<PAGE> 1
               UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                   FORM 10-Q

(Mark one)

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

For the quarterly period ended June 30, 1998

                                      OR

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

For the transition period from ------------ to -----------

Commission File Number 001-13875

                      ADVANCED COMMUNICATIONS GROUP, INC.
            (Exact name of registrant as specified in its charter)

                  DELAWARE                          76-0549396
       (State or other jurisdiction of           (I.R.S. Employer
       incorporation or organization)         Identification Number)

       390 S. WOODS MILL RD, SUITE 150                63017
             ST. LOUIS, MISSOURI                    (Zip Code)
  (Address of principal executive offices)


                                (314) 205-8668
             (Registrant's telephone number, including area code)

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 Exchange Act of
1934 during the preceding twelve months, and (2) has been subject to such
filing requirements for the past 90 days.  YES   X   NO
                                               -----    -----

As of August 10, 1998, the registrant had 19,615,865 shares of common stock,
$.0001 par value, outstanding.


<PAGE> 2

<TABLE>
PART I - FINANCIAL INFORMATION
Item 1. - Financial Statements
          --------------------

                                  Advanced Communications Group, Inc. and Subsidiaries
                                  -----------------------------------------------------
                            Consolidated Statements of Operations for the Three Months Ended
                            ----------------------------------------------------------------
                                                 June 30, 1998 and 1997
                                                 ----------------------
                                                      (Unaudited)
<CAPTION>
                                                                              Three Months Ended
                                                       ----------------------------------------------------------------
                                                          Actual               Pro Forma <F1>               Actual
(In thousands, except per share data)                  June 30, 1998           June 30, 1997             June 30, 1997
                                                       -------------           --------------            -------------
<S>                                                     <C>                     <C>                      <C>
REVENUES:
   Telecommunications                                   $   15,206              $   12,392               $      --
   Directory                                                12,809                  10,892                      --
                                                        ----------              ----------               ---------
       Total revenue                                        28,015                  23,284                      --
OPERATING COSTS:
   Cost of services                                         17,281                  12,638                     376
   Selling, general and administrative
       Expenses                                              8,631                   7,592
   Depreciation and amortization                             2,563                   2,270                       2
                                                        ----------              ----------               ---------
       Income (loss) from operations                          (460)                    784                    (378)
OTHER INCOME (EXPENSE):
   Interest expense                                           (276)                   (300)                    (68)
   Equity in loss of KINNET                                   (121)                   (241)                     --
   Other                                                       316                     126                      --
                                                        ----------              ----------               ---------
Income (loss) before income taxes                             (541)                    369                    (446)
Income tax expense                                             490                     854                      --
                                                        ----------              ----------               ---------

       Net income (loss)                                $   (1,031)             $     (485)              $    (446)
                                                        ==========              ==========               =========

Basic and diluted earnings (loss) per share             $     (.05)             $     (.02)              $    (.05)
                                                        ==========              ==========               =========

Weighted average shares outstanding                     19,615,865              20,518,612               8,223,222
                                                        ==========              ==========               =========

See accompanying notes to consolidated financial statements.

<F1>  The Company completed its initial public offering on February 18, 1998,
      concurrently with the acquisition of 9 operating companies and a 49%
      interest in another company.  The pro forma results were prepared
      giving effect to the offering and the acquisitions as if they had
      occurred on January 1, 1997.
</TABLE>

                                    2
<PAGE> 3

<TABLE>
                                  Advanced Communications Group, Inc. and Subsidiaries
                                  ----------------------------------------------------
                             Consolidated Statements of Operations for the Six Months Ended
                             --------------------------------------------------------------
                                                 June 30, 1998 and 1997
                                                 ---------------------
                                                       (Unaudited)
<CAPTION>
                                                                                Six Months Ended
                                                  -------------------------------------------------------------------
                                                  Pro Forma <F1>    Pro Forma <F1>     Actual <F2>       Actual <F2>
(In thousands, except per share data)             June 30, 1998     June 30,1997      June 30, 1998     June 30, 1997
                                                  --------------    --------------    -------------     -------------
<S>                                               <C>               <C>               <C>                <C>
REVENUES:
   Telecommunications                             $   28,972        $   23,446        $   21,757         $      --
   Directory                                          31,238            27,366            21,992                --
                                                  ----------        ----------        ----------         ---------
       Total revenue                                  60,210            50,812            43,749                --
OPERATING COSTS:
   Cost of services                                   34,232            26,692            24,928                --
   Selling, general and administrative
       expenses                                       18,935            16,387            14,594               646
   Depreciation and amortization                       4,907             4,563             3,765                 2
   Stock-based compensation                            1,760                --             1,760                --
                                                  ----------        ----------        ----------         ---------
       Income (loss) from operations                     376             3,170            (1,298)             (648)
OTHER INCOME (EXPENSE):
   Interest expense                                     (668)             (652)             (558)              (68)
   Equity in loss of KINNET                             (275)             (495)             (189)               --
   Other                                                 375               171               346                --
                                                  ----------        ----------        ----------         ---------
Income (loss) before income taxes                       (192)            2,194            (1,699)             (716)
Income tax expense                                     1,438             2,419               456                --
                                                  ----------        ----------        ----------         ---------

       Net income (loss)                          $   (1,630)       $     (225)       $   (2,155)        $    (716)
                                                  ==========        ==========        ==========         =========

Basic and diluted earnings (loss) per share       $     (.08)       $     (.01)       $     (.12)        $    (.09)
                                                  ==========        ==========        ==========         =========

Weighted average shares outstanding               19,615,865        20,072,254        17,450,119         8,223,222
                                                  ==========        ==========        ==========         =========

See accompanying notes to consolidated financial statements.


<F1>  The Company completed its initial public offering on February 18, 1998,
      concurrently with the acquisition of 9 operating companies and a 49%
      interest in another company.  The pro forma results were prepared
      giving effect to the offering and the acquisitions as if they had
      occurred on January 1, 1997.

