SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

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

                                   FORM 10-KSB

(Mark One)

_X_  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
     1934.

For the fiscal year ended December 31, 1999

                                       OR

___  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE OF
     ACT 1934.

From the transition period from ______________ to ______________.

                        Commission file number 001-14995

                    Accufacts Pre-Employment Screening, Inc.
                 (Name if Small Business Issuer in Its Charter)

               Delaware                                       13-4056901
    (State or Other Jurisdiction of                        (I.R.S. Employer
     Incorporation or Organization)                       Identification No.)

        6 Greene Street NY, NY                                  10013
(Address of Principal Executive Offices)                      (Zip Code)

                                 (212) 966-0666
                (Issuer's Telephone Number, Including Area Code)

         Securities registered under Section 12(b) of the Exchange Act:


    Title of Each Class                                  Name of Each Exchange
                                                          on Which Registered

    Common Stock, par                                            OTCBB
    value $.01 per share

         Securities registered under Section 12(g) of the Exchange Act:

                                       N/A
                                (Title of Class)


                                       N/A
                                (Title of Class)

     Check whether the issuer: (1) filed all reports 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 past 90 days.

Yes [X]    No [_]

     Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. ____

     State issuer's revenues for its most recent fiscal year. $2,283,533



<PAGE>

     State the aggregate market value of the voting and non-voting common equity
held by non-affiliates computed by reference to the price at which the common
equity was sold, or the average bid and asked price of such common equity, as of
a specified date within the past 60 days. $3,375,000, based on 2,700,000 shares
of common stock, par value $.01 per share, held by non-affiliates of the
Registrant and an average bid and asked price of $1.25 as reported on the OTC
Bulletin Board on April 4, 2000.

                    APPLICABLE ONLY TO CORPORATE REGISTRANTS

     State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: 6,627,471 shares of common
stock, par value $.01 per share, as of March 31, 2000.

Transitional Small Business Disclosure (check one): Yes ___   No _X_



                                       2

<PAGE>


                           FORWARD LOOKING STATEMENTS

     Accufacts Pre-Employment Screening, Inc., a Delaware corporation (the
"Company"), cautions readers that certain important factors may affect the
Company's actual results and could cause such results to differ materially from
any forward-looking statements that may be deemed to have been made in this Form
10-KSB or that are otherwise made by or on behalf of the Company. For this
purpose, any statements contained in the Form 10-KSB that are not statements of
historical fact may be deemed to be forward-looking statements. Without limiting
the generality of the foregoing, words such as "may," "expect," "believe,"
"anticipate," "intend," or comparable terminology are intended to identify
forward-looking statements. Factors that may affect the Company's results
include, but are not limited to, the Company's limited operating history, its
ability to produce additional products and services, its dependence on a limited
number of customers and key personnel, its possible need for additional
financing, its dependence on certain industries, and competition from its
competitors. The Company is also subject to other risks detailed herein or set
forth from time to time in the Company's filings with the Securities and
Exchange Commission.


                                     PART I

Item 1. Description of Business.

Business Development

     Accufacts Pre-Employment Screening, Inc. (the "Company") was originally
incorporated in the state of New York on October 6, 1996. On August 31, 1998,
the Company was merged into Southern Cargo Company, Inc., a public shell
incorporated in the State of Florida in 1993 but which did not commence
operations until mid-1998 ("Southern Cargo"). Simultaneously with such
acquisition, Southern Cargo changed its name to Accufacts Pre-Employment
Screening, Inc., and shortly thereafter reincorporated under the same name in
the State of Delaware.

     On October 13, 1999, the Company acquired all of the operating assets of
Maglio, Inc., a Florida corporation engaged in providing pre-employment
screening services ("Maglio, Inc."), by merging Maglio, Inc. with and into
Maglio-Accufacts Pre-Employment Screening, Inc., a Delaware corporation and
wholly-owned subsidiary of the Company ("Maglio-Accufacts").

     As used in this Form 10-KSB, the names "Accufacts Pre-Employment Screening,
Inc.," "Accufacts" and the "Company" all refer to the existing Delaware
corporation, its predecessor business entities and Maglio-Accufacts. The term
"business" refers to the business of the Company, its predecessors and
subsidiaries.

Business of Issuer

     The Company is engaged in conducting and providing background checks of
individuals for potential employers through the use of databases and a national
network of agents (engaged on an independent contractor basis) developed by the
Company. The background information products and services currently provided by
the Company consist of:



                                       3
<PAGE>

     o    criminal history,
     o    pre-employment credit reports,
     o    social security number verification,
     o    driving record history,
     o    pre-employment verification,
     o    education verification,
     o    professional reference verification,
     o    professional license verification,
     o    federal criminal/civil search,
     o    sex offender registration, and
     o    nation fugitive search.

     The Company believes that employers increasingly are realizing the benefits
of conducting thorough background checks of employees as well as the verifying
employment applications, not only because of the desire to help assure a better
quality employee, but also, in some industries, the concern with negligent
hiring lawsuits. The Company has approximately 700 customers located throughout
the United States. During each of the fiscal years ended December 31, 1999, 1998
and 1997, sales of the Company's services were made in 50 states, with
approximately 35.0%, 50.0% and 60.0%, respectively, of total sales having been
made in the State of New York. The Company's business strategy is to accelerate
market presence throughout the United States. The Company also intends to
enhance its existing products, develop new ones and pursue acquisitions of other
companies, assets and/or product lines that either complement or expand its
existing business. See "Business."


Markets

     The Company markets its employment background checking products and
services throughout the United States. Although any company with employees is a
potential customer of Accufacts, the Company believes that companies or
businesses with one or more of the following characteristics would typically
benefit most from conducting background checks on employees and job-applicants:

     o    High risk of liability for negligent hiring lawsuits relating to the
          action or inaction of employees;

     o    Physically demanding jobs;

     o    Employees with access to goods and cash of employers;

     o    High employee turnover; and

     o    Desire for better quality employees, not only with respect to
          competence, but also integrity.

     Industries in which one or more of these characteristics exist include:



                                       4
<PAGE>

     o    construction;

     o    retail;

     o    manufacturing;

     o    property management, including commercial office buildings, apartments
          and hotels;

     o    medical, including nursing homes, hospitals and in-home health care
          providers;

     o    city and county governments, including schools, gaming, temporary and
          permanent placement agencies; and

     o    accounting firms.

     Products and Services

     General.

     The Company's products and services are designed to verify job applicant
background information for employers and consist of database searches through
the use of the Company's in-house computer system and manual retrieval and
copying of public records by the Company's network courier system. The Company's
customers may request and receive records by telephone, mail, facsimile or
through the Company's two web sites, www.accufacts.com and www.maglioinc.com, or
by using proprietary software developed by Accufacts or a modem-equipped
personal computer or terminal to access the Company's on-line order placing
network. This network is available 24 hours per day, seven days a week.
Accufacts licenses its software to its customers free of charge.

     The prices to Accufacts' customers of the reports prepared by the Company
vary in price from $5.00 to $75.00 per report, depending upon the type and
location of the background check requested by the customer. The reports may be
viewed on screen or printed in either Accufacts' or the customer's offices. The
reports remain in a computer file in Accufacts' host computer system for two
years and are available to the customer at no additional cost during that
period.

     The Company's in-house computer host system consists of automated,
networked PCs running Window NT, using SQL data bases which automatically read
orders out to the Company's agents and/or to third party databases for automatic
processing. In addition, the Company operates its Internet-based consumer order
entry system with the same automatic computer system, thereby reducing
turnaround time and operating costs as compared to the Company's computers.

     The Company's network agent system currently consists of persons and small
companies located throughout the United States. The agents are engaged as
independent contractors by written agreements which provide for payment of a fee
on a per document, per day or monthly basis. The number of agents in each state
or locality depends on the size, population density, numbers of counties, and
the organization of the court systems within the state or locality.



                                       5
<PAGE>

     The Company currently offers the following products and services:

     Criminal Histories--Searches in selected geographical areas for the
presence of a criminal record. This background information is available
statewide from 32 states or from all 3,300 counties in the United States on a
county-by-county basis. The remaining 18 states do not have an accessible
statewide depository for this type of information. This information is retrieved
by Accufacts through its network agent system, computer access directly into the
states and certain counties or, in some instances, by facsimile, mail and
telephone.

     Motor Vehicle Driving Reports--Confirms driving records. This background
information is retrieved by Accufacts through a non-affiliated third party and
is available from all 50 states, the District of Columbia, and Puerto Rico. This
same information could be obtained directly by the Company from the source or
from other non-affiliated third parties. These reports and the credit reports
discussed below are the only two products for which Accufacts serves as a
broker.

     Credit Information. This background information is a special form of a
common "credit report" designed for employment purposes only. The report
complies with current provisions of the Fair Credit Reporting Act, as amended
("FCRA"). See "Government Regulation" below. Accufacts serves as a broker for
this information for all three of the major credit bureaus (Equifax, TRW and
TransUnion) and retrieves the information from these credit bureaus through
software developed and owned by Accufacts . Accufacts customers may order any
combination of the three credit bureaus.

     Social Security Number. This report will verify the issue date, number and
name associated with the number. It will also indicate if the number has been
reported deceased or not-issued as of a certain date. The report may also reveal
other names, including, "also-known-as" or maiden names, and/or addresses
previously or currently used by the applicant.

     Employment Verifications. Pursuant to the client's requirements, this
report can include a complete verification of all previous employers, or a
review of the most recent two or three positions held.

     Education Verifications. This report contains the applicant's academic
history including: name of institution, dates of attendance, major course of
study and the type of degree(s) received by the individual.

     Professional License Verification. Professional licenses in most states may
be verified to include physicians, registered nurses, dentists, chiropractors,
physical therapists, attorneys, certified public accountants, etc.

     Professional/Personal Reference Verification. This report is based on an
interview of a co-worker or personal reference as provided by the applicant. The
co-worker or personal reference is questioned as to the length and nature of
their relationship with the applicant and the applicant's skills and work ethic.



                                       6
<PAGE>

     Federal Search. This search consists of a check for criminal and civil
filings in a Federal District identified by the client, or the district of
residence as identified by Accufacts. This search will reveal criminal and civil
information that has not been purged, sealed or expunged by the court and
generally involves a two to four-year time frame from the date of the search.

