SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB


(Mark One)

    (X)  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the quarterly period ended        March 31, 1997
                                        ---------------------------

    (  ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

         For the transition period from ______________ to __________________

                         Commission file number 1-13478


                    GLOBAL TELECOMMUNICATION SOLUTIONS, INC.
        (Exact name of small business issuer as specified in its charter)


            Delaware                                           13-3698386
  -------------------------------                          -------------------- 
  (State or other jurisdiction of                            (IRS Employer
   incorporation or organization)                          Identification No.)


            5697 Rising Sun Avenue, Philadelphia, Pennsylvania 19120
                    (Address of principal executive offices)

                                 (215) 342-7700
                           (Issuer's telephone number)


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


         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days.   Yes X No

         State the number of shares  outstanding of each of the issuer's classes
of common equity,  as of the latest  practicable  date: As of May 9, 1997, there
were 2,190,116 shares of common stock outstanding.

                               Page 1 of 18 Pages

                            Exhibit Index -- Page 15

                                        1


<PAGE>



            GLOBAL TELECOMMUNICATION SOLUTIONS, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>



                                                                                                               Page
<S>                                                                                                             <C>   
Part I.  Financial Information

Item 1.  Consolidated Financial Statements

Consolidated Balance Sheets - March 31, 1997 (unaudited) and December 31, 1996....................................3

Consolidated Statements of Operations - Three months ended March 31, 1997 and 1996 (unaudited)....................4

Consolidated Statements of Cash Flows - Three months ended March 31, 1997 and 1996 (unaudited)....................5

Notes to Consolidated Financial Statements........................................................................6

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations....................9

Part II. Other Information

Item 2.  Changes in Securities...................................................................................13

Item 4.  Submission of Matters to a Vote of Security Holders.....................................................13

Item 6.  Exhibits and Reports on Form 8-K........................................................................13

Signatures.......................................................................................................14
</TABLE>


                                        2


<PAGE>

                    GLOBAL TELECOMMUNICATION SOLUTIONS, INC.
                                AND SUBSIDIARIES

                           Consolidated Balance Sheets
<TABLE>
<CAPTION>
                                   Assets                                              March 31,           December 31,
                                                                                         1997                 1996
                                                                                     (Unaudited)
<S>                                                                                       <C>                  <C>   
Current assets:
    Cash                                                                             $   235,618          $  1,352,322
    Accounts receivable, less allowance for doubtful accounts
      of $502,700 and $399,000 in 1997 and 1996, respectively                          2,208,575             2,450,119
    Inventory                                                                            241,367               202,129
    Deferred costs                                                                     1,220,100             1,127,887
    Prepaid royalties and patent license fees                                             70,876                95,396
    Prepaid expenses and other current assets                                            245,984               164,876
                                                                                      ----------         -------------
            Total current assets                                                       4,222,520             5,392,729
                                                                                     -----------          ------------
Goodwill, net                                                                         17,692,501            18,008,599
Fixed assets, net                                                                      1,886,752             1,948,917
Deferred financing fees, net                                                             301,530               270,219
Other assets                                                                             187,355               198,901
                                                                                       ---------         -------------
            Total assets                                                              24,290,658           $25,819,365
                                                                                      ==========           ===========
                    Liabilities and Stockholders' Equity Current liabilities:
    Accounts payable                                                                   3,688,810             3,238,666
    Accrued liabilities                                                                  733,957               542,965
    Deferred revenues                                                                  4,047,845             4,431,309
    Estimated sales and excise tax liability                                           1,986,348             1,684,478
    Amounts payable to affiliate                                                         954,628             1,073,921
    Capital lease obligation, current                                                     58,108                51,775
                                                                                       ---------         -------------
            Total current liabilities                                                 11,469,696            11,023,114
                                                                                     -----------           -----------
Capital lease obligation, long-term                                                       23,565                42,002
Convertible notes payable                                                              2,693,500             2,800,000
Notes payable, net of unearned discount of $1,291,285 and  $1,484,040                  1,758,715             1,565,960
                                                                                     -----------           -----------
            Total liabilities                                                         15,945,476            15,431,076
                                                                                    ------------           -----------
Stockholders' equity:
    Preferred stock, $.01 par value, authorized 1,000,000 shares;
      none issued                                                                             --                    --
    Common stock, $.01 par value, authorized 35,000,000 shares;
      issued and outstanding 1,856,782 and 1,837,601 shares, respectively                 18,568                18,376
    Additional paid-in capital                                                        23,301,014            22,990,766
    Deferred compensation                                                              (180,357)             (102,498)
    Accumulated deficit                                                             (14,681,419)          (12,406,504)
    Cumulative foreign currency translation adjustment                                  (12,624)              (11,851)
    Common stock note receivable                                                       (100,000)             (100,000)
                                                                                    ------------        --------------
            Total stockholders' equity                                                 8,345,182            10,388,289
                                                                                    ------------           -----------
            Total liabilities and stockholders' equity                               $24,290,658           $25,819,365
                                                                                     ===========           ===========
</TABLE>


