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         September 30, 1996

    (  ) 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.)


                     40 Elmont Road, Elmont, New York 11003
                    (Address of principal executive offices)

                                 (516) 326-1940
                           (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 November 8, 1996,
there were 5,512,801 shares of common stock outstanding.

                               Page 1 of 15 Pages

                            Exhibit Index -- Page 14

                                        1


<PAGE>



            GLOBAL TELECOMMUNICATION SOLUTIONS, INC. AND SUBSIDIARIES


<TABLE>

                                                                                                               Page
Part I.  Financial Information

Item 1.  Consolidated Financial Statements
<S>                                                                                                             <C>

Consolidated Balance Sheets - September 30, 1996 (unaudited) and December 31, 1995.............................   3

Consolidated Statements of Operations - Nine and three months ended September 30,
1996 and 1995 (unaudited)........................................................................................ 4

Consolidated Statements of Cash Flows - Nine months ended September 30, 1996
and 1995 (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 1-6 Other Information..........................................................................    12

         Signatures...........................................................................................   13
</TABLE>


                                        2


<PAGE>



            GLOBAL TELECOMMUNICATION SOLUTIONS, INC. AND SUBSIDIARIES

                           Consolidated Balance Sheets
<TABLE>
<CAPTION>


Assets                                                             September 30,                December 31,
                                                                      1996                          1995
                                                                   -------------                -----------
                                                                   (unaudited)
    <S>                                                                <C>                          <C>

  Current assets:
   Cash and cash equivalents                                         $  396,073                $   928,516
   Accounts receivable, less allowance for doubtful
     accounts of $284,000 and $165,000 in 1996 and 1995               4,121,771                  3,508,250    
   Inventory                                                            300,606                    268,874
   Deferred costs                                                     1,063,634                  1,235,972   
   Convertible notes receivable                                         325,000                    325,000
   Note receivable                                                         --                      237,000
   Prepaid royalties and patent license fees                            151,580                    292,911 
   Prepaid expenses and other current assets                            270,654                    155,008   
                                                                      ---------                 ----------
               Total current assets                                   6,629,318                  6,951,531   
                                                                      ---------                 ----------
 Goodwill, net                                                       18,265,198                     --
 Fixed assets, net                                                    1,929,790                    428,381
 Deferred financing fees, net                                            60,303                     --
 Other assets                                                           285,826                    102,052
                                                                     ----------                 ----------
               Total assets                                         $27,170,435                 $7,481,964
                                                                    ===========                 ==========    

           Liabilities and Stockholders' Equity

 Current liabilities:
   Accounts payable                                                   3,714,365                  1,819,813
   Accrued liabilities                                                  845,045                    491,488
   Deferred revenue                                                   5,925,633                  3,513,909
   Sales and excise tax liability                                     1,246,964                     --
   Amounts payable to related party                                   1,354,630                     --
   Capital lease obligation, current                                     53,221                     --
                                                                     ----------                 ----------
               Total current liabilities                             13,139,858                  5,825,210
                                                                     ----------                 ----------
 Capital lease obligation, long-term                                     52,139                     --

 Convertible notes payable                                            2,800,000                     --
                                                                     ----------                 ----------
               Total liabilities                                     15,991,997                  5,825,210
                                                                     ==========                 ==========

 Stockholders' equity:
   Preferred stock, $.01 par value, authorized 
     1,000,000 shares; none issued                                        --                        --
   Common  stock,  $.01 par  value,  authorized 
     15,000,000  shares;  issued and outstanding 
     5,512,801 and 3,141,678 shares, respectively                       55,128                      31,417
   Additional paid-in capital                                       21,375,835                   7,308,784
   Deferred compensation                                              (234,498)                   (197,165)
   Accumulated deficit                                              (9,910,074)                 (5,486,282)    
   Common stock subscription receivable                               (100,000)                     --
   Cumulative foreign currency translation adjustment                   (7,953)                     --
                                                                    -----------                 -----------    
               Total stockholders' equity                           11,178,438                   1,656,754
                                                                    -----------                 -----------
               Total liabilities and stockholders equity           $27,170,435                 $ 7,481,964
                                                                   ===========                 ===========
</TABLE>

          See accompanying notes to consolidated financial statements.

