UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington D.C. 20549
                                    ---------

                                   FORM 10-QSB

                Quarterly Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

For the quarter ended October 31, 1998       Commission File Number 33-14576-D
                      ----------------                      ----------

                         ELLIGENT CONSULTING GROUP, INC.
             (Exact name of registrant as specified in its charter)

                Nevada                                      87-0453842
            (State or other jurisdiction of              (I.R.S. Employer
            incorporation or organization)              Identification No.)

            152 West 57th Street, 40th Floor
            New York, New York                                 10019
            (Address of principal executive offices)        (Zip code)

Registrant's telephone number, including area code:     (212) 765-2915



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the  Securities  and  Exchange Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                              Yes   X      No      

Indicate  the number of shares  outstanding  of each  class of the  Registrant's
Common Stock.

The  Registrant has only one class of Common Stock  outstanding.  As of November
30,  1998,  there  were  14,544,225  shares  of the  Registrant's  Common  Stock
outstanding.

Transitional Small Business Disclosure Format (check one)

                              Yes          No   X  



<PAGE>



ELLIGENT CONSULTING GROUP, INC.
------------------------------------------------------------------------------


INDEX TO FORM 10-QSB
------------------------------------------------------------------------------



                                                              Page to Page
Part I.  Financial Information

Item 1.  Financial Statements

Consolidated Balance Sheet as of October 31, 1998 [Unaudited]    1.....

Consolidated Statements of Operations for the three months ended
October 31, 1998 and 1997 [Unaudited].......................     2.....

Consolidated Statement of Stockholders' Equity for the three months
ended October 31, 1998 and 1997 [Unaudited].................     3.....

Consolidated Statements of Cash Flows for the three months ended
October 31, 1998 and 1997 [Unaudited].......................     4.....5

Notes to Consolidated Financial Statements [Unaudited]......     6.....10

Item 2.  Managements' Discussion and Analysis of Financial
         Condition and Results of Operations...................  11.....14

Part II.  Other Information

Item 2.  Changes in Securities and Use of Proceeds.............  15.....

Item 6.  Exhibits and Reports on Form 8-K......................  15.....

Signature......................................................  16.....



<PAGE>



ELLIGENT CONSULTING GROUP, INC.
------------------------------------------------------------------------------


BALANCE SHEET AS OF OCTOBER 31, 1998
[UNAUDITED]
------------------------------------------------------------------------------


<TABLE>


Assets:
Current Assets:
<S>                                                                     <C>        
  Cash in Bank                                                          $    47,944
  Trade Accounts Receivable - Net of Allowance
   for Doubtful Accounts of $56,689                                       4,013,966
  Due from Related Parties                                                  620,831
                                                                        -----------

  Total Current Assets                                                    4,682,741

Property and Equipment - Net of Accumulated Depreciation of $596,847        342,384

Goodwill - Net of Amortization of $151,173                               11,942,653

Other Assets                                                                154,926

  Total Assets                                                          $17,122,704

Liabilities and Stockholders' Equity:
Current Liabilities:
  Cash Overdraft                                                        $    82,055
  Bank Loans                                                              2,007,292
  Accounts Payable                                                        1,839,340
  Accrued Expenses and Other Liabilities                                    381,926
  Notes Payable - Related Parties                                         8,268,890
  Deferred Taxes Payable                                                    207,000
  Leases Payable - Current                                                   50,173
  Due to Related Parties                                                  1,528,623
                                                                        -----------

  Total Current Liabilities                                              14,365,299

Long-Term Liabilities:
  Bank Loans - Long-Term                                                     75,000
  Leases Payable - Long-Term                                                107,190

  Total Long-Term Liabilities                                               182,190

Commitment and Contingencies                                                     --

Stockholders' Equity:
  Common Stock - $0.001 Par Value; 50,000,000 Shares Authorized
   14,544,225 Shares Issued and Outstanding                                  14,544

  Capital in Excess of Par Value                                          3,014,005

  Accumulated Deficit                                                      (453,334)

  Total Stockholders' Equity                                              2,575,215

  Total Liabilities and Stockholders' Equity                            $17,122,704


See Accompanying Notes to Consolidated Financial Statements.