<F2>  Actual results include the operations of the parent company for the
      entire six month period and the results of the acquired operating
      companies only for the period February 18, 1998 to June 30, 1998.
</TABLE>

                                    3
<PAGE> 4

<TABLE>
                                  Advanced Communications Group, Inc. and Subsidiaries
                                  ----------------------------------------------------
                                               Consolidated Balance Sheets
                                               ---------------------------
<CAPTION>

(In thousands, except share data)                                                (Unaudited)
                                                                                   June 30,                 Dec. 31,
                                                                                     1998                     1997
<S>                                                                              -----------                --------
Assets                                                                           <C>                      <C>
------
Current assets:
   Cash and cash equivalents                                                     $  10,058                $     --
   Accounts receivable, net                                                         24,526                      --
   Deferred costs                                                                    2,684                      --
   Prepaid expenses and other current assets                                         1,168                      --
                                                                                 ---------                --------
         Total current assets                                                       38,436                      --
                                                                                 ---------                --------

Property, plant and equipment, net                                                   6,957                       6
Intangible assets, net                                                             107,728                      --
Equity investment in KINNET                                                         17,852                      --
Other noncurrent assets                                                              2,051                   2,689
                                                                                 ---------                --------
         Total other assets                                                        134,588                   2,695
                                                                                 ---------                --------

                                                                                 $ 173,024                $  2,695
                                                                                 =========                ========

Liabilities and Stockholders' Equity
------------------------------------
Current liabilities:
   Accounts payable and accrued liabilities                                      $  16,711                $  2,098
   Current maturities of long-term debt                                              1,293                   3,141
   Other current liabilities                                                         2,209                      --
                                                                                 ---------                --------
         Total current liabilities                                                  20,213                   5,239
Long-term obligations:
   Long-term debt (related party)                                                   17,233                      --
   Other noncurrent liabilities                                                         94                      --
                                                                                 ---------                --------
         Total liabilities                                                          37,540                   5,239
                                                                                 ---------                --------
Stockholders' equity:
   Preferred Stock, Series A Redeemable Convertible:                                 1,122                      --
      20,000,000 authorized; 142,857 shares issued;
      $2,000 liquidation preference
   Common stock, $.0001 par value:  180,000,000 authorized;
      19,615,865 and 11,624,920 shares issued, respectively                              2                      --
   Additional paid-in capital                                                      140,374                   1,315
   Retained earnings (accumulated deficit)                                          (6,014)                 (3,859)
                                                                                 ---------                --------
         Total stockholders' equity                                                135,484                  (2,544)
                                                                                 ---------                --------

                                                                                 $ 173,024                $  2,695
                                                                                 =========                ========


See accompanying notes to consolidated financial statements.
</TABLE>

                                    4
<PAGE> 5

<TABLE>
                                  Advanced Communications Group, Inc. and Subsidiaries
                                  ----------------------------------------------------
                                          Consolidated Statements of Cash Flows
                                          -------------------------------------
                                                       (Unaudited)
<CAPTION>
                                                                                          Six Months Ended
                                                                                              June 30,
                                                                                ----------------------------------
(In thousands)                                                                     1998                     1997
                                                                                ----------                --------
<S>                                                                              <C>                       <C>
Cash flows from operating activities:
   Net income (loss)                                                             $  (2,155)                $  (716)
   Adjustments to reconcile net earnings to net cash:
      Depreciation and amortization                                                  3,765                       2
      Stock-based compensation expense                                               1,760                      --
      Equity in loss of KINNET                                                         189                      --
      Change in assets and liabilities:
        Decrease (increase) in:
          Accounts receivable, net                                                  (5,095)                     (4)
          Deferred costs                                                             1,942                      --
          Prepaid expenses and other current assets                                    274                      --
          Other assets, net                                                         (3,001)                   (443)
        Increase (decrease) in:
          Accounts payable and accrued liabilities                                   1,133                     479
                                                                                 ---------                 -------
        Net cash used in operating activities                                       (1,188)                   (682)
                                                                                 ---------                 -------
Cash flows from investing activities:
   Cash paid for businesses acquired, net of $828 cash acquired                    (83,277)                     --
   Additions to property, plant and equipment, net                                  (3,864)                     --
                                                                                 ---------                 -------
        Net cash used in investing activities                                      (87,141)                     --
                                                                                 ---------                 -------
Cash flows from financing activities:
   Borrowings of long-term debt                                                      2,886                     652
   Repayment of long-term debt                                                      (4,399)                     --
   Proceeds from common stock offering, net of offering costs                       99,900                      --
                                                                                 ---------                 -------
        Net cash provided by financing activities                                   98,387                     652
                                                                                 ---------                 -------
Net increase (decrease) in cash and cash equivalents                                10,058                     (30)
Cash and cash equivalents-beginning of period                                           --                      33
                                                                                 ---------                 -------
Cash and cash equivalents-end of period                                          $  10,058                 $     3
                                                                                 =========                 =======


See accompanying notes to consolidated financial statements.
</TABLE>

                                    5
<PAGE> 6

             Advanced Communications Group, Inc. and Subsidiaries
             ----------------------------------------------------
                  Notes to Consolidated Financial Statements
                  ------------------------------------------
                    Six Months Ended June 30, 1998 and 1997
                    ---------------------------------------
                                  (Unaudited)


1.    INTERIM RESULTS

      The financial statements contained herein are unaudited.  In the
opinion of management, these financial statements reflect all adjustments,
consisting only of normal recurring adjustments, which are necessary for fair
presentation of the results of the interim periods presented.  Reference is
made to the footnotes to the consolidated financial statements contained in
the Company's Annual Report on Form 10-K for the year ended December 31,
1997, filed with the Securities and Exchange Commission.


2.    BASIS OF PRESENTATION

      Advanced Communications Group, Inc. ("ACG" or "Company"), a Delaware
corporation, is a regional competitive local exchange carrier ("CLEC") that
provides a portfolio of telecommunications services to business and
residential customers in fourteen mid-America states and publishes yellow
page directories in selected markets in California, Oklahoma and Texas.

      ACG completed its initial public offering ("IPO") of its common stock,
par value $.0001 per share ("Common Stock") on February 18, 1998.  Cash
proceeds from the offering, net of offering costs, were $99.9 million.   Of
this amount, $84.1 million was used to pay the cash portion of the purchase
price of the Acquired Companies, $3.6 million was used to retire debt of the
Company and the Acquired Companies, and $1.75 million was paid to a
stockholder for a five-year non-compete agreement.  In connection with the
IPO, the Company simultaneously acquired all of the outstanding capital stock
of Great Western Directories, Inc. ("Great Western"), Valu-Line of Longview,
Inc. ("Valu-Line"), Feist Long Distance Service, Inc. ("Feist"), FirsTel,
Inc. ("FirsTel") and Tele-Systems, Inc. ("Tele-Systems"), substantially all
of the assets of Long Distance Management II, Inc. ("LDM II"), Long Distance
Management of Kansas, Inc. ("LDM of Kansas"), The Switchboard of Oklahoma
City, Inc. ("Switchboard"), and National Telecom, a proprietorship, and 49%
of the outstanding capital stock of KIN Network, Inc. ("KINNET")
(collectively "Acquisitions" or "Acquired Companies").

