UNITED STATES
                          SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C.  20549
                          ---------------------------------
                                      FORM 10-Q
          [Mark One]

          [X]  Quarterly  Report Pursuant  to Section  13 or  15(d) of  the
               Securities Exchange Act of 1934
                  For the quarterly period ended September 30, 1997.
                                          OR
          [  ] Transition Report  Pursuant to  Section 13  or 15(d)  of the
               Securities Exchange Act of 1934
                    For   the   transition    period   from    __________to
          ____________.

                             Commission File No.  0-19727

                            CUMBERLAND TECHNOLOGIES, INC.
          -----------------------------------------------------------------
          --
                (Exact name of registrant as specified in its charter)

                         Florida                            59-3094503     
          ------------------------------------         --------------------
          -  (State or other jurisdiction                 I.R.S. Employer
               of incorporation or organization)       Identification No.)

          4311 West Waters Avenue, Suite 501
          Tampa, Florida                               33614
          ------------------------------------         --------------------
          --
          (Address of principal executive office)      (Zip Code)

                                    (813) 885-2112
          -----------------------------------------------------------------
          --
                 (Registrant's telephone number, including area code)

                                    Not applicable
          -----------------------------------------------------------------
          --
          (Former  name, former address and  former fiscal year, if changed
          since last report)

          Indicate by check mark  whether the registrant (1) has  filed all
          reports  required to  be filed  by Section  13 or  15 (d)  of the
          Securities Exchange  Act of 1934  during the preceding  12 months
          and (2) has been subject to such filing requirements for the past
          90 days.  Yes  [X]       No   [  ]

                  Applicable Only to Issuers Involved in Bankruptcy
                     Proceedings During the Preceding Five Years<PAGE>





          Indicate by a  check mark  whether the registrant  has filed  all
          documents and reports required to be filed by Sections 12, 13, or
          15(d)  of the Securities Exchange  Act of 1934  subsequent to the
          distribution of securities  under a  plan confirmed  by a  court.
                    Yes  [X]       No   [  ]<PAGE>





                         Applicable Only to Corporate Issuers

          The  number of shares of the Registrant's common stock, $.001 par
          value, outstanding as of September 30, 1997 was 5,736,070 shares.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

                                      FORM 10-Q

                                        INDEX

                                                                       PAGE
                                                                       ----

          PART I    FINANCIAL INFORMATION

                    Item 1.   Condensed consolidated balance sheets
                               at December 31, 1996
                               and September 30, 1997   . . . . . . . . 1-2

                              Condensed consolidated statements of
                               operations for the nine months ended
                               September 30, 1996 and
                               September 30, 1997.  . . . . . . . . . . . 3

                              Condensed consolidated statements
                               of operations for the three months
                               ended September 30, 1996 and
                               September 30, 1997.  . . . . . . . . . . . 4

                              Condensed consolidated statements of
                               cash flows for the nine months ended
                               September 30, 1996 and 1997  . . . . . . . 5

                              Notes to condensed consolidated
                               financial statements   . . . . . . . . . 6-9

                    Item 2.   Management's Discussion and Analysis
                               of Financial Condition and
                               Results of Operations  . . . . . . . . 10-12


          PART II   OTHER INFORMATION

                    Item 1.   Legal proceedings . . . . . . . . . . . .  13

                    Item 2.   Changes in securities . . . . . . . . . .  13

                    Item 3.   Defaults upon senior securities . . . . .  13

                    Item 4.   Submission of matters to a vote
                               of security holders  . . . . . . . . . .  13

                    Item 5.   Other information . . . . . . . . . . . .  13

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

                              Signatures  . . . . . . . . . . . . . . .  14<PAGE>





              UNITED STATES SECURITIES AND EXCHANGE COMMISSION FORM 10-Q
                            PART I - FINANCIAL INFORMATION


          Item 1.   FINANCIAL STATEMENTS


                            CUMBERLAND TECHNOLOGIES, INC.

