U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB


        [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                 For the quarterly period ended: March 31, 1997
                                                 --------------

       [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

                           Commission File No. 0-11808

                             MB SOFTWARE CORPORATION


                       Colorado                              59-2219994
           (State or other jurisdiction of               (I.R.S. Employer
            incorporation or organization)             Identification Number)

                      2225 E. Randol Mill Road - Suite 305
                           Arlington, Texas 76011-6306
                                 (817) 633-9400


Check  whether the Issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for 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   [  ]


Check whether the  registrant  filed all  documents  and reports  required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the  distribution  of
securities under a plan confirmed by a court.
                                    Yes   [ X ]                      No   [   ]


As of  March 31, 1997, 67,885,000 shares of the Issuer's $.001 par value common 
stock were outstanding.

Transitional Small Business Disclosure Format
                                    Yes  [   ]                       No  [ X  ]






<PAGE>
                             MB SOFTWARE CORPORATION

                                   Form 10-QSB

                          Quarter Ended March 31, 1997


                                      INDEX

PART I  -  FINANCIAL INFORMATION                                 PAGE NUMBER

        Item 1  -  Financial Statements

             Consolidated Balance Sheet
             March 31, 1997 (Unaudited)                               3-4

             Consolidated Statements of Operations  -
             for the Three Months ended March 31, 1997
             (Unaudited)                                               5

             Consolidated Statements of Cash Flows
             for the Three Months ended March 31, 1997
             (Unaudited)                                               6

             Notes to Consolidated Financial Statements                7

        Item 2  -  Management's Discussion
        and Analysis of Financial Condition and
        Results of Operations                                         7-8

PART II - OTHER  INFORMATION


        Item 5  -  Other Information                                   9


        Item 6  -  Exhibits, Financial Statement Schedules
        and Reports on Form 8-K                                        9

SIGNATURES                                                             9








                                       2
<PAGE>

                    MB SOFTWARE CORPORATION AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET
                                 March 31, 1997


                                     ASSETS


                                                   MARCH, 31      DECEMBER,31

                                                     1997             1996
                                                 -------------    --------------
CURRENT ASSETS
       Cash                                    $      297,607   $       196,653
       Trade accounts receivable                    2,751,930           345,452
       Less Allowance for Bad Debt                   (104,775)          (33,487)
       Notes receivable                               266,552            10,000
      Commissions Receivable                            6,000                 -
      Deposits                                         18,645           18,488
      Prepaid Expenses                                 19,833           19,883
                                                 -------------    --------------
                    Total current assets           3,255,792           556,989
                                                 -------------    --------------

PROPERTY AND EQUIPMENT, NET                          182,335            63,349
                                                 -------------    --------------

OTHER ASSETS
       Goodwill                                      823,625           850,109
       Software development costs                    428,979           394,240
                                                 -------------    --------------

                    Total other assets             1,434,939         1,307,698
                                                 -------------    --------------

                                              $    4,690,731  $      1,864,687
                                                 =============    ==============


                                  - Continued -

                                       3
<PAGE>
                    MB SOFTWARE CORPORATION AND SUBSIDIARIES

                     CONSOLIDATED BALANCE SHEET (continued)
                              March 31, 1997
<TABLE>
<CAPTION>
<S>                                                                         <C>              <C>

                      LIABILITIES AND SHAREHOLDERS' EQUITY
                                                                                 March 31,       December 31,

                                                                                   1997              1996
                                                                              ---------------   ---------------
CURRENT LIABILITIES
       Notes Payable                                                        $        661,699 $         242,029
       Accounts payable                                                              187,162           149,741
       Accrued liabilities                                                           157,812           101,382
       Advance on medical receivables                                              2,069,113               -
       Other liabilities                                                             157,999           179,000
       Other                                                                            3,872              -
       Deferred revenue                                                              122,983           159,026
                                                                              ---------------   ---------------
                    Total current liabilities                                      3,360,641           831,178

