EXHIBIT 99.1





                         CERTIFIED TRANSPORT, INC. AND
                            VENTURE LOGISTICS, INC.
                                AND SUBSIDIARIES

                         COMBINED FINANCIAL STATEMENTS
                                      AND
                          INDEPENDENT AUDITORS' REPORT

                           December 31, 1997 and 1996


<PAGE>


             CERTIFIED TRANSPORT, INC. AND VENTURE LOGISTICS, INC.
                                AND SUBSIDIARIES


                                    CONTENTS


                                                            Page

Independent Auditors' Report                                  1

Combined Balance Sheets                                       2

Combined Statements of Income and Retained Earnings           3

Combined Statements of Cash Flows                             4

Notes to Combined Financial Statements                        5-9

<PAGE>

                          Independent Auditors' Report

Board of Directors
Certified Transport, Inc. and Venture Logistics, Inc.

We  have  audited  the  accompanying   combined  balance  sheets  of  Certified
Transport, Inc. and Venture Logistics, Inc. and Subsidiaries as of December 31,
1997 and 1996,  and the  related  combined  statements  of income and  retained
earnings  and cash flows for the years then  ended.  These  combined  financial
statements  are  the   responsibility   of  the  Companies'   management.   Our
responsibility is to express an opinion on these combined financial  statements
based on our audits.

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

In our opinion,  the combined  financial  statements  referred to above present
fairly,  in  all  material  respects,   the  financial  position  of  Certified
Transport,  Inc. and Venture  Logistics,  Inc. and Subsidiaries at December 31,
1997 and 1996, and the results of their operations and their cash flows for the
years then ended, in conformity with generally accepted accounting principles.

As explained in Notes 1 and 8 to the combined financial  statements,  effective
January  1,  1997,  Certified  Transport,  Inc.  and  Venture  Logistics,  Inc.
reorganized. The Companies transferred substantially all of their net assets to
their new  wholly-owned  subsidiaries,  Certified  Transport,  LLC and  Venture
Logistics, LLC. The 1996 financial statements have been restated to give effect
to the reorganization as if it had occurred on January 1, 1996.

As explained in Note 9 to the combined financial statements,  on March 24,
1998, Certified Transport,  Inc. and Venture Logistics, Inc. signed a letter of
intent to be acquired by The Transit Group, Inc.


                                             KATZ, SAPPER & MILLER, LLP
                                             Certified Public Accountants

Indianapolis, Indiana
March 5, 1998, except for
Note 9, as to which the date
 is March 24, 1998
<PAGE>
<TABLE>
<CAPTION>

             CERTIFIED TRANSPORT, INC. AND VENTURE LOGISTICS, INC.
                                AND SUBSIDIARIES

                            COMBINED BALANCE SHEETS
                           December 31, 1997 and 1996


                                     ASSETS

                                                                                                                     Restated-
                                                                                                                        Note 8
                                                                                                        1997              1996

<S>                                                                                               <C>               <C> 
CURRENT ASSETS
     Cash and equivalents                                                                         $  382,261        $  208,302
     Accounts receivable-trade, less allowance for doubtful
      accounts of $142,000 in 1997-Note 3                                                          2,456,919         1,492,368
     Accounts receivable-related parties-Note 2                                                      123,800           111,170
     Prepaid expenses and other assets                                                               274,025            49,609
                                                                                                   ---------         ---------
         Total Current Assets                                                                      3,237,005         1,861,449
                                                                                                   ---------         ---------

PROPERTY AND EQUIPMENT-Note 3
     Tractors and trailers                                                                         9,599,991         9,143,169
     Leasehold improvements                                                                            9,972            10,361
     Buildings                                                                                                         105,000
     Furniture and fixtures                                                                          234,109           202,447
                                                                                                   ---------         ---------
                                                                                                   9,844,072         9,460,977
     Less:  Accumulated depreciation                                                               5,277,837         4,033,932
                                                                                                   ---------         ---------
         Total Property and Equipment                                                              4,566,235         5,427,045
                                                                                                   ---------         ---------

OTHER ASSETS
     Notes and accounts receivable-related parties-Note 2                                            603,029           352,863
     Deposits                                                                                         72,534            69,045
                                                                                                    --------         ---------
         Total Other Assets                                                                          675,563           421,908
                                                                                                    --------         ---------