                        CONDENSED CONSOLIDATED BALANCE SHEETS


                                            December 31,   September 30,
                                                1996           1997
                                           -------------- -------------- 
                                                            (Unaudited)
           ASSETS                          
           ------
           Investments:                    
              Securities available-for-    
              sale at fair value:
                Fixed maturities . . . . . $    3,055,753 $   3,184,420 
                Equity securities  . . . .      1,020,016     1,105,930 
              Fixed maturity securities    
                held-to-maturity, at       
                amortized cost . . . . . .      1,664,264       982,019 
              Residential mortgage loan on 
                real estate, at unpaid     
                principal  . . . . . . . .         45,838        45,374 
              Short-term investments   . .        323,993       323,993 
                                            ----------------------------
                Total investments  . . . .      6,109,864     5,641,736 
                                           
              Cash and cash equivalents           669,076     1,920,216 
              Accrued investment income            89,652        75,770 
                                           
              Reinsurance recoverable  . .        987,953       987,201 
                                           
              Accounts receivable:         
                Trade  . . . . . . . . . .        906,530     1,642,932 
                Affiliate  . . . . . . . .         18,006       255,216 
              Deferred policy acquisition  
               costs   . . . . . . . . . .        635,189       747,402 
              Intangibles, net   . . . . .      1,956,724     1,749,437 
              Other assets   . . . . . . .        396,442       218,342 
                                            ----------------------------
                                           $   11,769,436 $  13,238,252 
                                            ============================

              See notes to condensed consolidated financial statements.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

                        CONDENSED CONSOLIDATED BALANCE SHEETS


                                            December 31,   September 30,
                                                1996           1997
                                           -------------- --------------
                                                            (Unaudited)
          LIABILITIES AND STOCKHOLDERS'    
          EQUITY
          --------------------------------
          Policy liabilities and accruals: 
             Loss and loss adjustments     
               expenses . . . . . . . . .  $    1,991,796 $  3,023,113  
             Unearned premiums  . . . . .       1,862,114    2,462,240  
          Ceded reinsurance payable . . .         165,504      254,146  
          Accounts payable and other       
             liabilities  . . . . . . . .         403,085      455,264  
          Long-term debt:                  
             Nonaffiliate   . . . . . . .       1,533,265    1,441,226  
                                            ----------------------------
               Total liabilities  . . . .       5,955,764    7,635,989  
          Stockholders' equity:                                         
             Preferred stock, $.001 par    
               value; 10,000,000           
               shares authorized, no       
               shares issued  . . . . . .               -            -  
             Common stock, $.001 par       
               value; 10,000,000 shares    
               authorized, 5,763,070       
               shares issued at December   
               31, 1996 and September 30,  
               1997, respectively . . . .           5,763         5,763 
             Capital in excess of par      
               value  . . . . . . . . . .       7,212,941     7,212,941 
             Net unrealized appreciation   
               of available-for-sale       
               securities . . . . . . . .          99,676        58,885 
             Accumulated deficit  . . . .      (1,263,937)   (1,425,108)
                                            ----------------------------
                                                6,054,443     5,852,481 
             Less treasury stock, at cost, 
               310,473 and 313,612 shares  
               at December 31, 1996 and    
               September 30, 1997,         
               respectively . . . . . . .        (240,771)     (250,218)
                                            ----------------------------
             Total stockholders' equity         5,813,672     5,602,263 
                                            ----------------------------
                                           $   11,769,436 $  13,238,252 
                                            ============================

              See notes to condensed consolidated financial statements.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

                   CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



                                            Nine Months Ended September
                                                        30,
                                           -----------------------------
                                                1996           1997
                                           -------------- --------------
                                             (Unaudited)    (Unaudited)
                                           
          REVENUES:                        
          --------                         
             Reinsurance premiums assumed  $    2,179,218 $     807,633 
             Direct premiums earned:                       
               Affiliates . . . . . . . .               -             - 
               Nonaffiliates  . . . . . .         733,859     3,981,294 
             Less reinsurance ceded   . .        (203,254)   (1,057,788)
                                            ----------------------------
             Net premium income   . . . .       2,709,823     3,731,139 
             Net investment income  . . .         278,824       297,892 
             Net realized investment gains         25,933       207,781 
             Commission and other income        1,627,910     1,964,945 
                                            ----------------------------
                                                4,642,490     6,201,757 
          Benefits and expenses:           
             Benefits and claims  . . . .       1,006,518     1,355,867 
             Amortization of deferred      
               policy acquisition costs         1,163,103     2,017,661 
             Operating expenses   . . . .       2,476,285     2,895,517 
             Interest expense:             
               Affiliates . . . . . . . .         372,066             - 
               Nonaffiliates  . . . . . .          90,720        93,883 
                                            ----------------------------
                                                5,108,692     6,362,928 
                                            ----------------------------
          Loss before income taxes  . . .        (466,202)     (161,171)
          Income taxes (benefit)  . . . .               -             - 
                                            ----------------------------
          Net loss  . . . . . . . . . . .  $     (466,202)$    (161,171)
                                            ============================
          Weighted average number of       
             shares   . . . . . . . . . .       3,776,172     5,449,538 
                                            ============================
          Net loss per share  . . . . . .  $         (.12)$        (.03)
                                            ============================