           See accompanying notes to consolidated financial statements

                                        3


<PAGE>

                    GLOBAL TELECOMMUNICATION SOLUTIONS, INC.
                                AND SUBSIDIARIES

                      Consolidated Statements of Operations
                                   (Unaudited)
<TABLE>
<CAPTION>


                                                                                            Three months ended
                                                                                                March 31,
                                                                                      1997                    1996
<S>                                                                                   <C>                       <C> 
Net sales                                                                         $ 3,688,153              $ 1,327,710
Cost of sales                                                                       2,855,357                1,013,556
                                                                                   ----------               ----------
                  Gross profit                                                        832,796                  314,154
                                                                                   ----------               ----------
Selling and marketing expenses                                                        778,663                  515,282
General and administrative expenses                                                 1,586,144                  848,980
Depreciation and amortization                                                         428,252                  141,418
                                                                                   ----------               ----------
                  Operating expenses                                                2,793,059                1,505,680
                                                                                   ----------               ----------
                  Operating loss                                                  (1,960,263)              (1,191,526)
Investment income                                                                       3,901                   19,581
Interest expense                                                                    (322,753)                 (17,226)
Other                                                                                   4,200                    1,400
                                                                                 ------------            -------------
                  Loss before income taxes                                        (2,274,915)              (1,187,771)
Income tax expense                                                                      --                       --
                  Net loss                                                      $ (2,274,915)            $ (1,187,771)
                                                                                  ===========              ===========
Net loss per share                                                          $          (1.23)       $            (.95)
                                                                              ===============         ================
Weighted average shares of common stock and common
  stock equivalents                                                                 1,847,786                1,254,830
                                                                                  ===========               ==========
</TABLE>


          See accompanying notes to consolidated financial statements.