                                        3


<PAGE>



            GLOBAL TELECOMMUNICATION SOLUTIONS, INC. AND SUBSIDIARIES

                      Consolidated Statements of Operations
                                   (Unaudited)



<TABLE>
<CAPTION>


                                                               Nine months ended                  Three months ended
                                                                 September 30,                       September 30,
                                                             1996              1995              1996             1995
                                                        ------------------------------      ----------------------------
 <S>                                                         <C>               <C>              <C>               <C>

Net sales                                                $ 8,412,887        $2,261,948        $3,816,531        $996,602
Cost of sales                                              5,973,124         2,131,868         2,586,076         875,184
                                                        ------------      ------------      ------------      ----------
    Gross profit                                           2,439,763           130,080         1,230,455         121,418
                                                        ------------      ------------      ------------      ----------
Selling and marketing expenses                             2,016,561           805,208           724,185         305,830
General and administrative expenses                        4,728,618         1,521,531         1,865,583         555,300
                                                        ------------      ------------      ------------      ----------
     Operating expenses                                    6,745,179         2,326,739         2,589,768         861,130
                                                          ----------      ------------      ------------      ----------
     Operating loss                                      (4,305,416)       (2,196,659)       (1,359,313)       (739,712)
Investment income                                             59,971           160,946            18,817          47,902
Interest expense                                           (188,147)                --         (100,639)              --
Other                                                          9,800               525             4,200           4,295
                                                      --------------    --------------     -------------     -----------
     Loss before income taxes                            (4,423,792)       (2,035,188)       (1,436,935)       (687,515)
Income tax expense                                          --                --                 --              --
                                                    ----------------  ----------------  ----------------     -----------
     Net loss                                           $(4,423,792)      $(2,035,188)      $(1,436,935)      $(687,515)
                                                        ===========       ===========       ===========       =========
Net loss per share                                   $         (.91)   $         (.65)   $         (.26)   $       (.22)
                                                     ==============    ==============    ==============     ============
Weighted average shares of common stock                    4,844,202         3,141,678         5,512,801       3,141,678
                                                         ===========       ===========      ============      ==========

</TABLE>



          See accompanying notes to consolidated financial statements.



                                        4


<PAGE>



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

<TABLE>
<CAPTION>

                                                                                                    Nine Months Ended
                                                                                                      September 30,
                                                                                                1996                  1995
<S>                                                                                             <C>                   <C>

Cash flows from operating activities:
 Net loss                                                                                  $(4,423,792)          $(2,035,188)
 Adjustments to reconcile net loss to net cash provided by or used in operating
     activities:
     Depreciation and amortization                                                              965,304                27,432
     Deferred compensation                                                                      362,667                58,334
     Amortization of deferred financing costs                                                    11,891                    --
 Changes in operating assets and liabilities, net of effects of acquisition:
     (Increase) decrease in accounts receivable                                                 342,913             (538,827)
     (Increase) decrease in inventory                                                            65,268             (110,483)
     (Increase) decrease in deferred costs                                                      172,338             (348,454)
     (Increase) decrease in prepaid royalties and patent license fees                           141,331             (227,294)
     (Increase) decrease in prepaid expenses and other current assets                            39,649              (66,066)
     Increase in other assets                                                                  (53,170)              (83,527)
     Increase (decrease) in accounts payable                                                  (411,026)               695,897
     Increase (decrease) in accrued liabilities                                               (180,174)                96,656
     Increase in sales and excise taxes payable                                                 520,333                    --
     Increase in deferred revenue                                                               413,578               281,840
                                                                                           ------------          ------------
                  Net cash used in operating activities                                     (2,032,890)           (2,249,680)
                                                                                          ------------          ------------
 Cash flows from investing activities:
      Purchases of fixed assets                                                               (252,919)             (285,655)
      Convertible notes receivable                                                                   --             (325,000)
      Cash acquired in excess of cash payment for acquisition                                    54,190               --
                                                                                          -------------           -----------
                  Net cash used in investing activities                                       (198,729)             (610,655)
                                                                                          ------------            ------------
 Cash flows from financing activities:
      Net proceeds from issuance of common stock and warrants                                 2,651,274                    --
      Payment of notes payable to related party                                               (650,000)                    --
      Increase in notes receivable from Global Link prior to merger                           (250,655)                    --
      Payments on capital lease obligations                                                    (43,490)                    --
                                                                                         -------------             ----------
                  Net cash provided by financing activities                                   1,707,129                    --
                                                                                           ------------            ----------
      Effects of exchange rate changes on cash                                                  (7,953)                    --
                                                                                        --------------             ----------
                  Net decrease in cash                                                        (532,443)            (2,860,335)
      Cash and cash equivalents at beginning of period                                          928,516             5,135,260
                                                                                          -------------           -----------
      Cash and cash equivalents at end of period                                           $    396,073            $2,274,925
                                                                                           ============            ==========
 Supplemental disclosures:
      Interest paid during the period                                                     $     24, 225             $      --
                                                                                          =============             =========
      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 warrants                                $    400,000               $     --
                                                                                          =============              ========
      Capital lease obligations incurred to acquire fixed assets                          $    148,850               $     --
                                                                                          =============              ========
</TABLE>