              See notes to condensed consolidated financial statements.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

                   CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



                                            Three Months Ended September
                                                        30,
                                           -----------------------------
                                                1996           1997
                                           -------------- --------------
                                             (Unaudited)    (Unaudited)
                                           
          REVENUES:                        
          --------                         
             Reinsurance premiums assumed  $      515,037 $     617,064 
             Direct premiums earned:                                    
               Affiliates . . . . . . . .               -             - 
               Nonaffiliates  . . . . . .         297,229     2,427,649 
             Less reinsurance ceded   . .         (48,369)     (840,184)
                                            ----------------------------
             Net premium income   . . . .         763,897     2,204,529 
             Net investment income  . . .          68,018       100,028 
             Net realized investment gains              -       128,304 
             Commission income  . . . . .               -             - 
             Other income   . . . . . . .         601,777       730,495 
                                            ----------------------------
                                                1,433,692     3,163,356 
          Benefits and expenses:           
             Benefits and claims  . . . .         252,595       935,808 
             Amortization of deferred      
               policy acquisition costs           311,239     1,132,246 
             Operating expenses   . . . .         898,276       904,086 
             Interest expense:             
               Affiliates . . . . . . . .         127,122             - 
               Nonaffiliates  . . . . . .          30,626        31,972 
                                            ----------------------------
                                                1,619,858     3,004,112 
                                            ----------------------------
          Loss before income taxes  . . .        (186,166)      159,244 
          Income taxes (benefit)  . . . .               -             - 
                                            ----------------------------
          Net Loss  . . . . . . . . . . .  $     (186,166)$     159,244 
                                            ============================
          Weighted average number of            3,776,172     5,449,458 
             shares   . . . . . . . . . .   ============================
          Net loss per share  . . . . . .  $         (.05)$         .03 
                                            ============================

              See notes to condensed consolidated financial statements.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

                   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                            Nine Months Ended September
                                                        30,
                                           -----------------------------
                                                1996           1997
                                           -------------- --------------
                                             (Unaudited)    (Unaudited)
          Operating activities:            
          Net income loss . . . . . . . .  $     (466,202)$    (161,171)
          Adjustments to reconcile net                     
             loss to net cash used in
             operating activities:
                Amortization/accretion of  
                investment premiums and    
                discounts . . . . . . . .          (5,966)       (2,917)
             Policy acquisition costs      
                amortized . . . . . . . .      (1,163,103)   (2,017,661)
             Policy acquisition costs      
                deferred  . . . . . . . .         999,066     1,905,448 
             Depreciation and amortization        284,854       207,287 
             Net realized (gain) loss on   
                sales of investments  . .         (25,933)     (207,781)
             Accrued interest on term      
                notes, net  . . . . . . .         395,986        93,883 
             (Increase) decrease in:       
                Accrued investment income          21,321        13,882 
                Reinsurance recoverable           582,753        89,394 
                Trade receivables . . . .        (508,742)     (736,402)
                Other assets  . . . . . .         (76,310)      178,100 
             Increase (decrease) in:                                    
                Policy liabilities and     
                  accruals  . . . . . . .        (490,008)    1,631,443 
                Ceded reinsurance payable               -             - 
                Accounts payable and other 
                  liabilities   . . . . .         107,618        52,179 
                                            ----------------------------
          Total adjustments . . . . . . .         121,536     1,206,855 
                                            ----------------------------
          Net cash used in operating       
             activities   . . . . . . . .        (344,666)    1,045,684 
          Investing activities:            
          Securities available-for-sale :                               
             Purchases - fixed maturities        (300,012)     (736,054)
             Sales - fixed maturities   .         620,000       599,311 
             Purchases - equities   . . .      (2,201,859)   (3,511,369)
             Sales - equities   . . . . .       2,427,619     3,600,174 