                                         1

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
------------------------------------------------------------------------------


STATEMENTS OF OPERATIONS
[UNAUDITED]
------------------------------------------------------------------------------



                                                              Three months ended
                                                                  October 31,
                                                             1 9 9 8       1 9 9 7
                                                             -------       -------

Income:
<S>                                                        <C>          <C>        
  Revenue                                                  $5,813,106   $        --
  Cost of Service                                           3,878,740            --
                                                           ----------   -----------

  Gross Profit                                              1,934,366            --
                                                           ----------   -----------

Cost and Expenses:
  General and Administrative                                1,808,311         6,848
  Depreciation                                                 56,974            --
  Amortization of Goodwill                                    151,173            --
                                                           ----------   -----------

  Total Cost and Expenses                                   2,016,458         6,848
                                                           ----------   -----------

  Operating Loss                                              (82,092)       (6,848)

Other Expense:
  Interest                                                   (224,484)           --
                                                           ----------   -----------

  Loss Before Income Taxes                                   (306,576)       (6,848)

Income Tax Benefit                                            (62,000)           --
                                                           ----------   -----------

  Net Loss                                                 $ (244,576)  $    (6,848)
                                                           ==========   ===========

  Basic and Diluted Loss Per Share                         $    (0.02)  $     (0.01)
                                                           ==========   ===========

  Weighted Average Number of Shares Outstanding            14,544,225       994,225
                                                           ==========   ===========



See Accompanying Notes to Consolidated Financial Statements.

                                         2

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
------------------------------------------------------------------------------


STATEMENTS OF STOCKHOLDERS' EQUITY
[UNAUDITED]
------------------------------------------------------------------------------




                                                                Deficit
                                                              Accumulated
                                                  Capital in  During the    Total
                  Common StockExcess ofAccumulatedStockholders'
                                Shares    Amount   Par Value    Deficit    Equity


<S>              <C> <C>      <C>       <C>       <C>         <C>        <C>      
  Balance - July 31, 1998     1,594,225 $  1,594  $ 386,955   $ (55,645) $ 332,904

Common Stock Issued in
Merger [11]                  12,950,000   12,950  2,627,050          --  2,640,000

Accumulated Deficit of
  Merged Company                     --       --         --    (153,113)  (153,113)

Net Loss for the Three Months
  Ended October 31, 1998             --       --         --    (244,576)  (244,576)
                              --------- --------  ---------   ---------  ---------

  Balance - October 31, 1998  14,544,225$ 14,544  $3,014,005  $(453,334) $2,575,215
                              ==================  ==========  =========  ==========



See Accompanying Notes to Consolidated Financial Statements.



                                         3

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
------------------------------------------------------------------------------


STATEMENTS OF CASH FLOWS
[UNAUDITED]
------------------------------------------------------------------------------



                                                              Three months ended
                                                                  October 31,
                                                             1 9 9 8       1 9 9 7
                                                             -------       -------
Operating Activities:
<S>                                                        <C>          <C>         
  Net Loss                                                 $ (244,576)  $    (6,848)
                                                           ----------   -----------
  Adjustments to reconcile Net Loss to
   Cash Provided by Operating Activities:
   Depreciation and Amortization                              208,147            --
   Deferred Income Taxes                                     (113,104)           --
   Imputed Interest                                           110,005            --

  Change in Assets and Liabilities:
   [Increase] Decrease in:
     Accounts Receivable                                   (1,027,573)           --
     Other Assets                                             (48,567)           --
     Due from Related Parties                                 (25,234)           --

   Increase [Decrease] in:
     Accounts Payable                                         259,563           367
     Accrued Expenses                                          88,364            --
     Due to Related Parties                                  (201,265)           --
                                                           ----------   -----------

   Total Adjustments                                         (749,664)          367
                                                           ----------   -----------

  Net Cash - Operating Activities                            (994,240)       (6,481)
                                                           ----------   -----------

Investing Activities:
  Payments for Property and Equipment                         (29,442)           --
  Cost of Acquisition                                         (41,104)           --
                                                           ----------   -----------

  Net Cash - Investing Activities                             (70,546)           --
                                                           ----------   -----------

Financing Activities:
  Decrease in Cash Overdraft                                  (17,106)           --
  Proceeds from Bank Loans                                    815,000            --
  Payments on Bank Loans                                      (14,583)           --
  Payments on Capital Leases                                   (4,277)           --
                                                           ----------   -----------

  Net Cash - Financing Activities                             779,034            --
                                                           ----------   -----------

  Net Decrease in Cash                                       (285,752)       (6,481)

Cash -Beginning of Years                                      333,696        14,338
                                                           ----------   -----------

  Cash - End of Years                                      $   47,944   $     7,857
                                                           ==========   ===========



See Accompanying Notes to Consolidated Financial Statements.

                                         4

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
------------------------------------------------------------------------------


STATEMENTS OF CASH FLOWS
[UNAUDITED]
------------------------------------------------------------------------------



                                                                  Years ended
                                                                  October 31,
                                                             1 9 9 8       1 9 9 7
                                                             -------       -------

Supplemental Disclosures of Cash Flow Information:
  Cash paid during the periods for:
<S>                                                        <C>          <C>        
   Interest                                                $  114,479   $        --
   Income Taxes                                            $       --   $        --

Supplemental Schedule of Non-Cash Investing and Financing Activities:
  During the three months ended  October 31, 1998,  the Company  acquired all of
the outstanding  common stock of Patra Capital in exchange for 12,950,000 shares
of its common stock.

