FORM 10-Q

                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549

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

                        For Quarter Ended June 30, 1999

                        Commission File Number 0-13898

                               VERAMARK TECHNOLOGIES, INC.

            (Exact name of registrant as specified in its charter)

          DELAWARE                      16-1192368
(State or other jurisdiction of         (IRS Employer Identification
  Incorporation or Organization)         Number)



     3750 MONROE AVENUE, PITTSFORD, NY            14534
(Address of principal executive offices)        (Zip Code)

                         (716) 381-6000
(Registrant's telephone number, including area code)

                              N.A.
(Former name, former address and former  fiscal  year,  if changed since last
report)

    Indicate  by  check  mark whether the Registrant (1) has filed all reports
required to be filed by Section  13  or  15  (d) of the Securities 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
requirement for the past 90 days.

          YES      XX         NO

    Indicate the  number of shares outstanding of each of the issuer's classes
of common stock, as of June 30, 1999.

     Common stock, par value $.10            7,588,050 shares

     This report consists of 15 pages.




<PAGE>
                                     INDEX



                                                                 PAGE

PART I    FINANCIAL INFORMATION

   Item 1 Financial Statements

          Condensed Balance Sheets -                             3 -  4
          June 30, 1999 and December 31, 1998

          Condensed Statements of Operations -                   5
          Three and Six Months Ended June 30, 1999 and 1998

          Condensed Statements of Cash Flows -                   6
          Six Months Ended June 30, 1999 and 1998

          Notes To Condensed Financial Statements                7 -  8

   Item 2 Management's Discussion and Analysis of                9 - 12
          Financial Condition and Results of Operations



PART II   OTHER INFORMATION

   Item 6 Exhibits and Reports on Form 8-K                      13 - 14



<PAGE>
                       PART  I -  FINANCIAL INFORMATION

                          VERAMARK TECHNOLOGIES, INC.

                           CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                           JUNE 30,            DECEMBER 31,
ASSETS                                                         1999                   1998*
<S>                                         <C>                     <C>
CURRENT ASSETS:                                         (Unaudited)
   Cash and Cash Equivalents                           $    804,689            $    371,209
     Investments                                          4,617,916               4,718,694
     Accounts Receivable, trade (net of
      allowance for doubtful accounts of
      $118,000 and $110,000, respectively)                2,844,971               2,273,705
     Inventories                                            504,122                 579,968
     Prepaid Expenses                                       199,885                 155,831
                                                       ------------            ------------
        Total Current Assets                              8,971,583               8,099,407

PROPERTY AND EQUIPMENT                                    7,177,675               5,864,469
   Less Accumulated Depreciation                         (4,693,560)             (4,455,539)
                                                       ------------            ------------
        Property and Equipment (Net)                      2,484,115               1,408,930

OTHER ASSETS:
     Software Development Costs
      (Net of accumulated amortization of
      $995,215 and  $1,322,254 respectively)              3,228,312               3,393,542
     Pension Assets                                       1,873,721               1,873,721
     Deposits and Other Assets                              505,974                 406,901
                                                       ------------            ------------
   Total Other Assets                                     5,608,007               5,674,164
                                                       ------------            ------------

TOTAL ASSETS                                           $ 17,063,705            $ 15,182,501
                                                       ============            ============

</TABLE>
See notes to Condensed Financial Statements.

                 *  DERIVED FROM AUDITED FINANCIAL STATEMENTS


<PAGE>

                          VERAMARK TECHNOLOGIES, INC.

