SECURITIES AND EXCHANGE COMMISSION


                             WASHINGTON, D.C. 20549

                        ________________________________
         
                                   FORM 10K-SB

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

For the fiscal year ended                                  Commission file
May 31, 1997                                                   number
                                                             000-18097

                        BERNARD HALDANE ASSOCIATES, INC.
                        --------------------------------
             (Exact name of Registrant as specified in its charter)

                          QUANTUM VENTURES GROUP, INC.
                           (Former Name of Registrant)

          Florida                                      59-2720407
          -------                                      ----------
(State or other jurisdiction                       (I.R.S. Employer
of incorporation or organization)                   Identification No.)

192 Lexington Avenue, 15th Floor, New York, New York 10016
----------------------------------------------------------
(Address of Principal Executive Offices)

444 Park Avenue South, Suite 503, New York, New York 10016
----------------------------------------------------------
(Former address of principal executive offices)

      Registrant's telephone number:                  (212) 679-3360

            
           Securities registered pursuant to Section 12(b) of the Act:
           -----------------------------------------------------------

                                                         Name of each exchange
Title of each class                                       on which registered
-------------------                                       -------------------

     COMMON                                                   NASDAQ

          Securities registered pursuant to Section 12(g) of the Act.


                                     COMMON

                                (Title of Class)


                                        1

<PAGE>



Indicate by check mark whether the Registrant (i) 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  (ii) has been  subject  to such  filing
requirements for the past 90 days.
                                                           YES   X     NO
                                                               ----       ----

      The aggregate  market value of the voting stock held by  nonaffiliates  of
the Registrant is approximately $1,132,290* (as of July 31, 1997.)


      APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS

      Indicate by check mark whether the  Registrant has filed all documents and
reports  required  to be filed by  Sections  12, 13, or 15(d) of the  Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court.
                                                YES        NO        N/A   X
                                                    ----      ----       ----

                  (APPLICABLE ONLY TO CORPORATE REGISTRANTS)







      Indicate  the number of shares  outstanding  of each of this  Registrant's
classes of common stock, as of the latest  practical date:  1,148,865  shares of
common  stock  issued and  outstanding  as of May 31,  1997.  (Includes  199,500
treasury shares.)


                      DOCUMENTS INCORPORATED BY REFERENCE

      Company's Registration Statement filed on Form S-18, File No. 000-18097.

      Annual Report on Form 10-K for the year ended May 31, 1993.

      Annual Report on Form 10-K for the year ended May 31, 1989.


      *Based upon market value of $2.75 per share,  representing  the average of
the low bid and ask  prices of  Registrant's  common  stock on July 31,  1997 as
reported by NASDAQ.






                                      2


<PAGE>



Item 1.  Business
-----------------

      (a)   General Development of Business
            -------------------------------

      Bernard Haldane  Associates,  Inc. (the "Company")  f/k/a Quantum Ventures
Group, Inc. owns the worldwide  licensing rights to the Bernard Haldane name and
system of career management.  The Bernard Haldane organization  operates through
sub  licensee  offices in the  United  States,  Canada  and the United  Kingdom,
offering  career  management,  out-placement  and job search  services under the
Bernard  Haldane  name.  Today there are 75 Bernard  Haldane  offices  operating
throughout the world.

      During the  Company's  last fiscal year,  nine new  licensee  offices were
opened.  Management  intends  to open  additional  licensee  offices,  and where
applicable,  offer  franchise  offices.  There are  currently  no company  owned
Haldane offices and management does not currently anticipate opening any company
owned  Haldane  offices.  During the past year,  the Company  licensed its first
overseas  office in the United  Kingdom.  The Company  will  continue to explore
overseas expansion opportunities.

        The Company has also developed a specially  designed  career  management
program to be offered to graduating  college  students  through its wholly owned
subsidiary,  First Career Corp. (See the narrative description of Business, Item
1(c) for a more detailed description of the operations of the Company.)

(b)   Financial Information about Industry Segments
      ---------------------------------------------

      The Company's primary business activity is providing career management and
advisory  services under the Bernard Haldane name.  Bernard  Haldane  operations
generated  royalty  revenues of $2,480,866 and generated  income before taxes of
$752,318,  for the  Company's  last fiscal year.  The Company also offers career
management  services  to recent  college  graduates  through  its  First  Career
program. No revenues have been generated to date.

(c)   Narrative Description of Business
      ---------------------------------

      The  Bernard  Haldane  system  offers its  clients a program  designed  to
prepare and teach its clients a means to achieve  individual career  advancement
and personal  development.  The Bernard Haldane system (the "System")  instructs
clients  on the  dynamics  of their  own  human  potential  and how to cope with
adverse changes in their  occupational  life through  individualized  counseling
sessions which normally last from three to twelve weeks.

      Dr. Bernard Haldane earned a P.H.D. in Humanities.  In 1946 he developed a
program to assist U.S.  military  officers in acquiring  civilian jobs following
World War II. Dr. Haldane also launched this program in  universities in the New
York area.  The initial  Haldane office was opened in New York in 1947 under the
name "Executive Job  Counselors",  and by 1948, Dr. Haldane was operating career
management  offices in Boston and Washington,  D.C. In 1958, Dr. Haldane changed
the Company's name from Executive Job  Counselors to Bernard  Haldane,  which it
and its licensees have used since that time.

                                        3

<PAGE>



      The current  system of  licensing  Bernard  Haldane  offices  began in the
1960s, with licensee offices in New York,  Chicago and Philadelphia.  The system
of Haldane licensee office expanded  significantly in the 1970s and early 1980s.
In 1986 Dan Bruce,  a licensee who operated  several  Haldane  offices,  and the
owner and principal  shareholder of DRB Ltd.,  acquired from Career Productivity
Inc., an entity owned by Dr. Bernard Haldane,  the principal rights,  names, and
methods  relating to  "Individual  Career  Counseling  Services"  on a worldwide
basis,  including the name "Haldane" and variations thereof,  although excluding
certain  activities  relating to the  personal  activities  of Dr.  Haldane.  In
consideration  for the transfer of these  rights,  DRB agreed to pay $14,000 per
month for ten years and $7,000 per month for an additional ten years (the latter
amount to be adjusted  beginning the eleventh year by 5% per year to "reflect an
inflation factor". To secure such payments,  DRB granted CPI a security interest
in the names, methods, rights, sublicenses, etc. conveyed therewith.

      In September 1989, there were  approximately  thirty seven Haldane offices
operating  throughout the United States and Canada. In most cases these licensee
offices paid a royalty fee equal to five percent (5%) of gross cash  revenues to
the license holder (DRB).  Total royalty  revenues  received by DRB for the year
ended 1988 totaled approximately $450,000.

      In September  1989, the Company formed Career  Services  Management  Corp.
("CSMC").  CSMC was an 80% owned subsidiary of the Company. In February 1995 the
Company acquired all shares of stock owned by the five minority  shareholders in
exchange for the issuance of a total of 75,000  shares of the  Company's  common
stock of which 45,000 shares have been redeemed  pursuant to the Company's stock
redemption program.

      In September 1989, CSMC acquired all of the issued and outstanding  shares
of stock of DRB for $1.25  million  payable,  $1 million at closing and $250,000
pursuant to a promissory note payable to Dan Bruce which provided for payment of
principal  and  interest  at the  rate of eight  percent  (8%)  per  annum.  The
principal  balance  on the note was to be  amortized  over a period of ten years
with the entire unpaid principal balance due in 1992. Mr. Bruce has subsequently
extended this  obligation  and under its current  terms  provides for payment of
interest only on the remaining outstanding principal balance of $200,000 payable
monthly at a rate of eight percent (8%) per annum.

      In addition to the  payment of the $1.25  million for the DRB shares,  DRB
remains  obligated to make monthly  payments of $7,000 per month until July 2006
(previous  to  July,  1996,  these  payments  were  $14,000  per  month)  to B+E
Partnership.  These  payments  are also  subject  to an  annual  cost of  living
adjustment.  At the time of  acquisition  of DRB Ltd.  these payments were being
made by DRB Ltd.  to Career  Productivity  Inc.,  whose  owner  was Dr.  Bernard
Haldane.  Subsequent thereto,  Career Productivity Inc. sold this obligation due
from DRB to B+E  Partnership.  One of the  partners  of B+E  Partnership  is Dan
Bruce,  the  previous  owner  of DRB  Ltd.  The  obligation  of  DRB to pay  B+E
Partnership  is  secured  by the  Haldane  license.  Should  DRB  default on its
obligation,  DRB would  forfeit  all rights to the use of the  Haldane  name and
system of career management. Mr. Bruce is not involved in DRB's or the Company's
operations.

   
                                      4


<PAGE>


      As of May 31,  1997,  there  were 75  Bernard  Haldane  offices  operating
throughout the United States, Canada and in the United Kingdom. The Company does
not currently operate any Haldane offices. However, several licensee offices are
owned by entities in which Jerold  Weinger,  the  Company's  president and chief
executive  officer  serves as either an officer,  director or  shareholder.  Any
Haldane  office  opened in a new  territory is subject to payment of a licensing
fee to DRB Ltd. at the prevailing licensing rate.

        Licensees  may open  additional  licensed  offices  within  an  existing
territory  without  payment of any new licensing  fees.  Offices  purchased from
existing licensees were not subject to payment of any territorial fee to DRB.
(See "Certain Transactions")









































                                        5


<PAGE>



                           THE BERNARD HALDANE SYSTEM

      The  Bernard   Haldane  System  (the   "System")   offers  its  clients  a
sophisticated  vocational program which can be utilized for career  advancement,
job hunting and self  satisfaction.  Most clients utilize the program as a means
to facilitate their job search or career development.

Some of the services offered included:

      Appraisal of client's qualifications.
      Development of client's career goals.
      Training clients to establish immediate and long-range objectives in
      relation to career goals.
      Developing a marketing program for the client.
      Developing a program to assist in establishing  appropriate
      interview contacts.
      Preparation for interviews.
      Development  of  effective  interview  techniques  to induce  job  offers.
      Counseling  on salary  negotiations  and fringe  benefits.  Assistance  in
      reviewing and assessing job offers.
      Future career planning.
      Consultation,   as  needed   concerning   organizational,   political  and
      interpersonal  skills related to career advancement.  Continued assistance
      for up to three years with client's career development.  Internet training
      and/or  access to assist  client in use of the World Wide Web in their job
      search.

      The System aids the client in developing the skills and tools necessary to
conclude a successful  job search.  The offices  provide  professional  guidance
through the actual search process and provides  assistance  until the client has
found a suitable position.  The System is taught on an individualized basis with
the client  working with a  professional  career adviser who guides and supports
the client through this process.

      The Bernard  Haldane  offices  will assist and support the client in three
ways; tangibly, psychologically and motivationally.  "Tangibly" includes several
aspects,  such as researching  companies via computer data bases, annual reports
and  brochures,  so the  client has an  understanding  of the  potential  of the
company's  background  and who  possibly  to  contact.  The client  undergoes  a
debriefing  regarding the  interviews he has went on in order to ascertain  what
the  client  has or has not  learned.  The  client  is  advised  as to the  next
appropriate  action to take. The  psychological  and  motivational  support is a
combination of the whole process as it is a part of the procedure to re-motivate
the client from the  frustrations  and  anxieties of the  interview  process and
unemployment.  The Bernard Haldane Office will work and support the client until
he/she has  accepted  the  position  of his/her  choice  within the  contractual
limitations.

      Each  office has the  flexibility  in the way it may  conduct  the System.
However,  the offices must comply with the overall System  guidelines.  Once the
client has commenced the new employment and/or position,  he/she enters into the
follow-up  phase  of  the  program.  A  client  should  return  to  each  office

                                      6


<PAGE>


approximately  90 days after  completion  of the  marketing  phase so his career
position can be assessed and to determine the client's attitudes and the way the
client has  progressed in to this new  position.  From this point the client can
draw upon the System and support services when and if needed for the duration of
the contract.

Client Fees
-----------

      A typical client pays fees set by the  individual  office in cash or based
on a payment plan over a period of several months.  Fees for the Haldane program
typically  cost from  $3,500 to  $7,500.  Fees are  payable  upon  commencement.
Licensee offices may, at their  discretion,  accept  installment  payments.  The
Company does not provide the sublicensee with financing.

Sub-licensee Fees
-----------------

      Sub-licensees (those owners/operators of the individually licensed Haldane
offices)  typically  pay a royalty  fee of either 5% or 6% of gross  revenues to
DRB. Royalty payments are due only on money actually collected.  New territorial
licenses are granted for a term of 20 years.  Prospective sublicensees typically
pay a sublicensing fee to DRB of approximately  $25,000 for the right to operate
a Haldane license in a designated area. This fee may be paid in full at the time
of executing the license or over a period of time.

The Bernard Haldane Operations
------------------------------

      The Haldane offices are generally located in suburban  metropolitan  area.
The size of each  office  varies  considerably  from one  licensee  to  another.
Average monthly rents vary considerably  depending upon the city and location of
each office. A typical Haldane office employs two consultants, two advisors, one
administrative  receptionist and one client support staffer. The consultants and
advisors are paid on a commission  basis.  The  administrative  receptionist and
client support staffer are paid a salary.  However, some offices may employ more
or less according to demand.