  During the three months ended October 31, 1998,  Patra Capital acquired all of
the outstanding common stock of CSI in exchange for 1,100,000 shares of Elligent
common  stock,  notes  payable  of  $8,500,000,   with  a  discounted  value  of
$8,158,885,  and $1,500,000,  which was paid by a stockholder of the Company and
related  companies  owned  or  controlled  by a  principal  stockholder  of  the
Company..

  During the three months ended October 31, 1998, and 1997, the Company  entered
into capital leases for $113,154, and $-0-, respectively.





See Accompanying Notes to Consolidated Financial Statements.

</TABLE>
                                         5

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------------



NOTE 1-ORGANIZATION AND CORPORATE HISTORY

Elligent Consulting Group, Inc., (the "Company") was incorporated in February of
1987 under the laws of the state of Nevada as Coronado Ventures, Inc. During the
period  commencing  in  1990  through  1992,  the  Company  acquired   Tahoeview
Cablevision,  Inc.  ("Tahoe") and Weststar Group North ("North") and changed its
name to Weststar Group, Inc.  Subsequently,  Tahoe and North became subject to a
bankruptcy  proceeding,  which,  on July 31, 1996, was concluded by an Order and
Judgment from the Court regarding the Final  Distribution of Proceeds of Sale of
Assets  by the  Receiver.  The  Company  was not  named  as a  defendant  in the
bankruptcy  and was not  involved  in any  manner,  except  that it was the sole
shareholder of Tahoe and North. The conclusion of the aforementioned proceedings
resulted  in the Company  emerging  without any  business  operations  and being
deemed to be a new entity for financial statement  reporting purposes.  Pursuant
to the order and Judgment of the Court,  Tahoe and North were ordered  dissolved
and therefore, only the operations of the Company since July 31, 1996 (the "Date
of Inception"), are included in the accompanying financial statements.

In July of 1997,  the Company  changed  its name to Arena  Group,  Inc.  and two
shareholders of the Registrant,  Lloyd T. Rochford and Denny W. Nestripke,  were
elected as directors,  with the express  purpose of locating a business  venture
with which the Registrant could enter into a  Reorganization.  On July 23, 1998,
the Registrant,  through its wholly owned subsidiary Patra Acquisition,  Inc., a
Delaware corporation ("Patra Acquisition"), entered into a Non-Binding Letter of
Intent (the "Letter of Intent") with Patra Capital Ltd., a Delaware  corporation
("Patra  Capital").  The  Letter  of  Intent  provided  for the  execution  of a
definitive  merger  agreement (the "Merger  Agreement").  Pursuant to the Merger
Agreement,  Patra Capital merged with Patra  Acquisition and Patra Capital,  the
surviving  corporation  of the merger,  became a wholly owned  subsidiary of the
Registrant (the "Reorganization"). As part of the Reorganization, the Registrant
changed its name to Elligent Consulting Group, Inc. on July 31, 1998.

On September 21, 1998,  effective August 1, 1998, for accounting  purposes,  the
Company through its wholly owned subsidiary, Patra Capital, purchased Conversion
Services International,  Inc. ("CSI"). The operations of CSI are included in the
Company's results of operations commencing on August 1, 1998. In connection with
the acquisition of CSI, CSI's shareholders signed employment agreements with the
Company for three years.

NOTE 2-BASIS OF PRESENTATION

In the opinion of the Company,  the accompanying  unaudited interim consolidated
financial  statements  contain  all  adjustments   (consisting  of  only  normal
recurring  accruals)  necessary  make  the  interim  financial   statements  not
misleading The financial statements have been prepared pursuant to the rules and
regulations of the Securities and Exchange  Commission for quarterly  reports on
Form  10-QSB and do not  include  all of the  information  and note  disclosures
required by generally accepted accounting principles.

It is suggested that these financial  statements be read in conjunction with the
audited financial  statements and notes for the fiscal year ended July 31, 1998,
included in the Elligent Consulting Group, Inc. Form 10-KSB.

The  Company  was deemed to be a new entity for  financial  statement  reporting
purposes on July 31, 1996 [See Note 1] and was in the development  stage through
July 31,  1998.  The three  months  ended  October 31, 1998 is the first  period
during which it is considered an operating company.