          See accompanying notes to consolidated financial statements.


                                        5


<PAGE>



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

                               September 30, 1996

(1)      Business and Basis of Presentation

         Business

         Global   Telecommunication   Solutions,   Inc.  (the   "Company")   was
         incorporated  on  December  23,  1992 and is engaged in the  designing,
         developing  and  marketing of prepaid phone cards  featuring  licensed,
         promotional and standard graphics. The Company also provides card users
         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 nine and three months ended
         September 30, 1996 are not  necessarily  indicative of the results that
         may be expected for the year ending December 31, 1996.

(2)      Loss Per Share

         Weighted  average  shares of common stock for the nine and three months
         ended  September  30,  1996 and  1995  does not  include  common  stock
         equivalents as their effect would be anti-dilutive.

(3)      Reclassifications

         Certain  reclassifications  have  been  made to the  1995  consolidated
         financial statements to conform to the 1996 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  Corp.  ("Global  Link"),  which  designs,  develops and markets
         prepaid phone cards through retail telephone calling centers as well as
         through distribution arrangements. 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  1,718,318 shares of
         common stock in exchange for all of the issued and  outstanding  common
         stock of Global Link. In addition,  the Company issued 52,805 shares of
         common  stock to a  creditor  of Global  Link.  The  total  cost of the
         acquisition was approximately  $11,500,000 including direct transaction
         costs  of  approximately   $450,000.  In  addition,   Global  Link  has
         $2,800,000  aggregate  principal  amount of 6% Debentures  outstanding,
         which principal  amounts are due and payable on June 23, 1999 for which
         the Company has guaranteed the payment.

                                        6


<PAGE>



                  The acquisition resulted in goodwill of $18,965,860,  based on
                  an allocation of purchase price, calculated as follows:

                  Fair market value of common stock issued          $11,039,488
                  Fair value of liabilities assumed                  10,718,587
                  Fair value of assets acquired                      (3,242,215)
                  Acquisition related costs                             450,000
                                                                     ----------
                           Goodwill                                 $18,965,860
                                                                    ===========

                  The  following   unaudited   combined  pro  forma  information
                  reflects the results of operations assuming the acquisition of
                  Global Link had been made at the  beginning of the  respective
                  periods.


                                        Nine Months Ended
                                           September 30,
                                1996                          1995
Net sales                    $ 9,776,000                 $ 8,808,000
Net loss                      (5,243,000)                 (5,109,000)
Net loss per share         $       (1.00)              $       (1.04)



                  Pro forma adjustments include recording  amortization  expense
                  on goodwill  (using the  straight-line  method over 15 years),
                  the elimination of amortization of the predecessor's  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  periods,  or of  results  which  may  occur in the
                  future.

(5)      Private Placement

         In May 1996,  the Company sold 600,000  shares of the Company's  common
         stock  and  1,200,000  warrants  through  a  private  placement  for an
         aggregate of $3,000,000.  Each warrant  entitles the holder to purchase
         one share of common  stock.  The warrants  are  identical to the public
         warrants,  however,  the Company has agreed that,  notwithstanding  the
         terms of the public  warrants,  the  warrants  issued  pursuant  to the
         private  placement are not  redeemable by the Company until  registered
         for sale and transferred by the original purchasers. In connection with
         this  private  placement,   the  Company  issued  a  warrant  to  Whale
         Securities  Co.,  L.P.,  the placement  agent  ("Whale"),  to purchase,
         through May 10, 2001,  up to 60,000  shares of common stock and 120,000
         warrants for $5.00 per each share of common stock and two warrants.

