<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
FORM 8-K/A
AMENDMENT NO. 1
TO CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
APRIL 15, 1997
Date of Report (date of earliest event reported)
Commission File Number 0-20835
THE LEAP GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 36-4079500
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
22 W. Hubbard Street, Chicago, IL 60610
(Address of principal executive office, including zip code)
(312) 494-0300
(Registrant's telephone number, including area code)
This Amendment to the Current Report on Form 8-K filed by the Registrant with
the Securities and Exchange Commission on April 30, 1997 is being filed in order
to amend Item 7 thereto as set forth below. The undersigned Registrant hereby
amends the following item of its Current Report on Form 8-K, originally filed
with the Securities and Exchange Commission on April 30, 1997, as set forth on
the pages attached hereto.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
The following financial statements and exhibits are filed as part of this
report, where indicated.
(a) Financial statements of YAR Communications, Inc.:
<TABLE>
<CAPTION>
<S> <C>
Independent Auditors' Report....................................... 3
Balance Sheets as of December 31, 1996 and 1995,
and (Unaudited) March 31, 1997................................... 4
Statements of Income and Retained Earnings for the Years Ended
December 31, 1996, 1995, and 1994, and (Unaudited) the Three
Months Ended March 31, 1997 and 1996............................. 5
Statements of Cash Flows for the Years Ended December 31, 1996,
1995, and 1994, and (Unaudited) the Three Months Ended March 31,
1997 and 1996.................................................... 6
Notes to Financial Statements...................................... 7-8
(b) Pro forma financial information:
Unaudited Pro Forma Consolidated Balance Sheet..................... 9
Unaudited Pro Forma Consolidated Statement of Operations........... 11
Notes to Pro Forma Consolidated Financial Information.............. 12
(c) Exhibits:
10.1* Asset Purchase Agreement between Rayco Group, Inc., The Leap
Group, Inc., Y.A.R. Communications, Inc., Yuri Radzievsky and
Anna Radzievsky, dated April 15, 1997. Registrant agrees to
furnish supplementally to the Commission, upon request, a copy
of any omitted schedule.
10.3* Employment Agreement of Yuri Radzievsky, dated April 15, 1997.
10.4* Employment Agreement of Anna Radzievsky, dated April 15, 1997.
23.1 Consent of Finkle, Ross & Rost.
- --------------------
</TABLE>
* Previously filed as Exhibit to the Registrant's Current Report on Form
8-K filed with the Securities and Exchange Commission on April 30, 1997.
2
<PAGE>
INDEPENDENT AUDITORS' REPORT
----------------------------
To the Board of Directors of
YAR Communications, Inc.
We have audited the accompanying balance sheets of YAR Communications, Inc. as
of December 31, 1996 and 1995, and the related statements of income and retained
earnings, and cash flows and supplementary information for each of the three
years ended December 31, 1996. These financial statements are the responsibility
of YAR Communications, Inc. Our responsibility is to express an opinion on these
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 financial statements and supplementary information referred
to above present fairly, in all material respects, the financial position of YAR
Communications, Inc. as of December 31, 1996 and 1995, and the results of its
operations and its cash flows for each of the three years in the period ended
December 31, 1996, in conformity with generally accepted accounting principles.
FINKLE, ROSS & ROST LLP
April 30, 1997
3
<PAGE>
YAR Communications, Inc.
Balance Sheets
<TABLE>
<CAPTION>
Assets
December 31, March 31,
------------------------- -----------
1996 1995 1997
----------- ---------- -----------
(unaudited)
<S> <C> <C> <C>
Current Assets
Cash and cash equivalents $ 586,872 $ 413,928 $ 771,431
Accounts receivable, net 5,528,964 3,773,795 3,649,884
Work in progress 733,831 624,494 988,651
Other current assets 871,503 978,773 351,633
Loan to shareholders 304,919 37,808 492,976
----------- ---------- ----------
Total current assets 8,026,089 5,828,798 6,254,575
Property and equipment, net 3,105,364 1,883,517 3,196,887
Security deposits 26,483 21,483 26,483
----------- ---------- ----------
Total Assets $11,157,936 $7,733,798 $9,477,945
=========== ========== ==========
Liabilities & Stockholders' Equity
Current Liabilities
Accounts payable & accrued expenses $238,154 $0 $152,188
Notes payable 2,013,580 1,393,140 0
Income taxes payable 9,038 9,385 0
Deferred income taxes payable 693,272 480,546 693,272
Short-term equipment lease liability 0 0 236,989
Deferred revenue 310,000 476,801 310,000
----------- ---------- ----------
Total current liabilities 3,264,044 2,359,872 1,392,449
Long-term equipment lease liability 0 0 515,924
Commitments and Contingencies
Stockholders' Equity
Common stock, $1 par value,
100 shares authorized, issued and
outstanding 100 100 100
Additional paid-in capital 1,900 1,900 1,900
Retained earnings 7,891,892 5,371,926 7,567,572
----------- ---------- ----------
Total stockholders' equity 7,893,892 5,373,926 7,569,572
Total Liabilities & Stockholders'
Equity $11,157,936 $7,733,798 $9,477,945
=========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
YAR Communications, Inc.