                                        6

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #2
------------------------------------------------------------------------------



NOTE 3-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND OTHER
DISCLOSURES

Principles of Consolidation -- The accompanying unaudited consolidated financial
statements  include the accounts of Elligent  Consulting  Group,  Inc.,  and its
wholly owned subsidiary,  Conversion Services  International,  Inc. ("CSI"). All
significant  intercompany  balances and transactions have been eliminated in the
consolidation.

Property  and  Equipment  --  Property  and  equipment  are  stated at cost less
accumulated  depreciation  and  amortization  and includes  equipment held under
capital  lease  agreements.   Depreciation  and  amortization,   which  includes
amortization of leased equipment,  are computed using the  straight-line  method
over the estimated useful lives of the respective assets. Estimated useful lives
range from 3 to 5 years as follows:

Furniture and fixtures                    5 years
Computers and technological equipment     3 years

Revenue  recognition -- The Company  records revenue as services are provided to
its customers by its personnel (employees and consultants).

Income Taxes -- Income taxes are provided based upon the provisions of Statement
of  Financial  Accounting  Standards  ["SFAS"] No. 109,  "Accounting  for Income
Taxes," which requires  recognition of deferred tax  liabilities  and assets for
the expected  future tax  consequences  of events that have been included in the
financial statements or tax returns. Under this method, deferred tax liabilities
and  assets  are  determined  based  on the  difference  between  the  financial
statement  and tax bases of assets and  liabilities  using  enacted tax rates in
effect for the year in which the differences are expected to reverse.

Use of Estimates -- The  preparation of financial  statements in conformity with
generally accepted  accounting  principles requires management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities 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.

Concentration  of Credit Risk -- The Company  extends credit to customers  which
results in accounts receivable arising from its normal business  activities.  It
routinely  assesses  the  financial  strength  of its  customers  and based upon
factors  surrounding  their credit risk  believes  that its accounts  receivable
credit risk exposure is limited. Such estimate of the financial strength of such
customers may be subject to change in the near future.  The Company's  largest 5
clients,  when  combined,  account for 41% of total revenues and 56% of accounts
receivable.  The Company's largest client accounts for 26% of the total revenues
and 36% of accounts receivable.

Basic and Diluted  Loss per Common Share -- During the year ended July 31, 1998,
the Company adopted Statement of Financial  Accounting Standards (SFAS) No. 128,
Earnings  Per  Share.  Under  SFAS 128,  loss per common  share is  computed  by
dividing  net loss  available  to common  stockholders  by the  weighted-average
number of common shares  outstanding  during the period.  Diluted loss per share
reflects  the  potential  dilution  which could occur if all  contracts to issue
common stock were  exercised  or converted  into common stock or resulted in the
issuance of common stock. In the Company's  present  position,  diluted loss per
share is the same as basic loss per share.  The  effect of the new  standard  on
prior years was immaterial; accordingly, prior periods have not been restated.


                                        7

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #3
------------------------------------------------------------------------------



NOTE 4-INTERIM RESULTS

The results of operations  for the three months ended October 31, 1998,  are not
necessarily  indicative  of the results to be expected  for the year ending July
31, 1999.

NOTE 5-DUE FROM RELATED PARTIES

Due from related parties  includes  amounts due from the shareholders of CSI and
an entity  wholly owned by a major  stockholder.  Repayment  terms have not been
established. These amounts will be received during 1999.

NOTE 6-BANK LOANS

Bank loans include the outstanding  amount of a revolving line of credit through
Summit Bank  ("Summit"),  in New Jersey,  that is used to finance the  Company's
accounts  receivable.  The line of credit is limited to the lesser of $1,850,000
or 80% of eligible  receivables  under 90 days aged.  Interest is payable on the
outstanding  balance  under  this  line of  credit  at the rate of  1.50%  above
Summit's prime rate. At December 8, 1998,  Summit's prime rate was 7.75%.  There
was a balance of $1,850,000  outstanding under this line of credit as of October
31, 1998. The line is collateralized by accounts receivable and equipment and is
due on January 1, 1999.

Additional debt consists of installment loans at interest rates ranging from 10%
to !0.50% due through April 2001.

NOTE 7-NOTES PAYABLE--Related Parties

Notes payable--related  parties represent amounts due to the Stockholders of CSI
as a result of its  acquisition  by Patra  Capital.  Total  notes  payable as of
October 31, 1998, are  $8,500,000,  with a discounted  value of $8,268,890.  The
payments are due as follows:

                       $1,000,000  November 24, 1998
                       $1,500,000  January 21, 1999 (payable in cash or stock at
                                   the option of the Company)
                       $3,750,000  May 1, 1999
                       $2,250,000  August 1, 1999

Interest at 8% is payable on the November  24th and January 21st  payments.  The
final  two  payments  bear no  interest.  The  principal  value  of the last two
installments has been discounted at the rate of 8%.