(6)      Warrants

         In January 1996, the Company issued five-year  warrants to Whale and/or
         its  designees  to purchase an  aggregate  of 200,000  shares of common
         stock at $5.125 per share in consideration for consulting services. The
         estimated  fair market value of these warrants of $400,000 was recorded
         as deferred  compensation  and the  Company has  recorded an expense of
         $266,664 to date.



                                        7


<PAGE>



(7)      Amounts Payable to Related Parties

         Simultaneously with the execution of the merger agreement,  Global Link
         executed an agreement with Peoples Telephone Company,  Inc. ("Peoples")
         pursuant to which  Peoples  agreed to accept  $1,050,000  ($550,000  of
         which was paid on the date of the merger  with the  balance of $500,000
         payable  on  June  28,  1996)  to  settle   certain   obligations   and
         indebtedness  to  Peoples.  In August  1996,  the  Company  and Peoples
         executed an agreement  (the "New Payment  Agreement")  whereby  Peoples
         agreed to  restructure  the payment terms of the remaining  $500,000 as
         follows:  $100,000  which was paid upon  execution  of the New  Payment
         Agreement and a monthly  payment of $33,333  beginning in November 1996
         until all amounts  including  accrued interest at 8% per annum are paid
         in full. In addition, the agreement provides for certain prepayments in
         the event the Company obtains additional financing or the occurrence of
         any change of control.

(8)      Tax Obligations and Compliance

         At September 30, 1996,  the Company is delinquent in remitting  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.

(9)      Liquidity

         The Company has  substantial  capital  requirements  resulting from the
         funding of losses from operations, the need to finance continued growth
         and certain  payment  obligations.  The Company  anticipates  that cash
         flows  will  improve  as a  result  of the  increase  in  revenues  and
         improvement in margins are anticipated. The Company anticipates,  based
         on its current plans and assumptions  relating to its operations,  that
         its cash balances,  together with projected cash flows from  operations
         will  be  sufficient  to  satisfy  the  Company's   contemplated   cash
         requirements for the next 12 months, although there can be no assurance
         that this  will be the case.  In the  event  that the  Company's  plans
         change,  its assumptions change or prove to be inaccurate or cash flows
         otherwise  prove to be  insufficient  to fund  operations,  the Company
         would be required to seek additional  financing or curtail its proposed
         expansion and possibly its operations.

(10)     Convertible Notes Receivable

         In March and May 1995,  the Company  advanced  $200,000  and  $125,000,
         respectively,  to Fone America,  Inc. ("Fone") evidenced by convertible
         promissory  notes bearing  interest at 10% per annum. The principal and
         accrued  interest thereon was due and payable on June 23, 1995 and July
         14, 1995, respectively. Accrued interest at September 30, 1996 amounted
         to approximately  $69,000. The Company has the option of converting any
         part of the principal into shares of Fone America's common stock on the
         basis of two shares for each $1.00 of  principal.  Fone has also agreed
         that,  at the Company's  option,  Fone will repay the notes by allowing
         the Company to utilize services which Fone will provide.  Such services
         consist of access to Fone's  switching  platforms,  the  utilization of
         Fone's network personnel and the sale and service of phone card vending
         machines.   Management   anticipates  that  the  Company  will  utilize
         approximately  $100,000  of  these  services  from  Fone in the  fourth
         quarter of 1996 and the remaining balance of the principal and interest
         owed under the notes during the first half of 1997. Based upon a review
         of Fone's financial statements,  discussions with Fone and knowledge of
         the  industry,  management  of the  Company  believes  that  Fone  will
         continue  to have the  wherewithal  to  provide  such  services  to the
         Company during such period.

                                        8


<PAGE>



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

Results of Operations

         The Company  generates  revenues from the sales of prepaid phone cards.
To date, the Company's expenses have exceeded  revenues,  resulting in losses of
$4,423,792 and $2,035,188, respectively, for the nine months ended September 30,
1996 and September 30, 1995.

         The Company's primary cost of sales are incurred in connection with the
design and manufacture of its prepaid phone cards,  royalties in connection with
the various license  agreements,  switch  administration  fees and long distance
carriers  fees (which long  distance  costs are generally not billed or incurred
until such time as long distance service is accessed).

         The Company records  deferred  revenue at the time it sells its prepaid
phone  cards and  recognizes  revenue  at the time the  consumer  accesses  long
distance service. In connection with sales of cards featuring licensed graphics,
the  Company  generally  charges a premium per minute  charge for long  distance
services.  The premium,  if any, is  recognized  at the time of sale,  while the
remaining  revenue is deferred  and  recognized  when long  distance  service is
accessed.  The Company recognizes deferred revenue as revenue relating to unused
calling time  remaining upon each card's  expiration  (generally 12 to 18 months
after issuance).

