a)
             Consolidated Financial Statements:
             Report of Deloitte & Touche LLP, Independent Auditors
             Consolidated Balance Sheet at September 30, 1999
             Consolidated  Statement  of Income for the period from July 9, 1999
               (date of inception) to September 30, 1999

             Consolidated Statement of Stockholders' Deficit for the period from
               July 9, 1999 (date of inception) to September 30, 1999

             Consolidated  Statement  of Cash Flows for the period  from July 9,
               1999 (date of inception) to September 30, 1999

             Notes to Consolidated Financial Statements

          (b)
             Statement of Operations for Accent Mortgage Services,  Inc. for the
               six months  ended June 30, 1999 and for the years ended  December
               31, 1998 and 1997, as follows:

                                       43

<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Stockholder and
Board of Directors of
Accent Mortgage Services, Inc.

     We have audited the accompanying balance sheet of Accent Mortgage Services,
Inc. as of June 30, 1999 and the related statements of operations, stockholder's
equity  (deficit) and cash flows for the six months then ended.  These financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

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

     In our opinion,  the financial statements referred to above present fairly,
in all material  respects,  the financial  position of Accent Mortgage Services,
Inc. as of June 30, 1999 and the  results of its  operations  and its cash flows
for the six months then ended in conformity with generally  accepted  accounting
principles.


HOLLAND SHIPES VANN, P.C.

Atlanta, Georgia
September 9, 1999, except for Note 12
as to which the date is September 21, 1999


                                      44


<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                                 BALANCE SHEET

-----------------------------------------------------------------------------
JUNE 30,                                                          1999
-----------------------------------------------------------------------------

<TABLE>
<S>                                                              <C>
ASSETS
 Mortgage portfolio, net                                          $ 1,030,842
 Restricted certificates of deposit                                   125,435
 Cash and cash equivalents                                             81,255
 Accrued interest receivable                                           12,634
 Property and equipment, less accumulated depreciation                 32,166
 Foreclosed real estate                                               593,960
 Due from related company                                             189,523
 Other assets                                                           1,500
-----------------------------------------------------------------------------
                                                                  $ 2,067,315
=============================================================================



LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)

LIABILITIES
 Lines of credit                                                  $ 1,632,342
 Notes payable                                                        776,713
 Due to stockholders                                                  153,094
 Accrued interest payable                                             208,080
 Other liabilities                                                    280,251
-----------------------------------------------------------------------------
                                                                    3,050,480
-----------------------------------------------------------------------------

COMMITMENTS AND CONTINGENCIES
-----------------------------------------------------------------------------

STOCKHOLDER'S EQUITY (DEFICIT)
 Common stock, no par value, 1,000,000 shares
  authorized; 400,000 shares issued and outstanding                    60,000
 Additional paid-in capital                                           624,595
 Accumulated (deficit)                                             (1,667,760)
-----------------------------------------------------------------------------
                                                                     (983,165)
-----------------------------------------------------------------------------
                                                                  $ 2,067,315
=============================================================================
</TABLE>


See accompanying notes to financial statements.


                                    45

<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                            STATEMENT OF OPERATIONS



-----------------------------------------------------------------------------
SIX MONTHS ENDED JUNE 30,                                                1999
-----------------------------------------------------------------------------

<TABLE>
<S>                                                              <C>
REVENUES
  Brokerage services                                              $   560,097
  Interest income                                                       9,188
-----------------------------------------------------------------------------
                                                                      569,285
-----------------------------------------------------------------------------

OTHER EXPENSES
  Brokerage services expense                                          323,222
  Interest expense                                                     30,986
  Provision for losses                                                 50,000
  Administrative and general                                          386,878
  Loss on disposal of property and equipment                          167,645
-----------------------------------------------------------------------------
                                                                      958,731
-----------------------------------------------------------------------------

NET LOSS                                                          $  (389,446)
=============================================================================
</TABLE>


See accompanying notes to financial statements.


                                     46
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
             STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY (DEFICIT)


<TABLE>
------------------------------------------------------------------------------------------------------------
                                                            Additional                           Total
                                             Common          Paid-in        Accumulated      Stockholder's
                                              Stock          Capital         (Deficit)      Equity (Deficit)
------------------------------------------------------------------------------------------------------------


<S>                                        <C>             <C>             <C>               <C>
BALANCE, December 31, 1998                  $  60,000       $ 124,595       $(1,278,314)      $(1,093,719)

 Net loss for the six months
  ended June 30, 1999                                                          (389,446)         (389,446)

 Capital contribution                                         500,000                             500,000
---------------------------------------------------------------------------------------------------------
BALANCE, June 30, 1999                      $  60,000       $ 624,595       $(1,667,760)      $  (983,165)
=========================================================================================================
</TABLE>



See accompanying notes to financial statements.


                                      47
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                            STATEMENT OF CASH FLOWS
<TABLE>

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

SIX MONTHS ENDED JUNE 30,                                                1999
-----------------------------------------------------------------------------


<S>                                                              <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net loss                                                        $  (389,446)
-----------------------------------------------------------------------------
  Adjustments to reconcile net loss to net cash
    used in operating activities:-
       Depreciation                                                    16,568
       Loss on disposal of property and equipment                     167,645
       Changes in assets and liabilities:
         Accrued interest receivable                                   47,959
         Other assets                                                  (1,500)
         Accrued interest payable                                     (34,835)
         Other liabilities                                             35,135
-----------------------------------------------------------------------------
                                                                      230,972
-----------------------------------------------------------------------------
NET CASH USED IN OPERATING ACTIVITIES                                (158,474)
-----------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Advances to related company                                        (189,523)
  Proceeds from sale of mortgages                                   2,199,119
  Purchase of certificates of deposit                                  (2,354)
  Proceeds from sale of equipment                                      13,500
-----------------------------------------------------------------------------
NET CASH PROVIDED BY INVESTING ACTIVITIES                           2,020,742
-----------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
  Capital contribution                                                500,000
  Loans from stockholders                                               2,794
  Decrease in lines of credit                                      (2,855,222)
  Proceeds from notes payable                                         528,891
  Principal payments on notes payable                                 (23,526)
-----------------------------------------------------------------------------
NET CASH USED IN FINANCING ACTIVITIES                              (1,847,063)
-----------------------------------------------------------------------------

NET INCREASE IN CASH                                                   15,205

CASH AND CASH EQUIVALENTS, beginning of period                         66,050
-----------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS, end of period                          $    81,255
=============================================================================
</TABLE>


See accompanying notes to financial statements.