NOTE 8-DUE TO RELATED PARTIES

Amounts  due to related  parties  consist  of $1.1  million  due to a  principal
stockholder  of the  Company  and  $400,000  due to  related  entities  owned or
controlled  by a principal  stockholder  of the Company.  These  amounts are not
subject to any  pre-specified  repayment  schedule and are not interest  bearing
liabilities.

NOTE 9-COMMON STOCK

Pursuant to a  reorganization  and  acquisition  of Patra Capital and Conversion
Services  International,  Inc.  ("CSI"),  effective  as of August 1,  1998,  the
Company issued  12,950,000  additional  common shares.  There are now 14,544,225
shares issued and outstanding and 50,000,000 shares authorized.


                                        8

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #4
------------------------------------------------------------------------------



NOTE 10-INCOME TAXES

The major  components of the net deferred  liability as of October 31, 1998, are
as follows:

Deferred Tax Assets:
  Net Operating Loss Carryforward           $  124,800
  Cash Basis Tax Accounting Asset              112,200
                                            ----------

  Total                                        237,000

Cash Basis Tax Accounting Liability            444,000

  Net Deferred Tax Liability                $  207,000
  --------------------------                ==========

The Company had  operating  loss carry  forwards at July 31,  1998,  of $53,926,
which expire in the years 2012 through 2013,  if unused.  Under federal tax law,
certain  potential  changes in  ownership of the Company may operate to restrict
future utilization of these carry forwards.

NOTE 11-REORGANIZATION AND ACQUISITIONS

On July 23, 1998,  the  Registrant,  through its wholly owned  subsidiary  Patra
Acquisition, Inc., a Delaware corporation ("Patra Acquisition"),  entered into a
Non-Binding Letter of Intent (the "Letter of Intent") with Patra Capital Ltd., a
Delaware  corporation  ("Patra Capital").  The Letter of Intent provided for the
execution of a definitive merger agreement (the "Merger Agreement"). Pursuant to
the Merger  Agreement,  Patra Capital  merged with Patra  Acquisition  and Patra
Capital,  the  surviving  corporation  of the  merger,  became  a  wholly  owned
subsidiary  of  the   Registrant   (the   "Reorganization").   As  part  of  the
Reorganization,  the Registrant  changed its name to Elligent  Consulting Group,
Inc. on July 31, 1998. On September 3, 1998, with an effective date of August 1,
1998, for accounting  purposes,  the Registrant  issued 12,950,000 shares of its
restricted  common stock to the then current  shareholders  of Patra  Capital in
exchange for all of the issued and outstanding common stock of Patra Capital. At
that time, the management of Patra Capital became the management of the Company.
The merger was accounted for as a Recapitalization of the Company.

On September 21, 1998,  effective August 1, 1998, for accounting  purposes,  the
Company through its wholly owned subsidiary, Patra Capital, purchased Conversion
Services International,  Inc. ("CSI"). The operations of CSI are included in the
Company's results of operations commencing on August 1, 1998. In connection with
the acquisition of CSI, CSI's shareholders signed employment agreements with the
Company for three years.

The  purchase  price  was  $12,298,885  consisting  of  1,100,000  shares of the
Company's  common stock  (valued at  $2,640,000),  cash  payments of  $1,500,000
delivered  at the closing and notes  payable of  $8,500,000,  with a  discounted
value of $8,158,885.  Interest at 8% is payable on the November 24th and January
21st payments.  The final two payments bear no interest. The payments are due as
follows:

                       $1,000,000  November 24, 1998
                       $1,500,000  January 21, 1999 (payable in cash or stock at
                                   the option of the Company)
                       $3,750,000  May 1, 1999
                       $2,250,000  August 1, 1999

Goodwill of $12,093,826  will be amortized over 20 years under the straight line
method.


                                        9

<PAGE>



ELLIGENT CONSULTING GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #5
------------------------------------------------------------------------------


NOTE 11-REORGANIZATION AND ACQUISITIONS [CONTINUED]

CSI has been in the  business of  providing  information  technology  consulting
services for approximately nine years. CSI provides high-end project management,
applications  implementation,   data  warehousing,   consulting,   internet  and
information  technology ("IT") staffing services.  CSI has recently expanded its
operation  to  accommodate  additional  consultant/employees  and  new  in-house
training   facilities.   CSI  currently  has  approximately  180  employees  and
consultants, and expects that number to increase as its business grows.