      The Company  believes its relationship  with the independent  sublicensees
are good and sponsors an annual  conference  in which  owners,  consultants  and
advisors are invited to attend. The Company  coordinates a national  advertising
program  for the  benefit of all  offices in the BHA  organization  and  through
advertisements in such  publications as the National Business  Employment Weekly
and The Wall Street  Journal.  The  Company  also  provides  initial and ongoing
seminars for career advisors and consultants as well as two company newsletters.
Some of the licensee  offices  utilize  television  and radio to supplement  the
present advertising.

      Jerold Weinger  serves as the  President,  Chairman of the Board and Chief
Executive Officer of the Company and oversees the Haldane operations.

Proposed Activities
-------------------

      The  continued  success  of the  Bernard  Haldane  operations  is  largely
dependent upon the number and success of local licensees. As a result, Haldane's

                                      7

<PAGE>


strategy is to continue the growth of its current  activities  through selective
expansion of licensee  offices.  During the Company's  last fiscal year nine new
licensee offices were opened. A total of $159,700 in territorial  licensing fees
were generated from opening these offices.  As the value of the Bernard  Haldane
name increases,  Management hopes to open additional offices in new territories,
especially  in Europe,  which will pay an initial  licensing  fee to DRB Ltd. in
addition  to the  monthly  royalty.  While  there can be no  assurance  that the
Company  will be able to  identify  prospective  licensees  who can  launch  the
Haldane program in Europe,  management  remains optimistic that the Company will
be able to open licensed  offices in Europe and expand  operations in the United
Kingdom.

      In conjunction  with the planned  expansion of licensee  offices,  DRB has
registered as a franchisor in those states which require  registration and offer
franchise  offices.  (See  "Government  Regulations".)  The Company's  franchise
circular has been filed and approved by the New York Attorney General's office.

      Some  of  the  licensee  owned  offices  currently  provide  out-placement
services to clients.  Management has found that many large national and regional
companies  require  the  services of a skilled  out-placement  company to assist
discharged  employees  to meet their goals and explore the market  place for new
job opportunities. In furtherance of these objectives,  Management has developed
an out-placement service,  called OUTFLEX, which is coordinated by the executive
offices and operated  through the various  licensee  offices.  Due to the unique
nature of out-placement  services,  the nationwide  Haldane  Operations have met
with limited success in the out-placement  field.  However,  individual  Haldane
offices  have met with varying  degrees of  profitability  in the  out-placement
field.  There are currently no plans for DRB to actively pursue an out-placement
program.

FIRST CAREER
      Following a 1995 pilot  program held at a major  northeastern  university,
the Company  through its wholly owned  subsidiary,  First Career  Corp.,  opened
three test markets  during the first quarter of 1997.  The purpose of testing is
to further  refine  First  Career's  job finding and career  management  program
directed  to the  market  of  college  seniors  and  recent  college  graduates.
Ultimately, the program is designed to be licensed nationwide, with royalty fees
paid for the right to operate a First Career office.

      Conceptually, the program appeals to graduates, and their parents, who are
frustrated in their search for meaningful career starts.  First Career's program
includes concentrated emphasis through trained counselors to help clients:

      Assess career employment qualifications
      Develop career goals
      Determine immediate objectives and the types of positions for which they
      are most qualified
      Establish realistic long range objectives that afford job satisfaction and
      income potential
      Construct a marketing  program and a  communications  program to establish
      appropriate level contacts and referrals.

                                        8


<PAGE>



      Prepare for interviews
      Develop interview techniques
      Review and assess job offers
      Negotiate  salary and fringe  benefits  following the decision to accept a
      job offer

      A  follow-up  review  designed  to  assist  in  internal  advancement  and
revalidation of career objectives.

      First career has incurred losses to date of nearly  $200,000.  The Company
attributes  this  loss  to  non-recurring  start-up  costs,  developing  program
materials and pilot testing.

Competition
-----------

      Management  believes that Bernard Haldane provides a unique service to its
clients which is unmatched by so-called job placement  agencies which attempt to
match clients with prospective  employees as opposed to the Haldane system which
provides individualized career management services.

      Nationwide there are several large career out-placement agencies including
Drake Beam Moran,  Right  Associates and Lee Hecht Harrison and Associates which
compete with Haldane to provide corporate out-placement and counseling services.
The focus of these companies is out-placement  services marketed to corporations
and not the individual client which is the primary focus of Haldane.

      The career management and employment  service market is highly fragmented,
and no single company possesses a major share of the market.  Although there are
hundreds of career  management,  job placement and employment service companies,
most are very small and operate in a single market.

      The  large   number  of   employment   services   and  career   management
organizations is a result of the low barriers to entry in the industry. However,
most companies remain small because expansion  requires a continued  increase in
working capital.

      The competitive  structure within each local marketing area is unique.  In
most major markets,  many of the large job placement  publicly traded  companies
will be present, and in addition,  there will be several large local competitors
which operate only in that market.  Competition is also provided by governmental
entities, such as state employment offices.

      The  Company's  marketing  strategy  is to promote  its  services in local
markets primarily through print advertising. Some licensee offices have utilized
radio and  television  advertising  with  varying  degrees of  success.  DRB has
prepared  television  commercials for use by the individual licensee offices and
makes these commercials  available at no charge.  Advertising in The Wall Street
Journal and National Business  Employment Weekly provide the Haldane system with
national exposure.  Each one of the sub-licensee offices, the owner/operators of
the individual  licensee  offices,  contribute to the cost of advertising in the
National Business Employment Weekly.

      Career management agencies in the U.S. are not regulated by any particular
federal laws.  However, some states require registration and/or licensing.

                                        9

<PAGE>



Government Restrictions
-----------------------

      Career  management  and  job  placement   organizations   have  become  an
increasingly  regulated  field,  particularly  by  the  states.  Several  states
prohibit  the payment of an advance  fee prior to securing a new job.  While the
Bernard Haldane system does not advertise as a job placement  agency some states
could  construe  the  Haldane  operations  as  falling  within  their  statutory
guidelines and accordingly,  restrict  operations in that state or, prohibit the
payment of any advance fees. Such regulation may adversely affect the operations
of the licensee offices.

      All Bernard  Haldane  offices  are subject to state and the Federal  Trade
Commission's  guideline on advertising and unfair and deceptive trade practices.
Prior to the  acquisition  of DRB,  several  of these  offices  were  cited  for
violations of these  provisions.  Management  believes that the licensee offices
are currently in compliance will all applicable guidelines.

      The Federal Trade  Commission  and some states may view,  the payment of a
royalty fee, the basis of which is the granting of a right to operate a business
using  the  payee's  name,   program  or  system  as  constituting  a  franchise
relationship. The fee may be a set sum for the right to operate the business or,
the royalty  payment may be based upon the payee's  revenues or a combination of
both.

      The Federal Trade  Commission has  promulgated its own rules regarding the
sale  of  franchisee   locations   which  are  formally   entitled   "Disclosure
Requirements and Prohibitions  Concerning  Franchising and Business  Opportunity
Ventures".  These rules  provide in part that prior to the sale of a  franchise,
the franchisor must deliver to the franchisee a disclosure  document.  Filing of
the franchise  documents with the FTC is not required prior to soliciting  sales
of the franchise.  Certain states may or may not have similar  disclosure and/or
registration requirements.

      In those states where the granting of a license for the right to operate a
Bernard  Haldane  office may  constitute a franchise,  DRB intends to enter into
franchise  agreements with current  licensees,  and if necessary under the state
statutes,  DRB will offer current licensees the right of rescission.  Management
is of the opinion that the  potential  liability  for  violation of any state or
federal statute relating to the sale of a franchise is not material.  The System
of DRB licensed Bernard Haldane offices has been in existence since the 1960s. A
majority of the current sublicensees  acquired their license from DRB Ltd. prior
to  the  Company's  acquisition  of  its  Haldane  license.  Even  assuming  any
sublicensee  has a  private  right of  rescission,  the  applicable  statute  of
limitations has expired for these private actions.









                                       10


<PAGE>



Employees
---------

      The  Company  employs  five  full  time  employees.   Additional  staffing
requirements are handled by temporary staffing agencies.


Item 2.  Properties
-------------------

      The Company's executive and corporate offices are currently located at 192
Lexington  Avenue,  New York,  New York  10016.  The  Company  currently  leases
approximately  7,000 square feet of space at a cost of approximately  $9,900 per
month. The Company  subleases  approximately 70% of this space, at the same cost
per square foot,  to entities in which Mr.  Weinger is  associated.  Net monthly
lease cost to the  Company  after  payment by the  subtenants  is  approximately
$3,000 per month.



Item 3.  Legal Proceedings
--------------------------

      There are currently no pending or threatened material legal proceedings.


Item 4.  Submission of Matters to a Vote of Security Holders
------------------------------------------------------------

                                     NONE

























                                       11

<PAGE>




                                    PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matter.
------------------------------------------------------------------------------

      (a)   Market Information
            ------------------

      The Company's common stock is currently traded on the National Association
of Securities  Dealers  Automated  Quotation System  ("NASDAQ") under the symbol
"BHAL".  There is limited trading actively in the Company's securities and there
can be no assurance a regular trading market for the Company's common stock will
be sustained.

      The following table sets forth,  for the period  indicated,  the bid price
range of the Company's common stock:

                                                           Common Stock
                                                           ------------

                                                    High Bid         Low Bid
                                                    --------         -------
1994
----

Quarter Ended February 28, 1994                        $2.87           $2.00

Quarter Ended May 31, 1994                             $3.00           $2.00

Quarter Ended August 31, 1994                          $2.75           $2.50

Quarter Ended November 30, 1994                        $2.75           $2.625


1995
----

Quarter Ended February 28, 1995                        $2.50           $2.62

Quarter Ended May 31, 1995                             $2.25           $2.25

Quarter Ended August 31, 1995                          $2.56           $2.43

Quarter Ended November 30, 1995                        $2.53           $2.43

1996
----

Quarter Ended February 29, 1996                        $2.87           $2.43

Quarter Ended May 31, 1996                             $2.56           $2.43


                                      12


<PAGE>

                                                           Common Stock
                                                           ------------

                                                    High Bid         Low Bid
                                                    --------         -------

Quarter Ended August 31, 1996                          $2.87           $2.43

Quarter Ended November 30, 1996                        $2.44           $2.44

1997
----

Quarter Ended February 28, 1997                        $2.75           $2.25

Quarter Ended May 31, 1997                             $2.50           $2.25

Period Ended July 31, 1997                             $2.37           $2.25


(Prices quoted reflect a prior 100:1 reverse stock split and a 4:1 reverse stock
split in May 1992.)

      Such market quotations reflect the high bid and low prices as reflected by
NASDAQ or by prices,  without retail  mark-up,  mark-down or commissions and may
not necessarily represent actual transactions.  The following companies serve as
market makers for the Company's  securities:  Tasin & Co., Carr  Securities  and
Howe, Barnes Investments Inc.

      (b)   Holders
            -------

      As of July 31, 1997 there were  approximately  1,350  holders of record of
the Company's common Stock.

      (c)   Dividends
            ---------

      The Company has not paid any cash  dividends  since its  inception and the
Board of  Directors  does not  contemplate  doing  so in the  near  future.  Any
decisions  as to future  payment of  dividends  will depend on the  earnings and
financial  position  of the  Company  and such  other  factors  as the  Board of
Directors deems relevant.











                                       13


<PAGE>

      Item 6. Selected Financial Data
      --------------------------------

      Summary of Operations:

      For the Years Ended May 31, 1997, 1996, 1995, 1994 and 1993.

                       1997         1996         1995        1994         1993
                                              (Restated)  (Restated)  (Restated)
Revenue

Royalty
Income              $2,480,866   $2,244,818  $1,747,988  $1,214,091  $  959,395

Sublicense
Income              $  159,697   $    -0-    $  104,214  $   99,625  $   19,229

Other
Income              $    -0-     $    -0-    $   35,400  $    -0-    $    -0-
                                                                    
Interest
Income              $  107,232   $   99,621  $   49,785  $   14,062  $   12,464


Total
Revenues            $2,747,795   $2,344,439  $1,937,387  $1,327,778  $  991,088

Net Income
 (Loss)             $  461,092   $  533,440  $  699,105  $  206,074  $  (86,670)

Net Income
 (Loss) per
  Share of
  Common Stock      $      .45   $     0.44  $     0.61  $     0.20  $     (.09)


      Restated for discontinued operations of retail travel agency.


SUMMARY OF BALANCE SHEET AS OF MAY 31

                       1997         1996        1995         1994        1993
                                             (Restated)   (Restated)  (Restated)

CURRENT ASSETS      $2,538,234   $2,147,294  $2,007,844  $1,128,480  $  731,440

Other Assets        $1,445,854   $1,277,536  $1,504,467  $1,529,655  $1,697,903

TOTAL ASSETS        $3,984,088   $3,424,830  $3,512,311  $2,658,135  $2,429,343

CURRENT LIABILITIES

Account Payable
and other Current
Liabilities         $  356,973   $ 149,695   $  213,660  $  157,424  $  137,096

Current Maturities
of Long Term Debt   $  235,240   $  245,956  $  315,951  $  307,065  $  298,860

Other Liabilities   $  512,518   $  555,799  $  591,437  $  702,988  $  810,053

Stockholder's
Equity              $2,879,357   $2,473,380  $2,391,263  $1,490,658  $1,183,334

TOTAL LIABILITIES
AND STOCKHOLDERS'
EQUITY              $3,984,088   $3,424,830  $3,512,311  $2,658,135  $2,429,343

      Restated for discontinued operations of retail travel agency.