                                      48
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999



 1. ORGANIZATION         Accent Mortgage Services, Inc. (AMSI) was
    AND SUMMARY OF       incorporated in the State of Georgia on August 21,
    SIGNIFICANT          1991. The Company engages in residential and
    ACCOUNTING           commercial brokerage services and in the purchase
    POLICIES             and sale of mortgages. The Company provides these
                         services primarily to residential mortgage customers
                         in the Southeastern United States. In 1999, the
                         Company expanded its services to include net branch
                         brokerage services, which allows outside agents to
                         broker loans utilizing the Company's licenses, and
                         provide short-term stage financing for modular home
                         purchasers. At June 30, 1999, the Company was a
                         wholly-owned subsidiary of Accent Holdings, Inc.

                         Effective July 9, 1999, Accent Holdings, Inc. exchanged
                         400,000 shares of Accent Mortgage Services, Inc. for
                         362,000 shares of common stock of The Accent Group,
                         Inc., thereby making AMSI a wholly-owned subsidiary of
                         The Accent Group. The Accent Group, Inc. then entered
                         into a reverse merger with Lahaina Acquisitions, Inc.
                         In connection with the merger, shareholders of The
                         Accent Group received 86% of the common stock of
                         Lahaina. The Accent Group, Inc. is now the surviving
                         parent of AMSI.

    MANAGEMENT           The preparation of financial statements in conformity
    ESTIMATES            with generally accepted accounting principles requires
                         management to make estimates and assumptions that
                         affect the reported amounts of assets and
                         liabilities, the disclosure of contingent assets and
                         liabilities at the date of the financial statements,
                         and the reported amounts of revenues and expenses
                         during the reporting period. Actual results could
                         differ from those estimates.

    MORTGAGE             Mortgage loans are held for sale and are carried at
    PORTFOLIO            the lower of cost or fair value with any unrealized
                         losses included in current period earnings.

                         The accrual of interest on mortgages is discontinued
                         when the mortgages become delinquent for 90 days or
                         more. Any accrued interest on delinquent mortgages is
                         charged against current-period interest income.
                         Subsequent interest income on such mortgages is
                         recognized only to the extent that cash payments are
                         received.


                                      49
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999
                                  (Continued)


    ALLOWANCE FOR        The allowance for losses is based on an analysis of
    LOSSES               the mortgage portfolio.  The analysis considers credit
                         profile factors such as mortgage characteristics and
                         actual and expected loss experience. Increases in
                         the allowance are charged to the provision for
                         losses. Reductions in the allowance result from
                         charge-offs, net of recoveries. In management's
                         judgment, the allowance is adequate to provide for
                         expected losses.

    PROPERTY AND         Property and equipment are recorded at cost.
    EQUIPMENT            Depreciation is provided utilizing the straight-line
                         method over the estimated useful lives of the
                         individual assets, which are generally five to seven
                         years. Depreciation expense totaled $16,568 for the
                         six months ended June 30, 1999.

    CASH AND CASH        The Corporation considers highly liquid investment
    EQUIVALENTS          instruments with an original maturity of three months
                         or less to be "cash equivalents." Cash equivalents
                         are carried at cost, which approximates market
                         value.

    CREDIT RISK          Concentration of credit risk with respect to the
                         Company's mortgages receivable exists since
                         borrowers are susceptible to changes in economic
                         conditions that could affect their ability to meet
                         their obligations. Additionally, the Company
                         maintains its cash in bank deposit accounts which,
                         at times, may exceed federally insured limits.

    INCOME TAXES         Income taxes are accounted for under the asset and
                         liability method. Deferred tax assets and
                         liabilities are recognized for the future tax
                         consequences attributable to differences between the
                         financial statement carrying amounts of existing
                         assets and liabilities and their respective tax
                         basis and operating loss carryforwards. Deferred tax
                         assets and liabilities are measured using enacted
                         tax rates expected to apply to taxable income in the
                         years in which those temporary differences are
                         expected to be recovered or settled. The effect on
                         deferred tax assets and liabilities of a change in
                         tax rates is recognized in income in the period that
                         includes the enacted date.


    FORECLOSED           Foreclosed real estate is carried at the lower of
    REAL ESTATE          cost or estimated fair value less estimated costs
                         to sell.

                                      50
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999
                                  (Continued)


 2. MORTGAGE              The Company's mortgage portfolio represents mortgages
    PORTFOLIO             closed either directly from borrowers or purchased
                          from other lenders. Mortgages receivable at June 30,
                          1999 consist of the following:

<TABLE>
                          <S>                                                            <C>
                           Principal of mortgages securing lines of credit                $ 1,244,279
                           Stage funding                                                      531,692
                           Principal of other mortgages                                       944,828
                           Less:  Purchase discounts                                         (844,366)
                           --------------------------------------------------------------------------
                                                                                            1,876,433
                           Less: Allowance for losses                                        (845,591)
                           --------------------------------------------------------------------------

                                                                                          $ 1,030,842
                           ==========================================================================
</TABLE>



                                      51
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999
                                  (Continued)

 3. PROPERTY AND         Property and equipment at June 30, 1999 are summarized
    EQUIPMENT            as follows:


<TABLE>
                          <S>                                           <C>
                           Furniture and fixtures                        $ 13,825
                           Office equipment                                26,269
                           ------------------------------------------------------
                                                                           40,094
                           Less: Accumulated depreciation                  (7,928)
                           ------------------------------------------------------

                                                                         $ 32,166
                           ======================================================
</TABLE>


 4. 401(K) PROFIT        Effective January 1, 1998, the Company established a
    SHARING PLAN         401(k) profit sharing plan covering substantially all
                         of its employees.  Effective June 30, 1999, the
                         Plan was terminated and all eligible employees
                         became 100% vested. The Company made contributions
                         of $953 in 1999.