                                        4


<PAGE>



            GLOBAL TELECOMMUNICATION SOLUTIONS, INC. AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                             Three months ended
                                                                                                  March 31,
                                                                                          1997                1996
<S>                                                                                       <C>                  <C>  
Cash flows from operating activities:
  Net loss                                                                           $(2,274,915)         $(1,187,771)
  Adjustments to reconcile net loss to net cash provided by or used in
    operating activities:
    Depreciation and amortization                                                         428,252              141,418
    Deferred compensation                                                                  73,789               98,667
    Amortization of deferred financing fees                                                 5,001                1,699
    Amortization of unearned discount                                                     192,755                   --
    Issuance of common stock as severance                                                  50,000                   --
    Loss on disposal of fixed assets                                                       19,912                   --
  Changes in operating assets and liabilities, net of effects of acquisition:
    Decrease in accounts receivable                                                       241,544            1,883,903
    Increase in inventory                                                                (39,238)             (24,796)
    Increase in deferred costs                                                           (92,213)             (46,573)
    Decrease in prepaid royalties and patent license fees                                  24,520                5,926
    (Increase) decrease in prepaid expenses and other current assets                     (81,108)               12,096
    (Increase) decrease in other assets                                                    11,546                  (9)
    Increase (decrease) in accounts payable                                               450,144            (319,765)
    Increase in accrued liabilities                                                       190,992              134,813
    Increase in sales and excise taxes payable                                            301,870              153,045
    Decrease in deferred revenue                                                        (383,464)             (74,688)
                                                                                       ----------         ------------
                  Net cash provided by (used in) operating activities                   (880,613)              777,965
                                                                                      -----------         ------------
Cash flows from investing activities:
  Purchases of fixed assets                                                              (69,901)             (57,851)
  Cash acquired in excess of cash payment for acquisition                                  --                   54,190
                                                                                      -----------         ------------
                  Net cash used in investing activities                                  (69,901)              (3,661)
                                                                                      -----------         ------------
Cash flows from financing activities:
  Payment of notes payable to affiliate                                                 (119,293)            (550,000)
  Increase in notes receivable from Global Link prior to merger                                --            (250,655)
  Proceeds from the exercise of options                                                     4,374                   --
  Payments on capital lease obligation                                                   (12,104)                   --
  Increase in deferred financing fees                                                    (38,394)                   --
                                                                                      -----------         ------------
                  Net cash used in financing activities                                 (165,417)            (800,655)
                                                                                      -----------         ------------
Effects of exchange rate changes on cash                                                    (773)              (2,657)
                                                                                      -----------         ------------
                  Net decrease in cash                                                (1,116,704)             (29,008)
Cash and cash equivalents at beginning of period                                        1,352,322              928,516
                                                                                      -----------         ------------
Cash and cash equivalents at end of period                                            $   235,618         $    899,508
                                                                                      -----------         ============
Supplemental disclosures:
Interest paid during the period                                                       $     9,328         $       --
                                                                                     ============         ============
Income taxes paid during the period                                                   $      --           $       --
                                                                                     ============         ============
Non-cash investing and financing activities:
  Issuance of common stock in connection with acquisition                             $      --            $11,039,488
                                                                                     ============         ============
  Deferred compensation arising from grant of options and warrants                    $   151,648         $    400,000
                                                                                     ============         ============
  Conversion of convertible notes payable in common stock                             $   106,500         $       --
                                                                                     ============         ============

</TABLE>

          See accompanying notes to consolidated financial statements.

                                        5


<PAGE>



            GLOBAL TELECOMMUNICATION SOLUTIONS, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

                                 March 31, 1997

(1)      Business and Basis of Presentation

         Business

         Global   Telecommunication   Solutions,   Inc.  (the   "Company")   was
         incorporated  on December 23, 1992 and is engaged in the  marketing and
         distribution of prepaid phone cards.  The Company's phone cards provide
         consumers  access  to  long  distance  service  through  its  switching
         facilities and long distance network arrangements.

         Basis of Presentation

         The accompanying  unaudited consolidated financial statements have been
         prepared in accordance with generally  accepted  accounting  principles
         for interim  financial  information  and with the  instructions to Form
         10-QSB and Item  310(b) of  Regulation  S-B.  Accordingly,  they do not
         include all of the  information  and  footnotes  required by  generally
         accepted accounting  principles for complete financial  statements.  In
         the  opinion  of  management,  all  adjustments  (consisting  of normal
         recurring accruals)  considered  necessary for a fair presentation have
         been included.  Operating  results for the three months ended March 31,
         1997 are not necessarily indicative of the results that may be expected
         for the year ending December 31, 1997.

(2)      Loss Per Share

         Weighted  average  shares of common  stock for the three  months  ended
         March 31, 1997 and 1996 does not include  common stock  equivalents  as
         their effect would be anti-dilutive.

(3)      Reclassifications

         Certain  reclassifications  have  been  made to the  1996  consolidated
         financial statements to conform to the 1997 presentation.

(4)      Acquisition

         On February 29, 1996, pursuant to an Agreement and Plan of Merger dated
         January 18,  1996,  the  Company,  through a  wholly-owned  subsidiary,
         acquired  all the issued and  outstanding  common  stock of Global Link
         Teleco  Corporation  ("Global Link"). The acquisition was accounted for
         as a purchase.  Accordingly,  the acquired assets and liabilities  were
         recorded at their  estimated fair values at the date of acquisition and
         the operating  results of Global Link were included in the accompanying
         consolidated statement of operations from the acquisition date.

         In connection  with the merger,  the Company  issued  572,773 shares of
         common stock in exchange for all of the issued and  outstanding  common
         stock of Global Link. In addition,  the Company issued 17,602 shares of
         common stock to Peoples Telephone Company, Inc. ("Peoples"), a creditor
         of Global Link and a principal  stockholder  of the Company.  The total
         cost of the acquisition was approximately  $11,400,000 including direct
         transaction costs of approximately $344,000.