                                       14

<PAGE>


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


      While  management  remains  pleased with the results of operations for the
past year, management believes that royalty revenues will not increase at nearly
the  same  rate  as in  the  past.  Although  royalty  revenues  increased  from
$2,244,818 to $2,480,866,  the percentage  increase in royalty  revenue was only
11% as compared to a 28% increase  from 1995 to 1996.  Moreover,  total  royalty
revenues  per office  declined  for the first time.  While nine new  territorial
offices  opened  this past year and  generated  $159,697 in  licensing  fees (as
compared to no new sublicensee  offices in 1996)  management does not anticipate
opening a  substantial  number of new  licensed sub  licensee  offices.  Haldane
offices are already open in almost every major  metropolitan  area in the United
States and Canada.  While there will likely be additional expansion into smaller
metropolitan  areas,  the  licensing fee and the royalty  revenues  which can be
generated will likely be  significantly  less than the typical Haldane office as
the geographical and demographical  market for the Haldane services and products
approach a saturation level.


      In an effort to increase its revenue base, the Company opened an office in
the United Kingdom. Due to logistical constraints,  the Company experienced only
limited success with this one office.  While management  intends to pursue other
opportunities  overseas,  there  can be no  assurance  that  expansion  into the
overseas market will prove successful.

      In an effort to diversify revenues,  management  identified a new targeted
market and  developed a special  program for this market,  First  Career.  First
Career provides career management for recently  graduated  college students.  To
date, First Career has incurred losses of $196,694 and there can be no assurance
that management will be able to reverse this trend.

      During the Company's last fiscal quarter, the Company's Board of Directors
received an offer from Mr. Weinger,  Mrs. Weinger,  the wife of Mr. Weinger, and
Mrs. Nadel, the wife of the Company's former  president,  to purchase the shares
of stock  owned  by the  outside  investors  at a cost of $2.75  per  share.  In
conjunction therewith, the Board of Directors determined that it would be in the
best  interests  of the  company  and  the  outside  shareholders  to  name  two
independent  directors to the Company's  Board of Directors to consider and vote
upon the fairness of the offer. On April 25, 1997,  Jeffrey  Schachter and Gregg
Weiss  were  elected  to the  Board  of  Directors.  In order  for the  Board to
determine  the  fairness  of the offer,  Laidlaw & Co. was  retained to render a
fairness opinion in connection with the proposed "going private" transaction. On
August 11, 1997 Laidlaw & Co. opined that from a financial point of view , it is
their opinion that the public  shareholders would be entitled to receive the sum
of $3.00 per share.  After reviewing the fairness  opnion,  Mr. and Mrs. Weinger
and Mrs.  Nadel  increased  their offer to purchase  the shares of common  stock
owned by the public investors to $3.00 per share.  Subsequent thereto, the Board
of  Directors  met and voted to  accept  the  offer  made by Mrs.  Nadel and Mr.
Weinger.


                                       15


<PAGE>


      Mr. and Mrs.  Weinger  and Mrs.  Nadel (the  "Weinger-Nadel  Group")  have
advised the Company that (i) they intend to establish  an entity  ("NEWCO")  for
the purpose of merging with and/or  combining  with the  Company,  and (ii) they
will contribute their shares of Common Stock in the Company to NEWCO in exchange
for securities of NEWCO. The Weinger-Nadel  Groups's proposal is to be submitted
to the vote of the Company's stockholders and will be subject to their approval.
However,  members of the  Weinger-Nadel  Group have, and therefore,  NEWCO, will
have a sufficient number of votes to carry stockholder approval of the proposal.
It  is  anticipated  that  if  such  merger  or  combination  is  approved,  all
stockholders (other than member s of the Weinger-Nadel  Group), will be entitled
to receive  $3.00 per share for their  shares of the  Company's  Common Stock or
such  amount as if found  appropriate  in court  assessing  their  rights  under
Florida law. The Company  anticipates  making further  announcements and a proxy
statement  will be  disseminated  to all  stockholders  of record  detailing the
proposal, the reasons for same and described stockholder rights.

LIQUIDITY CAPITAL RESOURCES

      As of May 31,  1997 the  Company  had  $2,538,234  in  current  assets  as
compared to $2,147,294 on May 31, 1996.

      Accounts  receivable  for 1997 total  $419,470  as compared to $329,146 in
1996. This increase is directly  attributable to the increasing royalty revenues
generated from the Haldane operation.  Notes receivable  increased from $183,371
to  $600,389.   This  increase  is  due  primarily  to  notes  receivables  from
sublicensees.  The Company has also  recorded  $145,000  for  deferred  taxes as
compared  to  $83,000  in  1996.  Total  assets  increased  from  $3,424,830  to
$3,984,088.

      Current liabilities increased from $395,651 to $592,213 as of May 31, 1997
due  primarily to an increase in accounts  payable  from $56,968 to $207,316.  A
significant portion of this increase is attributable to expenses associated with
the Haldane  anniversary  conference  in Las Vegas,  Nevada.  Long term debt was
reduced from $541,080 to $498,839.

      For 1997, cash flow from operating activities totaled $750,972 as compared
to $746,509 in 1996 and $885,897 in 1995.

      The Company  believes that its current cash  position and working  capital
are sufficient to meet its operational requirements for the coming year. Royalty
revenues from licensee offices and the sale of territorial rights to the Bernard
Haldane  offices are expected to be  sufficient  to meet the  Company's  ongoing
operational   expenses.   Management  does  not  anticipate  the  need  for  any
significant  capital  expenditures  in the coming year which  would  require any
third party  financing.  Nor does the Company believe that there is any material
risk of any sublicensee seeking rescission pursuant to any technical  violations
of state franchising statutes.







                                       16


<PAGE>



RESULTS OF OPERATION

      The Company reported income from continuing operations before income taxes
of $441,150 on revenues  of  $2,747,795,  and net after tax income of  $461,092.
This  compares to a net after tax income of  $533,440 on revenues of  $2,344,439
for the fiscal  year ended May 31,  1996 and net after tax income of $699,105 on
revenues of $1,937,387 for 1995.  Royalty income from Haldane offices  increased
from  $1,747,988 in 1995, to $2,244,818 in 1996 and $2,480,866 in 1997. This 11%
increase from 1996 to 1997 in royalty  revenue is primarily  attributable  to an
increase  in  the  number  of  Haldane  offices.   Income  attributable  to  the
discontinued  operations  of Quantum  Tours was  $19,942 in 1997 as  compared to
$19,996 in 1996 and a loss of $31,701 in 1995.

      Payroll,  general and  administrative  costs  increased from $1,147,271 in
1996 to $1,658,353.  This increase can be  attributable  to increased  costs and
expenses associated with the operations, management and oversight of the Haldane
operations,  increased  costs and payroll  expenses at the  Company's  executive
offices as well as costs  associated  with the  development  of the First Career
college program. In addition, this past year the company sponsored in Las Vegas,
Nevada its 50th  anniversary  conference.  The affair was  attended  by licensed
owners and their staff. The Company arranged for speakers and training  seminars
in addition to sponsoring an awards banquet during the four day conference.  The
decline in the Company's  net income from 1996 to 1997 is directly  attributable
to  approximately  $196,000  in  funding  for First  Career  and the cost of the
anniversary conference.

      Advertising  expenditures  increased from $73,538 to $78,544.   This small
increase in  advertising  expense is due to costs in marketing  the First Career
college program.

      Income  before  taxes was  $752,318  as  compared  to $841,768 in 1996 and
$728,806 in 1995.  Net income  after taxes  continues  to decline,  falling from
$699,105 in 1995 to $533,440 in 1996 and $461,092 in 1997.  The Company  remains
liable for federal and state  income  taxes at the  prevailing  rates on current
income as all carryforward tax losses have been utilized.

      The Company  anticipates  increases in royalty payments in the coming year
as the  existing  Haldane  offices  generate  marginal  increases  in  revenues.
However,  it is  unlikely  that the Company  will be able to maintain  its prior
growth rate as fewer new markets  become  available and  competition in existing
markets becomes increasingly difficult.

      Management  remains  disappointed  with the  results  of  launch  of First
Career. While the focus and pricing of the program have been modified, there can
be no  assurances  that  the  Company  will  be  able to  operate  First  Career
profitably in the future.

      Management  does not at this time  anticipate  opening any  company  owned
offices.  However,  management does not wish to foreclose this option should the
opportunity arise.


Item 8.  Financial Statements and Supplementary Data
----------------------------------------------------


                                       17

<PAGE>
                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                                      INDEX

                              FINANCIAL STATEMENTS








                                                                        PAGE
                                                                        ----
                                                                
Independent Auditors' Report                                             F-2
                                                                
Consolidated Balance Sheets                                     
   May 31, 1997 and 1996                                              F-3 - F-4
                                                                
Consolidated Statements of Income                               
   Years Ended May 31, 1997, 1996 and 1995                            F-5 - F-6
                                                                
Consolidated Statements of Changes in Stockholders' Equity      
   Years Ended May 31, 1997, 1996 and 1995                               F-7
                                                                
Consolidated Statements of Cash Flows                           
   Years Ended May 31, 1997, 1996 and 1995                            F-8 - F-9
                                                                
Notes to Consolidated Financial Statements                           F-10 - F-25





















                                                                
                                       F-1


<PAGE>











                         INDEPENDENT AUDITORS' REPORT


To the Board of Directors
Bernard Haldane Associates, Inc.


We have audited the accompanying  consolidated balance sheets of Bernard Haldane
Associates,  Inc. and  Subsidiaries  as of May 31, 1997 and 1996 and the related
consolidated  statements of income,  changes in stockholders'  equity,  and cash
flows for each of the  three  years in the  period  ended  May 31,  1997.  These
consolidated  financial  statements  are  the  responsibility  of the  Company's
management.  Our  responsibility is to express an opinion on these  consolidated
financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the financial  position of Bernard  Haldane
Associates, Inc. and Subsidiaries as of May 31, 1997 and 1996 and the results of
their  operations and their cash flows for each of the three years in the period
ended May 31, 1996, in conformity with generally accepted accounting principles.





                                                /s/ Miller, Ellin & Company 
                                                --------------------------- 
                                                CERTIFIED PUBLIC ACCOUNTANTS

New York, New York
August 7, 1997, except for
 Note 6 (e), which is dated
 September 11, 1997

                                       F-2


<PAGE>

                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS


                                     ASSETS

<TABLE>
<CAPTION>
                                                                         MAY 31,
                                                                 -----------------------
                                                                    1997        1996
                                                                 ----------   ----------
<S>                                                              <C>          <C>       
CURRENT ASSETS:
     Cash and cash equivalents                                   $1,698,099   $1,559,116
     Short-term investments                                          55,426       53,146
     Accounts receivable - net of allowance for doubtful
        accounts of $290,000 in 1997 and $170,000 in
        1996 (includes receivables from related parties
        of $86,413 and $105,325)                                    419,470      329,146
     Notes receivable - net (Note 4)                                149,080       48,478
     Due from related parties (Note 13)                              11,001       28,039
     Prepaid expenses and miscellaneous receivables                  60,158        9,734
     Deferred taxes (Note 9)                                        145,000       83,000
     Net assets of discontinued operations (Note 14)                   --         36,635
                                                                 ----------   ----------

              Total current assets                                2,538,234    2,147,294
                                                                 ----------   ----------

OTHER ASSETS:
     Licenses - net of accumulated amortization of
        $1,657,917 in 1997 and $1,460,376 in 1996 (Note 5)          864,611    1,062,152
     Equipment, fixtures and leasehold improvements -
        net of accumulated depreciation of $28,871 in
        1997 and $19,549 in 1996                                     50,831       20,031
     Security deposits and other                                     79,103       60,460
     Notes receivable - net (includes receivables from related
        parties of $27,647 and $31,152) (Notes 4 and 13)            451,309      134,893
                                                                 ----------   ----------

              Total other assets                                  1,445,854    1,277,536
                                                                 ----------   ----------

TOTAL ASSETS                                                     $3,984,088   $3,424,830
                                                                 ==========   ==========

</TABLE>
















         The accompanying notes are an integral part of these statements

                                       F-3


<PAGE>

                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                      LIABILITIES AND STOCKHOLDERS' EQUITY


                                                                                   MAY 31,
                                                                          -----------------------
                                                                             1997         1996
                                                                          ----------   ----------
<S>                                                                       <C>          <C>       
CURRENT LIABILITIES:
     Cash overdraft                                                       $     --     $   18,044
     Current maturities of long-term debt (Note 5)                           235,240      245,956
     Accounts payable                                                        207,316       56,968
     Accrued expenses and other current liabilities                            8,147       12,778
     Income taxes payable                                                    141,510       61,905
                                                                          ----------   ----------