                                      52
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999

                                  (Continued)


 5. LINES OF CREDIT        Lines of credit at June 30, 1999 consist of the
                           following:

<TABLE>
                          <S>                                                           <C>
                           $7,000,000 warehouse line of credit,
                           payable on demand, bearing interest
                           at prime plus 2%, secured primarily
                           by mortgages receivable                                        $   499,900

                           $2,000,000 warehouse line of credit,
                           bearing interest at prime plus 2%,
                           maturing October 1998, secured
                           primarily by mortgages receivable
                           and guaranteed by a principal share-
                           holder of Accent Holdings, Inc.                                  1,132,442
                           --------------------------------------------------------------------------

                                                                                          $ 1,632,342
                           ==========================================================================
</TABLE>


                           The Company is currently in default on its
                           $2,000,000 line of credit. The loan agreement
                           requires the Company to maintain certain net worth
                           requirements. Additionally, the agreement requires
                           mortgages to be removed as loan security from the
                           line within 90 days after advances are made on the
                           related mortgages. The Company is in violation of
                           both of these provisions. Management is currently
                           negotiating with the lender to cure the defaults.


                                      53
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999
                                  (Continued)


 6. NOTES PAYABLE          Notes payable at June 30, 1999 are summarized as
                           follows:

<TABLE>
                          <S>                                                           <C>
                           Note payable to bank in monthly
                           principal and interest payments of
                           $5,144 and a final balloon payment
                           of $167,780 in August 1999. The
                           note bears interest at 8.5% and is
                           secured by accounts receivable,
                           equipment and certificates of
                           deposit totaling $125,435                                      $ 170,831

                           Note payable to bank; interest rate
                           of 8.5%; maturing August 1999;
                           secured by a $107,000 certificate of
                           deposit of a shareholder's family
                           member                                                            75,000

                           Equipment note; monthly payments
                           of $175, bearing interest at 10%,
                           paid July, 1999                                                    1,991

                           Notes payable to affiliated company,
                           bearing interest at prime
                           plus 1%, maturing December 2001,
                           secured by stage funding mortgage
                           receivables                                                      528,891
                           ------------------------------------------------------------------------

                                                                                          $ 776,713
                           ========================================================================
</TABLE>


                                      54
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999
                                  (Continued)

 7. INCOME TAXES           The Company files a consolidated tax return with its
                           parent, Accent Holdings, Inc., and allocates income
                           tax benefits and expense based on the income or loss
                           of each company.

                           Temporary differences that give rise to significant
                           portions of deferred tax assets and liabilities at
                           June 30, 1999 consist of net operating loss
                           carryforwards, expense accruals, the allowance for
                           losses and the use of accelerated tax depreciation
                           methods. Net deferred taxes at June 30, 1999 include
                           the following components:

<TABLE>
                          <S>                                                           <C>
                           Deferred tax assets                                            $  745,000
                           Valuation allowance                                              (743,000)
                           -------------------------------------------------------------------------
                                                                                               2,000
                           Deferred tax liabilities                                           (2,000)
                           -------------------------------------------------------------------------


                           Net deferred taxes                                             $      -0-
                           =========================================================================
</TABLE>


                           At June 30, 1999, the Company has net operating loss
                           carryforwards for tax purposes of approximately
                           $551,000, which are available to offset future
                           taxable income through 2019.


                                      55
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999
                                  (Continued)

 8. OPERATING LEASE     The Company leases office space under a noncancelable
                        lease classified as an operating lease. Future minimum
                        obligations are as follows:


<TABLE>

                            Year Ended June 30,
                           -----------------------------------------------------------------------
                                <S>                                                     <C>
                                 2000                                                    $ 158,276
                                 2001                                                      161,619
                                 2002                                                      166,468
                                 2003                                                      171,407
                                 2004                                                      176,587
                                 Thereafter                                                 29,576
                           -----------------------------------------------------------------------

                                                                                         $ 863,933
                           =======================================================================
</TABLE>

                        Rental expense totaled $30,991 at June 30, 1999 and
                        is included in administrative and general expenses.

 9. RELATED PARTY       During 1999, Accent Holdings, Inc. made a capital
    TRANSACTIONS        contribution of $500,000 to the Company.

                        At June 30, 1999, shareholders of Accent Holdings,
                        Inc. have made non-interest bearing advances
                        totaling $153,094 to the Company.

                        During June 1999, the Company made $189,523 in
                        non-interest bearing advances to The Accent Group,
                        Inc.

                        In 1999, the Company borrowed $528,891 from Accent
                        Partners, a partnership of Accent Holdings, Inc. and
                        one of its shareholders. The funds were used to
                        finance stage funding mortgage receivables totaling
                        $531,692 at June 30, 1999.


                                      56
<PAGE>
                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999
                                  (Continued)
10.   COMMITMENTS       In July and August 1998, the Company purchased mortgage
      AND               notes from SGE Mortgage Funding Corp. Subsequent to the
      CONTINGENCIES     purchases, the Superior Court of Tift County, Georgia,
                        placed SGE in receivership and charged the receiver
                        with the responsibility of settling competing claims
                        to loans made and sold by SGE. Many of the loans
                        acquired by the Company from SGE were later sold to
                        Matrix Bank for $623,032. Matrix Bank contends some
                        of the loans are subject to competing claims or are
                        nonperforming assets, and has demanded that the
                        Company reacquire these loans. The Company is
                        negotiating with Matrix to resolve these issues,
                        however, the ultimate resolution is unknown at this
                        time. The Company has not provided for losses which
                        may result from the Matrix transaction.

