<PAGE>

                              FORM 10-Q 

                SECURITIES AND EXCHANGE COMMISSION

                      Washington, D.C.  20549
                                                                 
     

[X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
              OF THE SECURITIES EXCHANGE ACT OF 1934
            For Quarterly Period Ended August 31, 1996

                               
                                 OR
[ ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
              OF THE SECURITIES EXCHANGE ACT OF 1934

                    Commission File Number 0-13946
                                            
                         
                  INTERNATIONAL DESIGN GROUP, INC.
             ------------------------------------------
          (Exact name of registrant as specified in charter)

              Delaware                             59-2521916  
    ----------------------------               -----------------
    (State or other jurisdiction               (I.R.S. Employer
of incorporation or organization)             Identification No.)

                  1815 Griffin Rd, Dania, Florida       33004
             ---------------------------------------------------
            (Address of principal executive offices)   (Zip Code)

                               (954) 927-9119     
                           ---------------------
                      (Registrant's telephone number, 
                            including area code)

          
Indicate by check mark whether registrant (1) has filed all reports required 
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 
during the preceding 12 months (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 ___.  

As of September 30,1996, there were 3,768,401 shares of the Registrant's $.05 
par value common stock issued and 3,744,849 shares were outstanding. 

<PAGE>


                      INTERNATIONAL DESIGN GROUP, INC.
                                 CONTENTS
               

PART I - FINANCIAL INFORMATION                                  Pages


     Item 1. Financial Statements

     Condensed Consolidated Balance Sheets of
     International Design Group, Inc. ("IDG") as of
     August 31, 1996 and February 29,1996                         3 
       
     Condensed Consolidated Statement of Operations  
     of IDG for the six  months ended August 31,
     1996 and 1995                                                4
                               
     Condensed Consolidated Statement of Operations
     of IDG for the three months ended August 31,
     1996 and 1995                                                5     
 
     Condensed Consolidated Statement of Cash Flows of
     IDG for the six  months ended August 31, 1996 and                     
     1995                                                         6 

     Notes to Financial Satements                                 7  

 Item 2. Management's Discussion and Analysis of 
         Financial Condition and Results of 
         Operations                                              8-10

PART II. OTHER INFORMATION

     Item 1.Legal Proceedings                                     11           
     Item 2.Changes in Securities                                 11   
     Item 3.Defaults Upon Senior Securities                       11      
     Item 4.Submission of Matters to a Vote          
             of Security Holders                                  11           
     Item 5.Other Information                                     11
     Item 6.Exhibits and Reports on Form 8- K.                    11  
     Signatures                                                   12



                                      -2-
<PAGE>
                       INTERNATIONAL DESIGN GROUP, INC 
                               AND SUBSIDIARIES
                         CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                AUGUST 31,       FEBRUARY 29,
ASSETS                                             1996             1996
-----------------------------------------------------------------------------
<S>                                          <C>              <C>       
CURRENT ASSETS:
Cash and Cash Equivalents                        $204,704         $130,679 
Trading Securities                                 22,812          129,188 
Finance Receivables, less allowance
 for doubtful accounts of $ 598,000
 and $591,000 and unearned income of           
 $ 786,000  and $542,000                       11,209,123        8,149,416 
Drafts receivable                                 409,148          312,793 
Current maturities of notes receivable            164,360          171,515 
Prepaid expenses and other                         33,325           18,316
                                              -----------      -----------
      TOTAL CURRENT ASSETS
                                               12,043,472        8,911,907 
                                              -----------      -----------
PROPERTY AND EQUIPMENT- less
 accumulated depreciation of $ 88,076  
 and $68,720                                      153,306           91,628 