LONG TERM LIABILITIES
      Note Payable                                                                 1,348,932         1,283,808
      Other Liabilities                                                               40,000            40,000

                                                                              ---------------   ---------------
                   Total long term liabilities                                     1,388,932         1,323,808
SHAREHOLDERS' EQUITY
       Common stock .001 par value;100,000,000 shares
          authorized; 67,885,000  shares issued                                       67,885            67,885
       Additional paid-in capital                                                    810,320           810,322
       Retained Earnings (deficit)                                                (1,156,467)       (1,156,467)
       Treasury stock, at cost;409,577shares                                         (12,039)          (12,039)
       Net Earnings                                                                  231,459               -
                                                                              ---------------   ---------------
                    Total shareholders' equity (deficit)                             (58,842)         (290,299)
                                                                              ---------------   ---------------

                                                                            $      4,690,731  $      1,864,687
                                                                              ===============   ===============
</TABLE>

                                       4
<PAGE>
                    MB SOFTWARE CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

                                        Three Months               Three Months
                                        Ended 3/31/97             Ended 3/31/96
REVENUES
       Service fee & broker income             7,518       $               1,816
       Consulting Fees                        23,610                          -
       Software & maintenance sales          425,826                     603,099
       Other income                            4,514                      30,008
       Medical income                        705,852                          -
                                       -------------              --------------

               Total revenues              1,167,320                     634,923

COST OF REVENUES
       Cost of service & broker fees               -                          -
       Cost of software & maintenance        136,416                     102,839
       Cost of services                        8,706
                                       -------------              --------------
               Total cost of revenues        145,122                     102,839
                                       -------------              --------------

GROSS PROFIT                               1,022,198                     532,084
                                       -------------              --------------
OPERATING EXPENSES
       Selling, general & administrative     708,331                     429,839
       Depreciation and amortization          56,981                       5,616
                                       -------------              --------------
 
               Total operating expenses      765,312                     435,455
                                       -------------              --------------

INCOME FROM OPERATIONS                       256,886                      96,629

OTHER INCOME (EXPENSES)
       Interest income(expense), net          25,181                     (1,038)
       Other, net                                246                     (2,211)
                                       -------------              --------------

          Total other income
             (expense), net                   25,427                     (3,249)
                                       -------------              --------------

NET INCOME BEFORE TAXES                      231,459                      93,379
                                       -------------              --------------

PROVISION FOR  INCOME TAXES                        -                          -

NET PROFIT                      $            231,459        $             93,379
                                       =============              ==============

  Income per weighted-average
     common share                           0                           0
                                       =============              ==============

  Weighted-average common 
     shares outstanding                       67,885                      49,815
                                       =============              ==============

                                       5
<PAGE>
                    MB SOFTWARE CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
<S>                                                             <C>                   <C>
                                                                    Three Months         Three Months
                                                                   ended Mar. 31,       ended Mar. 31,
                                                                        1997                 1996
                                                                        ----                 ----

CASH FLOWS FROM OPERATING ACTIVITIES
       Net Income(Loss) for the period                          $      231,459         $     93,379
       Adjustments to reconcile net income(loss) to net
        cash used by operating activities:
                    Depreciation                                        56,981                5,616
                    Gain on debt extinguishment
                    Gain from reduction of liabilities                  (8,579)
                    Change in allowance for doubtful accounts          (71,288)
                    Changes in assets and liabilities, net of
                     effects of acquisition and disposition
                          Trade accounts receivable                 (2,439,965)             (61,793)
                          Advances on medical receivable            l2,069,113
                          Commission receivable                          6,000
                          Prepaid expenses and other                       (50)
                          Deposits                                         157                 (700)
                          Accounts payable and accrued liabities       (85,821)             (72,345)
                          Other liabilities -related parties           (21,001)             350,033
                          Deferred revenues                            (36,043)              48,722
                          Other                                          3,872                1,034
                                                                  ------------          -----------