                        At June 30, 1999, the Company was not in compliance
                        with Department of Housing and Urban Development
                        (HUD) net worth requirements. The Company is taking
                        corrective action; however, the ultimate resolution
                        of the matter and the effects it may have on the
                        Company's operations are not known.

                        The Company is involved in several lawsuits and
                        regulatory issues arising in the normal course of
                        business. In the opinion of management, no material
                        loss will result from settlement of these issues.

11. SUPPLEMENTAL        The Company paid interest of $65,821 during the six
    CASH FLOW           months ended June 30, 1999.
    INFORMATION

                                     57
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                                 JUNE 30, 1999
                                  (Continued)

12.   SUBSEQUENT           As mentioned in Note 1, effective July 9, 1999,
      EVENTS               Accent Holdings, Inc. exchanged 400,000 shares of
                           Accent Mortgage Services, Inc. for 362,000 shares of
                           common stock of The Accent Group, Inc., thereby
                           making AMSI a wholly-owned subsidiary of The Accent
                           Group. The Accent Group, Inc. then entered into a
                           reverse merger with Lahaina Acquisitions, Inc. In
                           connection with the merger, shareholders of The
                           Accent Group, Inc. received 86% of the common stock
                           of Lahaina. The Accent Group, Inc. is now the
                           surviving parent of AMSI.

                           In order to alleviate the Company's deficit in
                           stockholder's equity, on September 21, 1999, The
                           Accent Group transferred a subsidiary, Beachside
                           Commons I, Inc. into the Company. Beachside Commons
                           I, Inc.'s principal holding is real estate.
                           Management estimates that the net value of the
                           Company is approximately $1,700,000.

                           Additionally, in the merger referred to above, the
                           Company was relieved of stockholder loans totaling
                           approximately $153,000 at June 30, 1999. The loans
                           were transferred to additional paid-in capital.

                           The effect of the two transactions is to increase net
                           worth by approximately $1,853,000 and brings the
                           Company into compliance with the net worth
                           requirements of both HUD and its line of credit which
                           is in default.



                                     58
<PAGE>



INDEPENDENT AUDITORS' REPORT

To the Stockholder and
Board of Directors of
Accent Mortgage Services, Inc.

     We  have  audited  the  accompanying  balance  sheets  of  Accent  Mortgage
Services,  Inc. as of December 31, 1998 and 1997 and the related  statements  of
operations,  stockholder's  equity  (deficit)  and cash flows for the years then
ended.  These  financial  statements  are the  responsibility  of the  Company's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

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

     In our opinion,  the financial statements referred to above present fairly,
in all material  respects,  the financial  position of Accent Mortgage Services,
Inc. as of December 31, 1998 and 1997 and the results of its  operations and its
cash  flows for the years  then  ended in  conformity  with  generally  accepted
accounting principles.

Holland Shipes Vann, P.C.

Atlanta, Georgia
September 9, 1999, except for
Note 13, as to which the date
is September 21, 1999


                                   59
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                                 BALANCE SHEETS


<TABLE>
                                                                          ===========       ==========
December 31,                                                                 1998              1997
                                                                          ===========       ==========
<S>                                                                      <C>               <C>
ASSETS
   Mortgage portfolio, net                                                $ 3,823,921       $1,658,900
   Investments, held to maturity                                                               153,957
   Restricted certificates of deposit                                         123,081          121,500
   Cash and cash equivalents                                                   66,050           23,156
   Accrued interest receivable                                                 60,593           25,446
   Property and equipment, less accumulated depreciation                      229,879          141,841
   Other assets                                                                                 73,548
                                                                          -----------       ----------
                                                                          $ 4,303,524       $2,198,348
                                                                          ===========       ==========



LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)

LIABILITIES
   Lines of credit                                                        $ 4,487,564       $1,585,964
   Notes payable                                                              271,348          355,268
   Due to stockholders                                                        150,300           35,000
   Accrued interest payable                                                   242,915           26,719
   Other liabilities                                                          245,116           81,681
                                                                          -----------       ----------
                                                                            5,397,243        2,084,632
                                                                          -----------       ----------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDER'S EQUITY (DEFICIT)
   Common stock, no par value, 1,000,000 shares
      authorized; 400,000 shares issued and outstanding                        60,000           60,000
   Additional paid-in capital                                                 124,595
   Retained earnings (deficit)                                             (1,278,314)          53,716
                                                                          -----------       ----------
                                                                           (1,093,719)         113,716
                                                                          -----------       ----------
                                                                          $ 4,303,524       $2,198,348
                                                                          ===========       ==========
</TABLE>


See accompanying notes to financial statements.

                                       60
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                            STATEMENTS OF OPERATIONS


<TABLE>
                                                                          ===========       ===========
Year Ended December 31,                                                          1998             1997
                                                                          ===========       ===========
<S>                                                                      <C>               <C>
REVENUES
     Brokerage services                                                   $ 2,783,098       $1,910,837
     Interest and investment income                                            92,997           42,902
                                                                          -----------       ----------
                                                                            2,876,095        1,953,739
                                                                          -----------       ----------


EXPENSES
     Brokerage services expense                                             1,571,852          828,747
     Interest expense                                                         262,417           62,138
     Provision for losses                                                     853,056
     Administrative and general                                             1,520,800        1,231,261
                                                                          -----------       ----------
                                                                            4,208,125        2,122,146
                                                                          -----------       ----------

NET LOSS                                                                  $(1,332,030)      $ (168,407)
                                                                          ===========       ==========
</TABLE>


See accompanying notes to financial statements.


                                      61
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
             STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT)



<TABLE>
                                                        ========   ===========       =========       ================
                                                                    Additional        Retained           Total
                                                         Common       Paid-in         Earnings        Stockholder's
                                                         Stock        Capital        (Deficit)       Equity (Deficit)
                                                        ========   ===========      ==========       ================
<S>                                                    <C>          <C>            <C>               <C>
BALANCE, December 31, 1996                              $60,000                     $   222,123       $   282,123

   1997 net loss                                                                       (168,407)         (168,407)
                                                        -------      ---------      -----------       -----------
BALANCE, December 31, 1997                               60,000                          53,716           113,716

   1998 net loss                                                                     (1,332,030)       (1,332,030)

   Capital contribution                                              $ 124,595                            124,595
                                                        -------      ---------      -----------       -----------
BALANCE, December 31, 1998                              $60,000      $ 124,595      $(1,278,314)      $(1,093,719)
                                                        =======      =========      ===========       ===========
</TABLE>


See accompanying notes to financial statements.