NOTES  RECEIVABLE -  less current maturities      201,048          189,579 

OTHER ASSETS, less accumulated amortization
 of $ 18,000 and $16,000                           29,854           22,945 
                                              -----------       ----------
                                              $12,427,680       $9,216,059 
                                              ===========       ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
Accounts payable, accrued expenses and other     $345,722         $230,234 
Drafts Payable                                    633,532          308,130 
Notes payable                                     276,850          267,850 
Liability under options sold                            0           25,469 
Notes Payable to Directors                        500,000        1,500,000 
                                              -----------       ----------
  TOTAL  CURRENT LIABILITIES                    1,756,104        2,331,683 
                                              -----------       ----------
Notes payable to bank                           7,942,933        4,263,610 
                                              -----------       ----------

TOTAL LIABILITIES                               9,699,037        6,595,293 
                                              -----------       ----------
STOCKHOLDERS' EQUITY:
Common stock $.05 par, shares authorized 
 10,000,000; 3,768,401 issued and 3,744,849 
 outstanding                                      188,420         188,420 
ADDITIONAL PAID IN CAPITAL                      5,837,706       5,837,706 
DEFICIT                                        (3,230,694)     (3,338,571)
TREASURY STOCK ( 23,552 shares at cost )           (8,289)         (8,289)
COMMON STOCK SUBSCRIPTIONS RECEIVABLE             (58,500)        (58,500)
                                              -----------      ----------
    TOTAL STOCKHOLDERS' EQUITY                  2,728,643       2,620,766 
                                              -----------      ----------
                                               12,427,680       9,216,059 
                                               ==========       =========
</TABLE>
                See Notes to Condensed Financial statements
                                   -3-
<PAGE>

                      INTERNATIONAL DESIGN GROUP, INC 
                               AND SUBSIDIARIES
                   CONSOLIDATED  STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                               SIX MONTHS ENDED AUGUST 31,
                                                   1996            1995
                                               ----------------------------

REVENUES:
<S>                                            <C>             <C>
Finance charge income                           $1,163,734        $748,540 
Origination fees                                   458,622         375,617 
Late fees and other charges                        417,411         335,745 
Interest income and Other                           31,679          82,094 
                                                 ---------       ---------
                                                 2,071,446       1,541,996 
                                                 ---------       ---------
EXPENSES
General and administrative expenses                612,872         545,045 
Sales and marketing                                375,606         254,571 
Provision for doubtful accounts                    580,133         317,123 
Interest expense                                   299,227         170,550 
Interest expense to Directors                       74,375          78,265 
Depreciation and amortization                       21,356          16,500 
                                                 ---------       ---------
                                                 1,963,569       1,382,054 
                                                 ---------       ---------
NET INCOME                                       $ 107,877       $ 159,942 
                                                 =========       =========
Net Income per Common Share:
Primary:                                             $0.03           $0.05 
Fully Diluted:                                       $0.03           $0.04 

Computation Of Fully Diluted Earnings:
Net Income                                        $107,877        $159,942 
Less:Preferred Dividends                                 0          (4,500)
                                                  --------        --------
Primary net income                                 107,877         155,442 
Assumed conversions:
Preferred dividends eliminated                           0           4,500 
                                                  --------        --------
Fully diluted earnings                            $107,877        $159,942 
                                                  --------        --------
Average Number of Common Shares
Primary                                          3,793,063       3,088,577 
Fully Diluted                                    3,793,063       3,588,577 
</TABLE>
             See Notes to Condensed Financial statements
                                 -4-
<PAGE>
                      INTERNATIONAL DESIGN GROUP, INC 
                            AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                              THREE MONTHS ENDED AUGUST 31,
                                               1996                 1995
                                              -----------------------------
<S>                                           <C>              <C>
REVENUES:
Finance charge income                            $614,715         $395,334 
Origination fees                                  238,942          196,022 
Late fees and other charges                       223,785          183,470 
Interest income and Other                          12,875           34,831 
                                                ---------          -------
                                                1,090,317          809,657
                                                ---------          ------- 
EXPENSES