      Prior to February 1998, ACG had not conducted any operations other than
those relating to the IPO and the Acquisitions. Consequently, the actual
financial statements included herein relate only to the parent company prior
to February 18, 1998, but include the results of the Acquired Companies for
the period February 18, 1998 to June 30, 1998.  Certain pro forma operating
information is presented for comparative purposes as if the IPO and the
Acquisitions had occurred on January 1, 1997. The pro forma financial
information does not purport to represent the Company's results of operations
that would have actually occurred if the IPO and the Acquisitions had in fact
occurred on the date stated above.  Since the Acquired Companies were not
under common control or management, historical combined results of operations
may not be comparable to, or indicative of, future performance. The pro forma
Consolidated Statements of Operations reflect the historical results of
operations of the Acquired Companies and were

                                    6
<PAGE> 7

derived from the respective Acquired Companies' financial statements. All
intercompany accounts have been eliminated in consolidation.


3.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Cash and Cash Equivalents - For purposes of reporting cash flows, cash
equivalents include highly-liquid investments purchased with a maturity of
three months or less.

      Property, plant and equipment -- Property, plant and equipment are
stated at cost, less accumulated depreciation. Depreciation is computed using
the straight-line or an accelerated method over the respective lives of the
assets. The estimated useful lives of the assets range from 3 to 31 years.

      Intangible assets from business acquisitions  -- Intangible assets
resulting from the cost of businesses acquired exceeding the fair value of
net assets acquired consist principally of the customer lists and goodwill.
The value of customer lists and their estimated useful lives were determined
using independent appraisals.  Customer lists and goodwill are amortized on a
straight-line basis over their estimated useful lives ranging from 5 to 10
years and 25 to 40 years, respectively.  For the three months and six months
ended June 30, 1998, amortization expense relating to intangible assets was
$2,141,000 and $3,112,000, respectively.

      Deferred costs -- At December 31, 1997, the Company had deferred
certain legal, accounting, appraisal and other costs incurred in connection
with the Acquisitions and the IPO. At December 31, 1997, deferred acquisition
costs amounted to approximately $929,000 and deferred offering costs amounted
to $1,756,800. When the Acquisitions were completed, deferred acquisition
costs were included in the determination of excess purchase price. Deferred
offering costs were charged to additional paid-in capital upon the closing of
the IPO.

      Deferred line acquisition costs include the direct costs incurred in
connection with establishing local access line service for customers and are
being amortized on a straight-line basis over the estimated life of the
average customer local service contract. Deferred line acquisition costs are
included in other assets.

      Income taxes -- Deferred tax assets and liabilities are recognized for
the future tax consequences attributable to differences between the carrying
amounts of existing assets and liabilities for financial reporting purposes
and for income tax purposes.  The Company's effective tax rate is
substantially higher than statutory tax rates principally because
amortization of certain intangible assets is not deductible for tax purposes.

      Revenue recognition -- Directory revenues are derived from the sale of
advertising space in telephone directories and are recognized on the date
that the directory is published and substantially delivered. If the estimate
of total directory costs exceeds advertising revenues for a specific region's
telephone directory, a provision is made for the entire amount of such
estimated loss.   Directory costs are deferred until the date that the
directory is published and substantially delivered. Directory costs include
all direct costs related to the publishing of a region's telephone directory,
such as publishing and

                                    7
<PAGE> 8

distribution expenses and commissions on sales, other sales expenses and
depreciation and amortization. General and administrative costs are charged
to expense as incurred.

      Costs incurred with the expansion into new markets include all direct
costs related to the publishing of a first-year telephone directory
(prototype directory). Advertising space in prototype directories is
generally provided to advertisers at no cost; therefore, no advertising
revenues are derived from prototype directories. Because the future economic
benefit of the direct costs related to prototype directories cannot be
determined, such direct costs are charged to expense as incurred. The Company
had no prototype directories for the periods ended June 30, 1998 and 1997.

      Telecommunications revenues are recognized when long-distance, local
and 800 services are provided.  Billings made in advance for local services
are deferred until earned.

      Net earnings (loss) per share -- The Company has adopted the provisions
of Statement of Financial Accounting Standards (SFAS) No. 128, "Earnings per
Share", which replaces the presentation of primary earnings per share and
fully diluted earnings per share with a presentation of basic earnings per
share ("Basic EPS") and diluted earnings per share ("Diluted EPS"). Basic EPS
excludes dilution and is determined by dividing income available to common
stockholders by the weighted average number of common shares outstanding
during the period. Diluted EPS reflects the potential dilution that could
occur if securities and other contracts to issue common stock were exercised
or converted into common stock.  In periods of net loss the dilutive impact
of outstanding stock options, stock warrants and other common stock
equivalents are anti-dilutive and are therefore not considered in calculating
Diluted EPS.

      Use of estimates -- The preparation of the financial statements in
conformity with generally accepted accounting principles requires management
to make estimates and assumptions that affect reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.

      Fair value of financial instruments--The Company's only financial
instruments are cash, short-term trade receivables and payables, notes
payable and capital lease obligations. Management believes the carrying
amounts of the financial instruments classified as current assets and
liabilities approximate their fair values because of their short-term nature.
Management believes the interest rates on its notes payable and capital lease
obligations represent fair market rates, and therefore their carrying value
approximates fair value.

      Comprehensive Income -- The Company has adopted Statement of Financial
Accounting Standards ("SFAS") No. 130, "Reporting Comprehensive Income," as
of the first quarter of 1998. SFAS No. 130 establishes new rules for the
reporting and display of comprehensive income and its components, however it
has no impact on the Company's net income or stockholders' equity.   For the
quarters ended June 30, 1998 and 1997, the Company did not incur items to be
reported in comprehensive income that were not already included in the
reported net earnings; therefore, comprehensive income (loss) and net income
(loss) were the same for these periods.