Statement of Income and Retained Earnings
For the Years ended December 31, 1996, 1995, and 1994
And the Three Months ended March 31, 1997 and 1996
<TABLE>
<CAPTION>
For the Three Months
For the Year Ended December 31, Ended March 31,
--------------------------------------- -------------------------
1996 1995 1994 1997 1996
----------- ----------- ----------- ----------- -----------
(unaudited) (unaudited)
<S> <C> <C> <C> <C> <C>
Revenues $18,473,924 $13,645,030 $15,028,876 $3,520,957 $3,931,747
Cost of sales 8,967,277 7,759,532 8,868,413 1,919,893 1,922,358
----------- ----------- ----------- ----------- ----------
Gross profit 9,506,647 5,885,498 6,160,463 1,601,064 2,009,389
Operating expenses 6,797,002 5,131,013 3,705,371 1,916,020 1,449,376
----------- ----------- ----------- ----------- ----------
Operating income 2,709,645 754,485 2,455,092 (314,956) 560,013
Interest income/(expense) 38,054 54,562 59,924 (9,364) (6,075)
----------- ----------- ----------- ----------- ----------
Income before provision for
income taxes 2,747,699 809,047 2,515,016 (324,320) 553,938
Provision for income taxes (227,733) (75,337) (227,124) 0 (49,854)
----------- ----------- ----------- ----------- ----------
Net income $ 2,519,966 $ 733,710 $ 2,287,892 $(324,320) $ 504,084
=========== =========== =========== =========== ==========
Retained earnings
beginning of year $ 5,371,926 $ 4,638,216 $ 2,350,324 $7,891,892 $5,371,926
=========== =========== =========== =========== ==========
Retained earnings
end of year $ 7,891,892 $ 5,371,926 $ 4,638,216 $7,567,572 $5,876,010
=========== =========== =========== =========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
YAR Communications, Inc.
Statements of Cash Flows
For the Years ended December 31, 1996, 1995, and 1994
And the Three Months ended March 31, 1997 and 1996
<TABLE>
<CAPTION>
For the Three Months
For the Year Ended December 31, Ended March 31,
------------------------------------------- ----------------------------
1996 1995 1994 1997 1996
----------- ----------- ----------- ----------- -----------
(unaudited) (unaudited)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net income/(loss) $ 2,519,966 $ 733,710 $ 2,287,892 $ (324,320) $ 504,084
Adjustments to reconcile net income to
net cash used in operating activities:
Depreciation and amortization 427,654 229,232 184,334 90,000 75,000
(Increase) decrease in
accounts receivable (1,755,169) 189,109 (1,431,287) 1,879,080 1,479,164
(Increase) decrease in
work in progress (109,337) 67,423 (373,081) (254,820) (213,571)
Decrease (increase) in
other current assets 107,270 (388,492) (583,828) 340,572 55,359
Increase (decrease) in
accounts payable 283,154 (325) (812,565) (85,966) 367,523
Decrease (increase) in
income taxes payable (347) 9,385 (5,327) (17,796) 49,854
Increase in deferred
income taxes payable 212,726 51,425 201,252 0 0
(Decrease) increase in
deferred revenue (166,801) (2,735) 398,220 0 0
----------- ----------- ----------- ----------- -----------
Net cash provided by
(used in) operating activities 1,474,116 888,732 (134,390) 1,626,750 2,317,413
CASH FLOWS FROM
INVESTING ACTIVITIES
Purchase of property
and equipment (1,649,501) (1,038,670) (779,628) (181,522) (140,159)
Increase in security deposits (5,000) (3,883) - - -
----------- ----------- ----------- ----------- -----------
Net cash used in
investing activities (1,654,501) (1,042,553) (779,628) (181,522) (140,159)
CASH FLOWS FROM
FINANCING ACTIVITIES
Bank loan proceeds, net 620,440 220,440 1,172,700 (2,013,580) (1,319,890)
Equipment lease payable - - - 752,911 -
Stockholder loan repayments (267,111) (80,373) (248,195) - -
----------- ----------- ----------- ----------- -----------
Net cash provided by
(used in) financing activities 353,329 140,067 924,505 (1,260,669) (1,319,890)
----------- ----------- ----------- ----------- -----------
Net increase in cash and
cash equivalents 172,944 (13,754) 10,487 184,559 857,364
Cash and cash equivalents,
beginning of year 413,928 427,682 417,195 586,872 413,928
----------- ----------- ----------- ----------- -----------
Cash and cash equivalents,
end of year $ 586,872 $ 413,928 $ 427,682 $ 771,431 $ 1,271,292
=========== =========== =========== =========== ===========
</TABLE>
6
<PAGE>
YAR Communications, Inc.