                                        6


<PAGE>



         The  acquisition  resulted  in  goodwill  of  $19,069,000,  based on an
         allocation of purchase price, calculated as follows:

             Fair market value of common stock issued               $11,040,000
             Fair value of liabilities assumed                       10,811,000
             Fair value of assets acquired                           (3,126,000)
             Acquisition related costs                                  344,000
                                                                    -----------
                      Goodwill                                      $19,069,000

         The following  unaudited  combined pro forma  information  reflects the
         results of operations  assuming the acquisition of Global Link had been
         made on January 1, 1996.


                                                          Three Months Ended
                                                            March 31, 1996
                  Net sales                                 $  2,690,740
                  Net loss                                    (2,007,017)
                  Net loss per share                        $      (1.23)


         Pro  forma  adjustments  include  recording   amortization  expense  on
         goodwill and the elimination of interest expense on debt of Global Link
         repaid in connection with the acquisition.

         The pro forma results of operations are not  necessarily  indicative of
         the actual  results of  operations  that  would have  occurred  had the
         purchase been made at the  beginning of the  respective  period,  or of
         results which may occur in the future.

(5)      Reverse Stock Split

         In February  1997,  the Board of Directors  of the Company  approved an
         amendment to its Amended and Restated  Certificate of  Incorporation to
         effect a  one-for-three  reverse  stock  split.  All per share data and
         references  to number of shares  have been  retroactively  restated  in
         these financial statements to give effect to the reverse stock split.

(6)      Deferred Compensation

         In January 1997, the Company  extended its consulting  agreements  with
         two of the Company's  stockholders,  pursuant to which the stockholders
         will provide  consulting  services to the Company for a two-year period
         ending February 1999. As consideration for these services,  the Company
         issued  options to purchase  25,000 shares of common stock at $9.00 per
         share to each stockholder. These options became exercisable in February
         1997 and remain  exercisable  until  February  2002. The estimated fair
         market  value of these  options of  $151,648  was  recorded as deferred
         compensation  and the  Company  has  recorded  compensation  expense of
         $18,957 to date.

(7)      Amounts Payable to Principal Stockholder

         In March 1997,  the Company  entered  into an  agreement  with  Peoples
         whereby  Peoples agreed not to sell or otherwise  dispose of its shares
         of the Company's common stock until June 30, 1997 ("Termination Date").
         The   Company   agreed  that  it  would  pay  Peoples  the  balance  of
         approximately  $954,000  in trade  payables  from the  proceeds  of the
         Company's  proposed  secondary offering (note 10) within two days after
         the consummation of such offering ("Closing Date"). If the offering is

                                        7


<PAGE>



         consummated  before  June 30,  1997,  and the trade  payables  are paid
         within two days,  Peoples agreed to extend the Termination  Date to the
         six month anniversary of the Closing Date.

(8)      Tax Obligations and Compliance

         At March  31,  1997,  the  Company  has not  remitted  certain  amounts
         previously  collected for sales, use and excise taxes to various taxing
         jurisdictions.  Further,  the Company has not filed  certain  sales and
         use, excise,  income or franchise tax returns in certain  jurisdictions
         in which it does  business.  Management  is in the process of reviewing
         the Company's tax  collection,  remittance and compliance  policies and
         procedures and has recorded a reserve for estimated tax obligations and
         related  compliance  issues.  Depending on the ultimate  resolution  of
         these  matters,  it is  reasonably  possible  that the  amount  of this
         reserve  could  require  adjustment  in the near term and the amount of
         such adjustment could be material.

(9)      Liquidity

         The Company has  substantial  capital  requirements  resulting from the
         funding of losses  from  operations  and the need to finance  continued
         growth.  The Company  believes that its cash  balances,  along with the
         proceeds of $2,500,000  from the exercise of certain  warrants in April
         1997 (note 10), will satisfy the Company's cash requirements  until the
         end of 1997. Except for the financing referred to in note 10 below, the
         Company does not have any arrangements  with respect to, or sources of,
         additional  financing  and there can be no  assurance  that  additional
         financing will be available to the Company on  commercially  reasonable
         terms,  or at all.  The failure to obtain such  financing  could have a
         material adverse effect on the Company.