                                    8
<PAGE> 9

4.    ACQUISITIONS

      Concurrent with and as a condition to the closing of the IPO, the
Company acquired all of the outstanding capital stock of Great Western,
Valu-Line, Feist Long Distance, FirsTel and Tele-Systems, substantially all
of the assets of LDM II and LDM of Kansas, Switchboard and National Telecom,
and 49% of the outstanding capital stock of KINNET pursuant to the terms of
the Acquisitions.  The Acquisitions are accounted for using the purchase
method of accounting with the parent company being treated as the accounting
acquirer. The interest in KINNET is accounted for under the equity method of
accounting.

      The consideration paid for the Acquisitions included (i) cash, (ii)
Common Stock, (iii) promissory notes, and (iv) options and warrants to
purchase shares of Common Stock. For accounting purposes, in determining the
amount to be recorded as the purchase price attributable to the shares of
Common Stock issued for the Acquisitions, the value of such shares was
determined to be $38.0 million, which represents a discount of twenty percent
due to restrictions on the sale and transferability of the shares issued.
The following table sets forth for accounting purposes the fair value of
consideration paid with respect to the Acquisitions and the assets acquired.
The purchase price allocation has not been finalized due to the effect of
certain tax considerations of the acquired companies and the valuation of
consideration paid in the form of options and warrants.

<TABLE>
<CAPTION>
(In thousands)
      Consideration Paid for Acquired Companies:
<S>                                     <C>
            Cash                        $ 84,135
            Common Stock                  37,896
            Notes Payable                 17,350
            Options and Warrants             361
                                        --------
               Total Purchase Price     $139,742
                                        ========

      Assets Acquired:
            Net working capital         $  9,829
            Property and equipment         3,941
            Customer Lists                44,900
            Goodwill                      81,072
                                        --------
               Total Assets Acquired    $139,742
                                        ========
</TABLE>

      The promissory notes issued in the Acquisitions consist of (i) $15.0
million in notes payable two years from the closing of the Acquisitions and
bearing an annual rate of interest of five percent (5%), which notes may be
prepaid at any time and are subordinated to the Company's senior debt, (ii)
$2.0 million in notes convertible into shares of Common Stock at $14.00 per
share, payable two years from the closing of the Acquisitions and bearing an
annual rate of interest of ten percent (10%), which notes may be prepaid at
any time and are subordinated to the Company's senior debt, and (iii) a
$350,000 promissory note payable in three equal annual installments on each
anniversary and bearing an annual interest rate of seven percent (7%), which
note may be prepaid at any time.

      The following pro forma information presents results of operations as
if the Acquisitions had occurred at the beginning of the periods presented.
This pro forma information is based on historical information and does not
necessarily reflect the actual results that would have occurred nor is it
necessarily indicative of future results of the combined companies.

                                    9
<PAGE> 10

Pro forma information (In Thousands):

<TABLE>
<CAPTION>
                                                Six months ended June 30,
                                                -------------------------
                                    1997          1997             1998
                                  --------      --------         --------
<S>                               <C>           <C>              <C>
Total revenues                    $89,292       $50,812          $60,210
Net income (loss)                 $(5,577)      $  (225)         $(1,630)
Earnings (loss) per share         $  (.28)      $  (.01)         $  (.08)
</TABLE>

5.    SUBSEQUENT EVENT

      In August 1998, the Company entered into a $25.0 million revolving
credit facility with a bank.  The credit facility will be used for working
capital, capital expenditures and general corporate purposes.  Borrowings
under the facility are limited to 85% of eligible accounts receivable and
interest is due at LIBOR plus 1.5% or the bank's base rate plus .5%.  The
credit facility expires on August 6, 1999.


6.    NEW ACCOUNTING STANDARDS

      In 1997, the Financial Accounting Standards Board issued SFAS No. 131,
"Disclosures About Segments of an Enterprise and Related Information," which
establishes standards for reporting information about operating segments in
annual financial statements and requires that enterprises report selected
information about operating segments in interim financial reports issued to
shareholders. The Company will adopt the statement for its year end 1998
financial statements. The Company is currently evaluating the impact that the
statement will have on its reportable segments. Adoption of this statement
will have no impact on the Company's net income, financial position or cash
flows.

      In February 1998, the FASB issued Statement of Financial Accounting
Standards No. 132, "Employers' Disclosures about Pensions and Other
Postretirement Benefits", ("SFAS 132"). This statement requires additional
pension related disclosures. Adoption of this statement will have no impact
on the Company's net income, financial position or cash flows.

      In March 1998, the American Institute of Certified Public Accountants
(AICPA), issued Statement of Position 98-1 (SOP 98-1), "Accounting for the
Costs of Computer Software Developed or Obtained for Internal Use." This SOP
is effective for financial statements for fiscal years beginning after
December 15, 1998, with earlier application encouraged. The Company currently
accounts for its software costs generally in accordance with this SOP.

      In April 1998, the AICPA issued SOP 98-5, "Reporting on the Costs of
Start-Up Activities." This SOP provides guidance on the financial reporting
of start-up costs and organization costs. It requires costs of start-up
activities and organization costs to be expensed as incurred. The Company is
in compliance with this SOP.

                                    10
<PAGE> 11

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

      The statements contained in this Report that are not historical facts
(including statements as to the Company's plans, beliefs or expectations) are
forward-looking statements within the meaning of the federal securities laws
that involve certain risks and uncertainties.  Management wishes to caution
the reader that these forward-looking statements such as the Company's plans
to transition its resale customers to its own switch-based facilities, the
Company's belief that it will be able to achieve higher margins on its own
facilities-based local telecommunications services, the Company's
expectations that it will be able to meet its short-term working capital and
capital requirements from cash provided by operations and its existing credit
facilities, and the potential effects of the year 2000 issues, are plans and
predictions regarding future events and circumstances.  Actual events or
results may differ materially as a result of risks facing the Company.  For a
detailed discussion of those risks, reference is made to the statement under
"Risk Factors", in the Company's Registration Statement on Form S-1,
Securities Act File Number 333-37671 filed with the Securities and Exchange
Commission on February 12, 1998.