         TOTAL ASSETS                                                                             $8,478,803        $7,710,402
                                                                                                  ==========        ==========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
     Accounts payable                                                                             $  615,685        $  234,182
     Accrued payroll and payroll taxes                                                                85,944           109,461
     Other accrued expenses and taxes                                                                269,360           223,383
     Notes payable-bank-Note 3                                                                       700,000           650,000
     Current maturities of long-term debt-Note 3                                                   1,328,883         1,529,679
                                                                                                   ---------         ---------
         Total Current Liabilities                                                                 2,999,872         2,746,705

LONG-TERM DEBT
     Equipment obligations, less current maturities-Note 3                                         1,637,144         1,951,068
                                                                                                   ---------         ---------

         Total Liabilities                                                                         4,637,016         4,697,773
                                                                                                   ---------         ---------

STOCKHOLDERS' EQUITY-Note 7
     Common stock                                                                                      3,000             3,000
     Additional paid-in capital                                                                      170,682           170,682
     Retained earnings                                                                             3,668,105         2,838,947
                                                                                                   ---------         ---------
         Total Stockholders' Equity                                                                3,841,787         3,012,629
                                                                                                   ---------         ---------

         TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                               $8,478,803        $7,710,402
                                                                                                  ==========        ==========

</TABLE>
See Accompanying Notes to the Combined Financial Statements.

<PAGE>
<TABLE>
<CAPTION>
              COMBINED STATEMENTS OF INCOME AND RETAINED EARNINGS
                     Years Ended December 31, 1997 and 1996


                                                                                                                     Restated-
                                                                                                                        Note 8
                                                                                                     1997                 1996
<S>                                                                                           <C>                  <C>
OPERATING REVENUE-Note 6                                                                      $20,953,120          $16,635,491
                                                                                              -----------          -----------

OPERATING EXPENSES
     Salaries and fringes-drivers                                                               1,980,135            1,988,767
     Salaries and fringes-other                                                                 2,211,018            1,843,196
     Contract hauling                                                                           5,233,637            2,349,269
     Fuel, maintenance and supplies                                                             3,381,489            3,382,792
     Operating supplies and expense                                                             1,162,486            1,102,869

     General supplies and expense                                                                 782,498              654,883
     Depreciation and amortization                                                              1,688,411            1,710,225
     Insurance                                                                                    541,398              445,932
     Taxes and licenses                                                                           512,012              425,710
     Rent                                                                                         333,147              220,740

     Revenue equipment leasing                                                                     91,989              252,906
     Purchased transportation                                                                   1,648,394            1,570,454
                                                                                               ----------           ----------
         Total Operating Expenses                                                              19,566,614           15,947,743
                                                                                               ----------           ----------

Net Operating Income                                                                            1,386,506              687,748
                                                                                               ----------           ----------

OTHER INCOME (EXPENSE)
     Gain on sales of equipment                                                                    99,952               48,628
     Net other income                                                                              42,747              105,570
     Interest expense                                                                           (408,952)            (443,686)
                                                                                               ---------            ---------
         Other Income (Expense)-Net                                                             (266,253)            (289,488)
                                                                                               ---------            ---------

NET INCOME                                                                                      1,120,253              398,260

DISTRIBUTIONS TO STOCKHOLDERS                                                                   (291,095)            (162,620)

RETAINED EARNINGS
     Beginning of Year                                                                          2,838,947            2,603,307
                                                                                               ----------           ----------