     New York State Sex Offender Registry Search. This is a statewide search of
the New York State Sex Offender Registry Database. New York State sex offenders
are categorized by the risk that they pose to public safety. For a sex offender
to be included in the Registry, he or she must be under the supervision of the
New York State Criminal Justice System to include probation, parole or
incarceration.

     Nationwide Search for Outstanding Warrants. This search is conducted
through a law-enforcement entity and includes a search of the NCIC database for
wanted persons. It should be noted that for a subject to be listed on the NCIC
database, a State, Local or Federal Law Enforcement Agency must have entered the
subject into the database as a wanted person.

Accelerated Market Presence

     Accufacts intends to continue the acceleration of its market presence
throughout the United States by further expanding and refining sales and
marketing techniques used by it over the past several years, including the
following methods:

     o    Face-to-face selling with prospective customers, primarily larger
          companies;

     o    in-house telemarketing to existing customers and to prospective
          customers who have shown an interest in purchasing Accufacts' products
          and services;

     o    independent resellers;

     o    public relations;

     o    participation in trade shows and seminars;

     o    advertising in trade publications;

     o    maintaining a web page on the Internet; and

     o    mailing of news releases to existing customers and to prospective
          customers.



                                       7
<PAGE>

Acquisitions of Other Companies and/or Product Lines

     The Company is pursuing the acquisition of other companies, assets and/or
product lines that either complement or expand Accufacts' business. Target
companies are regional or state background checking companies or companies with
complementary products including but not limited to drug testing, skills testing
or safety and security products. The Company may use cash or stock or a
combination of stock and cash to affect any such acquisitions. The Company has
had, and will continue to have, discussions from time-to-time with potential
acquisition candidates. On October 13, 1999, the Company acquired Maglio, Inc.
buy merging it into Maglio-Accufacts, a wholly-owned subsidiary of the Company.
Other than the acquisition of Maglio, Inc. in October 1999, the Company has not
consummated any acquisitions nor is any acquisition considered probable as of
the date of this Form 10-KSB. No assurance can be given that the Company will be
successful in these efforts.

Long-Term Customer Relationships

     The Company is committed to providing quality products and services to its
customers. Management believes that the Company's emphasis on building long-term
relationships with its customers has played a significant role in Accufacts'
success. Management further believes that these relationships are important not
only to generate additional sales from existing customers, but also for customer
referrals. A large percentage of the Company's sales have been generated by
referrals from customers. The Company intends to continue to send monthly
newsletters to existing customers; monitor its larger customers daily; and
contact each of its customers on a regular basis through telesales.

Quality Customer Service and Support

     In order to offer customers quality service and support, Accufacts has
developed and will continue to enhance a client service and support program
including:

     o    the availability of a customer service representative twelve hours a
          day Monday through Friday;

     o    in-house training of all customer service representatives on
          Accufacts' products;

     o    quality control checks for Accufacts' products; and

     o    minimum acceptable performance guidelines for employees.

     In addition, Accufacts realizes the importance of long-term employees to
the success of its operations and, therefore, strives to provide a positive work
environment and benefits package for employees.



                                       8
<PAGE>

Marketing and Sales

     The Company's marketing program consists of direct marketing activities,
exhibitions at trade shows, the Internet, public relations activities and
in-house telemarketing. All of the leads generated by these marketing activities
are referred to new customer telesales representatives for follow-up and, if
applicable, obtaining the documentation (including executed User Agreements)
needed to open new customer accounts.

     There are five employees at the Company's headquarters in New York, who are
involved in marketing activities, one of whom is the Director of Marketing.

Customers

     The Company currently has approximately 700 customers located throughout
the United States. During each of the fiscal years ended December 31, 1999, 1998
and 1997, sales were made in 50 states, with approximately 35.0%, 50.0% and
60.0%, respectively, of total sales having been made in the State of New York.
No single customer of Accufacts accounted for more than 10.0% of total Accufacts
sales during the fiscal years ended December 31, 1999, 1998 or 1997.

     Historically, the Company experiences 35.0% of its annual sales in the
fourth quarter due to increased hiring by retailers, starting in mid-October and
continuing through the holiday season.

Government Regulation

     The Company is a "consumer reporting agency" within the meaning of that
term as used in, and therefore is subject to, the provisions of the FCRA, and is
regulated by the Federal Trade Commission ("FTC") under the Federal Trade
Commission Act. Under the provisions of the FCRA, a consumer reporting agency
may furnish a "consumer report" to a customer (other than a consumer or in
response to a court order) only if such agency has reason to believe that, among
other matters, the customer intends to use the information for a permissible
purpose, including in connection with a credit transaction involving the
consumer on whom the information is to be furnished or the review or collection
of an account of the consumer or the customer otherwise has a legitimate need
for the information in connection with a business transaction concerning the
consumer. The background checking reports of Accufacts are consumer reports for
purposes of the FCRA. In addition, certain of Accufacts' consumer reports are
"investigative consumer reports" within the meaning of that term under the FCRA.
The FCRA also prohibits disclosure of obsolete information concerning a
consumer. Obsolete information generally means information which is more than
seven years old.

     The FCRA requires a consumer reporting agency to maintain reasonable
procedures designed to ensure that the prohibitions on the use of obsolete
information are not violated, and that the information contained in a consumer
credit report is used for a proper purpose. In addition, a consumer reporting
agency must follow reasonable procedures to assure maximum accuracy of the
information concerning the consumer about whom the report relates. See sub
caption "Legal Considerations" below. The FCRA also requires a consumer
reporting agency,


                                       9
<PAGE>

upon request from a consumer, to disclose all information about that consumer in
a consumer report, together with the source and the recipients of the
information. In some cases, this information must be delivered to the consumer
at no cost, and, in others, the agency may charge a reasonable fee. Accufacts
historically has not charged such a fee.

     The Consumer Credit Reporting Reform Act (CCRRA) of 1996 amended the FCRA
and added new requirements on consumer reporting agencies providing consumer
reports for employment purposes. The requirements include:

     o    providing customers with a notification of their responsibilities
          under the FCRA;

     o    obtaining certifications from customers that they are performing
          certain specific actions as required by the FCRA;

     o    providing the subject of the report with a free copy of the report if
          adverse action is taken by an employer based on information in the
          consumer report; and

     o    providing a copy of a "Summary of Your Rights Under the Fair Credit
          Reporting Act" with each consumer report.

     The CCRRA also placed new requirements on the resale of consumer reports. A
consumer reporting agency providing consumer reports to a reseller must now
obtain the identity of the end user of the information for each report. In
addition, the consumer reporting agency must receive certifications from
resellers that their customers are performing the same specific actions as are
required of the consumer reporting agency's direct customers, and ensure that
reports are being resold only for permissible purposes.

     The FCRA provides that an investigative consumer report may not be prepared
on any consumer unless such consumer receives notice thereof in writing not
later than three days after the date on which the report was first requested,
which must include a statement, among others, that the consumer has the right to
request complete disclosure of the nature and scope of the investigation
requested. The FCRA further provides that if the consumer requests disclosure of
the information, the consumer reporting agency must make such disclosure in
writing not later than five days after the date on which the request for
disclosure was received. A consumer reporting agency may not be held liable for
any violation of the FCRA provisions relating to investigative consumer reports
if that agency shows by preponderance of the evidence that at the time of the
violation, such agency maintained reasonable procedures to assure compliance
with those provisions. Of the Company's current products, education/credential
confirmations and reference checks are investigative consumer reports for
purposes of the FCRA.

     The FCRA provides for civil liability sanctions against a consumer
reporting agency by a consumer for willful or negligent noncompliance with the
FCRA and criminal sanctions against officers and directors thereof who knowingly
and willfully disclose information in a report to a person not authorized to
receive the information.



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<PAGE>

     State laws also impact the Company's business. There are a number of states
which have laws similar to the FCRA, and some states which have human rights
laws more strict than the FCRA. A large number of states also regulate the type
of information which can be made available to the public and/or impose
conditions to the release of the information. For example, some state laws
prohibit access to certain types of information, such as workers' compensation
histories or criminal histories, while others restrict access without a signed
release from the subject of the report. In addition, many privacy and consumer
advocates and federal regulators have become increasingly concerned with the use
of personal information, particularly credit reports. Attempts have been made
and will continue to be made by these groups to adopt new or additional federal
and state legislation to regulate the use of personal information. Federal
and/or state laws relating to consumer reporting agencies and/or access and use
of personal information, in particular, and privacy and civil rights, in
general, amended or enacted in the future could materially adversely impact
Accufacts' operations.

Legal Considerations

     Under general legal concepts and, in some instances, by specific state and
federal statute, the Company could be held liable to customers and/or to the
subjects of background checking reports prepared by the Company for inaccurate
information or misuse of the information. The FCRA contains civil liability
provisions for willful and negligent noncompliance with its requirements. The
FCRA further provides in effect that, except for liability for willful or
negligent noncompliance with the FCRA and false information furnished with
malice or willful intent to injure a consumer, a consumer reporting agency, any
user of information or any person who furnishes information to a consumer
reporting agency will not be liable to the consumer for defamation, invasion of
privacy or negligence based on information disclosed to such consumer under the
provisions of the FCRA.

     The Company has developed and implemented internal policies designed to
help ensure that background information retrieved by it concerning a consumer is
accurate and that it otherwise complies with the provisions of the FCRA. In
addition, each customer of Accufacts is required to sign an agreement, wherein
such customer agrees, among other matters, to accept responsibility for using
information provided by Accufacts in accordance with the provisions of the FCRA
and all other applicable federal and state laws and regulations including
federal and state equal opportunity laws and regulations. Accufacts also has
internal checks in place regarding access and release of such information.
Additionally, Accufacts requires that all employees sign a written
acknowledgment covering the proper procedures for handling confidential
information.

     In Feburary 2000, the Company obtained an errors and omissions insurance
policy for its officer, directors and employees in the amount of $5.0 million.
Such policy expires on February 13, 2001.

Competition

     The background checking industry is highly fragmented. The Company faces
both direct and indirect competition for its products and services. In addition,
many companies perform employee background checking in-house.