                                       62
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                            STATEMENTS OF CASH FLOWS
<TABLE>

                                                                  ===========       ============
Year Ended December 31,                                              1998               1997
                                                                  ===========       ============
<S>                                                              <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss                                                       $(1,332,030)      $  (168,407)
                                                                  -----------       -----------
   Adjustments to reconcile net loss to net cash
        used in operating activities:-
             Depreciation                                              37,028            25,936
             Amortization of discount                                                   (13,898)
             Provision for losses                                     845,591
             Gain on sale of investments                              (31,218)
             Changes in assets and liabilities:
                 Accrued interest receivable                          (35,147)          (25,446)
                 Other assets                                          73,548            16,455
                 Accrued interest payable                             216,196            26,719
                 Other liabilities                                    163,435            33,283
                                                                  -----------       -----------
                                                                    1,269,433            63,049
                                                                  -----------       -----------
NET CASH USED IN OPERATING ACTIVITIES                                 (62,597)         (105,358)
                                                                  -----------       -----------

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of mortgages, net                                       (3,010,612)         (960,000)
  Acquisition of property and equipment                              (125,066)          (62,229)
  Purchase of investments and certificates of deposit                  (1,581)         (165,394)
  Proceeds from sale of investments                                   185,175
                                                                  -----------       -----------
NET CASH USED IN INVESTING ACTIVITIES                              (2,952,084)       (1,187,623)
                                                                  -----------       -----------

CASH FLOWS FROM FINANCING ACTIVITIES
  Capital contribution                                                124,595
  Borrowings on notes payable                                          75,000           492,979
  Loans from stockholders                                             115,300            35,000
  Increase in lines of credit                                       2,901,600           901,042
  Principal payments on notes payable                                (158,920)         (165,045)
                                                                  -----------       -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES                           3,057,575         1,263,976
                                                                  -----------       -----------

NET INCREASE (DECREASE) IN CASH                                        42,894           (29,005)

CASH AND CASH EQUIVALENTS, beginning of year                           23,156            52,161
                                                                  -----------       -----------
CASH AND CASH EQUIVALENTS, end of year                            $    66,050       $    23,156
                                                                  ===========       ===========
</TABLE>


See accompanying notes to financial statements.


                                       63
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997

 1. ORGANIZATION        Accent Mortgage Services, Inc. (AMSI) was incorporated
    AND SUMMARY OF      in the State of Georgia on August 21, 1991. The Company
    SIGNIFICANT         engages in residential and commercial brokerage
    ACCOUNTING          services and in the purchase and sale of mortgages. The
    POLICIES            Company provides these services primarily to mortgage
                        customers in the Southeastern United States. At
                        December 31, 1998, the Company was a wholly-owned
                        subsidiary of Accent Holdings, Inc.

                        Effective July 9, 1999, Accent Holdings, Inc. exchanged
                        400,000 shares of Accent Mortgage Services, Inc. for
                        362,000 shares of common stock of The Accent Group,
                        Inc., thereby making AMSI a wholly-owned subsidiary of
                        The Accent Group. The Accent Group, Inc. then entered
                        into a reverse merger with Lahaina Acquisitions, Inc. In
                        connection with the merger, shareholders of The Accent
                        Group received 86% of the common stock of Lahaina. The
                        Accent Group, Inc. is now the surviving parent of AMSI.

    MANAGEMENT          The preparation of financial statements in conformity
    ESTIMATES           with generally accepted accounting principles requires
                        management to make estimates and assumptions that
                        affect the reported amounts of assets and liabilities,
                        the disclosure of contingent assets and liabilities at
                        the date of the financial statements, and the reported
                        amounts of revenues and expenses during the reporting
                        period. Actual results could differ from those
                        estimates.

    MORTGAGE            Mortgage loans are held for sale and are carried at
    PORTFOLIO           the lower of cost or fair value with any unrealized
                        losses included in current period earnings.

                        The accrual of interest on mortgages is discontinued
                        when mortgages become delinquent for 90 days or
                        more. Any accrued interest on delinquent mortgages
                        is charged against current-period interest income.
                        Subsequent interest income on such mortgages is
                        recognized only to the extent that cash payments are
                        received.

    INVESTMENTS         Nonmortgage investments are classified as
                        held-to-maturity and are carried at historical cost,
                        adjusted for unamortized discount or premium.
                        Interest income is recognized on an accrual basis.


                                      64
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997
                                  (Continued)

    ALLOWANCE FOR          The allowance for losses is based on an analysis of
    LOSSES                 the mortgage portfolio. The analysis considers
                           credit profile factors such as mortgage
                           characteristics and actual and expected loss
                           experience. Increases in the allowance are charged
                           to the provision for losses. Reductions in the
                           allowance result from charge-offs, net of
                           recoveries. In management's judgment, the allowance
                           is adequate to provide for expected losses.

    PROPERTY               Property and equipment are recorded at cost.
    AND                    Depreciation is provided utilizing the straight-line
    EQUIPMENT              method over the estimated useful lives of the
                           individual assets, generally five to seven years.
                           Depreciation expense totaled $37,028 (1998) and
                           $25,936 (1997).

    CASH AND CASH          The Corporation considers highly liquid investment
    EQUIVALENTS            instruments with an original maturity of three
                           months or less to be "cash equivalents." Cash
                           equivalents are carried at cost, which approximates
                           market value.

    CREDIT RISK            Concentration of credit risk with respect to the
                           Company's mortgages receivable exists since
                           borrowers are susceptible to changes in economic
                           conditions that could affect their ability to meet
                           their obligations. Additionally, the Company
                           maintains its cash in bank deposit accounts which,
                           at times, may exceed federally insured limits.