     End of Year                                                                              $ 3,668,105          $ 2,838,947
                                                                                              ===========          ===========
</TABLE>
See Accompanying Notes to the Combined Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
                       COMBINED STATEMENTS OF CASH FLOWS
                     Years Ended December 31, 1997 and 1996
                                                                                                                       Restated-
                                                                                                                          Note 8
                                                                                                       1997                 1996
<S>                                                                                             <C>                  <C>  
OPERATING ACTIVITIES
     Net income                                                                                 $ 1,120,253          $   398,260
     Adjustments to reconcile net income to net cash
      provided by operating activities:
         Depreciation of property and equipment                                                   1,688,411            1,709,843
         Amortization of intangible assets                                                                                   406
         (Gain) on sales of equipment                                                              (99,952)             (48,628)
         (Increase) decrease in certain current assets:
              Accounts receivable                                                                 (964,551)              126,823
              Prepaid expenses and other assets                                                   (267,882)                5,135
         Increase (decrease) in certain current liabilities:
              Accounts payable, accrued expenses and taxes                                          403,961            (247,410)
                                                                                                  ---------            ---------
                  Net Cash Provided by Operating Activities                                       1,880,240            1,944,429
                                                                                                  ---------            ---------
INVESTING ACTIVITIES
     Cash paid for purchases of equipment                                                         (105,411)            (176,366)
     Proceeds from sales of equipment                                                               399,021              249,359
     (Increase) decrease in accounts and notes
      receivable-related parties                                                                  (219,329)              101,772
     (Increase) in deposits and other assets                                                        (3,489)              (2,100)
                                                                                                  ---------            ---------
                  Net Cash Provided by Investing Activities                                          70,792              172,665
                                                                                                  ---------            ---------
FINANCING ACTIVITIES
     Principal payments on long-term debt                                                       (1,535,978)          (2,019,594)
     Proceeds of short-term bank borrowings                                                         100,000              300,000
     Principal payments on short-term bank debt                                                    (50,000)             (75,000)
     Distributions to stockholders                                                                (291,095)            (162,620)
                                                                                                -----------           ----------
                  Net Cash (Used) by Financing Activities                                       (1,777,073)          (1,957,214)
                                                                                                -----------           ----------

NET INCREASE IN CASH AND EQUIVALENTS                                                                173,959              159,880

CASH AND EQUIVALENTS
     Beginning of Year                                                                              208,302               48,422
                                                                                                -----------           ----------

     End of Year                                                                                $   382,261          $   208,302
                                                                                                ===========          ===========
SUPPLEMENTAL DISCLOSURES
     Cash paid for interest                                                                     $   415,010          $   426,441
     Noncash investing and financing activities:
         Debt incurred for the acquisition of revenue
          Equipment                                                                               1,021,274              734,106
         Refinancing of long-term debt                                                                                    27,466

</TABLE>
See Accompanying Notes to the Combined Financial Statements.
<PAGE>
                     NOTES TO COMBINED FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        Organization and Principles of Combination: The accompanying combined
        financial statements  include the balances and transactions of
        Certified  Transport,Inc.and Venture  Logistics,  Inc. and their 
        wholly-owned  subsidiaries, Certified  Transport,  LLC  and  Venture 
        Logistics,  LLC  (together,  the "Company").  All material intercompany
        balances and transactions have been eliminated in the combination
        (see Note 8).

        Effective January 1, 1997 Certified Transport, Inc. and Venture
        Logistics, Inc. agreed to create a full-service freight carrier.
        Certified Transport, LLC,a  new  Indiana  limited   liability company,
        was capitalized with substantially all of the net assets of  Certified 
        Transport,  Inc.  and Venture Logistics,  Inc. Certified Transport, LLC
        then transferred the net assets of Venture Logistics, Inc. into Venture
        Logistics, LLC, a 99%-owned Indiana limited liability company of 
        Certified  Transport,  LLC. Certified Transport,  Inc. received a 2/3 
        interest in Certified  Transport,LLC and 2/3 of 1% interest in Venture
        Logistics,  LLC.  Venture  Logistics,  Inc.received a 1/3 interest in
        Certified Transport, LLC and 1/3 of 1% interest in Venture  Logistics,
        LLC. The  reorganization  was  accounted  for in a manner similar to a
        "pooling of interests".

        The Company is primarily engaged in the long haul  transportation  over
        the road business and also engages in freight  brokerage,  shipping and
        warehouse  services and grants credit to customers  located  throughout
        the United States and Canada.

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

        Property and Equipment are recorded at cost.  Depreciation  is provided
        over the estimated  useful lives of the assets using the  straight-line
        method. The estimated useful lives are as follows:

            Tractors and trailers                 3-5 years
            Leasehold improvements                 15 years
            Buildings                              31 years
            Furniture and fixtures               7-10 years

        Cash and Equivalents: For purposes of the statement of cash flows, cash
        equivalents  may include bank time  deposits,  money market fund shares
        and all highly  liquid debt  instruments  with  original  maturities of
        three months or less.  The Company  maintains  its cash in bank deposit
        accounts  which, at times,  may exceed  federally  insured limits.  The
        Company has not experienced any losses from these accounts.

        Advertising  Costs are expensed as incurred and totaled  $8,462 in 1997
        and $7,801 in 1996.