              See notes to condensed consolidated financial statements.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

                   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (continued)

                                            Nine Months Ended September
                                                        30,
                                           -----------------------------
                                                1996           1997
                                           -------------- --------------
                                             (Unaudited)    (Unaudited)
          Securities held-to-maturity:     
             Purchases  . . . . . . . . .        (680,116)     (299,492)
             Maturities   . . . . . . . .         310,000       985,000 
          Proceeds from purchases and      
             maturities of other           
             investments  . . . . . . . .          13,419           464 
          Net advances from affiliates                  -      (237,210)
                                            ----------------------------
          Net cash (used in) provided by   
             investing activities   . . .         189,051       400,824 
          Financing activities:            
          Issuance of common stock  . . .          24,949             - 
          Purchases of treasury stock . .         (93,643)       (9,447)
          Payments on short-term           
             borrowings and long-term      
             debt   . . . . . . . . . . .         (54,302)     (185,921)
          Net proceeds from short-term     
             borrowings   . . . . . . . .        (406,607)            - 
                                            ----------------------------
          Net cash (used in) provided by   
           financing activities   . . . .        (529,603)     (195,368)
                                            ----------------------------
          Increase (decrease) in cash and  
          cash equivalents  . . . . . . .        (685,218)    1,251,140 
          Cash and cash equivalents,       
           beginning of period  . . . . .       1,235,930       993,069 
                                            ----------------------------
          Cash and cash equivalents, end   $      550,712 $   2,244,209 
           of period  . . . . . . . . . .   ============================

              See notes to condensed consolidated financial statements.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

                                  SEPTEMBER 30, 1997


          1.   Summary of Significant Accounting Policies
               ------------------------------------------

               Organization  - Cumberland Holdings, Inc. ( CHI ), a Florida
               corporation,  was  formed  on  November 18, 1991,  to  be  a
               holding  company and  a wholly-owned  subsidiary  of Kimmins
               Corp. ( KC ). Effective October  1, 1992, KC contributed all
               of  the outstanding common stock of two of its other wholly-
               owned  subsidiaries,  Cumberland Casualty  &  Surety Company
               ( CCS ) and Surety Specialists, Inc. ( SSI ) to CHI. KC then
               distributed to  its stockholders  CHI s common stock  on the
               basis  of one  share of  common stock  of CHI for  each five
               shares of KC  common stock  and Class B  common stock  owned
               (the  Distribution). Effective  January 30,  1997 Cumberland
               Holdings, Inc. changed its  name to Cumberland Technologies,
               Inc.  ("CTI").    CTI  conducts  its  business  through  six
               subsidiaries. CCS, a Florida corporation formed in May 1988,
               provides  reinsurance for specialty sureties and performance
               and  payment  bonds  for  contractors. The  surety  services
               provided  include  direct surety  and  to  a lesser  extent,
               reinsurance. SSI,  a  Florida corporation  formed in  August
               1988,  is a  general  lines  agency  which  operates  as  an
               independent agent. Surety Group (SG), a Georgia corporation,
               and  Associates  Acquisition Corp.  d/b/a  Surety Associates
               (SA),  a South  Carolina corporation, purchased  in February
               and  July  1995, respectively,  are  general  lines agencies
               which  operate  as  independent  agencies.  Official  Notary
               Service of Texas, Inc. (ONS),  a Texas corporation formed in
               February 1994, provides registration  and sundry services to
               notaries. Qualex Consulting Group, Inc. (Qualex), a  Florida
               corporation  formed in  November  1994,  provides claim  and
               contracting consulting services.   CTI and  its subsidiaries
               are referred to herein as the  Company. 

               Principles of  Consolidation  - The  consolidated  financial
               statements include the accounts  of CTI and its wholly-owned
               subsidiaries.  All  material  intercompany transactions  and
               balances have been eliminated in consolidation.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                     (continued)

          1.   Summary of Significant Accounting Policies (continued)
               ------------------------------------------------------

               Basis  of  Presentation  -  The   accompanying  consolidated
               financial statements  have been prepared in  accordance with
               generally  accepted accounting  principles which, as  to the
               subsidiary   insurance   company,   differ  from   statutory
               accounting practices prescribed  or permitted by  regulatory
               authorities. The significant accounting policies followed by
               CTI and  subsidiaries that  materially affect  the financial
               statements are summarized in this note.