         Total current liabilities                                           592,213      395,651
                                                                          ----------   ----------

OTHER LIABILITIES:
     Long-term debt (Note 5)                                                 498,839      541,080
     Deferred rent payable                                                    13,679       14,719
                                                                          ----------   ----------

                                                                             512,518      555,799
                                                                          ----------   ----------

         Total liabilities                                                 1,104,731      951,450
                                                                          ----------   ----------

COMMITMENTS AND CONTINGENCIES (Note 6)

STOCKHOLDERS' EQUITY (Note 7):
     Common stock ($.00001 par value; 950,000,000 shares
       authorized, 1,148,865 shares issued and
       outstanding)                                                               12           12
     Additional paid-in capital                                            2,761,727    2,761,727
     Retained earnings                                                       624,056      162,964
                                                                          ----------   ----------
                                                                           3,385,795    2,924,703
     Less: Treasury stock (199,500 and 179,500 shares at cost) (Note 8)      506,438      451,323
                                                                          ----------   ----------

         Total stockholders' equity                                        2,879,357    2,473,380
                                                                          ----------   ----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                $3,984,088   $3,424,830
                                                                          ==========   ==========
</TABLE>








         The accompanying notes are an integral part of these statements

                                       F-4


<PAGE>



                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
                                                                 YEARS ENDED MAY 31,
                                                    ---------------------------------------  
                                                        1997          1996         1995
                                                    -----------   -----------   -----------
                                                                                (Restated)
<S>                                                 <C>           <C>           <C>        
REVENUES:
   Royalty income (includes royalty income
     from related parties of $301,394, $243,760
     and $165,129, respectively)                    $ 2,480,866   $ 2,244,818   $ 1,747,988
   Interest, dividends and other income                 107,232        99,621        49,785
   Sub-license income (includes sub-license
     income from related parties of $41,588,
     $-0- and $61,754, respectively)                    159,697          --         104,214
   Gain on sale of investment (Note 2)                     --            --          35,400
                                                    -----------   -----------   -----------

         Total revenues                               2,747,795     2,344,439     1,937,387
                                                    -----------   -----------   -----------

EXPENSES:
   Payroll and related costs                            453,573       362,554       337,207
   Other general and administrative                   1,204,780       784,717       541,426
   Amortization                                         197,541       197,541       197,541
   Advertising                                           78,544        73,538        46,805
   Interest                                              61,039        68,558        75,602
   Lawsuit judgment (Note 11)                              --          15,763        10,000
                                                    -----------   -----------   -----------

         Total expenses                               1,995,477     1,502,671     1,208,581
                                                    -----------   -----------   -----------

INCOME FROM CONTINUING OPERATIONS
   BEFORE INCOME TAXES (CREDITS)                        752,318       841,768       728,806

INCOME TAXES (CREDITS) (Note 9)                         311,168       328,324        (2,000)
                                                    -----------   -----------   -----------

INCOME FROM CONTINUING OPERATIONS                       441,150       513,444       730,806

DISCONTINUED OPERATIONS (Note 14):
   Income (loss) from operations of travel agency
     disposed of (net of income taxes of $10,000,
     $8,000 and $-0-, respectively)                      19,942        19,996       (31,701)
                                                    -----------   -----------   -----------

NET INCOME                                          $   461,092   $   533,440   $   699,105
                                                    ===========   ===========   ===========

</TABLE>







               The accompanying notes are an integral part of these statements

                                           F-5


<PAGE>



                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF INCOME
                                   (CONTINUED)






                                                    YEARS ENDED MAY 31,
                                          -------------------------------------
                                             1997         1996         1995
                                          ---------     --------    -----------
                                                                     (Restated)

NET EARNINGS PER COMMON AND
   COMMON EQUIVALENT SHARE:
     Continuing operations (Note 15)        $  .43       $   .43       $  .64
     Discontinued operations                   .02           .01         (.03)
                                            ------       -------       ------
                                            $  .45       $   .44       $  .61
                                            ======       =======       ======





WEIGHTED AVERAGE NUMBER OF COMMON AND
   COMMON EQUIVALENT SHARES (Note 15)    1,029,373     1,227,894    1,161,347
                                         =========     =========    =========


DIVIDENDS                                     NONE          NONE         NONE
                                              ====          ====         ====

























         The accompanying notes are an integral part of these statements

                                       F-6


<PAGE>



                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>

                                            COMMON STOCK,
                                             $.00001 PAR
                                          VALUE, AUTHORIZED      
                                          950,000,000 SHARES     ADDITIONAL      RETAINED      TREASURY STOCK
                                         -------------------      PAID-IN        EARNINGS     -------------------   
                                           SHARES     AMOUNT      CAPITAL        (DEFICIT)    SHARES     AMOUNT        TOTAL
                                         ---------    ------     ----------    -----------    -------  ----------    ----------
<S>                                      <C>            <C>      <C>           <C>             <C>     <C>           <C> 
BALANCE - MAY 31, 1994                     979,865      $ 10     $2,560,229    $(1,069,581)        -   $       -     $1,490,658

Exercise of stock options (Note 7)          94,000         1        201,499             -          -           -        201,500

Issuance of shares on acquisition of
  minority interest of subsidiary (Note 2)  75,000         1             (1)            -          -           -             -

Net income for the year ended
  May 31, 1995                                  -          -             -         699,105         -           -        699,105
                                         ---------      ----     ----------    -----------    -------  ----------    ----------

BALANCE - MAY 31, 1995                   1,148,865        12      2,761,727       (370,476)        -           -      2,391,263

Repurchase of common stock (Note 8)             -          -             -              -     179,500    (451,323)     (451,323)

Net income for the year ended
  May 31, 1996                                  -          -             -         533,440         -           -        533,440
                                         ---------      ----     ----------    -----------    -------  ----------    ----------

BALANCE - MAY 31, 1996                   1,148,865        12      2,761,727        162,964    179,500    (451,323)    2,473,380

Repurchase of common stock (Note 8)             -          -             -              -      20,000     (55,115)      (55,115)

Net income for the year ended
  May 31, 1997                                  -          -             -         461,092         -           -        461,092
                                         ---------      ----     ----------    -----------    -------  ----------    ----------


BALANCE - MAY 31, 1997                   1,148,865      $ 12     $2,761,727    $   624,056    199,500  $ (506,438)   $2,879,357
                                         =========      ====     ==========    ===========    =======  ==========    ==========

</TABLE>








































                 The accompanying notes are an integral part of these statements

                                                F-7



<PAGE>



                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>

                                                                      YEARS ENDED MAY 31,
                                                          -----------------------------------------  
                                                              1997           1996           1995
                                                          -----------    -----------    -----------
                                                                                         (Restated)
<S>                                                       <C>            <C>            <C>        
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income                                             $   461,092    $   533,440    $   699,105
   (Income) loss from discontinued operations                 (19,942)       (19,996)        31,701
   Adjustments to reconcile net income to net
     cash provided by operating activities:
       Expenses (income) not requiring the use of cash:
         Provision for losses on accounts
           and notes receivable                               189,173         97,469         34,866
         Depreciation                                           9,322          1,430          3,623
         Amortization of licenses                             197,541        197,541        197,541
         Gain on sale of investment                              --             --          (35,400)
         Interest expense - imputed                            45,043         52,048         60,935
         Interest income - imputed                            (13,167)        (6,403)        (6,994)
         Deferred income taxes                                (62,000)        89,000        (75,000)
       Changes in assets and liabilities:
         Accounts receivable                                 (210,324)      (141,548)      (115,359)
         Prepaid expenses                                     (50,424)        18,988        (28,628)
         Cash overdraft                                       (18,044)        18,044           --
         Accounts payable and other current liabilities       225,322        (82,009)        61,986
         Deferred rent payable                                 (1,040)        10,319         (1,350)
         Net assets of discontinued operations                 (1,580)       (21,814)        58,871
                                                          -----------    -----------    -----------

NET CASH PROVIDED BY OPERATING ACTIVITIES                     750,972        746,509        885,897
                                                          -----------    -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchases of short-term investments                        (55,426)      (302,138)      (625,876)
   Redemption of short-term investments                        53,146        699,868        175,000
   (Increase) decrease in due from related parties             17,038        231,961       (260,000)
   Acquisition of fixed assets                                (40,122)       (21,461)          --
   Proceeds from sale of investment                              --             --            5,000
   Additions to notes receivable                             (690,492)       (20,000)      (181,213)
   Payments of notes receivable                               217,468         63,249         64,650
   Security deposits                                          (18,643)         1,900        (55,586)
   Net assets of discontinued operations                        2,200           (500)          --
                                                          -----------    -----------    -----------

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES          (514,831)       652,879       (878,025)
                                                          -----------    -----------    -----------

</TABLE>









                 The accompanying notes are an integral part of these statements

                                            F-8


<PAGE>



                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (CONTINUED)

<TABLE>
<CAPTION>
                                                                      YEARS ENDED MAY 31,
                                                          -----------------------------------------  
                                                              1997           1996           1995
                                                          -----------    -----------    -----------
                                                                                         (Restated)
<S>                                                       <C>            <C>            <C>        
CASH FLOWS FROM FINANCING ACTIVITIES:
   Principal payments on debt                             $   (98,000)   $  (168,000)   $  (168,000)
   Exercise of employee stock options                            --             --          201,500
   Repurchase of common stock                                 (55,115)      (451,323)          --
                                                          -----------    -----------    -----------

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES          (153,115)      (619,323)        33,500
                                                          -----------    -----------    -----------

NET CHANGE IN CASH AND CASH EQUIVALENTS                        83,026        780,065         41,372

CASH AND CASH EQUIVALENTS - beginning                       1,615,073        835,008        793,636
                                                          -----------    -----------    -----------

CASH AND CASH EQUIVALENTS - ending
   (includes cash of discontinued operations of $-0-,
   $55,957 and $78,271, respectively)                     $ 1,698,099    $ 1,615,073    $   835,008
                                                          ===========    ===========    ===========


SCHEDULE OF NON-CASH INVESTING
   AND FINANCING ACTIVITIES:
     Receipt of notes receivable on sale of investment    $      --      $      --      $    30,000
                                                          ===========    ===========    ===========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
   Cash paid during the year for:
     Interest                                             $    61,039    $    68,558    $    75,602
     Income taxes                                             316,313        238,876         15,542

</TABLE>


















                 The accompanying notes are an integral part of these statements

                                                 F-9



<PAGE>

                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED MAY 31, 1997, 1996 AND 1995


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

   Nature of Operations
   --------------------

   Bernard  Haldane  Associates,   Inc.  ("Haldane")  through  its  wholly-owned
   subsidiary,  DRB Ltd.  ("DRB")  owns the  worldwide  licensing  rights to the
   Bernard  Haldane  name  and  system  of  career  consulting.  Haldane  is the
   franchiser of 71 career  consulting  offices  operating in the United States,
   Canada and the United Kingdom.  A new wholly-owned  subsidiary,  First Career
   Corp. ("FCC") is developing a specifically designed career consulting program
   for graduating college students. On May 31, 1996, another subsidiary, Quantum
   Tours International, Inc. ("QT") discontinued its full service travel agency.
   All other subsidiaries are inactive.

   After giving effect to the restatement for discontinued operations, Haldane's
   operations  consist  of only one  business  segment,  career  consulting  and
   advisory services.

   Principles of Consolidation
   ---------------------------

   The consolidated financial statements include the accounts of Haldane and its
   subsidiaries. All intercompany accounts and transactions have been eliminated
   in consolidation.

   Cash and Cash Equivalents
   -------------------------

   The Companies consider all highly liquid investments with original maturities
   of three months or less to be cash equivalents.

   Concentrations of Credit Risk
   -----------------------------

   The  Companies   maintain   their  cash   balances  with  various   financial
   institutions. Accounts at each institution are insured by the Federal Deposit
   Insurance   Corporation  up  to  $100,000.   Uninsured   balances   aggregate
   approximately   $1,615,000   and   $1,363,000  at  May  31,  1997  and  1996,
   respectively.

   The Companies'  short-term  investments  include  certificates  of deposit of
   financial  institutions  with high credit  ratings,  which mature  within one
   year. This investment policy limits the Companies' exposure to concentrations
   of credit risk.

   DRB sells franchises to individuals and corporations for both cash and notes.
   In the  event of  default  in  payment  of the  notes or  royalties,  DRB can
   repossess  the  office.  DRB  has  historically  experienced  losses  and has
   provided allowances against its notes and royalty receivables.

                                      F-10

<PAGE>
               BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    YEARS ENDED MAY 31, 1997, 1996 AND 1995


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

   Equipment, Fixtures and Leasehold Improvements
   ----------------------------------------------

   Equipment and fixtures are being  depreciated  on an  accelerated  basis over
   lives of five to seven years. Leasehold improvements are being amortized over
   the lives of the leases.

   Deferred Rent Payable
   ---------------------

   Deferred rent payable  represents the excess of recognized  rent expense over
   scheduled lease payments which will be credited to future operations.