Results of Operations

General

      The following table sets forth, for the periods presented, certain
actual and pro forma information relating to the operations of the Company,
expressed as a percentage of revenues, excluding stock-based compensation
expense:

<TABLE>
<CAPTION>
                                              Three Months Ended                   Six Months Ended
                                       -------------------------------      ------------------------------
                                           Actual          Pro Forma          Pro Forma         Pro Forma
                                       June 30, 1998     June 30, 1997      June 30,1998      June 30,1997
                                       -------------     -------------      ------------      ------------
<S>                                        <C>               <C>               <C>               <C>
Telecom revenues                            54.3%             53.2%             48.1%             46.1%
Directory revenues                          45.7              46.8              51.9              53.9
                                           -----             -----             -----             -----
     Total revenues                        100.0             100.0             100.0             100.0
Cost of services                            61.7              54.3              56.9              52.5
Selling, general and administrative
     expenses                               30.8              32.6              31.5              32.3
Depreciation and amortization                9.1               9.7               8.1               9.0
                                           -----             -----             -----             -----
     Income (loss) from operations          (1.6)              3.4               3.5               6.2
                                           =====             =====             =====             =====
</TABLE>

      Prior to February 1998, ACG had not conducted any operations other than
those relating to the IPO and the Acquisitions. Consequently, the actual
financial statements included herein relate only to the parent company prior
to February 18, 1998, but include the results of the Acquired Companies for
the period February 18, 1998 to June 30, 1998.  Certain pro forma operating
information is presented for comparative purposes as if the IPO and the
Acquisitions had occurred on January 1, 1997. The pro forma operating
information does not purport to represent the results of operations of the
Company that would have actually occurred if the IPO and the Acquisitions had
in fact occurred on the date stated above.  Since the Acquired Companies were
not under common control or management, historical combined

                                    11
<PAGE> 12

results of operations may not be comparable to, or indicative of, future
performance. The pro forma Consolidated Statements of Operations reflect the
historical results of operations of the Acquired Companies and were derived
from the respective Acquired Companies' financial statements.

Results of operations for the three months ended June 30, 1998, compared to
the pro forma results for the three months ended June 30, 1997

      Revenues for the three months ended June 30, 1998, increased 20.3% to
$28.0 million from $23.3 million in the second quarter of 1997.   Revenues
from telecommunication services were $15.2 million, or 54.3% of total
revenues, compared to $12.4 million and 53.2% of pro forma total revenue in
1997.  Revenues form the telecommunications segment increased 22.7% over the
comparable quarter of 1997 and 10.5% over the sequential quarter of 1998. The
increase in telecommunications revenue is due to increased local service
revenue as the Company implemented aggressive sales and marketing of local
services in addition to long-distance services.  The Company did not provide
any local service in the second quarter of 1997, compared to second quarter
1998 local service revenue of  $3.4 million.  Local service revenue for the
second quarter of 1998, increased 55.8% over first quarter 1998 pro forma
local service revenue of $2.2 million.  In the three months ended June 30,
1998, the Company installed approximately 18,300 local access lines.  At June
30, 1998, the Company had 45,242 local access lines in service.

      Directory revenues increased 17.6% to $12.8 million from pro forma
$10.9 million in the 1997 second quarter.   Directory revenues were 45.7% of
total revenue in the second quarter of 1998, a decrease from 46.8% of total
revenue in the 1997 second quarter.  The Company distributed six directories
in both the second quarter of 1998 and 1997.  Approximately $.6 million of the
increase is due to higher advertising revenue from recurring directories, and
approximately $1.3 million of the increase is due to the net impact of the
timing of the distribution of certain directories.  The Company does not
recognize revenue from a directory until a directory is substantially
delivered.

      Cost of services for the three months ended June 30, 1998, increased to
$17.3 million from pro forma $12.6 million in the second quarter of 1997, an
increase of 36.7%.  Cost of services as a percentage of total revenues was
61.7% in 1998 compared to 54.3% in 1997.   The increase is due primarily to
increased costs of providing local and long distance services.
Telecommunication cost of service was $11.6 million, or 76.4% of
telecommunications revenues for the three months ended June 30, 1998, compared
to pro forma cost of telecommunications services of $7.4 million, or 60.4% of
pro forma telecommunication revenues, in the second quarter of 1997.  The
higher cost of providing telecommunications service in gross dollars is due to
the increase in local service revenue and increased long distance usage.  The
increase in operating costs of the telecommunication segment as a percentage
of telecommunication revenues in 1998 is due to higher volume of lower margin
local service and also due to lower gross margins from long distance.  In
response to competition for long distance service, the Company reduced prices
thereby lowering gross margin on long distance service.  When the Company
deploys its own local switching facilities, the Company expects to transition
its resale customers to its own switch-based facilities.  The Company
believes that it will be able to achieve higher gross margins by providing
telecommunications services on its own network than it can currently obtain
by reselling the services of the incumbent providers.  The lower gross margin
of the telecommunications segment in the second quarter of 1998 is partially
offset by higher gross margins of the directory publications

                                    12
<PAGE> 13

segment.  The cost of directory in the second quarter of 1998 was $5.7
million, or 44.2% of directory revenue, compared to directory costs of $5.2
million, or 47.3% of directory revenue, in the second quarter of 1997.  The
lower cost of directory services as a percentage of sales is due to
incremental advertising revenues from recurring directories exceeding the
incremental cost associated with those revenues.

      Selling, general and administrative expenses for the second quarter
ended June 30, 1998, increased to $8.6 million from pro forma $7.6 million in
1997. The increase is due primarily to the direct costs associated with the
higher sales volume.  As a percentage of total revenues, selling and
administrative expenses were 30.8% in 1998, and 32.6% in 1997.  The decrease
in the expense rate is due to economies of scale realized for general and
administrative costs as a result of the higher sales volume.  The Company
expects that its selling, general and administrative costs will continue to
increase as the Company undertakes more aggressive sales and marketing
programs to develop its businesses.

      Depreciation and amortization was approximately $2.6 million in the
second quarter of 1998, an increase of $.3 million from pro forma
depreciation and amortization of $2.3 million in 1997.  Depreciation and
amortization includes approximately $2.0 million of amortization relating to
intangible assets resulting from the Acquisitions in both periods.  The Company
expects that its depreciation and amortization will continue to increase as
the Company implements its strategy of installing its own network and
facilities.

      Interest expense for the second quarter was approximately $.3 million
in both 1998 and on a pro forma basis in 1997.  The interest is primarily on
debt to related parties issued as consideration for certain of the Acquired
Companies.

      Income tax expense was $.5 million in the second quarter of 1998
compared to pro forma income taxes of $.9 million in 1997.  The decrease is
due to lower taxable income in 1998 than in 1997.  The Company's effective
tax rate is substantially higher than statutory tax rates principally because
amortization of certain intangible assets is not deductible for tax purposes.