                           CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                      June 30,               December 31,
                                                                         1999                      1998*
                                                                   (Unaudited)

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

CURRENT LIABILITIES:
  Accounts Payable                                                  $    616,256            $    740,576
  Accrued Compensation and Related Taxes                               1,156,469                 891,186
  Deferred Revenue                                                     2,285,876               2,061,475
  Other Accrued Expenses                                                 779,807                 838,713
                                                                    ------------            ------------
     Total Current Liabilities                                         4,838,408               4,531,950

  Pension Obligation                                                   3,079,778               2,882,847
                                                                    ------------            ------------
Total Liabilities                                                      7,918,186               7,414,797

STOCKHOLDERS' EQUITY:
   Common Stock, par value $.10,
    40,000,000 shares authorized; issued and
    outstanding, 7,668,275 and  7,607,709,
    respectively                                                         766,827                 760,771
   Additional Paid-in Capital                                         19,236,225              18,954,579
   Retained Earnings                                                 (10,471,776)            (11,734,431)
   Treasury Stock (80,225 and 52,300 shares at cost,
    respectively)                                                       (385,757)               (213,215)
                                                                    ------------            ------------
Total Stockholders' Equity                                             9,145,519               7,767,704
                                                                    ------------            ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                          $ 17,063,705            $ 15,182,501
                                                                    ============            ============
</TABLE>

See notes to Condensed Financial Statements.

                 *  DERIVED FROM AUDITED FINANCIAL STATEMENTS


<PAGE>

                          VERAMARK TECHNOLOGIES, INC.

                      CONDENSED STATEMENTS OF OPERATIONS


                                  (Unaudited)



<TABLE>
<CAPTION>
                                                  THREE MONTHS ENDED                            SIX MONTHS ENDED
                                                       JUNE 30                                       JUNE 30
                                                  1999           1998                       1999                 1998

<S>                                    <C>               <C>               <C>       <C>              <C>
SALES                                        $ 5,988,740       $ 3,982,773               $ 11,032,107      $ 7,587,150

COSTS AND OPERATING EXPENSES:
  Cost of Sales                                1,035,165           778,752                  1,827,144        1,543,057
  Engineering & Software Development           1,101,157           751,851                  1,769,124        1,381,996
  Selling, General and Administrative          3,176,114         2,312,163                  6,246,864        4,457,553
                                             -----------       -----------               ------------      -----------
   Total Costs and Operating Expenses          5,312,436         3,842,766                  9,843,132        7,382,606


INCOME FROM OPERATIONS                           676,304           140,007                  1,188,975          204,544

INTEREST INCOME                                   53,774            40,333                    118,680           78,868
                                             -----------       -----------               ------------      -----------
INCOME BEFORE INCOME TAXES                       730,078           180,340                  1,307,655          283,412

INCOME TAXES                                      25,000                 -                     45,000                -
                                             -----------       -----------               ------------      -----------
NET INCOME                                   $   705,078       $   180,340               $  1,262,655      $   283,412
                                             ===========       ===========               ============      ===========
INCOME PER SHARE
    Basic                                          $ .09             $ .02                      $ .17            $ .03
                                                   =====             =====                      =====            =====
    Diluted                                        $ .09             $ .02                      $ .16            $ .03
                                                   =====             =====                      =====            =====

</TABLE>


SEE NOTES TO CONDENSED FINANCIAL STATEMENTS.



<PAGE>
                          VERAMARK TECHNOLOGIES, INC.
                      CONDENSED STATEMENTS OF CASH FLOWS


<TABLE>
<CAPTION>
                                                                  Six Months Ended June 30,
                                                                 1999                  1998
                                                                         (Unaudited)

<S>                                                  <C>                          <C>
OPERATING ACTIVITIES:
Net Income                                               $ 1,262,655                     $  283,412
                                                         -----------                     ----------
Adjustments to Reconcile Net Income to Net Cash
 Provided by Operating Activities
    Depreciation and Amortization                            816,825                        619,878
    Provision for Losses on Accounts Receivable               10,000                          2,002
    Provision for Inventory Obsolescence                      85,000                         49,998
    Loss on Disposal of Fixed Assets                           2,399                              -