   Revenue Recognition
   -------------------

   DRB through its sale of franchise offices recognizes  revenues  (sub-license)
   at the time the  contract  is  completed  and when no  further  services  are
   required.  DRB also  recognizes  royalty revenue based on a percentage (5% to
   6%) of gross  collections of counseling fees by the franchisee or the minimum
   royalty fee, whichever is greater. Allowances for doubtful accounts have been
   provided for potential losses.

   QT recognized revenue when the tour commenced.  Revenue received prior to the
   commencement of the tour was deferred and recorded as unearned revenue.

   Intangible Assets
   -----------------

   The Bernard Haldane licenses  acquired  (approximately  $1,200,000) are being
   amortized over a ten year period using the straight-line  method. The cost of
   acquisitions  in  excess  of fair  value of  assets  acquired  which has been
   allocated to licenses (approximately  $1,250,000) is being amortized over the
   greater of a twenty year period (the general term of the  sub-license)  or 5%
   of royalty income and 50% of sub- licensing income for that particular year.

   Advertising Costs
   -----------------

   All costs  associated with advertising and promotion are expensed in the year
   incurred.

   Foreign Exchange
   ----------------

   DRB  converts  its foreign  currency  transactions  at  budgeted  rates which
   historically  approximate  the actual  exchange  rates for balance  sheet and
   statement of income items. The amount of foreign currency  exchange gains and
   losses are insignificant to the consolidated financial statements.

                                      F-11

<PAGE>
               BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    YEARS ENDED MAY 31, 1997, 1996 AND 1995

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

   Net Earnings Per Common and Common Equivalent Share
   ---------------------------------------------------

   For the years ended May 31, 1997,  1996 and 1995, net earnings per common and
   common  equivalent  share are based on the weighted  average number of common
   shares and common equivalent shares arising from dilutive stock options using
   the modified  treasury  stock method.  Fully diluted  earnings per common and
   common equivalent shares were the same as for the primary calculation.

   Realizability of a Deferred Tax Asset
   -------------------------------------

   The  Companies  have  recorded a deferred tax asset of $145,000 as of May 31,
   1997.  Realization  is dependent on  generating  sufficient  taxable  income.
   Although  realization is not assured,  management  believes it is more likely
   than not that all of the deferred  tax asset will be realized.  The amount of
   the deferred tax asset considered  realizable,  however,  could be reduced in
   the near term if future taxable income is not sufficient.

   Use of Estimates in the Preparation of Financial Statements
   -----------------------------------------------------------

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


NOTE 2 - ACQUISITIONS/DISPOSITIONS

   In 1989,  Haldane  acquired 80% of the outstanding  shares of Career Services
   Management  Corp.  ("CSM") for $800.  CSM acquired 100% of DRB for $1,250,000
   consisting  of  $1,000,000  in cash  and a note  payable  of  $250,000  which
   currently  is $200,000  (Note 5). On February 2, 1995,  Haldane  acquired the
   remaining 20% of the  outstanding  shares of CSM for 75,000 shares of its own
   common stock. CSM is currently inactive.

   In April  1995,  Haldane  sold  approximately  96% of its 80%  investment  in
   Andover  Equitites  Corp.  ("Andover").  The sale consisted of cash and notes
   (see Note 4) and resulted in a $35,400  gain which is included in  operations
   for the year  ended May 31,  1995.  Haldane's  investment  in  Andover  which
   represents   approximately   a  3%  ownership  is  carried  at  cost  and  is
   insignificant.

   The acquisitions  were accounted for using the purchase method of accounting.
   The  purchase  price was  allocated to the assets  acquired  and  liabilities
   assumed based on their estimated fair values.


                                      F-12

<PAGE>
               BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    YEARS ENDED MAY 31, 1997, 1996 AND 1995


NOTE 3 - NEW ACCOUNTING STANDARDS

   In March 1995, the Financial  Accounting  Standards Board issued Statement of
   Financial  Accounting  Standards No. 121 (SFAS No. 121),  "Accounting for the
   Impairment of Long-Lived  Assets and for Long-Lived Assets to be Disposed Of"
   which requires that long-lived assets and certain identifiable intangibles to
   be held and used by an entity be reviewed for impairment  whenever  events or
   changes in circumstances indicate that the carrying value of an asset may not
   be recoverable.  The adoption of SFAS No. 121 had no effect on the Companies'
   consolidated  financial  statements  since the Companies  annually review the
   carrying value and the amortization of its intangible assets.

   In October 1995, the Financial Accounting Standards Board issued Statement of
   Financial  Accounting  Standards  No.  123 (SFAS No.  123),  "Accounting  for
   Stock-Based  Compensation."  The Companies  have adopted the  disclosure-only
   provisions of SFAS No. 123 but apply Accounting  Principles Board Opinion No.
   25, "Accounting for Stock Issued to Employees" and related interpretations in
   accounting for granting of stock options.

   If the  Companies  had elected to  recognize  compensation  expense for stock
   options granted based on the method presented by SFAS No. 123, net income and
   earnings per share would have been changed to the pro forma amounts indicated
   below:

                                                        Year Ending May 31,
                                                       --------------------
                                                          1997        1996
                                                       --------    --------   
         Net income - as reported                      $461,092    $533,440
         Net income - pro forma                        $416,092    $497,440
         Earnings per share - as reported                  $.45        $.44
         Earnings per share - pro forma                    $.41        $.41

   The fair value of the stock  options used to compute  proforma net income and
   earnings per share  disclosures is the estimated  present value at grant date
   using the  Black-Scholes  option-pricing  method with the following  weighted
   average assumptions for 1997 and 1996: expected volatility of 11.9% and 3.8%;
   a risk-free  interest rate of 6.7% and 6.8% and an expected holding period of
   10 and 7 years.

   In February 1997, the Financial  Accounting  Standards Board issued Statement
   of  Financial  Accounting  Standards  No. 128 (SFAS No. 128),  "Earnings  Per
   Share" which is effective  for periods  ending after  December 15, 1997.  The
   Companies  will  implement  this new  standard for the third  quarter  ending
   February  28, 1998 and for the year ending May 31, 1998.  After  December 15,
   1997, prior period earnings per share, which are presented,  will be restated
   to conform to this new pronouncement.


                                      F-13


<PAGE>
               BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    YEARS ENDED MAY 31, 1997, 1996 AND 1995


NOTE 3 - NEW ACCOUNTING STANDARDS (CONTINUED)

   In June 1997, the Financial  Accounting  Standards Board issued Statements of
   Financial   Accounting   Standards   No.  130  (SFAS  No.  130),   "Reporting
   Comprehensive Income" and No. 131 (SFAS No. 131), "Disclosures About Segments
   of an  Enterprise  and  Related  Information"  which are both  effective  for
   periods   beginning  after  December  15,  1997.  The  Companies   anticipate
   implementing  SFAS No. 130 for the year ended May 31, 1998 and  reclassifying
   financial  statements for earlier periods.  Management believes that SFAS No.
   131 will not be  implemented  since  there  is only one  reportable  business
   segment.


NOTE 4 - NOTES RECEIVABLE

<TABLE>
<CAPTION>

     Notes receivable at May 31, consist of the following:

                                                                             1997           1996
                                                                         ----------     ----------
<S>                                                                      <C>            <C>       
     Various non-interest bearing notes receivable in connection
       with the sale of sub-licenses                                     $  177,300     $  100,500
     LaSalle Consulting - receivable in equal monthly installments
       of $2,097 through April 2002, with interest at 24% per annum          72,909         79,640
     Note receivable - employee/stockholder in 36 equal monthly
       installments of $589 through October 1998, including
       interest at 6% per annum                                               9,444         16,111
     Notes receivable in connection with the sale of Andover stock
       (Note 2), originally due April 1997, extended to October 1997,
       with interest at 10% per annum                                        30,000         30,000
     Note receivable - sub-licensee in equal monthly installments of
       $1,000 through December 1997, $2,000 from January 1998
       through December 1998 and $3,000 from January 1999 through
       December 2002 with a final payment of approximately $1,800
       in January 2003 including interest at 7% per annum                   176,795           -
     Note receivable in equal monthly installments of $5,000 through
       2001 with interest at 7% per annum                                   215,000           -
     Note receivable in equal monthly installments of $200 through
       March 1998 with the balance due April 1999, with interest at
       8% per annum; secured by stock in an affiliated company               34,130           -
                                                                         ----------     ----------
                                                                            715,578        226,251
     Less:  Unamortized discounted interest imputed at 7% to 8.5%
              on the above non-interest bearing notes                        50,189          7,880
                                                                         ----------     ----------
                                                                            665,389        218,371
     Less:  Allowance for credit losses on the above non-interest
              bearing notes (see below)                                      65,000         35,000
                                                                         ----------     ----------
                                                                            600,389        183,371
     Less:  Current portion                                                 149,080         48,478
                                                                         ----------     ----------
                                                                         $  451,309     $  134,893
                                                                         ==========     ==========
</TABLE>

                                      F-14

<PAGE>
                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED MAY 31, 1997, 1996 AND 1995


NOTE 4 - NOTES RECEIVABLE (CONTINUED)

   The amounts due over the next five years,  net of imputed interest of $50,189
   and allowance for credit losses of $65,000, are as follows:

                  Year Ending May 31,
                  -------------------

                        1998                      $149,080
                        1999                       140,270
                        2000                        96,534
                        2001                        97,766
                        2002                        89,690
                        Subsequent                  27,049
                                                  --------
                                                  $600,389
                                                  ========


   The Companies  adopted Statement of Financial  Accounting  Standards No. 114,
   "Accounting  by  Creditors  for  Impairment  of a Loan,"  (SFAS No.  114) and
   Statement of Financial  Accounting Standards No. 118 "Accounting by Creditors
   for Impairment of a Loan - Income Recognition and Disclosures" (SFAS No. 118)
   which  requires that impaired loans be measured based on the present value of
   expected future cash flows discounted at the loan's  effective  interest rate
   or at  market  price  or the  fair  value  of the  collateral  if the loan is
   collateral dependent. Notes receivable at May 31, consist of the following:

                                                   1997         1996
                                                ----------   ----------
       Notes receivable - impaired              $  406,492   $  122,620
       Less: Allowance for credit losses            65,000       35,000
                                                ----------   ----------
                                                   341,492       87,620
       Notes receivable - not impaired
          and no allowance for credit losses       258,897       95,751
                                                ----------   ----------
                                                $  600,389   $  183,371
                                                ==========   ==========

   The  Companies  recognize  interest  income on impaired  loans on actual cash
   received  with  interest  imputed at 8 1/2%.  The allowance for credit losses
   have been increased by $30,000 during the year ended May 31, 1997.

   The average  recorded  investment in impaired  loans and the interest  income
   recognized  during the years ended May 31,  1997 and 1996 were  approximately
   $265,000 and $24,000 and $131,000 and $10,000, respectively.

                                     F-15


<PAGE>
               BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    YEARS ENDED MAY 31, 1997, 1996 AND 1995


NOTE 5 - LONG-TERM DEBT

<TABLE>
<CAPTION>

  Long-term debt at May 31, consists of the following:

                                                                      1997        1996
                                                                  ----------  -----------
<S>                                                               <C>         <C>        
      B&E Partnership - payable in monthly installments of
        $7,000 through June 2006.  Secured by a license
        agreement.  This note is non-interest bearing.            $  756,000  $   854,000
      Dan R. Bruce - principal amount of $200,000 due February
        1998 with interest due in monthly payments of $1,333.
        The note is secured by a license agreement and currently
        bears interest at an annual rate of eight percent.           200,000      200,000
                                                                  ----------  -----------
               Total debt obligations                                956,000    1,054,000
        Less:  Unamortized discounted interest imputed at eight
                  percent on the above non-interest bearing loan.    221,921      266,964
                                                                  ----------  -----------
               Total present value of debt                           734,079      787,036

        Less:  Current portion                                       235,240      245,956
                                                                  ----------  -----------
                                                                  $  498,839  $   541,080
                                                                  ==========  ===========
</TABLE>


  The non-current  portion of long-term debt as of May 31, 1997 is payable as
  follows:

                    Year Ending May 31,
                    -------------------

                          1999                             $   45,746
                          2000                                 49,543
                          2001                                 53,655
                          2002                                 58,108
                          2003                                 62,931
                          Subsequent                          228,856
                                                           ----------

                                                           $  498,839
                                                           ==========









                                      F-16

<PAGE>
                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED MAY 31, 1997, 1996 AND 1995


NOTE 6 - COMMITMENTS AND CONTINGENCIES

(a) Leases
    ------

    Haldane leases its executive office in New York City for a term of ten years
    expiring  in  September  2005  and  sublets  approximately  70%  to  related
    entities.  FCC leases  office space in Syracuse,  New York for a term of one
    year expiring in March 1998.

    The following is a schedule by years of future minimum  rental  payments and
    sublease income under these leases (rounded to thousands):

                                                   Minimum
                                                    Rental       Sublease
                  Year Ending May 31,              Payments       Income
                  -------------------            -------------  ---------

                       1998                        $ 142,000     $83,000
                       1999                          119,000      83,000
                       2000                          119,000      83,000
                       2001                          128,000      90,000
                       2002                          133,000      93,000
                       Subsequent                    443,000     311,000
                                                  ----------    --------
                                                  $1,084,000    $743,000
                                                  ==========    ========


    Rent expense,  net of rental income of  approximately  $96,000,  $30,000 and
    $-0-,  charged to operations for the years ended May 31, 1997, 1996 and 1995
    amounted to approximately $48,000, $31,000, and $19,000, respectively.