               Reclassifications -   Certain amounts in  the 1996 financial
               statements  have been  reclassified to  conform to  the 1997
               financial statement presentations.

          2.   Net Income Per Share
               --------------------

               Net income per  share for  the three and  nine months  ended
               September 30, 1997  is based on the  weighted average number
               of shares  outstanding, adjusted for the  dilutive effect of
               stock options,  and is the same on  both a primary and fully
               diluted basis.

          3.   Term Note Due Affiliate
               -----------------------

               In  1988, CCS issued a  surplus debenture to  KC in exchange
               for $3,000,000 which bears interest at 10 percent per annum.
               Interest and  principal payments  are due quarterly  only if
               and when CCS s surplus, as defined below, exceeds $4,000,000
               and  are limited  to  an amount  equal  to one-half  of  the
               statutory  net  income  before  dividends  and  federal  and
               foreign  income taxes of CCS during that year.  In 1992, the
               debenture due  to KC from  CCS was assigned  to CTI.   As of
               December 31,  1996, no amounts could  be paid by  CCS to CTI
               under the terms  of the debenture.   On April 1, 1997,  CTI,
               forgave $375,000 of its  $3,000,000 surplus debenture due to
               CCS.   As  a  result,  CCS  increased  paid  in  capital  by
               $375,000.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                     (continued)

          3.   Term Note Due Affiliate
               -----------------------

               In addition, in 1992, CTI entered into a term note agreement
               with  KC  for  the  outstanding  amount  of  the  debenture,
               including interest  arrearage ($4,291,049) at  September 30,
               1992 as part  of the  distribution. The term  note was  pari
               passi  with the other debts  of CCS, bearing  interest at 10
               percent  of the unpaid principal and interest and was due on
               October 1,  2002. Interest and principal  were due quarterly
               with  minimum payments  equal to  one half  of  net earnings
               before interest and federal income taxes.

               The term note  was subordinate  in right of  payment to  all
               policyholders of CCS. Surplus funds are defined as funds CCS
               has remaining after deduction of capital, insurance reserves
               and  all other  liabilities, in  accordance with  accounting
               practices prescribed  or permitted by  the Florida Insurance
               Department. 

               Effective October  1, 1996,  CTI issued 1,723,290  shares at
               the  fair value of  $3.00 per share  of its  common stock to
               Kimmins Corp. (f/k/a  Kimmins Environmental Service,  Corp.)
               in exchange for surrender of the Company's term note payable
               in the amount of $5,169,870.

          4.   Notes Payable to Nonaffiliates
               ------------------------------

               In  connection  with  the  acquisition  of certain  agencies
               during 1995 (see Note 9), the Company entered into two notes
               payable with the agencies  previous owners. One note is  due
               March 1, 2002 and bears  interest at 8% through February 28,
               2001 and 10% thereafter.  Principal payments of $150,000 are
               due  annually  beginning March 1,  2000.  The  other is  due
               September 30,  2010  and  bears   interest  at  8%   through
               September 30, 1999 and  9% thereafter. Principal payments of
               $40,000  are   due  annually   for  three   years  beginning
               January 5, 1996.   Principal and interest payments  at 9% of
               $11,104 are due monthly beginning April 1, 1997.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                     (continued)

          5.   Intangibles
               -----------

               Intangible  assets  are  stated  at  cost  and   principally
               represent    purchased    customer   accounts,    noncompete
               agreements, purchased contract agreements, and the excess of
               costs  over  the  fair  value  of  identifiable  net  assets
               acquired (goodwill). Purchased customer accounts, noncompete
               agreements,  and  purchased  contract agreements  are  being
               amortized  on   a  straight-line  basis  over   the  related
               estimated lives and  contract periods, which range from 3 to
               15  years.  The  excess of  costs  over  the  fair value  of
               identifiable  net assets  acquired is  being amortized  on a
               straight-line   basis  over  15  years.  Purchased  customer
               accounts  are  records  and  files  obtained  from  acquired
               businesses  that contain  information on  insurance policies
               and the related insured parties that  is essential to policy
               renewals.