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<PAGE>

     Direct Competition

     There are a large number of companies engaged in the sale of one or more of
the background checking products sold by the Company, and the Company believes
that this number will increase. A significant number of these competitors are
small companies operating on a local or regional basis; while some are large
companies operating on a national scale. To the Company's knowledge, the
background checking portion of the business of its larger direct competitors is
currently a small portion of their overall operation. Unlike many of its direct
competitors, the Company serves as a broker for only two of its products --
credit reports and motor vehicle driving records -- and obtains the data for the
remainder of its products from the source. The Company believes that this helps
to give it a competitive pricing advantage. The Company also believes that it
has a competitive advantage over many of its competitors because of the wide
variety of products that it can offer to customers, and because of its newly
developed order entry and report retrieval system. Many of the Company's
competitors, however, have substantially greater financial and personnel
resources than the Company. In addition, it is possible that one or more of the
Company's larger direct competitors could expand their background checking
product line in the future.

     Indirect Competition

     The Company faces indirect competition from a number of companies engaged
in, among others, drug, aptitude and attitude testing, handwriting analysis and
on-the-job trial employment (employee leasing). These procedures, though often
used with background checking, compete with Accufacts' products and services.
Most of these competitors operate on a national scale and have substantially
greater financial and personnel resources than the Company. In addition, it is
possible that one or more of these competitors could expand their product lines
in the future to include background checking products and services.

Employees

     The Company has a total of 40 full-time employees, five of whom are
involved in marketing, two in finance, 24 in data processing, one in
programming, five in customer service and three in management. None of the
Company's employees is represented by labor unions or is subject to collective
bargaining arrangements. Accufacts considers its relations with its employees to
be good.

Item 2. Description of Property.

     The Company maintains its principals offices at a 3,000 square foot
facility located at 6 Greene Street, New York, NY 10013 pursuant to a lease
agreement, dated April 1, 1997, between the Company and 6 Greene Street
Associates, LLC. The lease, as amended, is for five years, expiring May 2003,
and the rent is $2,500 per month, or $30,000 per year, including heat, but
excluding electrical charges. The Company believes that these facilities are
adequate for its current needs.

     Maglio-Accufacts, the wholly-owned subsidiary of Accufacts, and successor
to Maglio, Inc., maintains a 2,960 square foot office located at 2180 West State
Road 434, Suite 4150, Longwood, Florida 32779 pursuant to a lease agreement,
dated May 28, 1998, as amended,


                                       12
<PAGE>

between Maglio, Inc. and CB Sanlando Center, Inc, and assigned to
Maglio-Accufacts. The term of the lease agreement is for five years, commencing
August 1, 1998 until July 31, 2003, and the monthly rent is (i) $4,440 for the
period from August 1, 1999 to September 31, 2000, (ii) $4,564 for the period
from August 1, 2000 to July 31, 2001, (iii) $4,687 for the period from August 1,
2001 to July 31, 2002 and (iv) $4,872 for the period from August 1, 2002 to July
31, 2003.

Item 3. Legal Proceedings.

     None.

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

     Not applicable.

                                     Part II

Item 5. Market for Common Equity and Related Stockholder Matters.

     In August 1998, Southern Cargo acquired all of the assets and assumed all
of the liabilities of our Company and changed its name to Accufacts
Pre-Employment Screening, Inc. and its state of incorporation from Florida to
Delaware. On September 9, 1998, the Company's common stock, par value $.01 per
share (the "Common Stock"), commenced being quoted on the OTC Bulletin Board,
the "OTCBB," under the symbol "APES." The following table sets forth the high
and low bid prices for the Company's Common Stock, commencing September 9, 1998,
on a quarterly basis. The quotations represent bid between dealers and do not
included retail mark-up, mark-down or commissions, and do not represent actual
transactions.

--------------------------------------------------------------------------------
              Quarter                      Low Bid Price*      High Bid Price*
--------------------------------------------------------------------------------
Fiscal 1998:
--------------------------------------------------------------------------------
3rd Quarter (from September 9, 1998)           $1.0000             $3.0000
--------------------------------------------------------------------------------
4th Quarter                                    $1.1250             $3.1875
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
Fiscal 1999:
--------------------------------------------------------------------------------
1st Quarter                                    $1.2500             $4.3750
--------------------------------------------------------------------------------
2nd Quarter                                    $1.1250             $5.0000
--------------------------------------------------------------------------------
3rd Quarter                                    $1.5625             $2.7500
--------------------------------------------------------------------------------
4th Quarter                                    $1.6250             $2.6875
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
Fiscal 2000:
--------------------------------------------------------------------------------
1st Quarter                                    $1.3750             $2.5625
--------------------------------------------------------------------------------
2nd Quarter (through April 5, 2000)            $1.2500             $1.4375
--------------------------------------------------------------------------------
-----------
*Source: OTCBB Quarterly Reports.



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<PAGE>

     The Company believes that as of March 31, 2000, there were 20 holders of
record of 6,627,471 shares of Common Stock, including holders which maintain
their ownership in "Street-Name."

Dividends

     The Company has never paid cash dividends on its Common Stock and does not
anticipate paying cash dividends on its Common Stock in the foreseeable future.
The Company anticipates that for the foreseeable future, earnings will be
retained for the development of its business. Accordingly, the Company does not
anticipate paying dividends on the Preferred Stock or Common Stock in the
foreseeable future. The payment of future dividends will be at the sole
discretion of the Company's Board of Directors and will depend upon among other
of the Company and general business conditions.

Recent Sales of Unregistered Securities

     The following is a summary of all securities sold by the Registrant within
the past three years which were not registered pursuant to the Securities Act of
1933, as amended (the "Act"):

     o    On August 20, 1998, the Company issued an aggregate of 3,750,000
          shares of its Common Stock to Philip Luizzo, the President and Chief
          Executive of Accufacts, in connection with the merger of Accufacts
          into Southern Cargo. The Company relied upon Section 4(2) promulgated
          under the Act in that such issuance did not involve a public offering.

     o    On August 26, 1998, the Company issued an aggregate of 500,000 shares
          of Common Stock to Robert DePalo in consideration for consulting
          services rendered. The Company relied upon Section 4(2) promulgated
          under the Act in that such issuance did not involve a public offering.

     o    On August 26, 1998, the Company issued 500,000 shares of Common Stock
          to the Old Oak Fund, Inc. in consideration for financial consulting
          services rendered. The Company relied upon Section 4(2) promulgated
          under the Act in that such issuance did not involve a public offering.

     o    On August 26, 1998, the Company issued 200,000 shares of Common Stock
          to Tammy Perrotta in consideration for financial advisory services
          rendered. The Company relied upon Section 4(2) promulgated under the
          Act in that such issuance did not involve a public offering.

     o    During the period commencing September 15, 1998 until December 18,
          1998, the Company sold an aggregate of 500,000 shares of Common Stock
          in a private placement to sophisticated investors pursuant to Rule 504
          of Regulation D promulgated under the Act.

     o    On October 13, 1999, the Company issued an aggregate of 177,471 shares
          of its Common Stock to Richard J. Maglio, the principal owner of
          Maglio, Inc., of


                                       14
<PAGE>

          which 174,971 shares were issued in connection with the acquisition of
          Maglio, Inc. by Maglio-Accufacts and 2,500 shares in consideration for
          Mr. Maglio entering into a non-competition agreement with the Company.
          The Company relied upon Section 4(2) promulgated under the Act in that
          such issuance did not involve a public offering.

     o    On October 11, 1999, the Company issued to Richard J. Maglio, in
          connection with the acquisition of Maglio, Inc. by Maglio-Accufacts,
          an option to purchase up to 50,000 shares of Common Stock of Accufacts
          at a purchase price of $2.50 per share at any time commencing October
          11, 2000 until, and including, October 11, 2002. The Company relied
          upon Section 4(2) promulgated under the Act in that such issuance did
          not involve a public offering.

Item 6. Management's Discussion and Analysis or Plan of Operation Plan of
        Operation.

     Accufacts Pre-Employment Screening, Inc., a Delaware corporation (the
"Company"), had revenues of $2,283,533 for the fiscal year ended December 31,
1999, as compared to $1,598,772 for the year ended December 31, 1998,
representing an increase of $684,761, or 42.8%. Such increase was due to
internal growth, a larger client base and cross-selling additional services
attributable to the acquisition of Maglio, Inc., a Florida corporation engaged
in providing pre-employment screening services ("Maglio, Inc."), by
Maglio-Accufacts Pre-Employment Screening, Inc., a Delaware corporation and
wholly-owned subsidiary of the Company, in October 1999 (the "Maglio
Acquisition").

     General and administrative expenses were $1,008,012 for the fiscal year
ended December 31, 1999, as compared to $552,474 for the fiscal year ended
December 31, 1998, representing an increase of $455,538, or 82.5%. Such increase
was attributable to the Maglio Acquisition, including the commencement of
programs to integrate Maglio, Inc.'s operations into the Company's, increased
legal and accounting fees and increased marketing expenses due to the Company's
increased attendance at industry trade shows and sponsorships.

     Net losses were $215,566 for the fiscal year ended December 31, 1999, as
compared to $124,881 for the fiscal year ended December 31, 1998, representing
an increase of $90,685, or 72.6%. Such increase was attributable to increased
expenditures in connection with integrating and creating a simplified and
automated new infrastructure to connect the Company's Florida and New York
offices. By combining the Florida and New York operations, the Company's
management believes that it will be able to reduce the amount of time allocated
to general and administrative matters as well as reduce costs of revenue, and
focus more on marketing.

     Net cash used in operating activities was $394,927 for the fiscal year
ended December 31, 1999, as compared to $106,214 for the fiscal year ended
December 31, 1998, representing an increase of $288,713, or 271.8%.

     Days outstanding in receivables was 62 days for the fiscal year ended
December 31, 1999, as compared to 59 days for the fiscal year ended December 31,
1998, representing an increase of 3 days, or 5.1%. This increase was
attributable to the gain of a larger client base with longer payment terms.



                                       15
<PAGE>

     The Company's financing activities included borrowing from a bank,
stockholders' loans and private placement offering. The Company's financing
activities resulted in net cash provided by financing activities of $681,115 and
$199,289 for the years ended December 31, 1999 and 1998, respectively,
reflecting an increase of $481,826, or a change of 241.7%. The Company believes
it will be able to fund its short-term cash needs through funds from operations
and additional capital raising efforts.

Liquidity and Capital Resources

     The Company intends to increase its business through the use of operating
profits and borrowings and additional capital raising. The Company believes that
its anticipated cash flow operations as well as availability of funds from
existing bank facilities and proceeds of the offering completed recently will
provide the liquidity to meet its current foreseeable cash needs for at least a
year.