<PAGE>
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        Income Taxes:  There is no provision for state and federal income taxes
        reflected in the combined financial statements because the stockholders
        of Certified Transport, Inc. and Venture Logistics,Inc. have elected to
        be taxed under the provisions of Subchapter S of the Federal Internal
        Revenue Code wherein corporate income is taxable directly to the 
        stockholders.

        Certified  Transport,  LLC  and  Venture  Logistics,   LLC,  which  are
        wholly-owned limited liability  companies,  are treated as partnerships
        for  federal  and state  income tax  purpose.  A  partnership  is not a
        taxpaying entity for federal or state income tax purposes. Accordingly,
        no income tax  expense  has been  recorded  in the  combined  financial
        statements as it relates to income  generated by the limited  liability
        companies.  Rather, all income or losses are reported on the income tax
        returns of Certified Transport, Inc. and Venture Logistics, Inc.

NOTE 2 - RELATED PARTY TRANSACTIONS

        The  Company  had the  following  balances  and  transactions  with its
        stockholders  or companies  controlled by its  stockholders at December
        31, 1997 and 1996, and during the years then ended:

                                                            1997          1996

            Notes and accounts receivable                $603,029      $352,863
            Accounts receivable (trade and other)         123,800       111,170
            Accounts payable                               60,000         7,434
            Equipment rental expense                       44,710        74,346

        The Company conducts the majority of its business from a building which
        had been  purchased and  renovated by an entity with common  ownership.
        Rent  expense of $165,561 in 1997 and  $120,000 in 1996 was incurred to
        the related entity.  The lessor's cost of the property is approximately
        $1,010,500. The property is pledged as collateral for a mortgage with a
        balance of approximately $760,000 at December 31, 1997.

        The Company paid rent aggregating  $36,030 for the first five months of
        1997 and $62,500 in 1996 to a related entity.

NOTE 3 - DEBT AND CREDIT AGREEMENTS

        The  Company  has a  revolving  line  of  credit  for  short-term  bank
        borrowings of up to $825,000 maturing on July 31, 1998.  Borrowings are
        limited to 75% of certain eligible accounts  receivable of the Company.
        Interest on these  borrowings is payable  monthly at 1% over the Bank's
        prime lending rate. The line of credit agreement  restricts  additional
        borrowings,  mergers,  loans,  investments or  guarantees.  The line is
        secured by certain  accounts  receivable  and equipment of the Company,
        and by personal guaranties of the Company's  stockholders.  At December
        31, 1997, $125,000 of the line of credit was unused.
<PAGE>
NOTE 3 - DEBT AND CREDIT AGREEMENTS (CONTINUED)

        The Company has an additional  revolving  line of credit for short-term
        bank  borrowings  of up to  $500,000  that  matures on April 18,  1998.
        Interest on these  borrowings  is payable at .75% over the Bank's prime
        lending rate.  The line is secured by certain  accounts  receivable and
        equipment of the Company,  and the personal guarantees of the Company's
        stockholders. At December 31, 1997, the line of credit was unused.

        At December 31, 1997 and 1996, long-term debt obligations of $2,966,027
        and  $3,480,747,  respectively,  were comprised of various  installment
        notes for equipment,  with interest rates ranging from 7.99% to 10.52%.
        The notes are  payable  in  monthly  installments  and are  secured  by
        tractors,   trailers  and   personal   guarantees   of  the   Company's
        stockholders.

        At December 31, 1997, the aggregate  long-term debt  maturities were as
        follows:

              Payable In                                           Principal

                 1998                                             $1,328,883
                 1999                                                854,120
                 2000                                                336,393
                 2001                                                281,856
                 2002                                                164,775
                                                                  ----------

                                                                  $2,966,027

NOTE 4 - OPERATING LEASES

        The   Company   leases   various   equipment   and   facilities   under
        noncancellable  operating  leases.  Rent expense under these leases was
        $822,761 in 1997 and $830,746 in 1996.  Minimum  future lease  payments
        required by these leases at December 31, 1997 are as follows:

              Payable In                                     Rental Payments

                 1998                                             $  847,805
                 1999                                                612,630
                 2000                                                 99,724
                                                                  ----------
                                                                  $1,560,159