General and administrative expenses               305,391          286,536
Sales and marketing                               226,938          116,011 
Provision for doubtful accounts                   296,871          168,962 
Interest expense                                  167,803           98,050 
Interest expense to directors                      26,562           39,453 
Depreciation and amortization                      11,078            9,300
                                                ---------          ------- 
                                                1,034,643          718,312 
                                                ---------          -------
NET INCOME                                         55,674           91,345 
                                                =========          =======
Net Income per Commin Share:
Primary:                                            $0.01            $0.03 
Fully Diluted;                                      $0.01            $0.03 

Computation Of Fully Diluted Earnings:
Net Income                                         55,674           91,345 
Less:Preferred Dividends                                            (2,250)
                                                   ------           ------
Primary net income                                 55,674           89,095 
                                                   ------           ------
Assumed conversions:
Preferred dividends eliminated                          0            2,250 
                                                  -------          -------
Fully diluted earnings                            $55,674          $91,345 
                                                  -------          -------
Average Number of Common Shares
Primary                                         3,793,063        3,128,356 
Fully Diluted                                   3,793,063        3,628,356 
</TABLE>
                See Notes to Condensed Financial Statements
                                     -5-
<PAGE>

                        INTERNATIONAL DESIGN GROUP, INC 
                                AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                              SIX  MONTHS ENDED AUGUST 31,
                                                1996                1995
                                              ----------------------------
<S>                                            <C>            <C>
OPERATING ACTIVITIES:
Net Income                                         $107,877       $159,942 
 Adjustments to reconcile net income  to
  net cash provided by (used in) operating 
  activities:
   Depreciation and amortization                     21,356         16,500 
   Provision for doubtful accounts                    7,000         48,496 
   Change in operating assets and
    liabilities:
   Increase in unearned income                      244,000         80,240 
   Increase in prepaid expenses & other             (23,918)        (5,142)
   Decrease  in drafts receivable                   (96,355)       (40,102)
   Increase (Decrease) in accounts payable,
    accrued expenses                                115,488         (5,443)
   Increase (Decrease)  in drafts payable           325,402        (74,338)
                                                   --------       --------
    Net cash provided by operating gactivities      700,850        180,153 
                                                   --------       --------
   INVESTING ACTIVITIES:
Premium finance loans - net of writeoffs        (16,442,009)   (10,318,864)
Payments received on premium finance loans       13,131,302      8,536,015 
Increase in notes receivable                       (127,013)       (82,008)
Payments received on notes receivable               122,699        110,398 
Capital expenditures                                (81,034)       (12,527)
Decrease in Marketable Securities                   106,376         11,651 
Increase (Decrease) in liability under options 
  sold                                              (25,469)       (36,432)
                                                  -----------   -----------
 Net Cash Used In Investing Activities            (3,315,148)   (1,791,767)
                                                  -----------   -----------
FINANCING ACTIVITIES
Increase in notes payable to bank                 19,947,000     2,236,150 
Paydowns in notes payable to bank                (16,267,677)     (575,150)
Paydowns in notes payable                              9,000       200,000 
Paydowns to notes payable to Directors            (1,000,000)            0 
Preferred dividends paid                                   0        (4,500)
Purchase of treasury shares                                0       (14,115)
Net Cash (Used In) Provided by Financing           ---------     --------- 
  Activities                                       2,688,323     1,842,385 
                                                   ---------     ---------
NET INCREASE IN CASH
 AND CASH EQUIVALENTS                                 74,025      $230,771 

  CASH AND CASH EQUIVALENTS,
   beginning of the period                           130,679       306,162 
                                                    --------      --------
  CASH AND CASH EQUIVALENTS, 
   end of period                                    $204,704      $536,933 
                                                    ========      ========
</TABLE>
                 See Notes to Condensed Financial Statements
                                      -6-

<PAGE>

International Design Group, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Unaudited)


NOTE A -- Basis of Presentation
-----------------------------------------------
The accompanying unaudited condensed consolidated financial statements have 
been prepared in accordance with generally accepted accounting principles for 
interim financial information and with the instructions to Form 10-Q and 
Article 10 of Regulation S-X.  Accordingly, they do not include all of the 
information and footnotes required by generally accepted accounting 
principles for complete financial statements.  In the opinion of management, 
all adjustments (consisting of normal recurring accruals) considered 
necessary for a fair presentation have been included.  Operating results for 
the six month period ended August 31, 1996 are not necessarily indicative of 
the results that may be expected for the year ending February 28, 1997.  For 
further information, refer to the financial statements and footnotes thereto 
included in the Company's annual report on Form 10-K for the year ended 
February 29, 1996.