       Nine months ended September 30, 1996 Compared to Nine months ended
                               September 30, 1995

         Net sales for the nine months ended September 30, 1996 were $8,412,887,
compared to $2,261,948 for the nine months ended September 30, 1995, an increase
of $6,150,939 or 271.9%.  Approximately  $5,981,000 or 264.4% of the increase is
attributable  to the  acquisition of Global Link (see note 4). Revenues from the
sale of cards featuring licensed graphics decreased by approximately $692,000 or
30.6%  primarily  as a result  of a  decrease  in  revenue  recognized  upon the
expiration  of certain  cards and a decrease of licensed  product  offerings  in
1996.  Furthermore,  revenue derived from the Company's standard cards decreased
by approximately  $144,000 or 6.4%.  Revenues from the sale of promotional cards
increased by  approximately  $186,000 or 8.2%.  Sales of cards to other carriers
increased by approximately $751,000 or 33.2%. The remaining increase in revenues
of approximately  $69,000 or 3.1% was due to an increase in the sale of non-card
products and services.  Gross margins increased to 29% of net sales for the nine
months  ended  September  30,  1996,  compared  to  5.8%  of net  sales  for the
comparable  period in the  prior  year.  The  increase  in the  gross  margin is
partially  a result of the  acquisition  of Global  Link whose  margins  for the
period  approximated  31.3%. The remaining net increase in the gross margin is a
result of a decrease in  transmission  costs as a percentage of sales  resulting
primarily  from the  recognition of revenue upon the expiration of certain cards
which had no associated  transmission  costs,  offset by an increase in sales of
cards with lower margins and an increase in production  costs as a percentage of
sales primarily due to the write off of printing and production costs related to
unsold expired prepaid phone cards.

         Selling and  marketing  expenses  were  $2,016,561  for the nine months
ended  September  30,  1996,  compared  to $805,208  for the nine  months  ended
September  30,  1995,  an  increase  of  $1,211,353  or  150.4%.   Approximately
$1,051,000  or  130.5% of this  increase  is  attributable  to the  Global  Link
acquisition.  The remaining increase consists of approximately $162,000 or 20.1%
of increased  salaries due to the hiring of additional  creative,  marketing and
sales personnel, an increase of approximately $36,000 or 4.5% in travel expenses
related to the additional personnel, and an increase of approximately $78,000 or
9.7% in commissions  paid to independent  sales agents,  offset by a decrease of
approximately  $110,000 or 13.7% in costs of the  advertisement and promotion of
the Company's  products,  including  attendance at trade shows and a decrease of
approximately $6,000 or 0.7% in other selling and marketing expenses.

         General and  administrative  expenses  increased to $4,728,618  for the
nine months ended September 30, 1996, compared to $1,521,531 for the nine months
ended September 30,1995, an

                                        9


<PAGE>



increase of  $3,207,087  or 210.8%.  Approximately  $2,992,000  or 196.6% of the
increase is attributable to the Global Link acquisition.  The remaining increase
is due to approximately  $304,000 or 20% of additional  amortization of deferred
compensation  costs with respect to warrants issued to outside  consultants,  an
increase of approximately $70,000 or 4.6% in costs resulting from the relocation
of the Company's  headquarters to a larger facility and the rent expense related
to  new  sales  offices,  an  increase  of  approximately  $37,000  or  2.4%  in
depreciation  expense due to the acquisition of additional  switching equipment,
and an increase of  approximately  $59,000 or 3.9% in insurance  expense.  These
increases  were  offset  by a  decrease  of  approximately  $62,000  or  4.1% in
salaries,  a decrease of approximately  $33,000 or 2.2% in travel expenses and a
decrease in  professional  fees of  approximately  $49,000 or 3.2.  Furthermore,
costs  associated  with the  utilization  of outside  consultants  and temporary
personnel  decreased $23,000 or 1.5% and other general and administrative  costs
decreased approximately $88,000 or 5.8% in the aggregate.

         Investment and interest  income amounted to $59,971 for the nine months
ended  September  30,1996 as  compared to  $160,946  for the nine  months  ended
September  30, 1995.  The decrease of $100,975 is a result of lower  balances of
cash  and  cash  equivalents  on hand  offset  by an  increase  as a  result  of
convertible notes receivable acquired in March and May 1995.