      Net loss was $1.0 million, or $.05 per share, in the three months ended
June 30, 1998, compared to pro forma net loss of  $.5 million, or $.02 per
share in 1997 second quarter. The decrease is primarily due to higher volume
of lower margin local service and lower margins from long distance service
discussed above.

      Earnings before interest, taxes, depreciation, amortization, equity
interest in KINNET and stock-based compensation expense  (EBITDA) decreased
to $2.4 million for the three months ended June 30, 1998, from pro forma
EBITDA of $3.2 million in the second quarter of 1997. EBITDA is a measure
commonly used in the telecommunications industry and is presented to assist
in an understanding of the Company's operating results and is not intended to
represent cash flow or results of operations in accordance with generally
accepted accounting principals.  EBITDA is not necessarily comparable to
other similarly titled measures

                                    13
<PAGE> 14

Pro forma results of operations for the six months ended June 30, 1998,
compared to the six months ended June 30, 1997

      Pro forma revenues for the six months ended June 30, 1998, increased
18.5% to $60.2 million from $50.8 million in the first six months of 1997.
Pro forma revenues from telecommunication services were $29.0 million, or
48.1% of pro forma total revenues, compared to $23.4 million and 46.1% of
total revenues in 1997.  The increase in telecommunications revenues is due
to increased local service revenue as the Company implemented aggressive
sales and marketing of local services in addition to long distance services.
The Company did not provide any local service in the first quarter of 1997,
compared to the first half of 1998 pro forma local service revenue of $5.5
million.  At June 30, 1998 the Company had approximately 45,000 local access
lines in service.

      Pro forma directory revenues increased 14.1% to $31.2 million from
$27.4 million in the first six months of 1997.  The Company distributed
eleven directories in both the first half of 1998 and 1997. Approximately
$1.7 million of the increase is due to higher advertising revenue from
recurring directories, and approximately $2.1 million of the increase is due
to the net impact of the timing of the distribution of certain directories.
The Company does not recognize revenue from a directory until a directory is
substantially delivered.

      Pro forma cost of services for the six months ended June 30, 1998,
increased to $34.2 million from $26.7 million in 1997, an increase of 28.2%.
Pro forma cost of services as a percentage of pro forma total revenues was
56.9% in 1998 compared to 52.5% in 1997.  The higher cost percentage in the
first half of 1998 is due to the telecommunications segment.
Telecommunication cost of service was $20.6 million, or 70.9% of
telecommunications revenues for the six months ended June 30, 1998, compared
to pro forma cost of telecommunications services of $14.5 million, or 61.9%
of pro forma telecommunication revenues, in the first half of 1997.  The
higher cost of providing telecommunications service in gross dollars is due
to the increase in local service revenue and increased long distance usage.
The increase in operating costs of the telecommunication segment as a
percentage of telecommunication revenues in 1998 is due to higher volume of
lower margin local service and also due to lower gross margins from long
distance. When the Company deploys its own local switching facilities, the
Company expects to transition its resale customers to its own switch-based
facilities.  The Company believes that it will be able to achieve higher
gross margins by providing telecommunications services on its own network
than it can currently obtain by reselling the services of the incumbent
providers.  The lower gross margin of the telecommunications segment in the
first six months of 1998 is partially offset by higher gross margins of the
directory segment.  The cost of directory services in the six months ended
June 30, 1998 was $13.7 million, or 43.8% of directory revenue, compared to
directory costs of $12.2 million, or 44.5% of directory revenue, in the
comparable period of 1997.  The lower cost of directory services as a
percentage of sales is due to incremental advertising revenues from recurring
directories exceeding the incremental cost associated with those revenues.

      Pro forma selling, general and administrative expenses for the six
month period ended June 30, 1998, increased to $18.9 million from $16.4
million in the same period of 1997.  The increase is due primarily to the
direct costs associated with the higher sales volume.  As a percentage of
total revenues, pro forma selling and administrative costs were 31.5% in
1998, and 32.3% in 1997.  The decrease in the expense rate is due to
economies of scale associated with the Company's higher sales volume.  The
Company expects that its selling, general and administrative costs will
increase as the Company undertakes more aggressive sales and marketing
programs to develop its businesses.

                                    14
<PAGE> 15

      Pro forma depreciation and amortization was approximately $4.9 million
in the six months ended June 30, 1998, compared to $4.6 million in the first
six months of 1997.  Pro forma depreciation and amortization includes
approximately $4.0 million of amortization relating to intangible assets
resulting from the Acquisitions in both periods.  The Company expects that its
depreciation and amortization will continue to increase as the Company
implements its strategy of installing its own network and facilities.

      Stock-based compensation of $1.8 million was expensed in the six months
ended June 30, 1998, relating to 300,000 stock options issued in December
1997.  The options vested equally over a three-month period beginning on the
date of the grant. This amount represents the remaining two thirds of the
total compensation expense expected to be realized based on the estimated
fair market value of the options on the date of the grant.  Stock-based
compensation expense of $.8 million was recognized in the fourth quarter of
1997.

      Pro forma interest expense was approximately $.7 million in both the
first six months of 1998 and 1997.  The interest is primarily on debt to
related parties issued as consideration for certain of the Acquired
Companies.

      Pro forma income tax expense was $1.4 million in the first half of 1998
compared to $2.4 million in 1997.   The decrease is due to lower taxable
income in the first half of 1998 than in the first half of 1997. The
Company's effective tax rate is substantially higher than statutory tax rates
principally because amortization of certain intangible assets is not
deductible for tax purposes.

      Pro forma net loss was $1.6 million, or $.08 per share, in the six
months ended June 30, 1998, compared to pro forma net loss of $.2 million,
or $.01 per share in the first half of 1997.  The increase in net loss is due
primarily to the stock-based compensation expense of $1.8 million.  Excluding
this item, net loss for the six months ended June 30, 1998, would have been
$.6 million, or $.03 per share.  The increase in net loss excluding the
stock-based compensation expense is due to the higher cost of providing local
service and lower margins from the Company's long distance service.

      Pro forma earnings before interest, taxes, depreciation, amortization,
equity interest in KINNET and stock-based compensation expense (EBITDA) was
$7.4 million for the six months ended June 30, 1998, a decrease from $7.9
million for the six months ended June 30, 1997.  The decrease is primarily
due to lower earnings from the telecommunications operations in 1998, offset
partially by higher earnings from the Company directory publishing segment.
EBITDA is a measure commonly used in the telecommunications industry and is
presented to assist in an understanding of the Company's operating results
and is not intended to represent cash flow or results of operations in
accordance with generally accepted accounting principles.