    INCOME TAXES           Income taxes are accounted for under the asset and
                           liability method. Deferred tax assets and
                           liabilities are recognized for the future tax
                           consequences attributable to differences between the
                           financial statement carrying amounts of existing
                           assets and liabilities and their respective tax
                           basis and operating loss carryforwards. Deferred tax
                           assets and liabilities are measured using enacted
                           tax rates expected to apply to taxable income in the
                           years in which those temporary differences are
                           expected to be recovered or settled. The effect on
                           deferred tax assets and liabilities of a change in
                           tax rates is recognized in income in the period that
                           includes the enacted date.


                                      65
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997
                                  (Continued)

 2. MORTGAGE              The Company's mortgage portfolio represents mortgages
    PORTFOLIO             closed either directly from borrowers or purchased
                          from other lenders. Mortgages receivable consist of
                          the following:


<TABLE>

                                                                            1998             1997
                           ----------------------------------------------------------------------
                          <S>                                       <C>               <C>
                           Principal of mortgages securing
                             lines of credit                         $ 4,626,154       $1,658,900
                           Principal of other mortgages                  944,828
                           Less:  Purchase discounts                    (901,470)
                           ----------------------------------------------------------------------
                                                                       4,669,512        1,658,900
                           Less: Allowance for losses                   (845,591)
                           ----------------------------------------------------------------------

                                                                     $ 3,823,921       $1,658,900
                           ======================================================================
</TABLE>



 3. INVESTMENTS           Investments classified as held-to-maturity consisted
                          of U. S. Government zero coupon bonds with an
                          amortized cost of $153,957 at December 31, 1997 and
                          a market value of $182,233. The bonds were sold in
                          1998 resulting in a realized gain of $31,218.


                                     66
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997
                                  (Continued)


 4. PROPERTY AND           Property and equipment are summarized as follows:
    EQUIPMENT


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

                          <S>                                       <C>               <C>
                           Automobiles                               $   24,160        $   24,160
                           Furniture and fixtures                        34,631            29,080
                           Office equipment                             173,973           129,624
                           Leasehold improvements                        89,206            14,040
                           ----------------------------------------------------------------------
                                                                        321,970           196,904
                           Less: Accumulated depreciation               (92,091)          (55,063)
                           ----------------------------------------------------------------------

                                                                     $  229,879        $  141,841
                           ======================================================================
</TABLE>


 5. 401(K) PROFIT          Effective January 1, 1998, the Company established a
    SHARING PLAN           401(k) profit sharing plan covering substantially
                           all of its employees. Effective June 30, 1999, the
                           Plan was terminated and all eligible employees
                           became 100% vested. The Company made contributions
                           of $5,664 in 1998 to the Plan.


                                      67
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997
                                  (Continued)



 6. LINES OF CREDIT        Lines of credit consist of the following:


<TABLE>
                                                                                 1998             1997
                           ---------------------------------------------------------------------------
                          <S>                                           <C>              <C>
                           $7,000,000 warehouse line of credit,
                           payable on demand, bearing interest
                           at prime plus 2%, secured primarily
                           by mortgages receivable                        $ 3,220,875


                           $2,000,000 warehouse line of credit,
                           bearing interest at prime plus 2%,
                           maturing October 1998, secured
                           primarily by mortgages receivable
                           and guaranteed by a principal share-
                           holder of Accent Holdings, Inc.                  1,266,689       $1,585,964
                           ---------------------------------------------------------------------------

                                                                          $ 4,487,564       $1,585,964
                           ===========================================================================
</TABLE>

                           The Company is currently in default on its
                           $2,000,000 line of credit. The loan agreement
                           requires the Company to maintain certain net worth
                           requirements. Additionally, the agreement requires
                           mortgages receivable to be removed as loan security
                           within 90 days after advances are made on the
                           related mortgages. The Company is in violation of
                           both of these provisions. Management is currently
                           negotiating with the lender to cure the defaults.


                                      68
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997
                                  (Continued)


 7. NOTES PAYABLE          Notes payable are summarized as follows:

<TABLE>

                                                                                         1998              1997
                           ------------------------------------------------------------------------------------
                          <S>                                                      <C>              <C>
                           Note payable to bank in monthly principal and
                           interest payments of $5,144 and a final
                           balloon payment of $167,780 in August 1999.
                           The note bears interest at 8.5% and is
                           secured by accounts receivable, equipment and
                           certificates of deposit totaling $123,081
                           (1998) and $121,500 (1997)                               $ 194,357         $ 236,481

                           Margin demand loan payable, secured
                           by investments, interest paid monthly
                           at variable rates                                                            109,233

                           Note payable to bank; interest rate of 8.5%;
                           maturing August 1999; secured by a $107,000
                           certificate of deposit of a shareholder's
                           family member                                               75,000


                           Equipment notes; monthly payments of $175
                           (1998) and $3,700 (1997), bearing interest at
                           rates from 9 1/2% to 17.99%, maturing June
                           1998 to April 1999, secured by office equipment              1,991             9,554
                           ------------------------------------------------------------------------------------

                                                                                    $ 271,348         $ 355,268
                           ====================================================================================
</TABLE>


 8. INCOME TAXES           The Company files a consolidated tax return with its
                           parent, Accent Holdings, Inc., and allocates income
                           tax benefits and expense based on the income or loss
                           of each company.


                                     69
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997
                                  (Continued)


                           Temporary differences that give rise to significant
                           portions of deferred tax assets and liabilities at
                           December 31, 1998 and 1997 consist of net operating
                           loss carryforwards, expense accruals, the allowance
                           for losses and the use of accelerated tax
                           depreciation methods. Net deferred taxes at December
                           31, 1998 and 1997 include the following components:



<TABLE>

                                                                  1998              1997
                           -------------------------------------------------------------

                          <S>                               <C>               <C>
                           Deferred tax assets               $ 593,000         $  67,000
                           Valuation allowance                (575,000)          (51,000)
                           -------------------------------------------------------------
                                                                18,000            16,000
                           Deferred tax liabilities            (18,000)          (16,000)
                           -------------------------------------------------------------

                           Net deferred taxes                $     -0-         $     -0-
                           =============================================================
</TABLE>

                           At December 31, 1998, the Company has net operating
                           loss carryforwards for tax purposes of approximately
                           $210,000, which are available to offset future
                           taxable income through 2018.