Notes to Financial Statements
NOTE 1 OPERATIONS
YAR Communications, Inc. (the "Company") was established in 1989 as a
continuation of Euramerica, Inc. which was established in 1975 by the same
founder. The Company engages in the business of multilingual communications
services.
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash Equivalents
The Company recognizes certificates of deposit with original maturities of three
months or less as cash equivalents for purposes of the statement of cash flows.
Accounting Method
The Company maintains its books and records on the accrual basis of accounting
for financial reporting.
Provision for Doubtful Accounts
The Company has provided an allowance for doubtful accounts of $253,049 and
$128,049 at December 31, 1996 and 1995, respectively.
Work in Progress
Work in progress includes all direct material, labor costs and estimated
earnings thereon on uncompleted jobs, net of progress billings at December 31,
1996 and 1995, respectively.
Depreciation and Amortization
Property and equipment are stated at cost. Depreciation is computed over the
estimated useful lives of the assets using accelerated and straight-line
methods. Leasehold improvements are amortized over the remaining term of the
lease. Expenditures for repairs and maintenance are charged to operations in the
period incurred. The estimated useful lives of the assets are as follows:
Automobile 5 years
Office equipment 7 years
Leasehold improvements 7-13 years
Income Taxes
The Company reports on the cash basis for income tax purposes.
At December 31, 1996 and 1995, $693,272 and $480,546, respectively, has been
provided for deferred local and California franchise taxes resulting from the
difference generated by the different methods of reporting income for tax and
financial reporting purposes.
The Company has elected to be taxed as an S Corporation for Federal and New York
State purposes. The Corporation does not pay Federal income tax or New York
State franchise tax on its taxable income. Instead, the shareholders are taxed
personally on the Corporation's taxable income. Therefore, the provision for
income taxes reflected in these financial statements consists primarily of New
York City corporation income tax and California franchise tax.
NOTE 3 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest during the years ended December 31, 1996, 1995 and 1994,
was $14,044, $15,893 and $17,259, respectively. Cash paid for income taxes
during the years ended December 31, 1996, 1995 and 1994, was $17,849, $14,420
and $49,181, respectively.
NOTE 4 PROPERTY AND EQUIPMENT
7
<PAGE>
Property and equipment at December 31, 1996 and 1995, at cost, consists of:
<TABLE>
<CAPTION>
1996 1995
----------- ----------
<S> <C> <C>
Automobile $ 151,456 $ 121,231
Office equipment 2,548,553 1,362,180
Leasehold improvements 1,427,857 994,954
----------- ----------
4,127,866 2,478,365
Less: Accumulated depreciation (1,022,502) (594,848)
----------- ----------
Property and equipment, net $ 3,105,364 $1,883,517
=========== ==========
</TABLE>
Charges against income for depreciation of property and equipment amount to
$427,654, $229,232 and $184,334, respectively, for the years ended December 31,
1996, 1995 and 1994.
NOTE 5 RELATED PARTY TRANSACTIONS
As of December 31, 1996 and 1995, the Company is due from its stockholder
$304,919 and $37,808, respectively. This loan is unsecured and non-interest
bearing. Refer to Note 6 for personal guarantees of corporate notes payable.
NOTE 6 NOTES PAYABLE
The Company has short-term commercial loans payable to a bank totaling
$2,013,580 and $1,292,140 as of December 31, 1996 and 1995, respectively. The
notes bear interest at the prime lending rate and are secured by accounts
receivable as well as a blanket lien on all corporate assets. The notes are
personally guaranteed by the officers of the corporation. The entire balance was
repaid in February 1997.