Actual period ended June 30, 1998

      The Company did not complete the Acquisitions until February 18, 1998,
therefore, actual results include only the activity of the Acquired Companies
from February 18, 1998 to June 30, 1998.  For the period ended June 30, 1998,
actual loss from operations was $1.3 million and net loss was $2.2 million.
Excluding the stock-based compensation of $1.8 million, the Company had
income from operations of

                                    15
<PAGE> 16
$.5 million and a net loss of $.4 million.  The Company had no operating
revenue in 1997 and was engaged principally in activities relating to the
IPO.

Liquidity and Capital Resources

      The Company's working capital at June 30, 1998 was $18.2 million and
its ratio of current assets to current liabilities was 1.9 to 1.0.

      On February 18, 1998, the Company completed its initial public offering
and simultaneously acquired 9 operating companies and a 49% interest in
another company.  Cash proceeds from the offering, net of offering costs,
were $99.9 million.  Of this amount, $84.1 million was used to pay the cash
portion of the purchase price of the acquired companies, $3.6 million was
used to retire debt of the Company and the Acquired Companies, and $1.75
million was paid to a stockholder of the Company for a five-year non-compete
agreement.  Stockholders of the Acquired Companies that became executive
officers or directors of the Company upon the consummation of the
Acquisitions received approximately $35.6 million of the cash purchase price
paid for the Acquisitions.

      On August 6, 1998, the Company entered into a $25.0 million revolving
credit facility with a bank.  The credit facility will be used for working
capital, capital expenditures and general corporate purposes.  Borrowings
under the facility are limited to 85% of eligible accounts receivable and
interest is due at LIBOR plus 1.5% or the bank's base rate plus .5%.  The
credit facility expires on August 6, 1999.

      The Company expects that it will be able to meet its short-term working
capital and capital requirements from cash provided by operations and funds
available under its revolving credit facility.  The Company continues to
evaluate other financing alternatives in order to finance its investment in
network facilities and other growth strategies.

YEAR 2000 ISSUE

      The year 2000 issue is a matter of world-wide concern for carriers and
affects many aspects of telecommunications technology, including the computer
systems and software applications that are essential for network administration
and operations. A significant portion of the voice and data networking and
network management devices have date-sensitive processing in them which affect
network administration and operations functions such as service activation,
service assurance and billing processes.

      The Company and its vendors have evaluated the year 2000 readiness of
the Company's computer systems and software applications. Certain of the
Company's key processing systems have recently been implemented and the
vendors of such systems have represented to the Company that the systems are
compliant with year 2000 issues without any modification and the Company will
require confirmation of year 2000 compliance in its future requests for
proposals from equipment and software vendors. Other legacy computer systems
and software that are currently in use are not currently compliant with year
2000 issues; however, the Company had previously planned on replacing such
systems in late 1998 for general business reasons other than the year 2000
issue. The failure of the Company's computer systems and software applications
to accommodate the year 2000 could have a material adverse effect on the
Company's business, financial condition, results of operation and cash flow.

      Further, if the networks and systems of the ILECs, IXCs and others on
whose services the Company depends and with whom the Company's networks and
systems must interface are not year 2000 functional, it could have a material
adverse effect on the operation of the Company's networks and, as a result,
have a material adverse effect on the Company. Most major domestic carriers
have announced that they expect all of their network and support systems to be
year 2000 functional by mid 1999. However, other domestic and international
carriers may not be year 2000 functional. The Company plans to participate in
the interoperability testing processes being put in place by industry
organizations and the Company intends to continue to monitor the performance
of its accounting, information and processing systems and software
applications and those of its third-party constituents to identify and resolve
any year 2000 issues. To the extent necessary, the Company may need to
replace, upgrade or reprogram certain systems and software applications to
ensure that all of the Company's computer systems and software applications
and all of its interoperability applications are year 2000 functional.
However, based on current information, the Company does not believe that it
will incur costs for any replacement, upgrade or reprogramming of its existing
computer systems or software applications to resolve any year 2000 issues that
will be materially in excess of those currently budgeted.


PART II - OTHER INFORMATION

Item 1. - Legal Proceedings
          -----------------

      Prior to the closing of ACG's initial public offering ("IPO") and ACG's
acquisition of Great Western Directories, Inc. ("Great Western"), Richard
O'Neal, the principal shareholder of Great Western and a current director of
ACG, expressed disagreement with the effect of the reverse stock split
involving ACG's predecessor (to be effected in connection with the
consummation of the IPO) on certain warrants that had been issued to the
stockholders of Great Western at the time of the execution of the initial
acquisition agreement between ACG and Great Western (the "Warrants").
Consolidated Partners Founding Fund ("CPFF"), a stockholder of ACG's
predecessor (as well as a stockholder of ACG after the consummation of the
IPO) and Mr. O'Neal executed a written agreement dated February 11, 1998
agreeing to engage in good faith negotiations after the Offering to determine
the type and amount of any consideration appropriately payable by CPFF to the
holders of the Warrants.  The written agreement further provided that if CFPP
and Mr. O'Neal could not reach a negotiated settlement within

                                    16
<PAGE> 17

forty-five days after the closing of the IPO, the matter would be referred to
binding arbitration and the cost of such arbitration would be borne by CPFF.
CPFF agreed not to effect any distribution of ACG common stock to its
interest owners prior to the resolution of these matters.

      No resolution was reached between Mr. O'Neal and CPFF within 45 days
following the consummation of the IPO and the matter has been referred to
arbitration. This matter was scheduled for arbitration on May 21, 1998,
however, the Company understands that pursuant to a court order, arbitration
of this matter has been stayed pending a determination by the court of whether
the agreement is binding and enforceable.

      In the event of a ruling or determination adverse to CPFF, any payment
which may be required by such a ruling or determination will be made solely by
CPFF. Such a payment will not involve the assets of the Company or the
issuance of additional Common Stock or Common Stock equivalents. However, such
a payment may be construed for accounting purposes as a capital contribution
by CPFF and deemed a payment by the Company of additional consideration for
the Great Western acquisition. This would increase the goodwill associated
with the Great Western acquisition and the related amortization charges.