The accompanying financial statements include the Company, its wholly owned 
subsidiaries Finco Financial Corporation, Eagle Premium Finance, Inc., QRS 
Acquisition, Inc., Reserve Funding Corporation, VoiceSoft Corporation and 
Federal Funding Corporation. All intercompany transactions and balances have 
been eliminated in consolidation.

 


















                                   -7-
<PAGE>
PART I - ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF 
OPERATIONS
Results of Operations - General
-------------------------------
Revenues increased to  $2,071,446 during the six months ended August 31, 1996 
as compared to $1,541,996 during the comparable period in 1995 as a result of 
the Company's growth in the insurance premium finance business. Insurance 
premiums financed increased to $16.4 million in 1996 compared to $10.3 
million for the same period in 1995. The number of contracts financed 
increased to 28,200 during 1996 as compared to 20,900 in 1995. This increase 
resulted primarily from the expansion of the Company's premium finance 
business to South Carolina as well as increased volume in Florida.  
 
The following table reflects the company's expenses as a percentage of 
revenues for the six months ended August 31,: 

<TABLE>                                                                       
<CAPTION>                                                                   
                                                                 
                                                   1996         1995
                                                   ----         ----
<S>                                                <C>          <C>
General and Administrative Expenses                 30%          35%
Sales and Marketing                                 18%          17%
Depreciation and Amortization                        1%           1%
Provision for Doubtful Accounts                     28%          21%     
Interest Expense                                    18%          16%
Total Expenses                                      95%          90%
</TABLE>

General and administrative expenses, as a percentage of revenue, decreased as 
a substantial portion of these expenses are fixed and do not directly 
correlate to revenue.  The provision for doubtful accounts has increased 
substantially as the Company has been accepting lower down payments on its 
finance agreements in an effort to compete effectively. Additionally, the 
Company expanded its finance operations to South Carolina and Maryland where 
the average down payment on finance contracts is significantly lower than in 
Florida. These lower down payments translate into higher bad debt write-offs 
when an insurance contract is canceled. As a result of increased competition 
among finance companies, the Company expects that the down payment levels may 
continue to decrease which will have a negative impact on the Company's 
profit margins. In determining the provision for doubtful accounts, 
management takes into account factors such as its average down payment rate, 
cancellation rate, unrefunded canceled contracts, specific problems with 
insurance agents, and financial condition of insurance companies among other 
factors.  

Until July 1, 1996, there was a statute in Florida which prohibited insurance 
premium finance companies from rebating a portion of the interest or 
origination fees to insurance brokers in an effort to induce the brokers to 
refer finance business to the Company. This prohibition expired on July 1, 
1996. This has resulted in the Company's costs increasing as the Company, in 
an effort to maintain  its market share, was forced to rebate a portion of 
its finance charges and origination fees to the insurance brokers. This may 
have a negative impact on future profitability.

Interest expense increased primarily as a result of increased borrowings 
during the current period.
                 
<TABLE>
<CAPTION>                                                      
                                                     1996          1995
                                                     ----          ----
<S>                                              <C>           <C>
Finance charge income                             $1, 163,734   $ 748,540
Interest expense                                      373,602     248,815 
Net interest margin                                   790,132     499,725    
Margin Percent                                            68%         67%  
</TABLE>

                                   -8-
<PAGE>



PART I - ITEM 2

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF 
OPERATIONS (Cont'd)

                                   
Overall, net income decreased to approximately $108,000 for the six months 
ended August 31, 1996 as compared to $160,000 during the same period in 1995. 
This decrease in net income is primarily attributable to a decrease in income 
from securities trading. 