     At December 31, 1999, the Company had total assets $1,510,236, as compared
to $447,210 at December 31, 1998, representing an increase of $1,063,026, or
237.8%. At December 31, 1999, the Company had total liabilities of $452,370, as
compared to $300,904 at December 31, 1998, representing an increase of $151,466,
or 50.3%.

     The Company had a working capital of $483,889 as of December 31, 1999, as
compared to $90,748 as of December 31, 1998, representing an increase of
$393,141, or 433.2%

     The Company currently has a bank source of funding:

     o    Line of credit in the amount of $100,000 ($43,274 of which was
          outstanding as of December 31, 1999) with an annual percentage rate of
          7.75%.

     o    An overdraft protection on Business Checking Account of $25,000 ($0 of
          which was outstanding as of December 31, 1999) with an annual
          percentage rate of 13.75%.

Year 2000 Issue

     The Company's in-house systems were Year 2000 compliant and its client
software was also Year 2000 compliant. The Company did not experience any
software problems attributable to the Year 2000 problem.

Item 7. Financial Statements.

     Consolidated Financial Statements are found immediately following the
signature page of this Report on pages F-1 through F-18.

Item 8. Changes in and Disagreements with Accountants on Accounting and
        Financial Disclosure.

     None.


                                       16
<PAGE>

                                    Part III

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
        with Section 16(a) of the Exchange Act.

     The directors and executive officers of Accufacts and Maglio-Accufacts are
as follows:

<TABLE>
<CAPTION>
                                                      Director of                         Director of
                           Position with              Accufacts     Position with         Maglio-Accufacts
Name                 Age   Accufacts                  Since         Maglio-Accufacts      Since
----                 ---   -------------              -----------   ----------------      ----------------
<S>                  <C>                              <C>           <C>                   <C>
Philip Luizzo        34    Chief Executive Officer,   1998          President and         1999
                           President and Chairman                   Director
                           Of the Board
John C. Svedese      39    Vice President and         1998          Vice President and    1999
                           Director Director

Richard J. Maglio    53      --                         --          Vice President of     1999
                                                                    Operations and
                                                                    Director
Anthony J. Luizzo    56    Corporate Secretary and    1998          Corporate Secretary   1999
                           Director                                 and Director
Frank Luizzo         50    Director                   1998          Director              1999
Joseph W. Slattery   62    Director                   1998          Director              1999
</TABLE>

     Philip Luizzo, the President, Chief Executive Officer and Chairman of the
Board of Directors of Accufacts and the President and a Director of
Maglio-Accufacts, has served as the President and Chief Executive Officer of
Accufacts and its predecessor, Southern Cargo, since 1994 and as President of
Maglio-Accufacts since 1999. For more than two years prior to 1994, Mr. Luizzo
was a manager of L.C. Security. Mr. Luizzo earned an undergraduate degree in
Finance from The University of Nevada, Las Vegas and has authored a number of
articles on background screening for major magazines and professional journals
including Security Management Magazine and The Internal Auditing Alert. Mr.
Luizzo has lectured to numerous companies and Professional organizations on
aspects of conducting background investigations for prospective employees.
Philip Luizzo is the son of Anthony J. Luizzo, the Corporate Secretary and a
Director of Accufacts' and Maglio-Accufacts, and the nephew of Frank Luizzo, a
Director of Accufacts and Maglio-Accufacts.

     John C. Svedese, the Vice President and a Director of Accufacts and
Maglio-Accufacts, has over 12 years experience as a senior investigative auditor
for the New York City District Council of Carpenters. Mr. Svedese has been with
Accufacts and its predecessor, Southern Cargo, since 1994 and with
Maglio-Accufacts since 1999, and is familiar with all aspects of the Company's
growth and development. Mr. Svedese monitors the day-to-day operations of
Accufacts in the New York City office. In order to maintain Accufacts' high
level of personal as well as professional services, he also acts as the business
liaison between Accufacts and its clients. Mr. Svedese assists the Board of
Education of the City of New York by providing seminars regarding pre-employment
screening by corporations to its faculty and students.

                                       17

<PAGE>

     Richard J. Maglio, the Vice President of Operations and a Director of
Maglio-Accufacts since October 1999, served as the President of Maglio, Inc., a
business engaged in providing employment background screening services to client
companies throughout the United States, since its inception in 1986 until it was
merged into Maglio-Accufacts in October 1999. Mr. Maglio earned an undergraduate
degree in Human Resources Management from the University of Wisconsin-Oshkosh in
1968.

     Anthony J. Luizzo, CFE, CST, DABFE, the Corporate Secretary and a Director
of Accufacts and Maglio-Accufacts, has been an owner and principal employee of
L.C. Consulting Group, Inc. for more than five years. Mr. Luizzo has over 35
years of law enforcement and security management experience as a former
detective with the New York City Police Department and as a senior security
administrator with the New York City Mayor's Office of Economic Development and
Business Services and the NYC Health & Hospitals Corporation. Anthony Luizzo
earned a graduate degree in criminology and undergraduate degree in security
management from Pacific Western University and held adjunct faculty positions at
John Jay College of Criminal Justice Studies and New York University. Mr. Luizzo
is presently an adjunct faculty member at Long Island University. Mr. Luizzo is
a certified fraud examiner, certified security trainer, certified police
instructor, and a board certified forensic examiner. He has written over 25
articles addressing aspects of security and loss prevention management for a
wide variety of magazines and professional trade journals including The CPA
Journal, Security Management Magazine, The Journal of Health Care Protection
Management, and The White Paper. He is the author of "Play it Safe," a retail
fraud prevention brochure, and coauthor of Fraud Auditing: A Complete Guide, a
workbook for accountants and auditors on conducting fraud audits and
investigations published by the Foundation for Accounting Education. Mr. Luizzo
has lectured on security management issues to corporations, municipal agencies
and professional organizations nationwide. He has conducted over 5,000 security
surveys for corporations, hospitals, commercial, institutional and residential
complexes, and often testifies as a security expert in litigation involving
deficient security. Mr. Luizzo is the President of the New York Chapter of
Certified Fraud Examiners. He serves or has served on the Board of Directors of
The Associated Licensed Detectives of New York State, The Society of
Professional Investigators, and The Academy of Security Educators and Trainers.
Anthony Luizzo is the father of Philip Luizzo, the President, Chief Executive
Officer and Chairman of the Board of Directors of Accufacts and the President
and a Director of Maglio-Accufacts, and the brother of Frank Luizzo, a Director
of Accufacts and Maglio-Accufacts.

     Frank Luizzo, CFE, a Director of Accufacts and Maglio-Accufacts, has, for
more than the past two years, been the Director of Operations of several
security-related departments at the Hard Rock Hotel and Casino in Las Vegas,
Nevada. For more than three years prior thereto, he was the General Manager of
United Coin Machine Co. in Las Vegas Nevada which is in the business of managing
slot machine route operations. Mr. Luizzo has over 30 years of law enforcement
and security management experience as a former Nevada State Trooper and Gaming
Agent/Supervisor - Gaming Control Board State of Nevada. Mr. Frank Luizzo is
presently the Director of Security for The Hard Rock Hotel and Casino, Las
Vegas, Nevada and formerly held positions as General Manager, United Coin
Machine Co. and Assistant to the Chairman, Aladdin Hotel and Casino. Mr. Luizzo
coauthored an article on "Casino Fraud" featured in Security Management Magazine
and was prominently featured in television documentaries on "Gaming Security"
for The Discovery Channel and "E" Entertainment. Mr. Luizzo is a member and past
president of the Las Vegas Security Chief's Association, a member of the


                                       18
<PAGE>

International Association of Financial Crime Investigators, and current
president of the Harmon Avenue Business Association. Mr. Frank Luizzo is the
uncle of Philip Luizzo, the President, Chief Executive Officer and Chairman of
the Board of Accufacts and the President and a Director of Maglio-Accufacts, and
the brother of Anthony J. Luizzo, the Corporate Secretary and a Director of
Accufacts and Maglio-Accufacts.

     Joseph W. Slattery, CFE, a Director of Accufacts and Maglio-Accufacts, has
been a manager with L.C. Security where he conducts the security board training
division for more than the past five years. Mr. Slattery has over 40 years of
law enforcement and security management experience as a former Deputy Inspector
with the New York City Police Department and as private security
consultant/trainer. Mr. Slattery earned an undergraduate/graduate degree in
security management from John Jay College of Criminal Justice Studies. Mr.
Slattery is a certified fraud examiner and a certified security guard instructor
in New York State. Mr. Slattery is a former treasurer for The Captain's
Endowment Association - New York City Police Department and a current board
member of The New York Chapter of Certified Fraud Examiners. Mr. Slattery has
lectured on various aspects of security, loss prevention and fraud prevention
management to corporations, municipal agencies and professional organizations
nationwide. Throughout his career, he has conducted numerous security surveys of
corporate facilities, hospitals, and commercial/industrial entities.

     All directors hold office until the next annual meeting of stockholders and
until their successors have been elected and qualified, subject to death,
resignation or removal from office prior to such time.

Section 16(a) Beneficial Ownership Reporting Compliance

     During the fiscal year ended December 31, 1999, Philip Luizzo, the
Company's President, Chief Executive Officer and Chairman of the Board; John
Svedese, the Vice President and a Director of the Company; Anthony J. Luizzo,
the Secretary and a Director of the Company; and Frank Luizzo and Joseph W.
Slattery, both of whom are Directors of the Company, did not timely file their
initial statements of beneficial ownership of securities on Form 3 with the
Securities and Exchange Commission and with the Company. Other than Philip
Luizzo, none of the other persons mentioned above beneficially held any
securities of the Company at either the required or actual time of filing such
Forms 3. Philip Luizzo's initial ownership of 3,750,000 shares of Common Stock
of the Company has remained unchanged from the date of filing to the date
hereof.

Item 10. Executive Compensation.

     The following summary compensation table sets forth the aggregate
compensation paid or accrued by the Company to the Chief Executive Officer and
to the four most highly compensated executive officers other than the Chief
Executive Officer whose annual compensation exceeded $100,000 for the fiscal
year ended December 31, 1999 (collectively, the "Named Executive Officers") for
services during the fiscal years ended December 31, 1999, 1998 and 1997:



                                       19
<PAGE>

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                      Annual Compensation
                                                        ---------------------------------------------------
                                                                                               Other Annual
                                        Fiscal                                                 Compensation
  Name and Principal Position            Year           Salary ($)          Bonus ($)             ($)(1)
  ---------------------------            ----           ----------          ---------          ------------
<S>                                      <C>             <C>                 <C>                 <C>
 Philip Luizzo, President and            1999            $150,000            $      0            $  8,400
 Chief Executive Officer                 1998            $ 49,420            $      0            $      0
                                         1997            $ 43,630            $      0            $      0
</TABLE>

----------
(1)  Includes a monthly car allowance of $700 per month.