(b) Licensing
    ---------

    In those  states  where the granting of a license for the right to operate a
    Haldane  office may  constitute  a  franchise  arrangement,  DRB  intends to
    register as a franchisor. DRB may also be subject to regulatory sanctions in
    these states for failing to register as a  franchisor  prior to the granting
    of a franchise license.  DRB intends to enter into franchise agreements with
    current licensees, and if necessary under the state statutes, DRB will offer
    current licensees the right of recission.  Management is of the opinion that
    the  potential  liability  for  violation  of any state or  federal  statute
    relating to the sale of a franchise  and in the aggregate is not material to
    the consolidated  financial statements.  The Companies to date have incurred
    approximately  $58,000 of legal costs in  connection  with this matter.  The
    Companies expect to incur no additional  costs of any significance  relating
    to this matter.


                                      F-17

<PAGE>
               BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    YEARS ENDED MAY 31, 1997, 1996 AND 1995

NOTE 6 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

(c) Consulting Agreements
    ---------------------

    On August 1,  1995,  Haldane  entered  into a  consulting  agreement  with a
    company whose president was Haldane's former president, for a period of five
    years.  Compensation  under the  agreement is as follows:  $62,000 the first
    year,  $69,000 the second year,  $74,000 the third year,  $83,000 the fourth
    year and $90,000 the fifth year. In addition,  Haldane  agreed to provide to
    the consultant a leased automobile and reimburse all approved expenses.  For
    the years ended May 31, 1997 and 1996, Haldane recorded compensation expense
    of $67,832 and $51,667, respectively.

(d) Tax Contingencies
    -----------------

    The Internal  Revenue Service and the City of New York have commenced audits
    of  Haldane's  consolidated  federal  and New York City tax  returns for the
    years ended May 31, 1995 and 1996.  Management  believes that the outcome of
    such audits  would have no  material  effect on the  Company's  consolidated
    financial statements.

(e) Going Private
    -------------

    Haldane has hired a financial advisory company and attorneys to evaluate the
    possibility  of going  private in the future.  The  Companies  have incurred
    $30,000 of costs which have been  charged to  operations  for the year ended
    May 31, 1997.

    Haldane's president and former president have offered to purchase the shares
    of common stock owned by the public investors at $3 per share,  which is the
    valuation made by the financial  advisory  company in its fairness  opinion.
    The estimated  number of shares to be purchased is less than 300,000  shares
    or $900,000.

NOTE 7 - COMMON STOCK OPTIONS AND WARRANTS

    Stock Options
    -------------

    The stock option  transactions  for the three fiscal years ended May 31, are
    summarized as follows:
<TABLE>
<CAPTION>
                                                                   1997       1996       1995
                                                                  -------    -------    -------
<S>                                                              <C>        <C>        <C>    
    Outstanding - beginning of year (exercisable at a price of
       $.25 to $3.50 per share)                                   386,000    326,000    355,000
    Granted at $2.50 per share                                     60,000     60,000     65,000
    Terminated                                                   (161,000)      -          -
    Exercised at prices ranging from $.25 to $2.25 per share         -          -       (94,000)
                                                                  -------    -------    -------
    Outstanding - end of year (exercisable at a price range of
       $.25 to $2.50 per share)                                   285,000    386,000    326,000
                                                                  =======    =======    =======

    Exercisable - end of year                                     285,000    386,000    326,000
                                                                  =======    =======    =======
</TABLE>


                                     F-18

<PAGE>
                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED MAY 31, 1997, 1996 AND 1995



NOTE 7 - COMMON STOCK OPTIONS AND WARRANTS (CONTINUED)

   Stock Options (Continued)
   -------------------------

   During  the years  ended May 31,  1997,  1996 and 1995,  options  to  acquire
   60,000, 60,000 and 65,000 shares, respectively, were granted to directors and
   employees  of the  Companies  at market  value.  A director  exercised  5,000
   options during the year ended May 31, 1995.

NOTE 8 - TREASURY STOCK

   In October  1995,  March and June  1996,  the Board of  Directors  authorized
   Haldane to repurchase  outstanding  shares of its common stock at fair market
   value  from  various  shareholders.  As of May 31,  1997  and  1996,  Haldane
   repurchased  20,000 and 179,500  shares,  respectively,  at fair market value
   with prices ranging from $2.49 to $2.75 per share.

NOTE 9 - INCOME TAXES

   Deferred Income Taxes
   ---------------------

   The Companies  utilize Statement of Financial  Accounting  Standards No. 109,
   "Accounting for Income Taxes," which requires the use of the liability method
   of accounting for income taxes. The liability method measures deferred income
   taxes by applying enacted statutory rates in effect at the balance sheet date
   to the differences  between the tax bases of assets and liabilities and their
   reported  amounts in the financial  statements.  The  resulting  deferred tax
   asset or liability is adjusted to reflect changes in tax laws as they occur.

   Deferred income taxes reflect  temporary  differences in reporting assets and
   liabilities for income tax and financial  accounting  purposes.  The deferred
   tax assets of $145,000  and  $83,000 as of May 31, 1997 and 1996  (consisting
   solely of allowance for doubtful accounts) are shown as current assets in the
   consolidated balance sheets. No valuation allowance has been provided.

   Income Taxes
   ------------

   Provision  for  income  taxes for the years  ended  May 31,  consists  of the
   following:

                                                  1997       1996       1995
                                                --------   --------  --------- 
      Current:
        Federal                                $267,457    $163,448  $     -
        State and local                         105,711      75,876     73,000
                                                --------   --------  --------- 
                                                373,168     239,324     73,000

      Deferred:
        Federal                                 (51,000)     93,000    231,000
        State and local                         (11,000)     (4,000)       -
      Change in valuation allowance                 -           -     (306,000)
                                               --------    --------  --------- 
                                               $311,168    $328,324  $  (2,000)
                                               ========    ========  ========= 



                                      F-19

<PAGE>



                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED MAY 31, 1997, 1996 AND 1995





NOTE 9 - INCOME TAXES (CONTINUED)

   Income Taxes (Continued)
   ------------

   Reconciliation  of statutory rate to effective  income tax rate on continuing
   operations for the years ended May 31, is as follows:

                                                        1997     1996     1995
                                                       -----    -----    ----- 
      At federal statutory rates                        34.0%    34.0%    34.0%
      Effect of:
         State income taxes, net of federal benefit      8.2      7.9      9.8
         Permanent differences                           1.2       .7       -
         Tax benefit of operating loss carryforwards      -      (2.6)   (33.1)
         Overaccrual of prior year taxes                (2.0)    (1.0)      -
         Change in valuation allowance                    -        -     (10.7)
                                                       -----    -----    -----

               Total                                    41.4%    39.0%      - %
                                                       =====    =====    =====
    
   The Companies file consolidated tax returns and had available at May 31, 1995
   unused operating loss carryforwards of approximately  $400,000 for income tax
   reporting purposes which were utilized to offset 1996 taxable income. Haldane
   had no taxable federal income for the year ended May 31, 1995, therefore,  no
   federal income tax liability or expense  provision has been recorded for that
   year.  The only  significant  difference  between  income  tax and  financial
   reporting is the allowance for doubtful accounts.


NOTE 10 - RETIREMENT PLANS

   The Companies have  simplified  employee  pension (SEP)  agreements  with all
   full-time  employees who are at least twenty-one years old and have performed
   services  for at least three of the  preceding  five years.  Such  agreements
   provide for discretionary  contributions by the employer. For the years ended
   May 31, 1997, 1996 and 1995, the Companies  contributed $21,000,  $29,750 and
   $41,424, respectively.

















                                      F-20

<PAGE>



                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED MAY 31, 1997, 1996 AND 1995



NOTE 11 - LAWSUIT JUDGMENT

   A former  sub-licensee  initiated  an  arbitration  against  DRB  before  the
   American Arbitration Association claiming damages for DRB's alleged breach of
   sub-license  agreement  and  interference  with a consulting  agreement.  The
   former  sub-licensee  was awarded  $104,381,  which was accrued as of May 31,
   1994.  Additional  interest  of $10,000 was  accrued as of May 31,  1995.  In
   January 1996, DRB paid $130,144.

NOTE 12 - GEOGRAPHIC AREAS

   The  Companies  earned  royalty  income  and  sub-licensee  income  from five
   Canadian franchisees and one franchisee located in the United Kingdom for the
   years ended May 31, as follows:


                                Royalty Income             Sub-Licensee Income
                       ------------------------------   ------------------------
                         1997       1996       1995      1997      1996    1995
                       --------   --------   --------   -------  ------- -------
      Canada           $201,148   $158,572   $114,221   $18,559  $   -   $   -
                       ========   ========   ========   =======  ======= =======
      United Kingdom   $ 12,123   $    -     $    -     $   -    $   -   $   -
                       ========   ========   ========   =======  ======= =======

   All other revenues are from United States sources.

   Included in accounts  receivable and notes  receivable at May 31, are amounts
   owed by the Canadian and United Kingdom franchisees, as follows:

                                          Accounts Receivable   Notes Receivable
                                          -------------------  -----------------
                                           1997       1996      1997       1996
                                          -------    -------   -------   -------
                          
      Canada                              $78,047    $93,088   $15,063   $   -
                                          =======    =======   =======   =======
      United Kingdom                      $ 2,189    $    -    $    -    $   -
                                          =======    =======   =======   =======

NOTE 13 - RELATED PARTY TRANSACTIONS

   As of May 31,  1997,  1996 and 1995,  a  principal  officer  and  director of
   Haldane owned and operated offices as follows:

                                                   1997    1996    1995
                                                  ------  ------  ------ 
                  Canada (Note 12)                   5       5       5
                  United States                      2       4       4
                  United Kingdom (Note 12)           1       -       -
                                                    ---     ---     ---
                        Total offices                8       9       9
                                                    ===     ===     ===

   During 1997,  three United States  offices were  transferred  to an unrelated
   existing  owner of other Haldane  offices and two new offices were  acquired;
   one in the United States and one in the United Kingdom.


                                      F-21

<PAGE>




                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED MAY 31, 1997, 1996 AND 1995




NOTE 13 - RELATED PARTY TRANSACTIONS (CONTINUED)

   From time to time the  Companies  advance  funds to  several  entities  whose
   officer and director is also an officer and director of Haldane.  The average
   monthly  balance  during  fiscal 1997 and 1996 of such  advances  amounted to
   approximately $373,000 and $375,000,  respectively. At May 31, 1997 and 1996,
   the  balance  of  such   advances   was  $-0-  and   approximately   $14,000,
   respectively.  In addition, at May 31, 1997 and 1996, the Companies were owed
   $11,000 and $14,000,  respectively,  for miscellaneous  reimbursable expenses
   from these entities.

   Interest  earned on advances  for the years ended May 31, 1997 and 1996 at 8%
   per annum amounted to approximately $30,000 for each year.


NOTE 14 - DISCONTINUED OPERATIONS

   On May 31,  1996,  Haldane  adopted a plan to  terminate  its  travel  agency
   operations which ceased in February 1997.

   The  components  of net  assets  of  discontinued  travel  agency  operations
   included in the consolidated balance sheets at May 31, are as follows:

                                                      1997      1996
                                                   ---------  ---------   
                  Cash and cash equivalents        $   -      $ 55,957
                  Prepaid expenses                     -         4,240
                  Property and equipment - net         -           635
                  Other assets                         -         2,200
                  Accounts payable                     -        (3,225)
                  Income taxes payable                 -        (8,000)
                  Deferred income                      -       (15,172)
                                                   --------   --------
                       Net assets                  $   -      $ 36,635
                                                   ========   ========
 
   The operating  results of the travel  agency  segment for the years ended May
   31,  1997 and 1996 are  shown  separately  in the  accompanying  consolidated
   income  statement.  The 1995  consolidated  statement  has been  restated  to
   segregate the operating results of the travel agency segment. Net revenues of
   the travel  agency  segment  for 1997,  1996 and 1995  amounted  to  $67,027,
   $95,474 and $68,047, respectively.

   There was no gain or loss on disposal of this segment.