 9. OPERATING LEASE        The Company leases office space under a
                           noncancelable lease classified as an operating
                           lease. Future minimum obligations are as follows:

<TABLE>
                           Year Ended December 31,
                           ------------------------------------------------------------
                                <S>                                           <C>
                                 1999                                          $110,307
                                 2000                                           159,629
                                 2001                                           164,441
                                 2002                                           169,343
                                 2003                                           174,410
                                 Thereafter                                     103,517
                           ------------------------------------------------------------

                                                                               $881,647
                           ============================================================
</TABLE>




                                      70
<PAGE>

                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997
                                  (Continued)

                        Rental expense totaled $54,333 (1998) and $26,657
                        (1997) and is included in administrative and general
                        expenses.


10. RELATED PARTY       The Company received advances from and paid expenses on
    TRANSACTIONS        behalf of several affiliated companies. During 1998,
                        the parent company, Accent Holdings, Inc.,
                        contributed net advances of $124,595 to the capital
                        of The Company.

                        Shareholders of Accent Holdings, Inc. made
                        non-interest bearing advances totaling $150,300
                        (1998) and $35,000 (1997) to the Company.

                        The Company paid consulting fees of $74,482 in 1998
                        to a company related through common ownership to one
                        of the shareholders of Accent Holdings, Inc.


11. COMMITMENTS         In July and August 1998, the Company purchased mortgage
    AND                 notes from SGE Mortgage Funding Corp. Subsequent to the
    CONTINGENCIES       purchases, the Superior Court of Tift County, Georgia,
                        placed SGE in receivership and charged the receiver
                        with the responsibility of settling competing claims
                        to loans made and sold by SGE. Many of the loans
                        acquired by the Company from SGE were later sold to
                        Matrix Bank for $623,032. Matrix Bank contends some of
                        the loans are subject to competing claims or are
                        nonperforming assets, and has demanded that the
                        Company reacquire these loans. The Company is
                        negotiating with Matrix to resolve these issues,
                        however, the ultimate resolution is unknown at this
                        time. The Company has not provided for losses which
                        may result from the Matrix transaction.

                        Subsequent to December 31, 1998, the Company determined
                        it was not in compliance with Department of Housing and
                        Urban Development (HUD) net worth requirements. The
                        Company is taking corrective action; however, the
                        ultimate resolution of the matter and the effects it may
                        have on the Company's operations are not known.


                                     71
<PAGE>


                         ACCENT MORTGAGE SERVICES, INC.
                         NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 1998 AND 1997
                                  (Continued)

                           The Company is involved in several lawsuits and
                           regulatory issues arising in the normal course of
                           business. In the opinion of management, no material
                           loss will result from settlement of these issues.


12. SUPPLEMENTAL           The Company paid interest of $46,221 (1998) and
    CASH FLOW              $35,419 (1997).  The Company paid income taxes of
    INFORMATION            $29,830 in 1997.


13. SUBSEQUENT             As mentioned in Note 1, effective July 9, 1999,
    EVENTS                 Accent Holdings, Inc. exchanged 400,000 shares of
                           Accent Mortgage Services, Inc. for 362,000 shares of
                           common stock of The Accent Group, Inc., thereby
                           making AMSI a wholly-owned subsidiary of The Accent
                           Group. The Accent Group, Inc. then entered into a
                           reverse merger with Lahaina Acquisitions, Inc. In
                           connection with the merger, shareholders of The
                           Accent Group, Inc.  received 86% of the common stock
                           of Lahaina. The Accent Group, Inc. is now the
                           surviving parent of AMSI.

                           In order to alleviate the Company's deficit in
                           stockholder's equity, on September 21, 1999, The
                           Accent Group transferred a subsidiary Beachside
                           Commons I, Inc. into the Company. Beachside Commons
                           I, Inc.'s principal holding is real estate.
                           Management estimates that the net value of the
                           Company is approximately $1,700,000.


                           Additionally, in the merger referred to above, the
                           Company was relieved of the stockholder loans
                           totaling approximately $153,000 at June 30, 1999.
                           The loans were transferred to additional paid-in
                           capital.

                           The effect of the two transactions is to increase
                           net worth by approximately $1,853,000 and brings the
                           Company into compliance with the net worth
                           requirements of both HUD and its line of credit
                           which is in default.
                                       72