NOTE 12-NEW AUTHORITATIVE PRONOUNCEMENTS

The  Financial  Accounting  Standard  Board  ["FASB"]  has issued  SFAS No. 133,
"Accounting  for Derivative  Instruments and Hedging  Activities."  SFAS No. 133
establishes  accounting  and  reporting  standards for  derivative  instruments,
including  certain  derivative  instruments  embedded in other contracts and for
hedging  activities.  SFAS  No.  133  requires  that  an  entity  recognize  all
derivatives  as either  assets or  liabilities  in the  statement  of  financial
position and measure those instruments at fair value. The accounting for changes
in the fair value of a derivative  depends on the intended use of the derivative
and how it is designated,  for example, gain or losses related to changes in the
fair value of a derivative not designated as a hedging  instrument is recognized
in earnings in the period of the change,  while  certain  types of hedges may be
initially  reported  as a  component  of  other  comprehensive  income  [outside
earnings] until the consummation of the underlying transaction.

SFAS No. 133 is effective for all fiscal quarters of fiscal years beginning
after June 15,  1999.  Initial  application  of SFAS No. 133 should be as of the
beginning  of a fiscal  quarter,  on that date,  hedging  relationships  must be
designated  anew and  documented  pursuant  to the  provisions  of SFAS No. 133.
Earlier application of all of the provisions of SFAS No. 133 is encouraged,  but
it is permitted only as of the beginning of any fiscal quarter.  SFAS No. 133 is
not to be applied  retroactively to financial  statements of prior periods.  The
Company does not currently have any derivative  instruments and is not currently
engaged in any hedging activities.

NOTE 13--COMMITMENTS AND CONTINGENCIES

Letter of Credit - The  Company  is  committed  under an  outstanding  letter of
credit with a bank to secure the security  deposit on the new office  space,  in
the  amount of  $291,657,  which  expires  November  1999.  The  agreement  will
automatically  extend for  additional  one year periods with a final  expiration
date of November 2003.

NOTE 14-SUBSEQUENT EVENT

In November  1998,  the Company issued stock options to acquire 92,000 shares of
common stock to employees of CSI.


                         .   .   .   .   .   .   .   .   .



                                        10

<PAGE>



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

FORWARD - LOOKING INFORMATION

The  forward-looking  statements  herein are based on current  expectations that
involve a number of risks and uncertainties. Such forward-looking statements are
based on assumptions that the Registrant will have adequate financial  resources
to fund the development and operation of its business and planned  acquisitions,
and that there will be no material adverse change in the Registrant's operations
or business and in the economy as a whole.  The foregoing  assumptions are based
on judgment  with respect to, among other things,  information  available to the
Registrant,  future  economic,  competitive  and  market  conditions  and future
business  decisions,  all of  which  are  difficult  or  impossible  to  predict
accurately and many of which are beyond the Registrant's  control.  Accordingly,
although the Registrant's management believe that the assumptions underlying the
forward-looking statements are reasonable, any such assumption could prove to be
inaccurate and therefore there can be no assurance that the results contemplated
in  forward-looking  statements  will be  realized.  There are a number of other
risks presented by the  Registrant's  business and operations  which could cause
the  Registrant's  financial  performance to vary markedly from prior results or
results contemplated by the forward-looking  statements.  Management  decisions,
including budgeting, are subjective in many respects and periodic revisions must
be made to reflect actual  conditions and business  developments,  the impact of
which  may cause  the  Registrant  to alter  its  capital  investment  and other
expenditures,  which may also  adversely  affect  the  Registrant's  results  of
operations.  In light of significant  uncertainties  inherent in forward-looking
information  included in this Quarterly Report on Form 10-QSB,  the inclusion of
such information should not be regarded as a representation by the Registrant or
any other person that the Registrant's objectives or plans will be achieved.

 In  addition  to  general  economic  factors  that could  adversely  affect the
economy,  the  several  factors  that  could  cause  expectations  to differ and
adversely  affect  the  Registrant's  plan of  operations  include,  but are not
limited  to,  the  following:  (1) the  Registrant  may  not be able to  attract
acquisition  candidates on favorable  terms;  (2)  financing  sources may not be
available to achieve the planned  acquisitions;  (3)  competition for consulting
assignments  remains strong and the Registrant  must continue to demonstrate its
ability  to meet the  needs of its  current  and  prospective  clients;  and (4)
changes in technology  may result in the  Registrant  not being able to meet the
needs of its current and  prospective  clients due to an  inability  to locate a
sufficient number of qualified consultants.

OVERVIEW

As part of a Reorganization, the Company changed its name to Elligent Consulting
Group,  Inc. on July 31, 1998. On September 3, 1998,  with an effective  date of
August 1, 1998, for accounting purposes, the Company issued 12,950,000 shares of
its restricted common stock to the then current shareholders of Patra Capital in
exchange for all of the issued and outstanding common stock of Patra Capital. At
that time, the management of Patra Capital became the management of the Company.
The merger was accounted for as a Recapitalization of the Company.