     Currently, the Directors of the Company are not compensated for serving on
the Board of Directors.

     On October 11, 1999, the Company entered into an employment agreement with
Richard J. Maglio, the Vice President of Operations and a Director of
Maglio-Accufacts. The term of the employment agreement is for three years,
commencing October 11, 1999 until October 11, 2002, during which Mr. Maglio is
to be employed as the Vice President of Operations of Maglio-Accufacts. Pursuant
to the terms of the employment agreement, Mr. Maglio is to receive an annual
base salary of $75,000, which shall be increased by a minimum of 4.0% for each
subsequent year, and 3.0% of any profits of the Company in excess of $500,000.
Mr. Maglio also received options to purchase up to 50,000 shares of Common Stock
of Accufacts at a purchase price of $2.50 per share at any time commencing
October 11, 2000 until October 11, 2002. During the term of the employment
agreement, Mr. Maglio is entitled to be reimbursed for automobile expenses not
exceeding $521 per month and for expenses incurred in connection with his
employment. Mr. Maglio's compensation under the foregoing employment agreement
was $21,723 for the fiscal year ended December 31, 1999.

     The Company does not have a stock option plan at this time.

Employment Contracts and Termination of Employment and Change-in-Control
Arrangements

     Philip Luizzo is employed as President and Chief Executive Officer of
Accufacts under an employment agreement, dated September 1, 1998, as amended.
The term of Mr. Luizzo's employment agreement is five years and provides for (i)
an annual base salary of $150,000, (ii) 10.0% of any profit in excess of
$500,000, (iii) reasonable out-of-pocket expenses and (iv) a monthly car
allowance of up to $700. In addition, in the event Mr. Luizzo is terminated
without cause or if there is a change-of-control (as defined in the employment
agreement) of the Company, Mr. Luizzo is entitled to receive his salary for a
period of two years commencing on the date of termination or change-of-control,
as the case may be. Also, if the Company terminates the employment agreement
without cause, the Company shall purchase Mr. Luizzo's shares in the Company
over a period of 6 months at the lesser of (x) market value (average of bid and
asked prices) or (y) $1.00 per share.



                                       20
<PAGE>

Item 11. Security Ownership of Certain Beneficial Owners and Management.

     The following table sets forth information concerning the beneficial
ownership of the Company's outstanding Common Stock as of March 31, 2000, by (i)
each person known by the Company to be the beneficial owner of more than five
percent of the outstanding shares of Common Stock, (ii) each Named Executive
Officer, (iii) each of the Company's directors and (iv) all executive officers
and directors as a group. Unless otherwise indicated below, to the knowledge of
Advanced Knowledge all persons listed below have sole voting and investment
power with respect to their shares of Common Stock except to the extent that
authority is shared by spouses under applicable law.

<TABLE>
<CAPTION>
                                                                 Amount and Nature of     Percentage of Class
      Name and Address of Beneficial Owner (1)                 Beneficial Ownership (2)           (3)
      ----------------------------------------                 ------------------------   -------------------
<S>                                                                    <C>                       <C>
Philip Luizzo                                                          3,750,000                 56.6%
John C. Svedese                                                                0                   --
Richard J. Maglio(4)                                                     177,471                  2.7%
Anthony J. Luizzo                                                              0                   --
Frank Luizzo                                                                   0                   --
 Joseph W. Slattery                                                            0                   --
All executive officers and directors as a group (six persons)          3,927,471                 59.3%
</TABLE>

----------

(1)  Unless otherwise noted, the address for each individual is in care of
     Accufacts Pre-Employment Screening, Inc., 6 Greene Street, New York, New
     York 10013.

(2)  A person is deemed to be the beneficial owner of securities that can be
     acquired by such person within 60 days from the date hereof. Each
     beneficial owner's percentage ownership is determined by assuming that
     options or warrants that are held by such person (but not those held by any
     other person) and which are exercisable within 60 days from the date of
     filing this Form 10-KSB have been exercised. Unless otherwise indicated,
     the Company believes that all persons named in the table have sole voting
     and investment power with respect to all shares of Common Stock
     beneficially owned by them.

(3)  Based on 6,627,471 shares of Common Stock as of March 31, 2000.

(4)  Address for reporting person is c/o Maglio-Accufacts Pre-Employment
     Screening, Inc., 2180 West State Road 434, Suite 4150, Longwood, Florida
     32779.

Item 12. Certain Relationships and Related Transactions.

     None.

Item 13. Exhibits, List and Reports on Form 8-K.

     On October 28, 1999, the Company filed with the Securities and Exchange
Commission a Current Report on Form 8-K, dated October 13, 1999, regarding the
acquisition of all of the operating assets of Maglio, Inc., a pre-employment
screening services company based in Longwood, Florida, by merging Maglio, Inc.
with and into Maglio-Accufacts.

     On December 23, 1999, the Company filed with the Securities and Exchange
Commission an amendment to the foregoing Form 8-K for the purpose of including
financial statements and pro forma financial information required by Item 7 of
Form 8-K.

                                       21

<PAGE>

                                    Exhibits
Exhibit
  No.                              Description
-------                            -----------

  2.1   Plan and Agreement of Merger of Maglio, Inc. and Maglio-Accufacts
        Pre-Employment Screening, Inc., dated October 11, 1999, by and among
        Accufacts Pre-Employment Screening, Inc., Maglio-Accufacts
        Pre-Employment Screening, Inc. and Maglio, Inc. (1)

  2.2   Supplemental Agreement, dated as of October 11, 1999, by and among
        Accufacts Pre-Employment Screening, Inc., Maglio-Accufacts
        Pre-Employment Screening, Inc., Maglio, Inc. and Richard J. Maglio (1)

  3.1   Articles of Incorporation of Accufacts Pre-Employment Screening, Inc.
        and Certificate of Merger (2)

  3.2   By-laws of Accufacts Pre-Employment Screening, Inc. (2)

  3.3   Certificate of Incorporation of Maglio-Accufacts Pre-Employment
        Screening, Inc.

  3.4   By-laws of Maglio-Accufacts Pre-Employment Screening, Inc.

  4.1   Specimen of Common Stock Certificate of Accufacts Pre-Employment
        Screening, Inc. (2)

  4.2   Asset Purchase Agreement, dated August 26, 1998, between Southern Cargo,
        Inc. and Accufacts Pre-Employment Screening, Inc. (2)

  4.3   Shareholder Rights and Registration Rights Agreement, dated as of
        October 11, 1999, by and between Accufacts Pre-Employment Screening,
        Inc. and Richard J. Maglio (1)

 10.1   Employment Agreement, dated September 1, 1998, between the Registrant
        and Philip Luizzo (2)

 10.2   Amendment, dated October 5, 1999, to the Employment Agreement, dated
        September 5, 1998, between the Registrant and Philip Luizzo (3)

 10.3   Employment Agreement, dated September 1, 1998, between the Registrant
        and John Svedese (2)

 10.4   Employment Agreement, dated October 11, 1999, by and among the
        Registrant, Maglio-Accufacts Pre-Employment Screening, Inc. and Richard
        J. Maglio

 10.5   Lease Agreement, dated April 1, 1997, between the Registrant and 6
        Greene Street Associates, LLC., as amended

 10.6   Lease Agreement, dated August 28, 1998, between Maglio, Inc. and CB
        Sanlando Center, Inc.

 21.1   List of Subsidiaries

 27.1   Financial Data Schedule

----------

(1)  Filed as an exhibit to the Registrant's Current Report on Form 8-K, dated
     October 13, 1999, filed with the Securities and Exchange Commission on
     October 28, 1999 (SEC File No.: 001-14995), and is incorporated by
     reference herein.

(2)  Filed as an exhibit to the Registrant's Form 10-SB filed with the
     Securities and Exchange Commission on May 7, 1999 (SEC File No.:
     001-14995), and is incorporated by reference herein.

(3)  Filed as an exhibit to the Registrant's Quarterly Report on Form 10-QSB for
     the quarter ended September 30, 1999 filed with the Securities and
     Commission on November 15, 1999 (SEC File No.: 001-14995), and is
     incorporated by reference herein.


                                       22
<PAGE>

                                   Signatures

     In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                        Accufacts Pre-Employment Screening, Inc.
Date: April 11, 2000
                                        By: /s/ Philip Luizzo
                                            -----------------
                                            Philip Luizzo
                                            President and
                                            Chief Executive Officer
                                            (Principal Executive Officer)

     In accordance with the Exchange Act, this report has been signed by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.

/s/ Philip Luizzo                                          Date: April 11, 2000
-----------------------
     Philip Luizzo
     President and Chief Executive Officer
     (Principal Executive Officer)

/s/ John C. Svedese                                        Date: April 11, 2000
-----------------------
     John C. Svedese
     Vice President and Director

/s/ Frank Luizzo                                           Date: April 11, 2000
-----------------------
     Frank Luizzo
     Director

/s/ Joseph W. Slattery                                     Date: April 11, 2000
----------------------
     Joseph W. Slattery
     Director

/s/ Anthony Luizzo                                         Date: April 11, 2000
----------------------
     Anthony Luizzo
     Secretary and Director



                                       23
<PAGE>


                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

--------------------------------------------------------------------------------
                                                                        CONTENTS



                                                                           Page
                                                                           ----


INDEPENDENT AUDITORS' REPORT                                                 F-2


CONSOLIDATED FINANCIAL STATEMENTS

  Balance Sheet                                                          F-3 - 4
  Statements of Operations                                                   F-5
  Statements of Changes in Stockholders' Equity                              F-6
  Statements of Cash Flows                                               F-7 - 8


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                              F-9 - 18


                                      F-1
<PAGE>



                          INDEPENDENT AUDITORS' REPORT




To the Stockholders and Board of Directors of
Accufacts Pre-Employment Screening, Inc and Subsidiary.