                                      F-22


<PAGE>



               BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    YEARS ENDED MAY 31, 1997, 1996 AND 1995



NOTE 15 - EARNINGS PER SHARE

   Net Earnings Per Common
     and Common Equivalent Share

   Net earnings per share for the years ended May 31, were calculated  using the
   modified treasury stock method as follows:

<TABLE>
<CAPTION>
                                                                 1997         1996        1995
                                                             ----------   ----------  ----------
<S>                                                          <C>          <C>         <C>       
   Earnings
   --------

   Income from continuing operations                         $  441,150   $  513,444  $  730,806

   Modified Treasury Stock Method
   ------------------------------

   Incremental income after the application of assumed
     proceeds toward repurchase of 20% of the outstanding
     common shares at the average market price and the
     reduction of debt, net of applicable income taxes            1,111       11,452       6,845
                                                             ----------   ----------  ----------

   Adjusted earnings                                         $  442,261   $  524,896  $  737,651
                                                             ==========   ==========  ==========

   Shares
   ------

   Weighted average number of common shares outstanding         950,903    1,105,442   1,070,365

   Additional shares assuming conversion of:
     Stock options and warrants utilizing the modified
        treasury stock method                                    78,470      122,452      90,982
                                                             ----------   ----------  ----------

   Number of common and common equivalent shares              1,029,373    1,227,894   1,161,347
                                                             ==========   ==========  ==========
   Earnings per common and common equivalent share
     from continuing operations                                    $.43         $.43        $.64
                                                                   ====         ====        ====

</TABLE>


   Fully diluted earnings per common and common equivalent share were the same.







                                     F-23


<PAGE>

               BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                    YEARS ENDED MAY 31, 1997, 1996 AND 1995



NOTE 16 - FAIR VALUE OF FINANCIAL INSTRUMENTS

   The amounts at which cash, accounts receivable,  short-term notes receivable,
   due from related parties,  accounts payable and other current liabilities are
   presented  in the balance  sheets  approximate  their fair value due to their
   short maturities.  The following table presents the carrying amounts and fair
   values at May 31, 1997 and 1996 for long-term notes receivable and debt:

                                              1997                 1996
                                     --------------------  -------------------- 
                                      Carrying      Fair    Carrying      Fair
                                       Amount      Value     Amount      Value
                                     ---------  ---------  ---------  ---------

         Long-term notes receivable  $ 451,000  $ 442,000  $ 135,000  $ 129,000
                                     =========  =========  =========  =========

         Long-term debt              $ 499,000  $ 526,000  $ 541,000  $ 570,000
                                     =========  =========  =========  =========


   The fair value of long-term  notes  receivable  and debt has been  determined
   based on discounted  cash flow using a market rate of interest at the balance
   sheet date as applicable to comparable notes and debt.


NOTE 17 - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

<TABLE>
<CAPTION>
                                           1st           2nd           3rd             4th
                                       ---------      ---------      ---------      ---------
<S>                                    <C>            <C>            <C>            <C>      
1997
----

Revenues                               $ 649,981      $ 687,556      $ 649,042      $ 761,216
Income from continuing operations
   before income taxes                   264,999        248,111        146,257         92,951
Income taxes                             106,000         99,000         43,368         62,800
Income from continuing operations        158,999        149,111        102,889         30,151
Income (loss) from discontinued
   operations                            (10,241)        28,204            (21)         2,000
Net income                               148,758        177,315        102,868         32,151

Net earnings per common and common
  equivalent share:
      Continuing operations            $     .16      $     .15      $     .10      $     .03
      Discontinued operations               (.01)           .03             --             --
                                       ---------      ---------      ---------      ---------
Total                                  $     .15      $     .18      $     .10      $     .03
                                       =========      =========      =========      =========


Market price per share:
   High                                $    2.87      $    2.44      $    2.75      $    2.50
   Low                                      2.43           2.44           2.25           2.25
</TABLE>

                                      F-24


<PAGE>


                BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED MAY 31, 1997, 1996 AND 1995





NOTE 17 - SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (CONTINUED)

<TABLE>
<CAPTION>

                                           1st           2nd           3rd             4th
                                       ---------      ---------      ---------      ---------
<S>                                    <C>            <C>            <C>            <C>      
1996
----
Revenues                               $ 583,937      $ 597,046      $ 562,246      $ 601,210
Income from continuing operations
   before income taxes                   222,901        212,146        215,409        191,312
Income taxes                              85,000         71,000         81,796         90,528
Income from continuing operations        137,901        141,146        133,613        100,784
Income (loss) from discontinued
   operations                            (10,131)       (35,360)        61,771          3,716
Net income                               127,770        105,786        195,384        104,500

Net earnings per common and common
  equivalent share:
      Continuing operations            $     .11      $     .12      $     .11      $     .09
      Discontinued operations               (.01)          (.03)           .05             --
                                       ---------      ---------      ---------      ---------
Total                                  $     .10      $     .09      $     .16      $     .09
                                       =========      =========      =========      =========

Market price per share:
   High                                $    2.56      $    2.53      $    2.87      $    2.56
   Low                                      2.43           2.43           2.43           2.43

There were no dividends for either year.


</TABLE>


















                                      F-25


<PAGE>

Item 9.   Changes  in and  Disagreements  with  Accountants  on  Accounting  and
--------------------------------------------------------------------------------
Financial Disclosure
--------------------
                                        NONE

Item 10.  Directors and Executive Officers of the  Registrant
-------------------------------------------------------------

     The executive officers and Directors of the Company are as follows:

Name                         Age    Position
----                         ---    --------

Jerold P. Weinger            52     President, Chief Executive
                                    Officer, Treasurer and Director

Jeffrey G. Klein             42     Secretary and Director

Jeffrey Schachter            47     Director

Gregg Weiss                  40     Director


      Jerold P.  Weinger was elected as a director of the Company in May of 1989
and  currently  serves as the  Company's  President,  Chief  Executive  Officer,
Treasurer  and  Chairman  of  the  Board.  In  September  1991,  266  Washington
Associates,  a New York real estate  general  partnership  in which Mr.  Weinger
serves as one of the general partners,  filed a voluntary petition in bankruptcy
with the United States  Bankruptcy  Court for the eastern  district of New York.
This action was subsequently dismissed. Since March 1992, Mr. Weinger has served
as the vice president and director of several different privately held companies
which operate Bernard Haldane licensed offices. Since November 1991, Mr. Weinger
has also served as the Chairman of the Board of Lauren & Associates,  a New York
based entity engaged as a temporary  employment agency.  Since 1994, Mr. Weinger
served as Chairman of the Board of Prime Time  Staffing,  Inc., a New York based
company engaged in information  technology and consulting.  Since June 1987, Mr.
Weinger  has  served as vice  president  of STAT  Staffing  Inc.,  a New  Jersey
corporation which provides temporary nursing care to institutions. From February
1987 until June 1989,  Mr. Weinger has served as the Vice  President,  Secretary
and Director of Euromed,  Inc., a New Jersey based company.  During this time he
also served as Vice President of Euromed's  wholly-owned  operating  subsidiary,
C.M.S.  Europe Limited,  which distributed medical products in Europe. From 1984
until December 31, 1987, Mr. Weinger was associated  with Brooks Weinger Robbins
& Leeds Inc. ("Brooks"),  formerly a registered broker-dealer,  and from January
1987 until January 1988, served as Chief Executive Officer of such firm.

      On or about  January  1987,  an action  was  commenced  in  United  States
District   Court  for  the   Southern   District  of  New  York  [87  Civil  593
(RWS)(U.S.D.C.,  S.D.N.Y.)] by the  Securities and Exchange  Commission  ("SEC")
against, inter alia, Jerold Weinger.

     The SEC action  alleged  that Mr.  Weinger  violated  Section  17(a) of the
Securities  Act of 1933,  as amended  (the "1933 Act"),  and Sections  10(b) and
15(c) of the Securities  Exchange Act of 1934, as amended (the "1934 Act"),  and
Rules  10(b)-5,  10(b)-6 and 15(c)-2  thereunder,  in  connection  with  certain
initial public offerings in which Mr. Weinger had participated as an employee of

                                       18

<PAGE>

Brooks,  Hamburger,  Satnick,  Inc.,  formerly  a  registered-dealer.   (Brooks,
Hamburger, Satnick Inc. is not a predecessor to Brooks, Weinger, Robbins & Leeds
Inc.) On or about  January  1987,  without  admitting  or denying any of the SEC
allegations,  Mr.  Weinger  consented  to the  entry  of a  Final  Judgement  of
Injunction enjoining Mr. Weinger from further violations of said Sections 17(a),
10(b) and 15(c) and Rules 10b-5, 10b-6 and 15cl-2.

     On  February  9,  1987,  the  SEC  issued  an  Order   Instituting   Public
Proceedings,  Making  Findings  and  Imposing  Remedial  Sanctions  Pursuant  to
Sections  15(d)  and  19(h) of the  Securities  Exchange  Act of 1934  (File No.
3-6790)  against  Jerold  Weinger et al. The  allegations  against  Mr.  Weinger
included willfully violating Section 17(a) of the 1933 Act, Section 10(b) of the
1934 Act and Rules 10b-5 and 10b-6  thereunder,  as well as willfully aiding and
abetting violations of Section 15(c) of the 1934 Act and Rule 15cl-2 thereunder.
Without  admitting or denying the SEC allegations,  Mr. Weinger consented to the
entry of an Order  suspending  him from  association  with any  broker,  dealer,
investment  company,  investment  advisor or municipal  securities dealer in any
capacity for a consecutive 90 day period (which period has expired).

     On January 4, 1989, the District  Business  Conduct  Committee for District
No. 12 of the National Association of Securities Dealers,  Inc. ("NASD") filed a
complaint  (No.  NY-7010)  before the NASD against  Jerold P. Weinger et al. The
Complaint  alleges  that Mr.  Weinger,  while  associated  with  Brooks  Weinger
violated  Article  III,  Section 1 of the NASD's  Rules of Fair  Practice by his
failure to become registered as a general securities principal  (notwithstanding
that he was  registered as a financial and  operations  principal at such time),
despite his alleged active engagement in the management of the firm's investment
banking  and  securities  business.  Without  admitting  or  denying  any of the
allegations  contained in the Complaint,  Mr. Weinger has agreed to the entry of
an order  requiring  Weinger  take and pass the  Series  24  General  Securities
Principal  examination  prior to applying for  association  with any NASD member
and, that Mr. Weinger is suspended in all capacities from  association  with any
NASD member for a period of ninety (90) days which period has since expired.

      Mr.  Weinger  received  a B.B.A.  from  Pace  University  and a M.S.  from
Brooklyn College.

      Jeffrey G. Klein,  has served as  Secretary  and a Director of the Company
since its inception.  Mr. Klein is a practicing attorney in Boca Raton, Florida.
From 1986-1989, Mr. Klein served as president and a Director of Unity Publishers
Corp., a publisher of financial newsletters.  During this time, Unity was giving
away shares of stock in publicly held companies as a gift for subscribing to its
newsletter.  Some states and the Securities and Exchange  Commission have deemed
this to be a prohibited  transaction and in those states, the newsletter and Mr.
Klein are subject to Cease and Desist Orders in reference to the distribution of
the  stock as a gift for  subscribing  to the  newsletter.  Unity was named as a
Defendant in an action brought by the Securities and Exchange  Commission and is
a signator to a Final Judgment of Permanent Injunction.  From 1986 through 1988,
Mr.  Klein  also  served  as  Secretary  and  Director  of  Capital   Investment
Development  Corp.,  a company  which went  public  pursuant  to a "Blind  Pool"
offering.  From January 1985 through 1986, Mr. Klein served as in-house  counsel
to First Commonwealth Financial Corp., InfoData,  Inc. and Newsletter Management
Corp., all of which were located in Boca Raton, Florida. From 1983 through 1985,
Mr.  Klein was  affiliated  with the law  offices of Gerald  Beyer,  Esq.,  Fort
Lauderdale,  Florida, and during 1983, Mr. Klein was employed by Arthur Andersen
& Co.,  Fort  Lauderdale,  Florida.  Prior  thereto,  Mr. Klein was a practicing
attorney in  Pittsburgh,  Pennsylvania.  Mr. Klein  received his J.D. and M.B.A.
degrees from the University of Pittsburgh and a B.A. from Boston University.
                                         19

<PAGE>

      Jeffrey  Schachter,  was elected a director of the Company in April, 1997.
Since 1976 he has served as the president of Silver Enterprises Refining,  Inc.,
a Cliffwood,  New Jersey based company involved in the commercial  extraction of
silver from  photographic  film. Mr.  Schachter  holds a Bachelor's  degree from
Lehman College in the Bronx, new York.

      Gregg  Weiss,  was elected a director  of the  Company in April 1997,  Mr.
Weiss is an attorney  practicing in New York City  concentrating in the areas of
taxation,  trusts and estate  planning.  In 1991 Mr.  Weiss  founded the firm of
Gardner & Weiss. Prior thereto,  Mr. Weiss was associated with several different
law firms and from 1981 -1984 Mr. Weiss worked for the Internal  Revenue Service
at the Office of Chief Counsel.  Mr. Weiss  received an L.L.M.  in Taxation from
New York  University,  a J.D.  degree  from  Hofstra  University  and a B.S.  in
Accounting from State University of New York at Albany.

      Directors of the Company hold their offices until the next annual  meeting
of the Company's  stockholders and until their successors have been duly elected
and qualified or until their earlier resignation,  removal from office or death.
There are no committees of the Board of Directors.

     Officers of the Company serve at the pleasure of the Board of Directors.

ITEM 11.  Executive Compensation
--------------------------------

       Mr.  Weinger,  the  Company's  President,  oversees  the Bernard  Haldane
operations  and  in  consideration  thereof,  receives  annual  compensation  of
$200,000 and devotes his full time to the operations of the Company. The Company
has established a Simplified  Employee  Benefit Plan,  (the "Plan").  During the
past year Mr.  Weinger  received  $15,000  pursuant to this Plan.  The terms and
conditions of Mr.  Weinger's  employment  are reviewed  annually by the Board of
Directors.