  Changes in Assets and Liabilities
     Accounts Receivable                                    (581,266)                      (712,533)
     Inventories                                              (9,154)                       264,912
     Prepaid Expenses and Other Current Assets               (44,054)                       (67,798)
     Deposits and Other Assets                               (99,073)                       (98,127)
     Accounts Payable                                       (124,320)                      (126,764)
     Accrued Compensation and Related Taxes                  265,283                        144,884
     Deferred Revenue                                        224,401                        309,216
     Other Current Liabilities                               (58,906)                       (93,143)
                                                         -----------                     ----------
  Net Adjustments                                            487,135                        292,525

  Net Cash Provided by Operating Activities                1,749,790                        575,937
                                                         -----------                     ----------

INVESTING ACTIVITIES:
   Investments                                               100,778                        680,125
   Additions to Property and Equipment                    (1,335,272)                      (451,639)
   Software Development Costs                               (393,907)                      (437,611)
                                                         -----------                     ----------
Net Cash Flows Used by Investing Activities:              (1,628,401)                      (209,125)
                                                         -----------                     ----------

FINANCING ACTIVITIES:
  Increase in Pension Obligation                             196,931                         (4,235)
  Proceeds from Sales of Stock                                     -                        143,384
  Employee Stock Purchase Plan                                66,287                              -
  Exercise of Stock Options and Warrants                     221,415                         50,201
  Treasury Stock Purchases                                  (172,542)                             -
  Stock Retirements                                                -                         (8,752)
                                                         -----------                     ----------
  Net Cash Flows Provided by Financing Activities            312,091                        180,598
                                                         -----------                     ----------

NET INCREASE IN CASH AND CASH EQUIVALENTS                    433,480                        547,410

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD               371,209                      1,106,944
                                                         -----------                     ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD                 $   804,689                     $1,654,354
                                                         ===========                     ==========

</TABLE>


<PAGE>
NOTES TO CONDENSED FINANCIAL STATEMENTS

(Unaudited)

(1)  GENERAL

     The  accompanying   unaudited   financial   statements   include   all
adjustments  of  a normal and recurring nature which are, in the opinion of
Registrant's management,  necessary  to  present  fairly  the  Registrant's
financial  position  as  of June 30, 1999 and the results of its operations
and cash flows for the three and six months ended June 30, 1999 and 1998.

     Certain information and  footnote  disclosures  normally  included  in
financial   statements  prepared  in  accordance  with  generally  accepted
accounting  principles   have  been  omitted  pursuant  to  the  rules  and
regulations of the Securities  and  Exchange  Commission.   These condensed
financial  statements  should  be  read  in  conjunction with the financial
statements and related notes contained in the  Annual Report for the fiscal
year ended December 31, 1998.

     The results of operations for the three and  six months ended June 30,
1999 are not necessarily indicative of the results  to  be  expected  for a
full year's operation.

     Except  for  the  historical information contained herein, the matters
discussed in this report are forward-looking statements which involve risks
and uncertainties, including  but  not  limited  to  economic, competitive,
governmental and technological factors affecting the Company's  operations,
markets, products, services and prices, and other factors discussed  in the
Company's filings with the Securities and Exchange Commission.

(2)  INVENTORIES

     The composition of inventories at June 30, 1999 and December 31,  1998
was as follows:

                                            JUNE 30,        DECEMBER 31,
                                              1999                 1998

Purchased parts and components             $ 379,204          $ 340,350
Work in process                               43,151            116,228
Finished goods                                81,767            123,390
                                           ---------          ---------
                                           $ 504,122          $ 579,968






<PAGE>

(3)  PROPERTY AND EQUIPMENT

     The  major classifications of property and equipment at June 30, 1999,
     and December 31, 1998 are:

                                           JUNE 30,         DECEMBER 31,
                                              1999                 1998

Machinery and equipment                $ 1,401,548          $ 1,377,179
Computer hardware and software           3,457,238            3,075,398
Furniture and fixtures                   1,080,037            1,064,117
Leasehold improvements                   1,238,852              347,775
                                       -----------          -----------
                                       $ 7,177,675          $ 5,864,469
                                       ===========          ===========

 (4) EARNINGS PER SHARE

     Earnings  per share have been calculated under SFAS 128, "Earnings Per
     Share."