The Company recorded net income of $55,674 for the three months ended August 
31, 1996 as compared to $91,345 during the comparable period in 1995.  The 
lower income in 1996 is attributed to increases in provision of bad debt 
since the Company is experiencing higher write - offs due to lower down 
payments being taken as well as a decrease in income from securities 
trading.   
  
 Liquidity and Capital Resources
 -------------------------------
The Company's working capital position at August 31, 1996  increased to 
$10,287,368 as compared to $6,580,224 at February 29, 1996. This increase was 
due primarily to an increased level of premium finance activity during the 
period which was funded by long term debt.

The Company increased borrowings under its bank revolving line of credit by 
approximately $3.7 million between February 29, 1996 and August 31, 1996.  
This increase resulted from an increase in premium finance loans during the 
period. Finance receivables increased to approximately $11.2 million at 
August 31, 1996 from approximately $8.1 million at February 29, 1996. 

As of August 31, 1996, the Company's revolving credit arrangements are 
summarized as follows:
<TABLE>
<CAPTION>
Description                          Lender   Loan Balance    Expiration Date
-----------                          -----    -------------   ---------------
<S>                               <C>         <C>             <C> 
$10,000,000 Revolving Credit 
    Agreement                        Bank      $ 7,942,933     Feb. 23, 1999
$1,000,000 Revolving Credit 
    Agreement                      Chairman    $   500,000     On Demand
</TABLE>
During June 1996, the Company repaid $500,000 of the $1 million revolving 
credit agreement with the Company's Chairman as well as the $500,000  
revolving credit agreement with one of the Company's Director's. These 
repayments were funded with the Company's Revolving Credit Agreement with a 
Bank.  Both the revolving credit agreements with the Company's Chairman and 
one of the Company's Directors expired in July 1996.  The agreement with the 
Chairman was extended on a month to month basis.  The agreement with the 
Director was not extended.

The Company extended its line of credit with a bank to $10.0 million in 
August 1996 with an option to increase it to $11.0 million.   The new 
agreement, which matures in 1999, also requires the Company to maintain 
certain financial ratios.  Borrowings under the line are based on eligible 
finance receivables, interest is payable monthly at the Company's choice of 
LIBOR plus 3.25% or the bank's prime rate plus 1.25%.  

As part of the Company's investment activities, the Company sells put 
options.  These options give the purchaser the right to sell to the Company 
a certain security at a fixed price through a certain date.  These options 
involve a high degree of risk because if the value were to substantially 
decrease on a security which the Company sold put options on, the loss to 
the Company could greatly exceed the proceeds of the sale of the option.

It is the opinion of management that the Company will have sufficient funds 
to satisfy its cash requirements for at least the next 12 months .




                                      -9-

<PAGE>


PART I - ITEM 2

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Cont'd)





Inflation and Foreign Currency Fluctuations:
--------------------------------------------
Presently, inflation and foreign currency fluctuations do not have any 
adverse effect on the Company's business.  However, inflation would have an 
adverse effect on the Company as its cost of money would increase while the 
maximum interest rates the Company is allowed to charge are set by state law.

























                                    -10-

<PAGE>
PART II. - OTHER INFORMATION

                     Item 1.  Legal Proceedings
                                   NONE
 
                     Item 2.  Changes in Securities
                                   NONE
 
                Item 3.  Defaults Upon Senior Securities
                                   NONE

      Item 4.  Submission of Matters To A Vote of Security Holders
                                   NONE

                       Item 5.  Other Information
                                   NONE
     
                Item 6.  Exhibits and Reports on Form 8-K
                                   NONE  
       



























                                  -11-

<PAGE>

                                                                                

                                SIGNATURE


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



                                                                                

(Registrant>               INTERNATIONAL DESIGN GROUP, INC.
BY (Signature)             /s/ David Raymond 
(Date)                     July 15, 1996    
(Name and Title)           David Raymond, President and
                           Chief Financial Officer




















                                      -12-