      On May 14, 1998, Plaintiff Brenda A. Baldwin ("Plaintiff") filed a
three count Complaint against Great Western Directories, Inc. ("Great Western")
and Richard O'Neal ("O'Neal"), President of Great Western, Plaintiff alleges
that, pursuant to a decree of divorce, she received 31.25 shares of common
stock of Great Western, representing 2.5% of the issued and outstanding stock
of Great Western prior to January 10, 1997. Plaintiff alleges that she sold
her stock to Great Western on January 10, 1997, for $225,000 as a result of
certain misrepresentations and omissions by O'Neal, including a representation
that Great Western was struggling financially and its prospects for the future
were poor. Plaintiff also alleges that prior to the sale of her shares,
Mr. O'Neal was aware of negotiations between Great Western and Advanced
Communications Corp. regarding the sale of all of the shares of Great Western
to Advanced Communications Corp. and that he failed to disclose this
information.

      Shortly after the sale by Plaintiff, Great Western reissued the
Plaintiff's shares to Plaintiff's former husband, Ron Baldwin. Mr. Baldwin,
who already has an ownership interest in the company, paid $225,000 for the
shares.

      On June 16, 1997, the shareholders of Great Western entered into a stock
purchase agreement with Advanced Communications Corp. pursuant to which they
agreed to sell all of the issued and outstanding shares of Great Western. The
stock purchase agreement was restated on October 6, 1997. On February 12, 1998,
Advanced Communications Group, Inc., successor to Advanced Communications
Corp., completed an initial public offering and subsequently acquired all of
the issued and outstanding shares of Great Western pursuant to the restated
stock purchase agreement. Plaintiff alleges that had she not sold her shares,
she would have received consideration of approximately $2,350,000.

      Count I of the Complaint alleges that Great Western and O'Neal violated
Section 10b of the Securities Act of 1934 and Rule 10b-5 by reason of the
alleged misrepresentations and omissions described above. Count II of the
Complaint is a claim under the Texas securities laws based upon the alleged
misrepresentations and omissions described above. Count III of the Compalint
is a common law fraud claim also based on the alleged misrepresentations and
omissions described above. Plaintiff seeks actual and punitive damages in an
unspecified amount, as well as costs and attorneys' fees.

      Great Western and O'Neal have filed an answer denying the substantive
allegations of Plaintiff's Complaint and denying any liability to Plaintiff.
Preliminary discovery has taken place in the form of a production of documents
by the parties.

                                  17

<PAGE> 18

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

          (a)     Exhibits

                  Exhibit 3.1 - Restated Certificate of Incorporation
                                as Amended

                  Exhibit 11 - Computation of Earnings Per Share

                  Exhibit 27 - Financial Data Schedule

          (b)     Reports on Form 8-K

      During the quarter ended June 30, 1998, the company filed a Report on
Forma 8-K dated May 5, 1998 - Item 2 (Acquisition or Disposition of Assets)
which contained the following financial statements:

ADVANCED COMMUNICATIONS GROUP, INC. FINANCIAL STATEMENTS
Report of Independent Auditors
Consolidated Balance Sheets as of December 31, 1996 and 1997
Consolidated Statements of Operations for the period from inception (June 1,
      1996) through December 31, 1996 and the year ended December 31, 1997
Consolidated Statements of Changes in Stockholders' Deficit for the period
      from inception (June 1, 1996) December 31, 1996 and the year ended
      December 31, 1997.
Consolidated Statements of Cash Flows for the period from inception (June 1,
      1996) through December 31, 1996 and year ended December 31, 1997
Notes to Consolidated Financial Statements


GREAT WESTERN DIRECTORIES, INC. FINANCIAL STATEMENTS
Report of Independent Auditors
Balance Sheets as of December 31, 1996 and December 31, 1997
Statements of Operations for the year ended January 31, 1996, and the two
      years ended December 31, 1997

                                    18
<PAGE> 19

Statements of Stockholders' Equity for the year ended January 31, 1996, the
      11 months ended December 31, 1996 and the year ended December 31, 1997
Statements of Cash Flows for the year ended January 31, 1996, and the two
      years ended December 31, 1997
Notes to Financial Statements


VALU-LINE OF LONGVIEW, INC. FINANCIAL STATEMENTS
Report of Independent Auditors
Combined Balance Sheets as of December 31, 1996 and 1997
Combined Statements of Income for the three years ended December 31, 1995,
      1996 and 1997
Combined Statements of Stockholders' Equity for the three years ended
      December 31, 1995, 1996 and 1997
Combined Statements of Cash Flows for the three years ended December 31,
      1995, 1996 and 1997
Notes to Combined Financial Statements


FEIST LONG DISTANCE SERVICE, INC. FINANCIAL STATEMENTS
Report of Independent Auditors
Balance Sheets as of December 31, 1996 and 1997
Statements of Operations for the two years ended December 31, 1997
Statements of Stockholders' Equity for the two years ended December 31, 1997
Statements of Cash Flows for the two years ended December 31, 1997
Notes to Financial Statements


FIRSTEL, INC. FINANCIAL STATEMENTS
Report of Independent Auditors
Balance Sheets as of December 31, 1996 and 1997
Statements of Operations for the three years ended December 31, 1997
Statements of Stockholders' Deficit for the three years ended December 31,
      1997
Statements of Cash Flows for the three years ended December 31, 1997
Notes to Financial Statements


KIN NETWORK, INC. FINANCIAL STATEMENTS
Reports of Independent Auditors
Balance Sheets as of December 31, 1996 and 1997
Statements of Operations for the two years ended December 31, 1997
Statements of Stockholders' Equity for the two years ended December 31, 1997
Statements of Cash Flows for the two years ended December 31, 1997
Notes to Financial Statements

                                    19
<PAGE> 20

ADVANCED COMMUNICATIONS GROUP, INC. UNAUDITED PRO FORMA COMBINED FINANCIAL
STATEMENTS
Basis of Presentation of Unaudited Pro Forma Combined Financial Statements
Unaudited Pro Forma Combined Balance Sheet as of December 31, 1997
Unaudited Pro Forma Combined Statement of Operations for the year ended
      December 31, 1996
Unaudited Pro Forma Combined Statement of Operations for the year ended
      December 31, 1997
Notes to Pro Forma Combined Financial Statements


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.

                              Advanced Communications Group, Inc.
                              (Registrant)


Date:  August 14, 1998        /s/ Richard Anthony
                              -------------------
                              Richard Anthony
                              President and Chief Executive Officer


Date:  August 14, 1998        /s/ William H. Zimmer III
                              -------------------------
                              William H. Zimmer
                              Executive Vice President
                              and Chief Financial Officer
                              (Principal Financial and Accounting Officer)

                                    20