<PAGE>


        (2)  Exhibits



<TABLE>
<CAPTION>
EXHIBIT NO.                                      DESCRIPTION OF EXHIBIT
-----------                                      ----------------------
<S>         <C>
 2.1         Agreement and Plan of Merger dated July 21, 1999 by and among Lahaina Acquisitions, Inc., LAHA
             No. 1, Inc., Mongoose Investments, LLC, The Accent Group, Inc. and Accent Mortgage Services, Inc.
             (the "Plan of Merger")(1)
 3.1         Amended and Restated Articles of Incorporation.(2)
 3.2         Bylaws of the Company.(2)
 4.1         Securities Purchase Agreement dated December 7, 1998, by and between Lahaina Acquisitions, Inc.
             and GCA Strategic Investment Fund Limited.(3)
 4.2         9% Convertible Note of Lahaina Acquisitions, Inc. payable to GCA Strategic Investment Fund
             Limited, in the principal amount of $750,000.(3)
 4.3         Letter Agreement dated January 19, 1999 by and between Lahaina Acquisitions, Inc. and GCA
             Strategic Investment Fund, Ltd. amending 9% Convertible Note.(4)
 4.4         Registration Rights Agreement dated December 7, 1998, by and between Lahaina Acquisitions, Inc.
             and GCA Strategic Investment Fund Limited.(3)
 4.5         Letter Agreement dated January 19, 1999 by and between Lahaina Acquisitions, Inc. and GCA
             Strategic Investment Fund, Ltd. confirming conversion of $25,000 Beachside Commons Note.(4)
 4.6         Form of Stock Certificate.(2)
 4.7         Securities Purchase Agreement dated August 19, 1999 by and between Lahaina Acquisitions, Inc., and
             GCA Strategic Investment Fund Limited.(1)
 4.8         9% Convertible Note of Lahaina Acquisitions, Inc. payable to GCA Strategic Investment Fund
             Limited, in the principal amount of $500,000.(1)
 4.9         Registration Rights Agreement dated August 19, 1999 by and between Lahaina Acquisitions, Inc. and
             GCA Strategic Investment Fund Limited.(1)
4.10         Common Stock Purchase Warrant in the amount of 50,000 shares to be issued by Lahaina
             Acquisitions, Inc. and purchased by GCA Strategic Investment Fund Limited, expiring on August 19,
             2004.(1)
4.11         Pledge Agreement dated August __, 1999 by and among Mongoose Investments, LLC, Richard P.
             Smyth and GCA Strategic Investment Fund Limited.(1)
4.12 +       Registration Statement on Form S-8 (Registration No. 333-90295), dated and filed with the
             commission on November 4, 1999.
10.1         Contract of Engagement dated January 19, 1999 by and between Lahaina Acquisitions, Inc. and LKB
             Financial LLC.(4)
10.2         Settlement and Release Agreement dated June 30, 1999 by and between Lahaina Acquisitions, Inc. and
             Sherry Klein.(1)

</TABLE>




                                       73

<PAGE>
<TABLE>
<S>         <C>
10.3         Purchase and Sale Agreement dated June 30, 1999 by and between Lahaina Acquisitions, Inc. and
             Mongoose Investments, LLC.(1)
10.4         GCA Consent to Agreement and Plan of Merger dated August 19, 1999 by and between Lahaina
             Acquisitions, Inc. and GCA Strategic Investment Fund, Limited.(1)
10.5         Consulting Agreement dated August 16, 1999 by and between Lahaina Acquisitions, Inc. and Gerald
             F. Sullivan.(1)
10.6         Consulting Agreement dated August 16, 1999 by and between Lahaina Acquisitions, Inc. and Gator
             Glory, LLC.(1)
10.7         Indemnification Agreement dated August __, 1999 by and between Lahaina Acquisitions, Inc. and
             Richard P. Smyth.(1)
10.8         Indemnification Agreement dated August __, 1999 by and between Lahaina Acquisitions, Inc. and
             Gerald F. Sullivan.(1)
10.9         Indemnification Agreement dated August __, 1999 by and between Lahaina Acquisitions, Inc. and
             Sidney E. Brown.(1)
10.10        Indemnification Agreement dated August __, 1999 by and between Lahaina Acquisitions, Inc. and D.
             Nelson Lester.(1)
10.11        Escrow Agreement dated August 16, 1999 by and among Lahaina Acquisitions, Inc., LAHA No. 1,
             Inc., Mongoose Investments, LLC, The Accent Group, Inc., Accent Mortgage Services, Inc. and
             Altman, Kritzer & Levick, P.C.(1)
10.12        Escrow Agreement dated August 19, 1999 by and among Lahaina Acquisitions, Inc., GCA Strategic
             Investment Fund Limited and Kim T. Stephens, Esq.(1)
10.13        Second Mortgage on Beachside Commons in the principal amount of $500,000.(1)
10.14        1999 Accent Stock Option Plan.(1)
16           Letter of Resignation from Kenneth A. Walters, P.A.(5)
21           Subsidiaries of the Registrant
23.1         Consent of Deloitte & Touche, LLP
23.2         Consent of Holland Shipes Vann, P.C.
27           Financial Data Schedule (for SEC use only)
</TABLE>


+ Previously filed.

(1)  Incorporated by reference to the Company's Current Report on Form 8-K dated
     August 23, 1999 and filed with the commission on September 7, 1999.

(2)  Incorporated by reference to the  Registration  Statement on Form 10, filed
     December 29, 1995.

(3)  Incorporated by reference to the Company's Current Report on Form 8-K dated
     and filed with the commission on December 28, 1999.

(4)  Incorporated by reference to the Company's  Quarterly Report on Form 10-Q/A
     for the period  ended  December  31,  1998,  filed with the  commission  on
     October 29, 1999.

(5)  Incorporated by reference to the Company's Current Report on Form 8-K dated
     September 17, 1999 and filed with the commission on September 21, 1999.

     (b) Reports on Form 8-K.

         Current  Report on Form  8-K/A  dated  August  23,  1999 and filed with
the commission  on September 30, 1999,  financial  statements,  pro forma
financial information and exhibits pertaining to the merger of Lahaina
Acquisitions,  Inc. and The Accent Group, Inc.

         Current Report on Form 8-K dated  September 17, 1999 and filed with the
commission  on September  21,  1999;  resignation  of Kenneth A.  Waters,  PA as
certifying  accountant  and  appointment  of Deloitte & Touche LLP as certifying
accountants.

         Current  Report on Form 8-K/A  (amendment no. 2) dated February 3, 1999
and filed with the  commission on September 21, 1999;  resignation of Millward &
Co. as certifying  accountant  and  appointment of Bearden & Smith as certifying
accountants.

         Current  Report on Form 8-K dated  August  23,  1999 and filed with the
commission on September 7, 1999; change in control of the Registrant  pertaining
to the merger of Lahaina Acquisitions, Inc. and The Accent Group, Inc.

                                       74

<PAGE>


                                   SIGNATURES

     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
its behalf by the undersigned, thereunto duly authorized.

                                 LAHAINA ACQUISITIONS, INC.
                                  (Registrant)

Dated: June 2, 2000            By:    /s/ L. Scott Demerau
                                        --------------------
                                        L. Scott Demerau
                                        President and Chief Executive Officer


                                       75