<PAGE>
          Item 2  Management's  Discussion and Analysis of Financial
                  Condition and Results of Operations

RESULTS OF OPERATIONS

     Sales for the three months ended June  30,  1999  represented a record
second  quarter for the Company, totaling $5,988,740, an  increase  of  50%
over the  sales  of  $3,982,773 achieved for the same three months of 1998.
Sales for the six months  ended June 10, 1999 of $11,032,107 are 45% higher
than the sales of $7,587,150  generated  for  the  same six month period of
1998.

     Net income for the quarter ended June 30, 1999  was  $705,078  or $.09
per  share.   This  compared with net income of $180,340, or $.02 per share
for the three months  ended  June  30, 1998.  Net income for the six months
ended June 30, 1999 was $1,262,655 or  $.16  per  diluted  share, which
compared with net income of $283,412 or $.03 per share for the  same  six
month period of 1998, represents an increase of 346%.

     Sales of the Company's core call accounting products  and  services to
both  domestic  and international markets grew by 57% during the first  six
months of 1999 versus  the  first six months of 1998, accounting for 73% of
total sales.

     Sales of Verabill, the Company's billing and customer care product for
wireline, wireless and other  network  service providers, account for 8% of
total sales for the first six months of  1999  and  are 63% higher than the
Verabill sales realized during the first six months of 1998.

     Sales of INFO/MDR, the company's Centrex and virtual  private  network
offering for the first six months of 1999 are approximately equal to  sales
generated  during  the  first six months of 1998.  Sales and new orders for
INFO/MDR were particularly strong during the second quarter of 1999 and the
Company remains confident  that sales of INFO/MDR for the current year will
comfortably  exceed  the levels  of  sales  realized  for  1998.   INFO/MDR
accounted for 9% of total  sales  for  the three months ended June 30, 1999
and 7% of total sales for the six months ended June 30, 1999.

     Sales of TMS, the Company's medium  to high-end telemanagement product
have accounted for 4% of the Company's total  sales during 1999, increasing
by 81% over TMS sales achieved during the first six months of 1998.

     For  the six months ended June 30, 1999, 33%  of  Company  sales  were
generated from  previously  deferred  billings  for  a variety of services,
including training, installation, custom rate updates,  and  implementation
services.   This  compares  with  27%  of Company sales being derived  from
previously deferred billings for the fist  six  months  of  1998.   For the
three  months  ended  June  30,  1999,  12%  of  sales were from previously
deferred billings for services which have not been  and are not expected to
be utilized by customers, based on historical experience.
<PAGE>
     For the three months ended June 30, 1999, the Company  earned  a gross
margin  on  sales  of  $4,953,575  versus a gross margin $3,204,021 for the
three months ended June 30, 1998.  For  the six months ended June 30, 1999,
gross margins were $9,204,963, an increase  of 52% over the gross margin of
$6,044,093 earned for the first six months of  1998.   The  higher  margins
reflect  a  combination  of  higher sales volumes and lower direct products
costs as a percentage of sales.

     Net engineering and software  development  expense  for the six months
ended June 30, 1999 of $1,769,124 are 28% higher than the  net  engineering
and development expense of $1,381,996 incurred for the first six  months of
1998.  There were no development costs capitalized in the second quarter of
1999.  The table below summarized the impact on the Company's operations of
its   engineering   and   development  expenses  on  a  gross  and  net  of
capitalization basis, and adds  back charges included in cost of sales from
the amortization of previously capitalized development costs.