NOTE 5 - RETIREMENT PLAN

        The Company  sponsors a defined  contribution  401(k)  retirement  plan
        covering substantially all of its employees who have completed one year
        of service and have attained  twenty-one years of age. The Plan permits
        plan participant  contributions  of up to 15% of participant  wages and
        requires   the   Company   to  match  up  to  6%  of  the   participant
        contributions.   In  addition,   the  Company  may  make  discretionary
        contributions  to the Plan.  Contributions  to the Plan by the  Company
        were $15,308 in 1997 and $11,246 in 1996.
<PAGE>

NOTE 6 - MAJOR CUSTOMER

        The Company engages in business with a national air freight corporation
        with locations  throughout the  midwestern  United States.  The Company
        performed  long-haul  transportation  for seventeen  individual  profit
        centers of this customer and conducted business  individually with each
        of these locations. Billings in the aggregate to this customer amounted
        to 51% in 1997 and 49% in 1996 of total billings.  In 1996, the Company
        provided  logistical  and  warehouse  services to a customer  for which
        billings in the aggregate amounted to 11% of total billings.


NOTE 7 - STOCKHOLDERS' EQUITY

        Combined  stockholders'  equity  was  comprised  of  the  following  at
        December 31, 1997 and 1996:
<TABLE>
<CAPTION>
                                   Common Stock,      Additional           Retained Earnings
                                   No Par Value    Paid-in Capital        1997             1996
            <S>                       <C>              <C>              <C>              <C> 

            Certified Transport,
             Inc.                     $2,000           $166,682         $2,797,342       $2,140,355
            Venture Logistics,
             Inc.                      1,000              4,000            870,763          698,592
                                      ------           --------         ----------       ----------

                                      $3,000           $170,682         $3,668,105       $2,838,947
                                      ======           ========         ==========       ==========
</TABLE>
        Certified Transport, Inc. has 1,000 shares authorized with 600 shares 
        issued and outstanding. Venture Logistics, Inc. has 1,000 shares 
        authorized with 100 shares issued and outstanding.

NOTE 8 - REORGANIZATION AND RESTATEMENT OF FINANCIAL STATEMENTS

        As  described  in Note 1,  the  accompanying  1997  combined  financial
        statements are based on the assumption that the companies were combined
        for the full year and the 1996 financial  statements have been restated
        to give effect to the  reorganization  as if it had occurred on January
        1, 1996. All intercompany transactions have been eliminated.

        Summarized results of operations for 1996 and the summarized assets and
        liabilities on January 1, 1997 (date of reorganization) of the separate
        companies are as follows:
<PAGE>
<TABLE>
<CAPTION>
    
                                          Certified            Venture
                                          Transport,          Logistics,
                                            Inc.                 Inc.        Eliminations         Combined
            <S>                           <C>                 <C>               <C>              <C>   
            Operating revenue             $12,993,726         $4,132,765        $491,000         $16,635,491
            Expenses and other             13,049,038          3,692,005         491,000          16,237,231
                                          -----------         ----------        --------         -----------

            Net Income (Loss)             $   (55,312)        $  440,760        $  -0-           $   398,260
                                          ===========         ==========        ========         ===========

            Distributions to
             Stockholders                                     $  162,620                         $   162,620
                                                              ==========                         ===========

            Current assets                $ 1,257,990         $  670,659        $ 67,200         $ 1,861,449
            Property and equipment, net     5,174,149            252,896                           5,427,045
            Other assets                      420,898              1,010                             421,908
                                          -----------         ----------        --------         -----------

                 Total Assets             $ 6,853,037         $  924,565        $ 67,200         $ 7,710,402
                                          ===========         ==========        ========         ===========

            Current liabilities           $ 2,622,323         $  191,582        $ 67,200         $ 2,746,705
            Long-term debt                  1,921,677             29,391                           1,951,068
            Stockholders' equity            2,309,037            703,592                           3,012,629
                                          -----------         ----------        --------         -----------

                 Total Liabilities and
                  Stockholders' Equity    $ 6,853,037         $  924,565        $ 67,200         $ 7,710,402
                                          ===========         ==========        ========         ===========
</TABLE>
        Accounts  receivable  from  stockholders  in the amount of $48,997 have
        been  reclassified from current assets to other assets within the above
        presentation to conform with the current year presentation.

NOTE 9 - SUBSEQUENT EVENT

        Effective  March 24, 1998,  the Company signed a letter of intent to be
        acquired by The Transit Group, Inc. for cash of $800,000 and $6,800,000
        of the Transit Group, Inc.'s restricted common stock.