We have  audited  the  accompanying  consolidated  balance  sheet  of  Accufacts
Pre-Employment  Screening,  Inc. and subsidiary as of December 31, 1999, and the
related consolidated  statements of operations,  changes in stockholders' equity
and cash flows for the two years then ended. These financial  statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

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

In our opinion, the consolidated  financial statements referred to above present
fairly,  in  all  material   respects,   the  financial  position  of  Accufacts
Pre-Employment  Screening  Inc. and  subsidiary as of December 31, 1999, and the
results of their consolidated  operations and their cash flows for the two years
then ended, in conformity with generally accepted accounting principles.




/s/ Marcum & Kliegman LLP

March 14, 2000
New York, New York


                                      F-2
<PAGE>


                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                                      CONSOLIDATED BALANCE SHEET

                                                               December 31, 1999
--------------------------------------------------------------------------------


<TABLE>
<S>                                                                   <C>           <C>
                                     ASSETS



CURRENT ASSETS
 Cash                                                                 $  298,331
 Accounts receivable, net of allowance for doubtful accounts
  of $4,836                                                              636,463
                                                                      ----------

       Total Current Assets                                                         $  934,794


PROPERTY AND EQUIPMENT, Net                                                            155,084


OTHER ASSETS
 Security deposits                                                         8,554
 Prepaid expense                                                          68,572
 Deferred income tax asset                                               185,600
 Intangible assets, net                                                  157,632
                                                                      ----------


       Total Other Assets                                                              420,358
                                                                                    ----------


       TOTAL ASSETS                                                                 $1,510,236
                                                                                    ==========
</TABLE>


      The accompanying notes are an integral part of these financial statements.


                                      F-3
<PAGE>


                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                                      CONSOLIDATED BALANCE SHEET

                                                               December 31, 1999
--------------------------------------------------------------------------------


<TABLE>
<S>                                                                   <C>           <C>
                      LIABILITIES AND STOCKHOLDERS' EQUITY


CURRENT LIABILITIES
 Accounts payable and accrued expenses                                $   194,056
 Current maturities of capital lease obligations                            8,295
 Note payable, bank                                                        43,274
 Loans payable, stockholder                                                21,280
 Deferred income tax liability                                            184,000
                                                                      -----------

       Total Current Liabilities                                                    $   450,905

OTHER LIABILITIES
 Capital lease obligations, less current maturities                                       1,465
                                                                                    -----------

       TOTAL LIABILITIES                                                                452,370

COMMITMENTS

STOCKHOLDERS' EQUITY
 Preferred stock, $.01 par value, 5,000,000 shares authorized,
  none issued and outstanding                                                  --
 Common stock, $0.01 par value, 50,000,000 authorized,
   6,627,471 issued and outstanding                                        66,275
 Additional paid-in-capital                                             1,319,821
 Accumulated deficit                                                     (328,230)
                                                                      -----------

       TOTAL STOCKHOLDERS' EQUITY                                                     1,057,866
                                                                                    -----------

       TOTAL LIABILITIES AND
        STOCKHOLDERS' EQUITY                                                        $ 1,510,236
                                                                                    ===========
</TABLE>

      The accompanying notes are an integral part of these financial statements.


                                      F-4
<PAGE>

                         ACCUFACTS PRE-EMPLOYMENT SCREENING, INC. AND SUBSIDIARY

                                           CONSOLIDATED STATEMENTS OF OPERATIONS

                                  For the Years Ended December 31, 1999 and 1998
--------------------------------------------------------------------------------



                                                        1999           1998
                                                     -----------    -----------

REVENUES                                             $ 2,283,533    $ 1,598,772


COST OF SALES                                          1,531,924      1,119,043
                                                     -----------    -----------


       GROSS PROFIT                                      751,609        479,729


GENERAL AND ADMINISTRATIVE EXPENSES                    1,008,012        552,474
                                                     -----------    -----------


       OPERATING LOSS                                   (256,403)       (72,745)


OTHER INCOME (EXPENSE)
 Interest income (expense), net                            4,857        (10,031)
                                                     -----------    -----------


       LOSS BEFORE INCOME TAXES                         (251,546)       (82,776)


INCOME TAX (BENEFIT) EXPENSE                             (35,980)        42,105
                                                     -----------    -----------


       NET LOSS                                      $  (215,566)   $  (124,881)
                                                     ===========    ===========


Net (Loss) Per Share, Basic and Diluted              $     (0.03)   $     (0.02)
                                                     ===========    ===========


Weighted average number of common shares outstanding   6,228,556      5,181,096
                                                     ===========    ===========


      The accompanying notes are an integral part of these financial statements.


                                      F-5
<PAGE>

                         ACCUFACTS PRE-EMPLOYMENT SCREENING, INC. AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

                                  For the Years Ended December 31, 1999 and 1998
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                                   Common Stock
                                                                            --------------------------
                                                    Preferred Stock                   Shares                              Additional
                                              --------------------------    --------------------------                     Paid in
                                                Shares         Amount        Subscribed      Issued         Amount         Capital
                                              -----------    -----------    -----------    -----------    -----------    -----------
<S>                                                  <C>     <C>              <C>            <C>          <C>            <C>
BALANCE - January 1, 1998                            --             --      $      --              200    $     5,380    $      --


Issuance of shares resulting from merger                                                     3,750,000         37,500

Recapitalization resulting from merger                                                         999,800          4,620

Issuance of shares for consulting services                                                   1,200,000         12,000

Issuance of shares in connection with the
  Offering, net of offering costs                                                              125,000          1,250        198,220

Common stock subscribed in connection with
  the Offering                                                                  375,500                         3,750        746,250

Stock subscription receivable in connection
  with the Offering

Net loss
                                              -----------    -----------    -----------    -----------    -----------    -----------


BALANCE - December 31, 1998                                                     375,500      6,075,000         64,500        944,470


Stock subscription received                                                    (375,000)       375,000

Issuance of shares relating to acquisition                                                     174,971          1,750        370,063

Issuance of shares relating to
  non-competition agreement                                                                      2,500             25          5,288

Net loss
                                              -----------    -----------    -----------    -----------    -----------    -----------
BALANCE - December 31, 1999                          --      $      --             --        6,627,471    $    66,275    $ 1,319,821
                                              ===========    ===========    ===========    ===========    ===========    ===========

<CAPTION>


                                                     Stock
                                                 Subscription    Accumulated
                                                  Receivable       Deficit        Total
                                                  -----------    -----------   -----------
<S>                                               <C>            <C>
BALANCE - January 1, 1998                         $      --      $    55,687   $    61,067


Issuance of shares resulting from merger                             (37,500)           --

Recapitalization resulting from merger                                (5,970)       (1,350)

Issuance of shares for consulting services                                          12,000

Issuance of shares in connection with the
  Offering, net of offering costs                                                  199,470

Common stock subscribed in connection with
  the Offering                                                                     750,000

Stock subscription receivable in connection
  with the Offering                                  (750,000)                    (750,000)

Net loss                                                            (124,881)     (124,881)
                                                  -----------    -----------   -----------


BALANCE - December 31, 1998                          (750,000)      (112,664)      146,306


Stock subscription received                           750,000                      750,000

Issuance of shares relating to acquisition                                         371,813

Issuance of shares relating to
  non-competition agreement                                                          5,313

Net loss                                                            (215,566)     (215,566)
                                                  -----------    -----------   -----------
BALANCE - December 31, 1999                       $      --      $  (328,230)   $ 1,057,866
                                                  ===========    ===========   ===========
</TABLE>


      The accompanying notes are an integral part of these financial statements.


                                      F-6
<PAGE>


                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                           CONSOLIDATED STATEMENTS OF CASH FLOWS

                                  For the Years Ended December 31, 1999 and 1998
--------------------------------------------------------------------------------

                                                            1999         1998
                                                         ---------    ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                                 $(215,566)   $(124,881)
                                                         ---------    ---------
Adjustments to reconcile net loss to net cash used in
 operating activities:
  Depreciation and amortization                             44,330       33,358
  Increase in accounts receivable                         (119,593)     (60,515)
  Increase in prepaid expense                              (68,572)        --
  Increase in security deposits                               --           (508)
  Increase in accounts payable and accrued expenses          6,074        6,332
  Increase (decrease) in deferred income taxes             (41,600)      40,000
                                                         ---------    ---------

    TOTAL ADJUSTMENTS                                     (179,361)      18,667
                                                         ---------    ---------

    NET CASH USED IN OPERATING ACTIVITIES                 (394,927)    (106,214)
                                                         ---------    ---------

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchases of property and equipment                      (23,702)     (25,233)
  Payment for intangible asset                             (21,000)     (19,000)
  Cash acquired in connection with acquisition               4,348         --
                                                         ---------    ---------

       NET CASH USED IN INVESTING ACTIVITIES               (40,354)     (44,233)
                                                         ---------    ---------

CASH FLOWS FROM FINANCING ACTIVITIES
  Repayments on capital lease obligations                   (9,179)      (6,395)
  Net repayments of note payable, bank                     (54,706)      (5,786)
  Repayments on stockholder's loans                         (5,000)        --
  Proceeds from issuance of common stock                   750,000      250,000
  Payments for the offering costs                             --        (38,530)
                                                         ---------    ---------

       NET CASH PROVIDED BY FINANCING ACTIVITIES           681,115      199,289
                                                         ---------    ---------

    NET INCREASE IN CASH                                   245,834       48,842

CASH - Beginning                                            52,497        3,655
                                                         ---------    ---------

CASH - Ending                                            $ 298,331    $  52,497
                                                         =========    =========

      The accompanying notes are an integral part of these financial statements.


                                      F-7
<PAGE>

                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                CONSOLIDATED STATEMENTS OF CASH FLOWS, Continued

                                  For the Years Ended December 31, 1999 and 1998
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

                                                                         1999       1998
                                                                       --------   --------
<S>                                                                    <C>        <C>
Cash paid during the years for:
     Interest                                                          $  6,192   $ 10,066
     Income taxes                                                      $  4,529   $  1,034

Non-cash investment and financing activities:

  Acquired assets through capital leases                               $   --     $ 25,334
  Subscription receivable for common stock subscribed in
   connection with the Offering                                        $   --     $750,000
  Issuance of shares resulting from merger                             $371,813   $ 37,500
  Issuance of shares for consulting services                           $   --     $ 12,000
  Accounts payable acquired in connection with the merger              $   --     $  1,350
  Issuance of shares resulting from collection of stock subscription   $750,000   $   --
  Issuance of shares relating to a non-competition agreement           $  5,313   $   --

  The Company  acquired the following  assets and liabilities in connection with
  its acquisition of Maglio, Inc. during the year ended December 31, 1999:

  Accounts receivable                                                  $227,475
  Property and equipment                                                 84,296
  Security deposit                                                        5,846
  Accounts payable                                                      (35,632)
  Notes payable                                                         (34,645)
                                                                       --------
  Total                                                                $247,340
                                                                       ========
</TABLE>

      The accompanying notes are an integral part of these financial statements.