               The carrying  value of goodwill and  other intangible assets
               will be reviewed  if circumstances suggest that  they may be
               impaired.   If  this  review indicates  that the  intangible
               assets will  not be recoverable, as determined  based on the
               undiscounted  cash flows  of  the entity  acquired over  the
               remaining amortization period, the Company s  carrying value
               of the goodwill will  be reduced by the  estimated shortfall
               of cash flows.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                     (continued)


          6.   Loss and Loss Adjustment Expenses
               ---------------------------------

               The liability  for unpaid claims including  incurred but not
               reported losses is based  on the estimated ultimate cost  of
               settling the  claim (including the effects  of inflation and
               other societal  and economic factors), using past experience
               adjusted for current trends and any other factors that would
               modify past  experience. These estimates are  subject to the
               effects of  trends in loss severity  and frequency. Although
               considerable  variability  is  inherent in  such  estimates,
               management  believes that  the  reserves for  loss and  loss
               adjustment   expenses  are   adequate.  The   estimates  are
               continually reviewed and adjusted as necessary as experience
               develops or new information becomes known.  Such adjustments
               are  included in  current  operations. A  liability for  all
               costs  expected  to  be  incurred  in  connection  with  the
               settlement of  unpaid claims  (claim adjustment  expense) is
               accrued  when the  related  liability for  unpaid claims  is
               accrued. Claim adjustment expenses include costs associated
               directly with  specific  claims paid  or in  the process  of
               settlement,  such  as  legal  and  adjusters    fees.  Claim
               adjustment expenses also include  other costs that cannot be
               associated with  specific claims  but are related  to claims
               paid or in the process of settlement, such as internal costs
               of the claims function.

               The Company does  not discount its  reserves for losses  and
               loss  adjustment  expenses.  The  Company  writes  primarily
               surety contracts which are of short duration.

               The  Company   does  not   consider  investment   income  in
               determining  if  a  premium  deficiency  relating  to  short
               duration contracts exists.

          7.   Unearned Premiums
               -----------------

               Unearned premiums are calculated  using the monthly pro rata
               basis.<PAGE>





                            CUMBERLAND TECHNOLOGIES, INC.

          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                     (continued)


          8.   Reinsurance
               -----------

               The Company  assumes and cedes reinsurance  and participates
               in  various  pools.  The accompanying  financial  statements
               reflect  premiums,  benefits  and  settlement  expenses, and
               deferred policy acquisition costs, net of reinsurance ceded.
               Amounts  recoverable  from  reinsurers  are  estimated in  a
               manner consistent  with the future policy  benefit and claim
               liability associated with the reinsured policies.

               Accounts recoverable  from reinsurers  are  presented as  an
               asset in the accompanying consolidated financial statements.

          9.   Acquisitions
               ------------

               Effective   February 28,   1995,   the    Company   acquired
               substantially  all  of the  assets  of The  Surety  Group, a
               Georgia insurance agency specializing in the sales of surety
               bond policies.  The purchase price of  $850,000 is comprised
               of $325,000 paid  at closing, the  assumption of $25,000  of
               capital lease obligations and a $500,000 note payable to the
               seller. The  purchase agreement provides  that the  purchase
               price  may  be  reduced, but  not  increased,  based on  the
               agency s  operating  results  during the  three-year  period
               ending February 28, 1998.

               Effective  July 1,  1995, the  Company acquired  all of  the
               assets  of   Surety  Associates,  Inc.,  a   South  Carolina
               insurance agency  specializing in  the sales of  surety bond
               and  certain  types  of   property  and  casualty  insurance
               policies. The  purchase price of $1,330,241  is comprised of
               $180,241 paid at closing,  and a $1,150,000 note  payable to
               the seller.

               Both acquisitions have been accounted for using the purchase
               method. The  results of operations of  the acquired entities
               have   been  included   in  the   accompanying  consolidated
               statements  of  operations since  their  respective purchase
               date.