Net cash used by operating activities                                 (295,165)             363,946
                                                                  ------------          -----------

CASH FLOWS FROM INVESTING ACTIVITIES
      Purchases of property and equipment                             (118,986)              (4,725)
      Software development costs capitalized                           (45,792)             (38,279)
       Collections on notes receivable                                  26,631               (9,000)
       Advances on notes receivable                                   (212,038)
                                                                  ------------

Net cash provided (used) by investing activities                      (350,185)             (52,004)
                                                                  ------------          -----------

CASH FLOWS FROM FINANCING ACTIVITIES
      Principal payments on notes payable                              (18,845)            (159,246)
      Proceeds from notes payable                                      425,000              454,000
      Payment on other liabilities - related parties
      Change in cash overdraft                                                              (14,277)
      Proceeds from common stock issuance                                                    45,000
      Treasury Stock                                                (1,152,459)
                                                                  ------------          -----------

Net cash provided by financing activities                             (746,304)             325,477
                                                                  ------------          -----------

INCREASE / (DECREASE) IN CASH                                          100,954              (13,535)
                                                                  ------------

 Cash at beginning of period                                           196,653               36,535

  Cash at end of period                                         $      297,607        $      23,000  
                                                                  ============          ===========

SUPPLEMENTAL INFORMATION
       Cash paid during the period for interest                 $       25,181        $       1,038 
                                                                  ============          ===========


SUPPLEMENTAL SCHEDULE OF NON-CASH
INVESTING AND FINANCING ACTIVITIES

       Issuance of treassury stock in settlement of note payable                              45000


</TABLE>


                                       6
<PAGE>

                             MB SOFTWARE CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 1997
                                   (Unaudited)

1.       BASIS OF PRESENTATION

Certain  information  and footnote  disclosures  normally  included in financial
statements prepared in accordance with generally accepted accounting  principles
have been condensed or omitted,  although  management  believes the  disclosures
herein are adequate to make the  information  presented  not  misleading.  These
interim financial  statements should be read in conjunction with the most recent
financial statements of MB Software Corporation included in the Company's report
on Form 10-KSB for the year ended December 31, 1996.

The interim  financial  information  included  herein is  unaudited;  however it
reflects all adjustments  (consisting  solely of normal  recurring  adjustments)
which are, in the opinion of management,  necessary for a fair  presentation  of
financial position, results of operations and cash flows for the interim period.
The  results of  operations  for the three  months  ended March 31, 1997 are not
necessarily indicative of the results to be expected for the full year.

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

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

The Company
MB Software  Corporation  has begun to  strengthen  its  position in  healthcare
through application of a strategy to augment and leverage its core business.  In
the quarter ended March 31, 1997, the Company  maintained its market-share  with
its current  customer  install  base of 3,500  users  comprised  of  physicians,
dentists and chiropractors, with over 2,350 physical installs.

The  Company  has  embarked  on its 1997  Strategic  Plan,  which calls for even
greater  concentration and quality of customer service within its core business,
Santiago SDS, Inc.,  building  Santiago's revenue stream in two untapped areas -
Electronic  Media Claims (EMC) and  electronically  prepared  physician  billing
statements.  Combined,  those elements of business represent  significant upside
revenue  potential,  which could add revenues without a corresponding  offset in
operating  expense.  While  introduction of the Company's  Windows-95 version of
OneClaim  Plus  continues  to prove  its ease of use and  efficacy  in  multiple
disciplines of physician,  dental and  chiropractic  practice  management in the
healthcare marketplace, the Company also recognizes that incremental growth must
be achieved through acquisition of compatible and complementary companies.  Such
growth strategy was successfully  implemented during the quarter ended March 31,
1997,  wherein two  acquisitions  were  accomplished.  Both going  concerns were
transitioned into the Company's  Strategic Plan without major  capitalization or
restructuring.  Both acquisitions,  Color Country Health Express, Inc. and North
Florida Physical Medicine  Associates remain ahead of plan in terms of financial
and operational improvement.