(10)     Subsequent Events

         Pursuant to an agreement with Wheatley Partners, L.P. ("Wheatley"),  an
         affiliate  of  the  Company,   in  April  1997,  the  Company  received
         $2,500,000 upon the exercise of warrants to purchase  333,334 shares of
         Common Stock issued to Wheatley in a private  placement  consummated by
         the Company in December 1996.

         In April 1997, the Company filed a registration  statement on Form SB-2
         with the Securities and Exchange Commission for a secondary offering of
         securities.  The  Company  is  attempting  to raise  approximately  $20
         million in gross proceeds.



                                        8


<PAGE>



                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

                  When used in this Form 10-QSB and in future  filings by Global
Telecommunication  Solutions,  Inc. ("GTS" or the "Company") with the Securities
and Exchange  Commission  ("SEC"),  in the Company's  press releases and in oral
statements  made with the  approval of an  authorized  executive  officer of the
Company, the words or phrases "will likely result," "management expects" or "the
Company  expects,"  "will  continue," "is  anticipated,"  "estimated" or similar
expressions  (including  confirmations by an authorized executive officer of the
Company  of any such  expressions  made by a third  party  with  respect  to the
Company)  are  intended  to  identify  "forward-looking  statements"  within the
meaning of the Private  Securities  Litigation  Reform Act of 1995.  Readers are
cautioned not to place undue  reliance on any such  forward-looking  statements,
each of which  speak only as of the date made.  Such  statements  are subject to
certain  risks and  uncertainties  that  could  cause  actual  results to differ
materially  from  historical   earnings  and  those  presently   anticipated  or
projected.  The Company has no obligation to publicly  release the result of any
revisions  which  may be  made  to any  forward-looking  statements  to  reflect
anticipated or unanticipated events or circumstances occurring after the date of
such statements.

Company Overview

                  On February 29, 1996, the Company  acquired,  through a merger
("Global  Link  Merger"),  all of the  outstanding  capital stock of Global Link
Teleco  Corporation  ("Global  Link")  for a  purchase  price  of  approximately
$11,400,000. Prior to the Global Link Merger, GTS primarily focused on marketing
custom-  designed  prepaid  phone cards for business  promotional  use and other
retail products  utilizing  prepaid phone card technology.  Global Link marketed
primarily   traditional  prepaid  phone  cards  through  various  retailers  and
distributors,  including  supermarkets,  convenience stores, travel agencies and
tour   wholesalers  and   Company-owned   and  operated  retail  phone  centers.
Capitalizing  on the  strengths of their prior  businesses,  GTS and Global Link
have integrated their operations to create a more diversified prepaid phone card
company.  Global Link's operating  results were  consolidated with the Company's
commencing on March 1, 1996.

                  The Company records  deferred revenue at the time it sells its
prepaid phone cards. The Company recognizes revenue (i) at the time the consumer
accesses long distance  services  utilizing the Company's  phone cards or in the
case of promotional  programs  during the period the program is executed or (ii)
when the phone card expires  (generally 12 to 18 months after issuance or six to
12 months after last use). At the time revenue is recognized, the costs to which
that  revenue  specifically  relates  also  are  recognized.  When  the  Company
recognizes  revenue due to the  expiration of a prepaid phone card,  the Company
does not incur any long distance costs associated with that revenue. As of March
31, 1997, the Company's deferred revenue was $4,047,845.

                  The Company's primary cost of sales are the costs of providing
the long  distance  service and the design and  production  of its prepaid phone
cards.  The cost of providing long distance  service  represents  obligations to
carriers that provide  minutes of long distance over their networks and services
associated with the Company's phone cards.

                  The Company's selling and marketing expenses consist primarily
of salary and related  employment  expenses  for the  Company's  in-house  sales
force,  advertising and promotional  expenses,  and commissions payable to third
party  distributors,  sales  agents  and  brokers.  The  Company's  general  and
administrative expenses consist primarily of salaries and occupancy costs.