<TABLE>
<CAPTION>

                                               THREE MONTHS ENDED                 SIX MONTHS ENDED
                                            JUNE 30,        JUNE 30,         JUNE 30,         JUNE 30,
                                              1999            1998            1999              1998
<S>                                   <C>             <C>             <C>             <C>
Gross Expenditures for Engineering &
 Software Development                       $1,101,157       $ 958,682      $2,163,031      $1,819,607
Less:  Costs Capitalized                           -0-        (206,831)       (393,907)       (437,611)

Net Engineering & Software
 Development Expense                        $1,101,157       $ 751,851      $1,769,124      $1,381,996


Plus:  Amounts Amortized and Charged
 to Cost Of Sales                              342,101         250,982         559,137         460,110
                                            ----------       ---------      ----------      ----------
Total Expense Recognized                    $1,443,258      $1,002,833      $2,328,261      $1,842,106
                                            ==========      ==========      ==========      ==========
</TABLE>



     Selling,  general  and  administrative  expenses  for the three months
ended  June 30, 1999 of $3,176,114 are 37% higher than the  expense  levels
incurred  during  the  three month period ended June 30, 1998.  For the six
months ended June 30, 1999,  selling general and administrative expenses of
$6,246,864 are 40% higher than  the  same  six  month  period of 1998.  The
higher spending levels continue to reflect the significant  growth  in  the
Company  employment  in  all  functional areas, a trend that is expected to
continue throughout the balance  of  1999.   Expense  levels  for salaries,
benefits,   recruiting,   training,   and   travel   continue  to  increase
accordingly.  SG&A spending as a percentage of sales however  has decreased
from 59% of sales for the first six months of 1998 to 57% of sales  for the
six  month  period  ended  June  30,  1999.   The  following table compares
employment at June 30, 1999 to employment at June 30,  1998 on a functional
basis.


<PAGE>

<TABLE>
<CAPTION>
                                        EMPLOYMENT AT           EMPLOYMENT AT
                                          JUNE 30,                JUNE 30,
                                            1999                    1998
<S>                                <C>                    <C>
Operations                                   14                      12
Engineering/Development/Test                 57                      42
Sales/marketing                              52                      44
Customer Support/Service                     55                      42
Administration                               17                      15
                                            ---                     ---
                                            195                     155
                                            ===                     ===
</TABLE>

     The   second   quarter  of  1999  represented  the  company's   eighth
consecutive quarter of  increased sales and net income.  Net income for the
quarter ended June 30, 1999 was 11.8% of sales versus 4.5% of sales for the
quarter ended June 30, 1998,  and  represents  11.4%  of  sales for the six
months  ended June 30, 1999 versus 3.7% of sales for the six  months  ended
June 30, 1998.

LIQUIDITY AND CAPITAL RESOURCES

     The  Company's  total  cash  position  (cash  on  hand plus short-term
investments) at June 30, 1999 was $5,422,605 an increase  of  6%  from  the
$5,089,903   of   cash   and   investments  at  December  31,  1998.   This
strengthening in the cash position  has  been  achieved  during a period of
significant expenditures in capital equipment and facilities.   During  the
first  half  of  1999  the Company has invested $1,335,272 in expanding its
facilities,  improving  internal   networks  and  information  systems  and
equipping employers with the latest  state  of  the  art  tools designed to
enhance  productivity.  While the rate of capital spending is  expected  to
slow somewhat  during  the  second  half  of  1999,  capital  spending will
continue  above prior historical levels given the significant increases  in
employment which are expected to continue throughout 1999.

     Software  development  cost capitalized of $3,228,312 representing 19%
of total assets at June 30, 1999  have  declined  from $3,393,542 or 22% of
total  assets  at  December  31,  1999.   There  were no development  costs
capitalized during the second quarter of 1999.

     Total  assets have increased by over 12% from  December  31,  1998  to
$17,063,705.

     Accrued compensation and related taxes have increased from $891,186 at
December 31,  1998  to  $1,156,469  at June 30, 1999, reflecting the higher
employment levels.