                                      F-8
<PAGE>

                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 1 - Summary of Significant Accounting Policies

     Nature of Business

     Accufacts Pre-Employment  Screening, Inc. ("Accufacts") was incorporated on
     October  6, 1994 in the State of New York.  On August 31,  1998,  Accufacts
     consummated  a  merger  with  a  public  shell,   Southern   Cargo  Company
     ("Southern"),  a Florida  corporation.  Southern  simultaneously  with this
     merger changed its name to Accufacts Pre-Employment Screening Inc. ("APES")
     and shortly thereafter  re-incorporated in the State of Delaware. Under the
     terms  of the  merger  all of the  outstanding  shares  of  Accufacts  were
     acquired by Southern in exchange for 3,750,000  shares of  Southern's  $.01
     par value common  stock.  This  transaction  was accounted for as a reverse
     acquisition whereby Accufacts was the acquirer for accounting purposes. The
     historical  financial  statements  prior to August  31,  1998 were those of
     Accufacts.

     APES  and its  subsidiary  acts as an  information  service  bureau  and is
     engaged  primarily in the business of verifying  job  applicant  background
     information for employers using databases and a national  network of agents
     throughout the United States.

     Business Combination

     On October 13, 1999,  APES  acquired all of the net assets of Maglio,  Inc.
     ("Maglio"),  a  Florida  corporation,  by  merging  Maglio  with  and  into
     Maglio-Accufacts  Pre-Employment  Screening, Inc. ("MAPES"), a wholly-owned
     subsidiary established by APES. The acquisition was accounted for using the
     purchase  method of accounting and was completed by issuing  177,471 shares
     of APES  common  stock  consisting  of  174,971  shares of common  stock in
     consideration  for the  acquisition  and  2,500  share of  common  stock in
     consideration  for a stockholder of Maglio entering into a  non-competition
     agreement.  The  purchase  price  over  the fair  value  of the net  assets
     acquired was $120,125 and is being amortized using the straight-line method
     over 20 years. The fair value of the  non-competition  agreement was $5,313
     and is being amortized using the straight-line  method over the term of the
     agreement (see Note 3).

     Principles of Consolidation

     The  Consolidated  financial  statements  include the  accounts of APES and
     MAPES,  collectively  referred  to as the  "Company".  The  operations  and
     financial  position of MAPES were  included in the  consolidated  financial
     statements   since  October  13,  1999.   All   significant   accounts  and
     transactions have been eliminated in the consolidation.


                                      F-9
<PAGE>

                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 1 - Summary of Significant Accounting Policies, continued

     Property and Equipment and Depreciation

     Property and equipment are recorded at cost. Depreciation is computed using
     the straight-line method over the expected useful lives of the assets. Upon
     retirement or other disposition of depreciable assets, the cost and related
     accumulated  depreciation are eliminated from the accounts, and any gain or
     loss on disposal is credited to or charged against income.  In the event of
     a trade in, the undepreciated  cost of the trade-in is included in the cost
     of the newly acquired asset.

     Revenue Recognition

     Revenues are recorded at the time of performance of service.

     Cash

     The  Company  has cash  balance in a bank in excess of the  maximum  amount
     insured by the FDIC as of December 31, 1999.

     Advertising Cost

     Advertising  costs are expensed as incurred.  For the years ended  December
     31,  1999  and  1998,   advertising   expense  was  $34,128  and   $15,378,
     respectively.

     Income Taxes

     The Company's method of accounting for income taxes is the liability method
     required by FASB Statement No. 109  "Accounting  for Income Taxes".  Income
     taxes are  provided  for the tax  effects of  transactions  reported in the
     financial statements and consist of taxes currently due and deferred taxes.
     The Company will file a consolidated federal tax return in 1999.

     Computer Software

     The Company adopted Statement of Position ("SOP") 98-1, "Accounting for the
     Costs of Computer  Software  Developed or Obtained for Internal  Use".  SOP
     98-1 establishes the accounting for costs of software products developed or
     purchased   for  internal  use,   including   when  such  costs  should  be
     capitalized. In accordance with SOP 98-1, payroll and payroll-related costs
     incurred  directly  associated with the internal-use  software project were
     capitalized  by the Company and such  capitalized  costs are amortized on a
     straight-line basis over three years.

     Net Income (Loss) Per Share

     In February 1997, the Financial  Accounting  Standards  Board (FASB) issued
     Statement of Financial  Accounting  Standards No. 128, "Earnings Per Share"
     ("SFAS 128"),  which is required to be adopted  beginning  with the quarter
     ended December 31, 1997. The Company adopted SFAS 128, which eliminates the
     presentation  of primary and fully  diluted  earnings per share ("EPS") and
     requires the  presentation  of basic and diluted EPS. Net income (loss) per
     share is computed based on the weighted  average number of shares of common
     stock  outstanding  during the periods.  Common stock  equivalents were not
     included in the calculation of diluted  earnings per share in 1999 and 1998
     as such inclusion would be antidiluted.



                                      F-10
<PAGE>

                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 1 - Summary of Significant Accounting Policies, continued

     Use of Estimates in the Financial Statements

     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 and
     disclosure  of  contingent  assets  and  liabilities  at  the  date  of the
     financial  statements  and the  reported  amounts of revenues  and expenses
     during  the  reporting  period.  Actual  results  could  differ  from those
     estimates.

     Fair Value of Financial Instruments

     The Company's  financial  instruments include cash, accounts receivable and
     accounts payable.  Due to the short-term nature of these  instruments,  the
     fair value of these  instruments  approximate  their  recorded  value.  The
     Company has other  liabilities,  which it  believes is stated at  estimated
     fair market value.

     Impairment of Long-Lived Assets

     Property and equipment and  intangible  assets are reviewed for  impairment
     whenever  events or changes in  circumstances  indicate  that the  carrying
     amount may not be recoverable. If the sum of the expected undiscounted cash
     flows is less  than the  carrying  value of the  related  asset or group of
     assets, a loss is recognized for the difference  between the fair value and
     carrying value of the asset or group of assets.

     Stock-Based Compensation

     In October 1995, SFAS No. 123,  "Accounting  for Stock-Based  Compensation"
     was issued. SFAS 123 prescribes  accounting and reporting standards for all
     stock-based   compensation   plans,   including   employee  stock  options,
     restricted  stock,  employee stock  purchase  plans and stock  appreciation
     rights. SFAS 123 requires compensation expense to be recorded (i) using the
     new fair  value  method or (ii)  using the  existing  rules  prescribed  by
     Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to
     Employees" ("APB 25") and related interpretations with pro forma disclosure
     of what net income and  earnings  per share would have been had the Company
     adopted  the new fair value  method.  The  Company  intends to  continue to
     account  for its stock  based  compensation  plans in  accordance  with the
     provisions of APB 25.

     Comprehensive Income

     During the year ended December 31, 1998, the Company adopted FASB Statement
     No. 130, "Reporting  Comprehensive  Income" ("SFAS 130"). SFAS 130 requires
     the  reporting  of  comprehensive  income in  addition  to net income  from
     operations.  Comprehensive  income is a more inclusive  financial reporting
     methodology that includes disclosure of certain financial  information that
     historically has not been recognized in the calculation of net income.  The
     adoption of SFAS 130 and the related  required  disclosures have no effects
     on the financial statements for the years ended December 31, 1999 and 1998.


                                      F-11
<PAGE>


                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 1 - Summary of Significant Accounting Policies, continued

     Reporting of Segments

     In June 1997, the FASB issued SFAS No. 131,  "Disclosures about Segments of
     an  Enterprise  and  Related  Information",   effective  for  fiscal  years
     beginning after December 15, 1997, with reclassification of earlier periods
     required for  comparative  purposes.  SFAS No. 131 establishes the criteria
     for  determining  an  operating  segment  and  establishes  the  disclosure
     requirements  for  reporting  information  about  operating  segments.  The
     Company has determined  that under SFAS No. 131, it operates in one segment
     of service and its customers and operations are within the United States.

     Pensions and Other Benefit Plans

     In February  1998,  the FASB issued SFAS No. 132,  "Employers'  Disclosures
     about  Pensions and Other  Postretirement  Benefits",  effective for fiscal
     years beginning  after December 15, 1997,  with  restatement of disclosures
     for earlier periods required for comparative purposes. SFAS No. 132 revises
     certain  employers'  disclosures  about  pension and other  post-retirement
     benefit  plans.   The  Company  adopted  this  standard  in  1998  and  the
     implementation  of this  standard did not have any impact on its  financial
     statements.

     Start-up Activities Costs

     In April 1998,  the ASEC of AICPA  issued SOP No. 98-5,  "Reporting  on the
     Costs of Start-up  Activities",  and effective  for fiscal years  beginning
     after December 15, 1998. SOP 98-5 requires the costs of start-up activities
     and organization costs to be expensed as incurred. The Company adopted this
     standard in 1999 and the implement of this standard did not have a material
     impact on its financial statements.

     Accounting Developments

     In June 1998,  the FASB  issued SFAS No. 133,  "Accounting  for  Derivative
     Instruments and Hedging  Activities",  effective for fiscal years beginning
     after June 15, 1999, which has been deferred to June 15, 2000 by publishing
     of SFAS  No.  137.  SFAS  No.  133  establishes  accounting  and  reporting
     standards  for  derivative   instruments,   including  certain   derivative
     instruments  embedded  in  other  contracts  (collectively  referred  to as
     derivatives),  and for hedging activities.  This Statement requires that an
     entity  recognize all  derivatives  as either assets or  liabilities in the
     statement of financial  condition  and measure  those  instruments  at fair
     value.  The  accounting  for  changes  in the fair  value  of a  derivative
     instrument depends on its intended use and the resulting  designation.  The
     Company  does not expect  that the  adoption of this  standard  will have a
     material impact on its financial statements.