                                        9


<PAGE>



Results of Operations

                  The  following  table sets forth,  for the periods  indicated,
items from the Company's  Consolidated  Statements of Operations  expressed as a
percentage of sales:

<TABLE>
<CAPTION>

                                                                                    Percentage of Sales
                                                                              --------------------------------
                                                                                     Three Months Ended
                                                                                        March 31,
                                                                              --------------------------------
                                                                                    1996             1997
                                                                                    ----             ----
<S>                                                                                  <C>             <C>  
Traditional card sales.................................................             76.3             81.2
Promotional card and other retail product and service sales............             23.7             18.8
                                                                                    ----             ----
         Net sales.....................................................            100.0            100.0
Cost of sales..........................................................             76.3             77.4
                                                                                    ----             ----
         Gross profit..................................................             23.7             22.6
                                                                                   -----             ----
Selling and marketing expenses.........................................             38.8             21.1
General and administrative expenses....................................             63.9             43.0
Depreciation and amortization..........................................             10.7             11.6
                                                                                   -----             ----
         Operating expenses............................................            113.4             75.7
                                                                                   -----             ----
         Operating loss................................................            (89.7)           (53.1)
                                                                                   ------           ------
Interest income........................................................              1.5              0.1
Interest expense.......................................................             (1.3)            (8.8)
Other..................................................................               --              0.1
                                                                                   ------           ------
         Loss before income taxes......................................            (89.5)           (61.7)
Income tax expense.....................................................               --               --
                                                                                   ------           ------
         Net loss......................................................            (89.5%)          (61.7%)
                                                                                   =======          =======
</TABLE>


Three Months Ended March 31, 1997 Compared to Three Months Ended March 31, 1996

     Substantially  all of the increases in revenues from traditional  cards and
operating expenses were attributable to GTS' acquisition on February 29, 1996 of
all of the  outstanding  capital stock of Global Link.  Global Link's  operating
results  were  consolidated  with the  Company's  commencing  on March 1,  1996.
Accordingly,  while Global Link's operating  results were included for all three
months of the quarter ended March 31, 1997, Global Link's operating results only
were included for one month of the quarter ended March 31, 1996.

     Net  sales for the  three  months  ended  March  31,  1997 were  $3,688,153
compared to  $1,327,710  for the three months  ended March 1996,  an increase of
$2,360,443,  or 177.8%.  Net sales of traditional phone cards were approximately
$2,995,000 for the three months ended March 31, 1997,  compared to approximately
$1,013,000   for  the  three  months  ended  March  31,  1996,  an  increase  of
approximately  $1,982,000.  Net  sales  generated  from the sale of  promotional
cards,  other retail products  utilizing prepaid phone card technology and other
services for the three months ended March 31, 1997 were approximately  $693,000,
compared to approximately  $315,000 for the comparable period in the prior year,
an increase of approximately  $378,000. The Company's gross margins decreased to
22.6% of net sales for the three months ended March 31, 1997,  compared to 23.7%
of net sales for the  comparable  period in the prior year.  The decrease in the
gross  margin was  primarily  a result of an  increase in the sale of cards with
reduced  per-minute rates to consumers and an increase in patent license fees as
a result of an increase in revenues  subject to such fees,  offset by a decrease
in production and switch administration costs as a percentage of sales.

     Selling and marketing  expenses were $778,663  (21.1% of net sales) for the
three months ended March 31, 1997, compared to $515,282 (38.8% of net sales) for
the three months ended March 31,1996.  Approximately $69,500 of the increase was
due to  increased  salaries  and  benefits  of  marketing  and sales  personnel.
Additionally, approximately $33,200 of the increase was due to additional travel
expenses,
                                       10


<PAGE>



$54,200 to  commissions  paid to  independent  third party  distributors,  sales
agents and brokers, $33,200 to costs associated with the Company's attendance at
trade  shows,  and  $59,000 to an increase in the  provision  for  uncollectible
accounts  receivable,  all of which increased as a result of the increase in net
sales.

     General and  administrative  expenses were $1,586,144  (43.0% of net sales)
for the three months ended March 31,  1997,  compared to $848,980  (63.9% of net
sales) for the three  months  ended March 31,  1996.  The  increase  consists of
approximately  $288,300 in salaries  and  related  benefits of other  additional
personnel  which make up the  Company's  infrastructure,  including  accounting,
legal,  customer  service  and  support and  information  technology  personnel;
approximately  $150,600 in rent  costs;  approximately  $73,100 in  professional
fees; and approximately $50,000 expensed as a result of the issuance of stock to
a former employee.