      Mr.  Klein has  received  compensation  from the Company of  approximately
$44,000 for legal services  rendered.  Mr. Weiss and Mr.  Schachter will receive
$2,000 per month in  consideration  for their services on the Board of Directors
and acting as consultants  to the Company.  Payment will be made for a period of
five months.

      The following  table sets forth the  compensation of the company's two (2)
officers for the last three (3) fiscal years:













                                       20


<PAGE>



                               ANNUAL COMPENSATION


NAME
AND PRINCIPAL                        ANNUAL                  LONG TERM
POSITION                      YEAR  COMPENSATION            COMPENSATION
--------------------------------------------------------------------------------


JEROLD WEINGER,
PRESIDENT               1997        $215,000    (1)               (2)
                        1996        $222,500    (1)               (2)
                        1995        $202,105    (1)               (2)




JEFFREY KLEIN
SECRETARY               1997        $ 44,000                       (2)
                        1996        $ 40,000                       (2)
                        1995        $ 37,500                       (2)


(1)   Includes $35,250, $22,500 and $15,000 pursuant to the Company's Simplified
Employee Benefit Plan in 1995, 1996 and 1997


(2)   During the year ended May 31, 1997, Mr. Weinger and Mr. Klein were granted
options to purchase 25,000 and 5,000 shares of the Company's  common stock at an
exercise  price of $2.50 per  share.  During the year  ended May 31,  1996,  Mr.
Weinger and Mr. Klein were granted  options to purchase  25,000 and 5,000 shares
of the Company's  common stock at an exercise  price of $2.50 per share.  During
the year ended May 31, 1995, Mr.  Weinger and Mr. Klein were granted  options to
purchase  25,000 and 7,500 shares of the  Company's  common stock at an exercise
price of $2.50 per share.














                                         21


<PAGE>



Item 12.  Security Ownership of Certain Beneficial Owners and Management
------------------------------------------------------------------------

     The following table sets forth certain information  regarding the Company's
Common Stock beneficially owned on July 31, 1997 (i) by each person who is known
by the Company to own  beneficially  more than 5% of the Company's Common Stock,
(ii) by each of the Company's Directors, and (iii) by all executive officers and
Directors as a group.*

Renee Nadel                              270,000           28.44%(4)
7885 Ayr Court
Boca Raton, Florida
33496

Jeffrey G. Klein (3)                       5,000           Less than 1%
23123 State Road 7, Suite 350B
Suite 350B
Boca Raton, Florida  33428

Lilli Weinger                            287,750           30.31%(4)
4 Woodgreen Place
Rockville Center, NY 11570

Jerold P. Weinger (1)(2)(3)              132,520           13.96%(4)
192 Lexington
15th Floor
New York, New York  10016

All executive officers
and Directors as a
Group (2 persons) (2)(3)                 137,520           14.46%(4)
____________________________
    *As of June 30, 1997

(1)   Does not give  effect  to  shares of stock  owned by the  children  of Mr.
Weinger whose ownership he disclaims.

(2)   Does not give effect to those shares owned by Lilli Weinger, the spouse of
Jerold Weinger.

(3)   Does not give effect to shares of stock  issuable  to Mr.  Weinger and Mr.
Klein upon exercise of stock options.  (See Certain  Transactions).  Mr. Weinger
has been  granted  options to purchase a total of 120,000  shares of stock.  Mr.
Klein has been  granted the options to purchase a total of 22,500  shares of the
Company's  common  stock.  Assuming  exercise  of  the  foregoing  options,  the
respective share of ownership would be 26.60% for Mr. Weinger and would be 2.90%
for Mr. Klein.

(4)   Does not take into account 199,500 shares of treasury stock.

Item 13.  Certain Relationships and Related Transactions
--------------------------------------------------------

      The  Company  was  incorporated  under the laws of the state of Florida on
July 22, 1986, and shortly  thereafter Joel S. Nadel, Bruce E. Mates and Jeffrey

                                         22

<PAGE>


G. Klein  subscribed  for  275,000,  275,000 and 7,500  shares of the  Company's
Common Stock, respectively,  for an aggregate consideration of $22,500 or $.0001
per share.  (After giving affect to a 100:1 reverse stock split and a subsequent
4:1 reverse  stock  split).  On or about  September  1989,  Bruce Mates sold his
276,250  shares to Lilli  Weinger  pursuant to a private  sale of the  Company's
stock.  Subsequent  thereto,  Mrs.  Weinger gifted 5,000 shares of the Company's
stock to an  unaffiliated  third  party.  Lilli  Weinger  is the wife of  Jerold
Weinger.  On or about  September  1990,  Mr. Nadel gifted his 270,000  shares of
stock in the Company to Renee Nadel, his wife.

      During  the  years  ended  May 31,  1996 and May 31,  1997  pursuant  to a
resolution   of  the  Board  of  Directors,   the  Company   redeemed  from  the
shareholders, a total of 179,500 and 20,000 shares respectively of the Company's
common stock at an average cost of between $2.49 and $2.75 per share,  including
5,000 shares of common stock owned by Jeffrey Klein.

      During  the  Company's  last  fiscal  year,  a majority  of the  Company's
shareholders  pursuant to a recommendation  of the Board of Director granted Mr.
Weinger  and Mr.  Klein  options to purchase  25,000 and 5,000  shares of common
stock of the  Company  at an  exercise  price of $2.50  per  share.  Options  to
purchase  25,000 shares of common stock at an exercise  price of $2.50 per share
was  granted  to Windsor  Consulting  Inc.,  a key  consultant,  and  options to
purchase  5,000 shares of common stock at a price of $2.50 per share was granted
to Donna Quartiero, a key employee.

      On May 31, 1996, a majority of the  Company's  shareholders  pursuant to a
recommendation  of the Company's  Board of Directors,  granted the Company's two
officers,  Mr. Weinger and Mr. Klein,  options to purchase  25,000  shares,  and
5,000 shares respectively, of the Company's common stock at an exercise price of
$2.50 per share.  The Company  also  granted  options  for 25,000  shares of the
Company's  common stock to Windsor  Consulting  Inc., and 5,000 shares of common
stock to Donna  Quartiero.  The  options  were  granted to the  foregoing  at an
exercise price of $2.50 per share.  The exercise price  represented  the average
between the low and high bid for the Company's common stock on May 31, 1996.

      On May 31, 1995, a majority of the  Company's  shareholders  pursuant to a
recommendation  of the Board of Directors,  granted to the  Company's  officers,
including  Joel Nadel,  the Company's  former  president,  and Donna  Quartiero,
options to purchase shares of the Company's common stock at an exercise price of
$2.50 per share.  The exercise  represented the average between the low and high
bid for the  Company's  common stock on May 31, 1995. A total of 25,000  options
were granted to both Mr. Nadel and Mr.  Weinger,  and 7,500 options were granted
to Mr.  Klein and Ms.  Quartiero.  The options are  issuable for a period of ten
years from the date of issuance.

      On  September  3,  1993,   the  Company's   Shareholders   pursuant  to  a
recommendation of the Board of Directors,  granted to the company's officers and
Donna  Quartiero,  a key employee,  options to purchase  shares of the Company's
common stock at any exercise price of $1.75. The exercise price  represented the
average between the low and high bid for the Company's common stock on September
3, 1993 the date of  issuance.  A total of 20,000  options  were  granted to Mr.
Nadel  and Mr.  Weinger  and 5,000  options  were  issued  to Mr.  Klein and Ms.
Quartierro.  The options are exercisable for a period of ten years from the date
of issuance. Previous thereto on December 18, 1990, Messieurs Nadel, Weinger and
Klein  were  issued  options  the  purchase  25,000,  25,000  and  5,000  shares
respectively at an exercise price of $.25 per share.  Also on December 18, 1990,

                                       23

<PAGE>


options to purchase  5,000 shares of the  Company's  common stock at an exercise
price of $.25 per share were issued to Donna Quartiero and Phillip Nadel.

      All stock options and exercise price thereof reflect at 4:1 reverse split.

      In April  1995,  The  Company  sold  14,000,000  of its  shares of Andover
Equities  Corp.  to a group of four  individual  investors  for  cash and  notes
totalling $35,000. - Payment on the notes remains due and outstanding.

      In  February  1995,  the  Company   acquired  the  remaining  20%  of  the
outstanding  shares  of common  stock of Career  Services  Management  Corp.  in
exchange for the issuance of a total of 75,000  shares of the  Company's  common
stock. Of these 75,000 shares,  45,000 shares have been redeemed pursuant to the
Company's stock redemption program at an average cost of $2.50 per share..


                                     PART IV


Item 14.  Exhibits, Financial Statements Schedule and Reports on Form 8-K
-------------------------------------------------------------------------

      (a)   Documents filed as part of this report

            (1)   Financial Statements.

                  Reports of Independent Certified Public Accountants.

                  Comparative  Consolidated  Balance Sheets - as of May 31, 1997
                  and May 31, 1996.

                  Comparative  Consolidated  Statements  of  Operations  for the
                  years ended May 31, 1997, 1996 and 1995.

                  Comparative    Consolidated    Statements    of   Changes   in
                  Stockholders' Equity for the years  ended May 31,  1997,  1996
                  and 1995.

                  Comparative  Consolidated  Statements  of Cash  Flows  for the
                  Years ended May 31, 1997, 1996 and 1995.

                  Notes to Financial Statements.



                  All  schedules  for  which  provision  is made  in  applicable
regulations  and  regulations of the Securities and Exchange  Commission are not
required under the related  instructions or are  inapplicable and therefore have
been omitted.



                                       24


<PAGE>
                                               INCORPORATED
EXHIBIT #  DESCRIPTION                         BY REFERENCE TO
---------  -----------                         ---------------


3(a)       -Certificate of Incorporation*      Exhibit 3(a) filed as part of the
                                               Company's Registration Statement
                                               on Form S -18 ,File No. 000-18097
 
 (b)        -By-Laws*                          Exhibit 3(b) filed as part of the
                                               Company's Registration Statement
                                               on Form S-18, File No. 000-18097.

4(a)       -Form of certificate                Exhibit 4(a) filed as part of the
           evidencing shares of Common         Company's Registration Statement
           Stock.                              on Form S-18, File No. 000-18097.

 (b)       -Form of Class A Redeemable         Exhibit 4(b) filed as part of the
           Common Stock Purchase Warrant*      Company's Registration Statement
                                               on Form S-18, File No. 000-18097.

 (c)      -Form of Class B Redeemable          Exhibit 4(c) filed as part of the
           Common Stock Purchase Warrant*      Company's Registration Statement
                                               on Form S-18, File No. 000-18097,

 (d)       -Form of Class C Redeemable         Exhibit 4(d) filed as part of the
           Common Stock Purchase Warrant.*     Company's Registration Statement
                                               on Form S-18, File No. 000-18097.

 (e)       -Form of Warrant Agency             Exhibit 4(e) filed as part of the
           Agreement between Registrant        Company's Registration  Statement
           and American Stock Transfer Co.*    on Form S-18, File No. 000-18097.

 (f)       -Form of Warrant issued by          Exhibit 4(f) filed as part of the
           Registrant to Brooks, Weinger,      Company's  Registration Statement
           Robbins and Leeds Inc.*             on Form S-18, File No. 000-18097.

10(a)      -Letter of Intent between           Exhibit 10(e)  Annual  Report  on
           Registrant  and DRB,  Ltd.***       Form 10-K for the year ended  May
                                               31, 1989.

  (b)      -Stock Purchase Agreement           Exhibit 10(F)  Annual  Report  on
           between Career Service              Form 10-K for the year ended  May
           Management Corp. and D.R.B.         31, 1989.
           Ltd.****

  (C)     -Opinion Letter Issued by            Filed as an Exhibit herewith
           Laidlaw & CO.

22        -Subsidiaries of Registrant          Filed as an Exhibit herewith

27        -Financial Data Schedule             Filed as an Exhibit herewith
                                               (Electronic filing only)
      (c)   Reports on Form 8-K
            -------------------

            No report on Form 8-K was filed  during the three month period ended
      May 31, 1997.

                                         25

<PAGE>




                                   SIGNATURES
                                   ----------


      Pursuant  to the  requirements  of Section  13 or 15(d) 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.


BERNARD HALDANE ASSOCIATES, INC.




By:/s/ Jerold Wienger
   -------------------------------- 
         JEROLD WEINGER
      PRESIDENT/TREASURER

DATED: 9/17/97
      ---------

      Pursuant to the requirements of the Securities  Exchange Act of 1934, this
report has ben signed below on those dates by the following persons on behalf of
this Registrant in the capacities indicate.



By:/s/ Jerold Wienger
   -------------------------------- 
         JEROLD WEINGER
      PRESIDENT/TREASURER/DIRECTOR

DATED: 9/17/97
      ---------


 /s/ Jeffrey G. Klein
-----------------------------------
       JEFFREY G. KLEIN
      SECRETARY/DIRECTOR

DATED: 9/17/97
      --------- 





                                      26