                                      F-12
<PAGE>


                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 2 - Property and Equipment

     Property and equipment is comprised of the following at December 31, 1999:

                                                               Estimated Useful
                                              Amount                 Lives
                                            ------------       -----------------
       Furniture                             $  56,134              7 years
       Telephone equipment                       6,843
       Equipment                               141,161              5 years
       Computer software                        62,612              3 years
                                             ---------
                                               266,750

       Less: accumulated depreciation          111,666
                                             ---------

            Property and equipment, net      $ 155,084
                                             =========

     Depreciation  expense  for the  years  ended  December  31,  1999  and 1998
     amounted to $38,741 and $31,141 respectively.


NOTE 3 - Intangible Assets

     Intangible assets at December 31, 1999 consists of the following:

                                                               Estimated Useful
                                              Amount                 Lives
                                            ------------       -----------------
       Customer lists                        $  19,000              5 years
       Goodwill                                141,125             20 years
       Non-competition covenant                  5,313              3 years
                                             ---------
                                               165,438

       Less: accumulated amortization            7,806
                                             ---------

            Non-competition covenant, net    $ 157,632
                                             =========

     Amortization  expense  for the  years  ended  December  31,  1999  and 1998
     amounted to $5,589 and $2,217, respectively.


                                      F-13
<PAGE>

                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 4 - Note Payable, Bank

     The Company has a $75,000 line of credit with a bank through June 30, 2000.
     The line bears interest at prime plus 2%, is secured by  substantially  all
     of the assets of the Company and is personally  guaranteed by a stockholder
     of the Company.

     The  Company  also has a $25,000  business  checking  line of credit with a
     bank.  The credit  line bears  interest  at prime plus 6% and is secured by
     substantially  all of the assets of the  Company.  There is no  outstanding
     balance under this line at December 31, 1999.


NOTE 5 - Loans Payable, Stockholder

     Loans payable, stockholder represents advances made by a stockholder of the
     Company   through  the  normal  course  of  business.   Such  advances  are
     noninterest-bearing with no definitive repayment terms.


NOTE 6 - Stockholders' Equity

     At inception,  Accufacts  authorized  and issued 200 shares of no par value
     common stock for $5,380.  On August 31, 1998, the Company issued  3,750,000
     shares of its, $.01 par value,  common stock in connection  with the merger
     between   Accufacts  and  Southern  which  has  been  accounted  for  as  a
     recapitalization (see Note 1). In addition, historical stockholders' equity
     of  Accufacts  prior  to the  merger  was  retroactively  restated  for the
     equivalent  number of shares  received in the merger after giving effect to
     the difference in par value of Accufacts and Southern. As a result, 999,800
     shares  of  common  stock  were   recapitalized  by  the  Company  for  the
     restorative  effects  of the  recapitalization.  The  Company  also  issued
     1,200,000  of the  Company's  $.01 par value  common  stock for  consulting
     services rendered.

     On September 15, 1998, the Company offered to sell as part of the placement
     offering pursuant to Rule 504 of Regulation D of the Securities Act of 1933
     a minimum of 25,000 shares and a maximum of 500,000 shares of the Company's
     $.01 par value  common  stock at an offering  price of $2.00 per share (the
     "Offering").  The  Offering  was  completed  on December  18, 1998  whereby
     125,000  shares were sold and 375,000 shares were  subscribed  for. The net
     proceeds  from  the  sale of the  common  stock at  December  31,  1998 was
     $199,470,  net of direct related costs of $50,530.  The stock subscriptions
     in the amount of $750,000 were received  during 1999 and 375,000  shares of
     common stock were issued.

     On October 13,  1999,  the Company  issued  177,471  shares of its $.01 par
     value common stock in  connection  with the  acquisition  of Maglio and for
     entering into a non-competition agreement with a stockholder of Maglio (see
     Note 1).


                                      F-14
<PAGE>


                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 7 - Income Taxes

     Prior to the August 31, 1998 merger,  the Company elected to be taxed as an
     S corporation  for federal and state income tax purposes.  Pursuant to this
     election, earnings or losses were subject to tax at the stockholder's level
     rather than the corporate level. As a result of the August 31, 1998 merger,
     the S  Corporation  status was  terminated.  In addition,  the Company also
     prepares its tax returns on the cash basis and the financial  statements on
     the accrual basis which results in temporary differences.

     The income tax expense  (benefit) for the years ended December 31, 1999 and
     1998 consists of the following:

                                               1999                 1998
                                           -------------        -------------
         Current:
              Federal                          $     --            $    --
              State                               4,320              2,105
              Local                               1,300                 --
                                               --------            -------

         Deferred:
              Federal                           (16,000)            30,000
              State                             (11,600)            10,000
              Local                             (14,000)                --
                                               --------            -------

                                               $(35,980)           $42,105
                                               ========            =======

     The  components  of deferred  tax asset  (liability)  at December  31, 1999
     consist of the following:

         Current
           Cash basis accounting adjustment                      $ (184,000)

         Non-Current
           Net operating loss carryforward                          185,600
                                                                 ----------

           Deferred Tax Asset, Net                               $    1,600
                                                                 ==========

     The  following  is a  reconciliation  of income tax computed at the Federal
     Statutory rate to the provision for taxes:


                                      F-15
<PAGE>

                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 7 - Income Taxes, continued

                                                             1999        1998
                                                           --------    --------
     Federal tax (benefit) computed at statutory rate      $(73,292)   $(42,460)
     State and local tax (benefit) net of federal benefit   (19,980)      1,389
     Cash basis adjustments and tax implications resulting
       from termination of S corporation status              57,292      83,176
                                                           --------    --------

                                                           $(35,980)   $ 42,105
                                                           ========    ========

     At December 31,  1999,  based upon tax returns  filed and to be filed,  the
     Company has net  operating  loss  carryforward  for federal tax purposes of
     approximately $417,000 which will expire in year 2019.


NOTE 8 - Commitments

     Capitalized Lease Obligation

     The Company  obtained  equipment under two capital leases expiring  through
     the year 2001. The assets and liabilities under capital leases are recorded
     at the lower of the present value of the minimum lease payments or the fair
     values of the asset.  The assets are included in property and equipment and
     are being depreciated over the assets estimated useful lives.

     Minimum  future lease payments under capital leases as of December 31, 1999
     for each of the next two years, and in aggregate, are as follows:

     For the Year Ending
         December 31,          Principal        Interest             Total
     --------------------------------------------------------- -----------------
             2000               $8,295            $ 721            $ 9,016
             2001                1,465               32              1,497
                                ------            -----            -------
              Total             $9,760              753            $10,513
                                ======            =====            =======

     Interest  rate on  these  two  capitalized  leases  are  13.1%  and  14.2%,
     respectively, and is imputed based on the lessor's implicit rate of return.
     Monthly  payments of $499 and $433 are payable  through March 2001 and July
     2000, respectively.

     Operating Lease Agreement

     The Company is obligated under a  noncancelable  operating lease for office
     space expiring March 2003. The Company also rents another  premises under a
     noncancelable operating lease which expires July 2003. Rent expense for the
     years  ended   December   31,  1999  and  1998  was  $43,090  and  $26,400,
     respectively.


                                      F-16
<PAGE>

                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 8 - Commitments, continued

     Operating Lease Agreement, continued

     Future minimum  rental  payments  under the above  noncancelable  operating
     leases as of December 31, 1999 are as follows:

              For the Year Ending
                 December 31,                    Amount
          ----------------------------     ------------------
                     2000                       $ 82,997
                     2001                         85,377
                     2002                         87,165
                     2003                         41,602
                                                --------

                          Total                 $297,141
                                                ========

     Employment Agreements

     On September 1, 1998,  the Company  entered into two  five-year  employment
     agreements with two officers whereby the Company will pay a total salary of
     $200,000 per annum. At December 31, 1999, total future minimum  commitments
     under these two agreements are $734,000.

     On October 11,  1999,  the company  entered  into a  three-year  employment
     agreement with an executive  whereby the Company will pay a total salary of
     $75,000 per annum plus stock  options.  At December 31, 1999,  total future
     minimum commitments under this agreement was $209,000.


NOTE 9 - Stock Options

     In October 1999, the Company granted options,  to purchase 50,000 shares of
     its common stock,  to an executive at an exercise price of $2.50 per share.
     These options will be  exercisable  on the first  anniversary  of the grant
     date, therefore as of December 31, 1999, the options are not vested and the
     proforma  net loss and net loss per  share are the same as net loss and net
     loss per share as reported in the accompanying statements of operations.

     Pro forma  information  regarding  net  income  and  earnings  per share is
     required  by SFAS  123,  and has  been  determined  as if the  Company  had
     accounted  for its employee  stock  options  under the fair value method of
     SFAS 123. The fair market value for these options was estimated at the date
     of grant using a Black-Scholes  option-pricing  model amounted to $1.53 per
     share with the following  weighted-average  assumptions  for the year ended
     December 31, 1999:


                                      F-17
<PAGE>


                                        ACCUFACTS PRE-EMPLOYMENT SCREENING, INC.
                                                                  AND SUBSIDIARY

                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 9 - Incentive Stock Option Plan, continued

     Expected volatility                                       1.014
     Dividend yield                                               --
     Risk-free rate                                            5.87%
     Average life                                             3 year

     The  Black-Scholes   option  valuation  model  was  developed  for  use  in
     estimating  the  fair  value  of  traded  options,  which  have no  vesting
     restrictions  and are fully  transferable.  In addition,  option  valuation
     models  require the input of highly  subjective  assumptions  including the
     expected stock price  volatility.  Because of the Company's  employee stock
     options  have  characteristics  significantly  different  from those traded
     options,  and  because  changes in the  subjective  input  assumptions  can
     materially  affect the fair value estimate,  in management's  opinion,  the
     existing models do not necessarily provide a reliable single measure of the
     fair value of its employee stock options.


                                      F-18
<PAGE>


                                    Exhibits

Exhibit
  No.                             Description
-------                           -----------

 3.3  Certificate of Incorporation of Maglio-Accufacts Pre-Employment Screening,
      Inc.

 3.4  By-laws of Maglio-Accufacts Pre-Employment Screening, Inc.

10.4  Employment Agreement, dated October 11, 1999, by and among the Registrant,
      Maglio-Accufacts Pre-Employment Screening, Inc. and Richard J. Maglio

10.5  Lease Agreement, dated April 1, 1997, between the Registrant and 6 Greene
      Street Associates, LLC., as amended

10.6  Lease Agreement, dated August 28, 1998, between Maglio, Inc. and CB
      Sanlando Center, Inc.

21.1  List of Subsidiaries

27.1  Financial Data Schedule