On September 21, 1998,  effective August 1, 1998, for accounting  purposes,  the
Company through its wholly owned subsidiary, Patra Capital, purchased Conversion
Services International,  Inc. ("CSI"). The operations of CSI are included in the
Company's results of operations commencing on August 1, 1998. In connection with
the acquisition of CSI, CSI's shareholders signed employment agreements with the
Company for three years.



                                       11

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The  purchase  price  was  $12,298,885  consisting  of  1,100,000  shares of the
Company's  common stock  (valued at  $2,640,000),  cash  payments of  $1,500,000
delivered  at the  closing  and notes  payable of  $8,500,000,  with an original
discounted  value of $8,158,885.  Interest at 8% is payable on the November 24th
and January 21st payments. The final two payments bear no interest. The payments
are due as follows:

                       $1,000,000 November 24, 1998
                       $1,500,000 January 21, 1999 (payable in cash or stock at
                                  the option of the Company)
                       $3,750,000 May 1, 1999
                       $2,250,000 August 1, 1999

The  Registrant  expects to continue  an  acquisition  program to acquire  other
technology  consulting  companies  constituting a set of key consulting practice
areas to serve as a platform  ("platform") for further roll-up and consolidation
through  acquisition of similar companies in the future.  Through these platform
companies, the Registrant plans to offer its clients an enterprise-type offering
of  services.  These  services  will  include  management  consulting,  business
function  reengineering,  mission  critical  application  rollouts  and  package
implementation,  database and datawarehousing consulting, networking and interim
and permanent staffing or support.

The Registrant will then continue its  development  through  continued  internal
growth from the acquired platform companies and additional rollout  acquisitions
within each of its service  offering  areas.  Through this  expansion and growth
strategy,  the  Registrant  plans to develop  into a leading  global  technology
services company.

The  Registrant   plans  to  enter  a  business  segment  that  has  significant
competition from other much larger  companies.  The Registrant  expects to offer
its services to large national and multi-national companies.
There are no copyrights or patents owned by the Registrant.

The Company's corporate headquarters are located in New York City, New York. CSI
maintains its offices in East Hanover, New Jersey.

The  Registrant  plans  to  continue  an  expansion  strategy  through  (1)  the
acquisition  of  a  select  number  of  technology   consulting  companies  with
complementary  areas of  expertise  and (2)  internal  growth from the  acquired
operating subsidiaries. While there is significant risk as a result of potential
external  problems,  lack of  available  capital,  changing  economic and market
conditions, and significant competition from much larger companies, through this
expansion strategy,  the Registrant's plans are to develop into a leading global
consolidator of technology services companies.  Key to the acquisition  strategy
is the retention of the acquired company's management and staff.

For the three month  period ended  October 31, 1998,  the Company had revenue of
$5.8  million  reflecting  an increase of 46% from the  comparable  year earlier
period  and a net loss of  $244,576.  The major  components  of this loss are as
follows:

Cash flow from operations of CSI                   $ 332,703
                                                   ---------

Depreciation, amortization and interest              432,632
Income tax benefit                                   (62,000)
Management and holding company expenses              206,647
                                                   ---------

Subtotal acquisition related and other expenses      577,279

Net Loss                                           $(244,576)

                                       12

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The  management  and holding  company  expenses  represent  costs related to new
acquisitions  in  progress,  and  efforts to locate  equity  and debt  financing
required to achieve the growth goals of the Company.  The remaining  analysis of
quarterly  results  focuses  on  the  operations  of  CSI,  our  sole  operating
subsidiary. The unaudited information for this interim period is not necessarily
indicative of the results for the entire year,  nor should it be used to project
the Company's operations for future dates or periods.

The  financial   statements  presented  herein  represent  the  first  financial
statements of Elligent  Consulting Group, Inc. since its  reorganization in July
1998 and its  acquisition  of CSI. The CSI  acquisition  was accounted for as of
August 1, 1998, on the purchase method of accounting and therefore the financial
statements  only reflect CSI's income and operations for the three month period.
In order to provide  investors with appropriate  historical  data,  Management's
discussion  will include  comparative  data reflecting the results of operations
for CSI during the year preceding its acquisition by the Company.

CSI has been in the  business of  providing  information  technology  consulting
services for approximately nine years. CSI provides high-end project management,
applications  implementation,   data  warehousing,   consulting,   internet  and
information  technology ("IT") staffing services.  CSI has recently expanded its
operation  to  accommodate  additional  consultant/employees  and  new  in-house
training   facilities.   CSI  currently  has  approximately  180  employees  and
consultants,  and expects that number to increase as its business  grows.  CSI's
revenues have doubled over the past two years,  and the current revenue run rate
is $25 million.