         Interest expense for nine months ended September  30,1996  increased to
$188,147  from $0 for the nine months ended  September  30, 1995, as a result of
interest on the $2,800,000  convertible notes payable and amounts due to Peoples
Telephone Company, Inc. (Peoples) acquired from Global Link and interest expense
on capital lease obligations recorded in 1996.

         For  the  foregoing  reasons,  the  Company  incurred  a  net  loss  of
$4,423,792 for the nine months ended September 30,1996 compared to a net loss of
$2,035,188 for the nine months ended September 30,1995.

Liquidity and Capital Resources

         At September  30, 1996 the Company had cash and cash  equivalents  of $
396,073  and a working  capital  deficit of  $6,510,540  compared to 928,516 and
$1,126,321, respectively, at December 31, 1995. This decrease in working capital
was primarily a result of the  assumption by the Company of certain  obligations
and other debt of Global Link in  connection  with the merger.  Refer to Note 10
for a discussion on the collection of convertible notes receivable.

         Net  cash  used in  operating  activities  for the  nine  months  ended
September 30, 1996 of $2,032,890 was primarily due to the Company's net loss and
a decrease in  accounts  payable  and  accrued  liabilities,  offset by non-cash
items,  including  depreciation and amortization,  increases in sales and excise
taxes  payable and  deferred  revenue  and a decrease  in  accounts  receivable.
Accounts  receivable  are  generated  pursuant  to sales of prepaid  phone cards
primarily to distributors, dealers and corporations. 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  or at the  expiration  dates of the  phone  cards.  Net  cash  used in
investing  activities for the nine months ended  September 30, 1996 consisted of
$252,919 of capital  expenditures,  net of $54,190 in cash acquired in excess of
cash  payment for the Global Link  acquisition.  Net cash  provided by financing
activities  consisted of  $2,651,274 of net proceeds from the issuance of common
stock and  warrants  pursuant to a private  placement  completed  in May 1996, a
payment to Peoples of $650,000, an increase in notes receivable of $250,655 from
Global Link prior to the merger and  payments on capital  lease  obligations  of
$43,490.  The  Company  does not  have  any  material  commitments  for  capital
expenditures.


         The Company has  substantial  capital  requirements  resulting from the
funding of losses  from  operations,  the need to finance  continued  growth and
certain  payment  obligations.  The  Company  anticipates  that cash  flows will
improve as a result of the increase in revenues and  improvement  in margins are
anticipated. The Company anticipates, based on its current plans and assumptions
relating to its operations, that its cash balances, together with projected cash
flows from operations will be

                                       10


<PAGE>



sufficient to satisfy the Company's  contemplated cash requirements for the next
12 months, although there can be no assurance that this will be the case. In the
event that the Company's  plans change,  its  assumptions  change or prove to be
inaccurate or cash flows otherwise prove to be insufficient to fund  operations,
the  Company  would be  required  to seek  additional  financing  or curtail its
proposed expansion and possibly its operations.

Forward-Looking Statements

         When used in this Form 10-QSB and in future filings by the Company with
the Securities and Exhange  Commission,  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," and "the Company  expects,"
"will  continue,"  "is  anticipated,"  "estimated,"  "project,"  or "outlook" 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.  The Company
wishes  to  caution   readers   not  to  place   undue   reliance  on  any  such
forward-looking  statements,  each of which speak only as of the date made. Such
statements  are  subject to certain  risks and  uncertainties  that could  cause
actual results to differ materially from historical earnings and those presently
anticipated or projected. Such risks and other aspects of the Company's business
and operations are described in the Company's Registration Statement on Form S-3
(No. 333-6925).  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.


                                       11


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PART II. OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K

A.       Exhibits

         27       Financial Data Schedule (9/30/96)


B.       Current Reports on Form 8-K

         Current  Report on Form 8-K for event dated  March 1, 1996,  filed with
         the Commission on March 15, 1996, and amendments thereto on Form 8-K/A,
         filed  with the  Commission  on May 10,  1996 and  September  6,  1996,
         respectively.

                                       12


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                                   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:   November 18,1996

                                 GLOBAL TELECOMMUNICATION SOLUTIONS, INC.



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

                                       13


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EXHIBIT INDEX


Exhibit Number                      Description                           Page

         27                         Financial Data Schedule                15



                                       14

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