                                       7
<PAGE>

Results of Operations

This  section  discusses  the  operational   results  of  the  Company  and  its
subsidiaries  for the  quarterly  period ended March 31, 1997.  Since January 1,
1997,  the Company  has been able to exceed its goals in terms of  acquisitions,
operating improvement and overall profitability. During the quarterly period, MB
Software acquired the assets and specific liabilities of two (2) going concerns:

     o Color  Country  Health  Express,  Inc.,  a  Utah-based  medical  facility
comprised of three (3) locations. This acquisition occurred in January.

     o North Florida Physical Medicine Associates, formerly First Coast Physical
Medicine,  a  Florida-based  physical  medicine  and medical  facility  with two
locations.

In the quarterly  period ended March 31, 1997,  revenues  from the  consolidated
entities  improved to $1,167,320,  an increase of 84% over the $634,922 reported
for the same  period in 1996.  Revenues  were  generated  from  software  sales,
medical and physical medicine  services,  and claim servicing fees. This was the
fifth consecutive quarter of increased revenues for the Company.

Operating  expenses again increased at a decreasing  rate when measured  against
the revenue growth for the quarter.  Actual operating expenses for the March 31,
1997 quarter were $765,312,  65% of revenues,  compared to $435,455,  which were
69% of revenues for the quarter ended March 31, 1996. This cost  containment and
decrease  were   noteworthy   when   measured   against  a  higher  than  normal
non-recurring  administrative  costs  associated with the acquisition of the two
target entities.

Total  current  liabilities  for the  period  ended  March  31,  1997  reflected
$3,360,641.  For the  same  period  in  1996,  total  current  liabilities  were
$935,672.

The Company's Management continues to fulfill its Strategic Plan which calls for
profitability  in all operating  arms of the Company,  acquisition  of carefully
measured medical targets that are  complimentary  to its core software  business
and   aggressive   cost   containment.   The  Company   demonstrated   continued
profitability  through  strong  operational  results  and  exceeded  its revenue
targets.  Additionally,  Management  has  developed a focus to contain  debt and
quickly move to reduce financial obligations associated with the consolidations.

The company  continues  to pursue its strategy of forming  alliances  with major
healthcare entities that share common strategies. One such alliance was effected
with  Envoy-NEIC in March,  1997. The company plans to leverage  distribution of
software  through  existing  channels  and build  critical  mass of claim volume
through the combined efforts of allianced companies,  thereby creating a win-win
situation that benefits the healthcare industry as a whole.

Liquidity and Capital Resources

As of March 31, 1997, the Company had total assets of $4,690,731, an increase of
278% over the  quarter  ended  March 31, 1996 which  reflected  total  assets of
$1,238,319.  Net working  capital  improved to ($104,849)  for the quarter ended
March 31, 1997 over ($782,091) for the same period March 31, 1996.



                                       8
<PAGE>


PART II  -  OTHER INFORMATION

ITEM 5.  OTHER INFORMATION

ITEM 6.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES
              AND REPORTS ON FORM 8-K

Exhibits - All exhibits are  incorporated  by reference  from prior filings with
the Commission.

Financial Statements  -  See Item 1 for financial statements filed with this 
--------------------
report.

Reports on Form 8-K  -  Original 8-K was filed Feb. 6, 1997 and an Amendment 
-------------------
No.1 was filed April 4, 1997


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


                                   SIGNATURES


In accordance  with the  requirements  of the Exchange Act, the  registrant  has
caused this report to be signed on its behalf by the undersigned  thereunto duly
authorized.


                             MB SOFTWARE CORPORATION



Date: May 14, 1997                        /s/ Scott A. Haire
                                        ----------------------
                                        Scott A.  Haire, Chairman of the Board,
                                        Chief Executive Officer and President
                                        (Principal Financial Officer)