For the three  months ended  October 31, 1998,  the Company had revenues of $5.8
million from its  operating  subsidiary  CSI  reflecting a 46% increase from the
revenues of CSI during the corresponding period in 1997 prior to its acquisition
by the  Company.  The cost of revenues  was $3.9  million  resulting  in a gross
margin from operations of $1.9 million or 33%.

The unaudited  results of operations  for CSI for the three months ended October
31, 1998, and 1997, are as follows:

                                       Three months            Three months
                                          Ended                   Ended
                                      October 31, 1998        October 31, 1997
                                      [In Thousands]          [In Thousands]
                                        [Unaudited]             [Unaudited]

   Revenue                             $      5,813            $      3,983
   Cost of revenue                            3,879                   2,640
                                       ------------            ------------
      Gross margin                            1,934                   1,343
   Operating expenses                         1,601                   1,162
                                       ------------            ------------
      Cashflow from operations         $        333            $        181
                                        ===========            ============

CSI  continues  to show  significant  growth in  revenues  in 1998,  versus  the
comparable  period a year  ago.  Operating  expenses  are  running  higher  than
projected for the next twelve month period, due to continued growth in staff and
related training costs prior to placing new staff on a billable status.

The Company expects to reduce operating expenses as a percent of gross margin in
1999.

Liquidity and Financial Position

As of October  31,  1998,  the  Company  had a working  capital  deficit of $9.7
million.  Its working  capital  deficit  reflects (a) $2.0 million due to Summit
Bank related to the  revolving  line of credit  collateralized  by the Company's
accounts  receivable and other loans,  (b) accounts payable and accrued expenses
of $2.3 million,  (c) notes payable to  stockholders  of $8.3 million related to
the  acquisition of CSI, and (d) amounts due to related parties of $1.5 million,
relative to the  acquisition  of CSI and the funding of costs  related to future
acquisitions  in  progress.  These  latter  amounts are  principally  due to the
Company's principal stockholder.

                                       13

<PAGE>





The principal  sources of funds,  other than from the revolving  line of credit,
are (a) the personal assets of the Company's  principal  stockholder and related
entities  owned or controlled by the Company's  principal  stockholder,  (b) the
sale  of  securities  and (c)  additional  financing  sources.  The  Company  is
presently engaged in negotiations  with respect to additional  financing sources
and the  private  placement  of  shares of the  Company's  common  stock.  A new
revolving  line of credit of $30  million,  to replace the Summit Bank line,  is
expected to close and be funded in late December.  A private placement of common
stock of the Company is  expected  to close in  mid-January  1999.  However,  no
assurance  can be given that the Company will be  successful  in obtaining  such
financing,  and the failure to obtain necessary  financing could have a material
adverse effect upon the Company.  At the present time, the Company's  management
believes that its current  sources of funding are adequate to support the growth
of the Company and its wholly owned subsidiary, CSI. The current sources are not
adequate to support the Company's acquisition plans.



                                       14

<PAGE>



PART II.    OTHER INFORMATION

Item 2.     Changes in Securities and Use of Proceeds

Item 6.     Exhibits and Reports on Form 8-K

Reports on Form 8-K.

The Company filed two reports on Form 8-K related to the  acquisition of CSI and
the reorganization of the Company. These reports were filed as follows:

September  15,  1998    Name  change  and plan of merger  of Patra  Capital,
                        Patra Acquisition and CSI

October 6, 1998         This filing included the complete merger agreement
                        between SI, Patra Capital and Patra Acquisition.

The Company filed three reports on Form 8-K/A related to the  acquisition of CSI
and the reorganization of the Company. These reports were filed as follows:

October 1, 1998         This  filing was  required  to correct the name tag
                        associated with the 8K of September 15 regarding the
                        change of name of Arena Group to Elligent Consulting
                        Group

October 19,  1998       This  filing  included  the  audited   financial
                        statements  of  Conversion  Services  International,
                        Inc. ("CSI") for the three years ended  December 31,
                        1995,  1996 and 1997

December 7,  1998       This  filing   included  the  audited   financial
                        statements  of Patra  Capital  Ltd for the period
                        from its inception to July 31, 1998

INDEX TO EXHIBITS



                                       15

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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.


                                             ELLIGENT CONSULTING GROUP, INC.

Date: December 15, 1998                      By: /s/ Edwin T. Brondo 
                                                ---------------------
                                 Edwin T. Brondo
                                                Chief Financial Officer

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


         Signature                                 Title(s)

By:      /s/ Edwin T. Brondo                       Chief Financial Officer
         (Edwin T. Brondo)

                                       16

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