               The effects of the  acquired assets have been  excluded from
               the accompanying consolidated statements of cash flows.<PAGE>





          Item 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                       ---------------------------------------
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                    ---------------------------------------------
                           LIQUIDITY AND CAPITAL RESOURCES
                           -------------------------------
           
               The capacity of a surety company to underwrite insurance and
          reinsurance  is  based  on  maintaining  liquidity  and   capital
          resources sufficient to  pay claims and  expenses as they  become
          due. Based  on standards established by  the National Association
          of Insurance Commissioners (NAIC)  and promulgated by the Florida
          Department  of  Insurance,  the  Company is  permitted  to  write
          premiums  up  to an  amount equal  to  three times  its statutory
          surplus,  or approximately  $15,000,000  at  September 30,  1997,
          respectively.  Therefore,  based upon  statutory  guidelines, the
          Company   could  increase   earned   premiums  by   approximately
          $11,000,000 in 1997 in addition to the amount earned in 1996. The
          primary sources of liquidity for the Company are funds  generated
          from surety premiums, investment  income, and proceeds from sales
          and   maturities   of   portfolio   investments.   The  principal
          expenditures are payment of  losses and loss adjustment expenses,
          insurance operating expenses, and commissions.

               At September  30, 1997,  the Company s $13,238,252  of total
          assets   calculated  based   on  generally   accepted  accounting
          principles were  distributed primarily as follows:  58 percent in
          cash  and investments (including  accrued investment  income), 21
          percent in  receivables and reinsurance recoverables,  19 percent
          in  intangibles  and  deferred  policy acquisition  costs  and  2
          percent in other assets.

               The  Company  maintains  a  liquid  operating  position  and
          follows  investment guidelines  that are  intended to  provide an
          acceptable  return  on  investment while  maintaining  sufficient
          liquidity to meet its obligations.

               Net  cash used  in operating  activities was  $(344,665) and
          $1,045,684 for the nine months ended September 30, 1996 and 1997,
          respectively.   In 1996 the cash used in operating activities was
          primarily  attributable to  payments of  claims  and reinsurance,
          which offset in  part by a decrease in accounts  receivable.  Net
          cash  provided in operating activities during 1997 is a result of
          an  increase in policy liability  accruals which is  offset by an
          increase in trade receivables and policy acquisition costs.

               Net  cash (used  in)  provided by  investing activities  was
          $189,050 and  $400,824 for  the nine  months ended  September 30,
          1996, and  1997, respectively.   Investing activities  consist of
          purchases and sales of investments.<PAGE>





                       MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                       ---------------------------------------
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                    ---------------------------------------------
                           LIQUIDITY AND CAPITAL RESOURCES
                           -------------------------------
                                     (Continued)

               KC  and  Cumberland  entered  into  a  term  note  agreement
          evidencing  the balance of the surplus debenture which was due KC
          from CCS. The surplus debenture, as well as all accrued interest,
          has been assigned to Cumberland.<PAGE>





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

             COMPARISON OF NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996

               During the nine months ended September 30, 1997, net premium
          income totaled $3,731,139 representing an increase of  38 percent
          from  that of the same period in 1996 ($2,709,823).  The increase
          was due  to the  discontinuation  of the  Pooling Agreements  and
          implementing marketing of direct premiums.  During the first nine
          months  of  1997 as  compared  to  the same  period  during 1996,
          assumed premiums decreased  $1,371,585 (63%) and direct  premiums
          increased $3,247,435 (443%).
               Net  investment  income  for  the  third  quarter   of  1997
          increased $200,916 when  compared to   investment income for  the
          same period of 1996.   The increase is attributed to  $207,781 in
          realized gains during 1997, an increase of $181,850 over realized
          capital gains for  the same period  during 1996.  Commission  and
          other income increased by  $337,035 or 21% during the  first nine
          months of 1997 when compared to 1996.

               During the nine  months ended September  30, 1997 and  1996,
          benefits and  claims  expenses  decreased $349,349  or  35%.  The
          increase  is  attributed  to  the  increase of  direct  premiums.
          Benefits and claims represented in prior periods were  calculated
          at 40% of the pooling agreement premiums.

               During  the  nine  months  ended  September  30,  1997,  the
          amortization of deferred policy acquisition increased $854,558 or
          73 percent  when compared to  the same period  during 1996.   The
          increase is attributed to increased premiums written.

               Operating expenses  increased during  the nine  months ended
          September 30, 1997 by  $419,231 when compared to the  nine months
          ended September 30, 1996.  The increase is attributed to expenses
          associated  with the Company's  marketing strategy and  effort to
          enter into the direct premium market of the surety business.   As
          a result, payroll increased by approximately $265,667,  travel by
          $46,456 general office  expenses including rent, supplies,  etc.,
          increased  by  $82,237,  and accounting  and  actuarial  services
          increased by $30,400.  Direct written premiums are $3,981,294 and
          $733,859 for September 30, 1997 and 1996, respectively.