     Depreciation and amortization  expense  increased to $428,252 for the three
months  ended March 31, 1997 from  $141,418 for the three months ended March 31,
1996,  primarily due to the  amortization of goodwill  resulting from the Global
Link Merger and the acquisition of additional switching equipment.

     Investment and interest  income was $3,901 for the three months ended March
31, 1997,  compared to $19,581 for the three  months  ended March 31, 1996.  The
decrease of $15,680 was a result of lower balances of cash and cash  equivalents
on hand.

     Interest  expense for the three  months  ended March 31, 1997  increased to
$322,753 from $17,226 for the three months ended March 31, 1996,  primarily as a
result  of  interest  on  the  principal   amount  of   convertible   debentures
("Convertible  Debentures"),  amounts  due to Peoples  Telephone  Company,  Inc.
("Peoples"),  and  the  amortization  of  the  unearned  discount  and  deferred
financing  costs  relating  to the  issuance  of notes  payable  pursuant to the
private  placement  consummated by the Company in December 1996  ("December 1996
Private Placement").

     For the foregoing  reasons,  the Company  incurred a net loss of $2,274,915
for the three months ended March 31, 1997,  compared to a net loss of $1,187,771
for the three months ended March 31, 1996.

Liquidity and Capital Resources

                  At March 31, 1997 the Company had cash and cash equivalents of
$235,618 and a working capital deficit of $7,247,176, compared to $1,352,322 and
$5,630,385, respectively, at December 31, 1996.

                  Net cash used in  operating  activities  for the three  months
ended March 31, 1997 of $880,613 was primarily due to the Company's net loss and
a decrease in deferred  revenue,  offset by non-cash items such as  depreciation
and amortization,  increases  accounts  payable,  accrued expenses and sales and
excise taxes payable and a decrease in accounts receivable.  Accounts receivable
are generated pursuant to sales of prepaid phone cards primarily to distributors
and retail  establishments.  Typically,  the Company  provides 30- day terms (or
less) to reputable  retail  establishments  that sell its phone cards.  Deferred
revenue  represents  sales of prepaid  phone cards for which revenue has not yet
been recognized, but will typically be recognized in future periods as customers
access long distance services, at the expiration dates of the phone cards or, in
the case of promotional  phone card  programs,  during the period the program is
executed. Net cash used in investing activities for the three months ended March
31,  1997  consisted  of  $69,901  of  capital  expenditures.  Net cash  used in
financing activities  consisted of payments to Peoples of $119,293,  payments on
capital lease obligations of $12,104,  an increase in deferred financing fees of
$38,394 in  connection  with the  issuance of notes  payable in  December  1996,
offset by $4,374 of proceeds from the exercise of employee stock options.  Under
its carrier agreement with Sprint, the Company must fulfill a $200,000 per month
usage commitment.

                  Pursuant  to  an  agreement  with  Wheatley   Partners,   L.P.
("Wheatley"),  an affiliate of the Company,  in April 1997, the Company received
$2,500,000  upon the exercise of warrants to purchase  333,334  shares of Common
Stock issued to Wheatley in the December 1996 Private Placement.

                                       11


<PAGE>



                  In April 1997, the Company filed a  registration  statement on
Form SB-2 with the SEC for a secondary  offering of  securities.  The Company is
attempting to raise approximately $20 million in gross proceeds.

                  As indicated in the  accompanying  financial  statements,  the
Company  incurred a net loss of $2,274,915  for the three months ended March 31,
1997 and is in a negative  working  capital  position of $7,274,176 at March 31,
1997.  Management's  projections  indicate that the Company  anticipates that it
will continue to generate  operating losses and negative cash flow through 1997.
The Company has substantial capital  requirements  resulting from the funding of
losses from  operations and the need to finance  continued  growth.  The Company
believes that its cash balances,  along with the proceeds of $2,500,000 from the
exercise of warrants in April 1997, will satisfy the Company's cash requirements
until the end of 1997.  Other than the Company's $20 million  planned  secondary
offering  of  securities,  for which no  assurance  can be given that it will be
consummated,  the Company  does not have any  arrangements  with  respect to, or
sources of,  additional  financing and there can be no assurance that additional
financing will be available to the Company on commercially  reasonable terms, or
at all.  The  failure to obtain  such  financing  could have a material  adverse
effect on the Company.