     Deferred revenues at June 30, 1999  were  $2,285,876 versus $2,061,475
at  December  31,  1998.   Deferred  revenues  represent   the   value   of
unrecognized  revenues  related  to  a  variety  of  services for which the
Company has billed customers, but not yet performed the associated service.
These  services typically include training, installation,  maintenance  and
support,  and  implementation  services.   It  is expected that the revenue
associated  with these services will be recognized  over  the  next  twelve
months as the actual services are provided.
<PAGE>
     During the first half of 1999 the Company repurchased 27,925 shares of
its common stock  on the open market for a total consideration of $172,542.
Since September of  1998  the  Company  has  repurchased  a total of 80,225
shares of its common stock at an average price of $4.81.  This  continues a
policy   of   repurchasing   Company   stock  as  market  conditions,  cash
requirements and profitability allow.

     The Company maintains a private equity line of credit agreement with a
single institutional investor.  Under the  equity line, the Company has the
right to sell to the investor shares of the  Company's  common  stock  at a
price equal to 88% of the average bid price of the stock for the subsequent
ten trading days.  During the term of the agreement the Company may sell up
to  $6  million  to this investor, with no more than $500,000 in any single
month.   This  agreement  expires  on  August  30,  2000.   There  were  no
transactions under  this  agreement  during the first or second quarters of
1999.

     The Company also maintains an agreement  with  a major commercial bank
for  a  secured  demand  line  of  credit  arrangement  in  the  amount  of
$3,000,000.  There have been no borrowings against this agreement.

     In light of its current cash position, profitable operations,  and the
credit  arrangements  referred  to  above, the Company believes that it has
sufficient resources to meet its financial  needs  and  support anticipated
growth over the next twelve months.

<PAGE>

                          PART II - OTHER INFORMATION

ITEM 6:             EXHIBITS AND REPORTS ON FORM 8-K

(1)  Registrant's Condensed Financial Statements for the three and six months
     ended June 30, 1999 and 1998 are set forth in Part I, Item 1 of this
     Quarterly Report on Form 10-Q.

(2)  Calculation of earnings per share.



<PAGE>

                                               EXHIBIT A: (2)

                          VERAMARK TECHNOLOGIES, INC.

                      CALCULATIONS OF EARNINGS PER SHARE



<TABLE>
<CAPTION>
                                                Three Months Ended                Six Months Ended
                                                     June 30,                         June 30,
                                           1999              1998             1999              1998
<S>                                  <C>               <C>              <C>               <C>

BASIC
Net Income                                  $  705,078       $  180,340        $1,262,655       $  283,412
                                            ==========       ==========        ==========       ==========
Weighted Common Shares Outstanding           7,580,182        7,575,444         7,585,160        7,563,157
                                            ==========       ==========        ==========       ==========
Income Per Common Share                          $ .09            $ .02             $ .17            $ .03
                                                 =====            =====             =====            =====

DILUTED
Net Income                                  $  705,078       $  180,340        $1,262,655       $  283,412
                                            ==========       ==========        ==========       ==========
Weighted Average Shares Outstanding          7,580,182        7,575,444         7,585,160        7,563,157

Additional Dilutive Effect of Stock
 Options and Warrants after
 Application of Treasury Stock Method          417,958          389,745           515,670          400,340
                                            ----------        ---------         ---------        ---------
Weighted Average Shares Outstanding          7,998,140        7,965,189         8,100,830        7,963,497
                                            ==========        =========         =========        =========
Income per Common Share and Common
Equivalent Share                                 $ .09            $ .02             $ .16            $ .03
                                                 =====            =====             =====            =====
</TABLE>


<PAGE>

                                  SIGNATURES

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



                          VERAMARK TECHNOLOGIES, INC.

                                  REGISTRANT

Date:     _________________________



_____________________________________
David G. Mazzella
President and CEO




Date:     _________________________



_____________________________________
Ronald C. Lundy
Treasurer (Chief Accounting Officer)


<PAGE>