               Net interest expense decreased by $368,903  in 1997 and is a
          result of conversion  of the  affiliated term note  to equity  on
          October 1, 1996.<PAGE>





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

             COMPARISON OF THREE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
               During  the  three  months  ended  September  30,  1997, net
          premium income totaled $2,204,529 representing an increase of 189
          percent  from that of  the same period  in 1996 ($763,897).   The
          increase  is  attributed to  the  increase in  direct  premium of
          $2,130,420 or  717 percent.   This was  offset by an  increase in
          ceded premiums of $791,815.

               During  the  three  months  ended September  30,  1997,  net
          investment income of  $100,028 increased by 47% percent from that
          in  1996  ($68,018).   The  increase  is  a  result of  increased
          earnings  from  equity  securities  and  other  invested  assets.
          Realized investment gains of $128,304 for the three months ending
          September 30, 1997 increased investment income for the period  to
          $228,332.

               During  the three  months  ended September  30, 1997,  other
          income of $730,495 increased by 21 percent from $601,777 in 1996,
          and  is  attributed to  commission income  earned  from increased
          business written by the agencies purchased during 1995.

               During the  three months ended September  30, 1997, benefits
          and claims  expenses  increased to  $935,808  from $252,595  when
          compared  to the  same  period  in 1996.    The  increase is  due
          primarily  to  an  increase   in  benefits  and  claims  reserves
          associated with the marketing of direct premiums.

               During  the  three  months  ended  September 30,  1997,  the
          amortization of  deferred policy  acquisition costs increased  to
          $1,132,246  from  $311,239 when  compared to  the same  period in
          1996.     The  increase  is  due  primarily  to  an  increase  in
          amortization of  deferred  acquisition cost  associated with  the
          direct premium written.

               During the  three months ended September 30, 1997, operating
          expenses remained  consistent when  compared to  the same  period
          during 1996

               Net interest expense decreased by $125,776  when compared to
          the  same period  during  1996  and is  a  direct result  of  the
          conversion of the affiliated term  note to equity  on October 1,
          1996.<PAGE>





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

             COMPARISON OF THREE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996 
                                       (continued)

               Net income for  the three months  ending September 30,  1997
          was  $159,245 as  compared to  a  loss of  $186,166 for  the same
          period  in 1996.    The  positive  results  for  the  quarter  is
          attributed  to increased  direct written  premium of  $2,130,420,
          realized capital gains  and other income  earned by the  agencies
          and claims consulting company that make up the Cumberland  group.
          Claims and benefits of $935,808 reflect  the reserve increase and
          amortization of deferred cost of $1,132,246 represent  commission
          expense, not  deferred, on direct premiums written.  Cumberland s
          operating expenses of $904,086 for the third quarter of 1997 when
          compared to the same  period during 1996 ($898,276) shows  only a
          slight increase of 1 percent.   Interest expense decreased due to
          the note conversion to equity on October 1, 1996.<PAGE>





                             PART II - OTHER INFORMATION
                                           

          Item 1.   Legal proceedings

                    None

          Item 2.   Changed in securities
                    None

          Item 3.   Defaults upon senior securities

                    None

          Item 4.   Submission of matters to a vote of security holders

                    None

          Item 5.   Other information

                    None

          Item 6.   Exhibits and reports on Form 8-K

                    (a)   None

                          Exhibit 27 - Financial Data Schedule
                          (for SEC use only)

                    (b)   No  reports on  Form 8-K  were  filed during  the
                          quarter for which this report is filed.<PAGE>





                                      SIGNATURES


                Pursuant  to the  requirements  of the  Securities Exchange
          Act of 1934, the Company has duly caused this report to be signed
          on its behalf by the undersigned thereunto duly authorized.


                                           CUMBERLAND TECHNOLOGIES, INC.


           Date: November 14, 1997         By:    /s/Joseph M. Williams
                                           ------------------------------
                                           Joseph M. Williams
                                           President and
                                           Chief Executive Officer
                                           (Principle Executive Officer)
           Date: November 14, 1997         By:    /s/Carol S. Black
                                           ------------------------------
                                           Carol S. Black
                                           Secretary and
                                           Chief Financial Officer
                                           (Principle Accounting and
                                              Financial Officer)<PAGE>