                                       12


<PAGE>



PART II. OTHER INFORMATION

Item 2.  Changes in Securities

(c)      Recent Sales of Unregistered Securities

                  During the three months ended March 31, 1997, the Company made
the following sales of unregistered securities:

<TABLE>
<CAPTION>


                                                                       Consideration
                                                                       Received and
                                                                      Description of                           If Option, Warrant
                                                                   Underwriting or Other                         or Convertible
                                                                    Discounts to Market      Exemption from     Security, Terms of
                                                                      Price Afforded to       Registration         Exercise or
Date of Sale              Title of Security       Number Sold            Purchasers             Claimed             Conversion
------------              -----------------       -----------         ------------------     ---------------     ------------------
<S>                             <C>                   <C>                    <C>                  <C>                   <C> 
1/21/97 and 3/27/97         Common Stock             11,496        conversion of 6% Senior        4(2)                 N/A
                                                                   Secured Convertible
                                                                   Promissory Notes
-----------------------------------------------------------------------------------------------------------------------------------
3/4/97                      Common Stock              7,130        severance payment to           4(2)                 N/A
                                                                   former employee
-----------------------------------------------------------------------------------------------------------------------------------
3/31/97                     options to               20,004        options granted - no           4(2)         exercisable for ten
                            purchase                               consideration received                      years from date of
                            Common Stock                           by Company until                            grant at an exercise
                            granted to                             exercise                                    price of $11.125 per
                            directors                                                                          share
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

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

                  By unanimous  written  consent  dated  February 11, 1997,  the
Board of Directors  of the Company  authorized  an  amendment  to the  Company's
Amended and Restated  Certificate  of  Incorporation  to effect a  one-for-three
reverse stock split  ("Reverse  Split") of the currently  issued and outstanding
shares of the  Company's  Common  Stock.  The  number of shares of Common  Stock
authorized  by the Amended and  Restated  Certificate  of  Incorporation  was to
remain at  35,000,000.  The Board of  Directors  fixed the close of  business on
February  14,  1997 as the record  date for the  determination  of  stockholders
entitled to vote with respect to stockholder authorization of the Reverse Split.
Thereafter,  on February 17, 1997, ten stockholders who were owners of record of
2,880,154 pre-split shares (51.8%) of Common Stock of the Company, the Company's
only class of voting  securities  outstanding,  executed  and  delivered  to the
Company their written  consents to authorize the amendment.  On March 3, 1997 an
Information  Statement was mailed to all of the stockholders of the Company.  On
March 24,  1997,  the  Company  effectuated  the  Reverse  Split by  filing  the
Amendment  to its Amended and Restated  Certificate  of  Incorporation  with the
Delaware Secretary of State.

Item 6.  Exhibits and Reports on Form 8-K

(a)      Exhibits

         3.1      Amendment to Amended and Restated Certificate of Incorporation
                  to effectuate the one-for-three reverse stock split.

         27       Financial Data Schedule (3/31/97)

(b)      Current Reports on Form 8-K

         None.

                                       13


<PAGE>



                                   SIGNATURES


                  In  accordance  with  requirements  of the  Exchange  Act, the
Registrant  caused  this  Report to be signed on its behalf by the  undersigned,
thereunto duly authorized.


Dated:   May 15, 1997

                                       GLOBAL TELECOMMUNICATION SOLUTIONS, INC.



                                     By:    /s/ Maria Bruzzese
                                        ---------------------------------------
                                        Maria Bruzzese, Chief Financial Officer


                                       14


<PAGE>



EXHIBIT INDEX

<TABLE>
<CAPTION>

Exhibit Number                              Description                                                Page
<S>                                            <C>                                                     <C>  
         3.1                                Amendment to Amended and Restated
                                            Certificate of Incorporation to effectuate the
                                            one-for-three reverse stock split.                          16

         27                                 Financial Data Schedule                                     18


</TABLE>

                                       15

<PAGE>