NOTE 7 MAJOR CUSTOMER
The Company earned in excess of 50% of its revenue from services rendered under
a contract with one major customer during the years ended December 31, 1996,
1995, and 1994.
NOTE 8 LEASE COMMITMENTS
The Company leases facilities under several operating leases expiring December
31, 2006 or earlier. The leases provide for certain fixed escalation charges and
various rent holidays in certain years. Minimum lease payments under the
aforementioned leases, excluding escalation charges and rent holidays, for the
next five years approximate the following:
<TABLE>
<S> <C>
1997 $411,000
1998 $397,000
1999 $420,000
2000 $423,000
2001 $385,000
</TABLE>
NOTE 9 SUBSEQUENT EVENTS
In February 1997, the Company utilized approximately $771,000 of a $1,000,000
leasing line with a commercial bank to lease computer equipment.
On April 15, 1997, the Company sold substantially all of the Company's assets
and certain liabilities to The Leap Group, Inc. for a purchase price of $20
million in cash.
8
<PAGE>
THE LEAP GROUP, INC. --- YAR COMMUNICATIONS, INC.
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(1) UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
The following unaudited pro forma consolidated balance sheet has been derived
from The Leap Group, Inc. (the Company) consolidated balance sheet as of January
31, 1997 included in the Company's annual report on Form 10-K for the fiscal
year ended January 31, 1997. Adjustments have been made to such information to
give effect to the acquisition of YAR Communications, Inc. ("YAR") as if it had
occurred on the balance sheet date. The unaudited pro forma consolidated balance
sheet combines the Company's consolidated balance sheet as of January 31, 1997
with YAR's balance sheet as of December 31, 1996. The unaudited pro forma
consolidated balance sheet should be read in conjunction with the consolidated
financial statements of the Company and Subsidiaries, including the notes
thereto, which are included in the Company's Annual Report on Form 10-K for the
fiscal year ended January 31, 1997, and the financial statements of YAR,
including the notes thereto, contained elsewhere in this Form 8-K.
The Leap Group, Inc. --- YAR Communications, Inc.
-------------------------------------------------
Unaudited Pro Forma Consolidated Balance Sheet
-------------------------------------------------
<TABLE>
<CAPTION>
ASSETS
------
Pro Forma
LEAP YAR Other Balance
Actual Actual Adjustments Sheet
------------ ------------ ----------- -----------
CURRENT ASSETS
<S> <C> <C> <C> <C>
Cash and cash equivalents $32,312,749 $ 586,872 (20,000,000) (d) $12,899,621
Accounts receivable, net 4,793,937 5,528,964 10,322,901
Costs in excess of billings, net 218,721 733,831 952,552
Deferred income tax asset 64,622 - 64,622
Loan from shareholder - 304,919 (304,919) (a) -
Other current assets 215,174 871,503 19,854,274 (a),(c) 20,940,951
----------- ----------- -----------
Total current assets 37,605,203 8,026,089 45,180,647
----------- ----------- -----------
PROPERTY AND EQUIPMENT, net 1,189,361 3,105,364 4,294,725
OTHER ASSETS
Goodwill 0 0 12,079,372 (b) 12,079,372
All other assets 1,065,048 26,483 (224,929) (b) 866,602
----------- ----------- ----------
Total other assets 1,065,048 26,483 12,945,974
TOTAL ASSETS $39,859,612 $11,157,936 $62,421,346
=========== =========== ===========
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Pro Forma
LEAP YAR Other Balance
Actual Actual Adjustments Sheet
------------ ----------- ----------------- ------------
<S> <C> <C> <C> <C>
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 2,644,270 $ 238,154 $ 2,882,424
Current income tax payable 0 9,038 (9,038) (a) 0
Deferred income tax payable 0 693,272 (693,272) (a) 0
Billings in excess of costs 214,264 310,000 524,264
Notes payable - 2,013,580 20,000,000 (b) 22,013,580
Current portion of capital lease obligations 52,066 - 52,066
------------ ----------- -----------
Total Current Liabilities 2,910,600 3,264,044 25,472,334
LONG-TERM DEBT
Deferred income tax payable 294,326 - 294,326
Capital lease obligations 71,999 - 71,999
------------ ----------- -----------
Total Long-Term Debt 366,325 - 366,325
TOTAL LIABILITIES 3,276,925 3,264,044 25,838,659
------------ ----------- -----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value; 20
million shares authorized, no shares
issued nor outstanding - - -
Common stock, $.01 par value; 100
million shares authorized, actual and
pro forma 13.6 million shares issued and
outstanding as of January 31, 1997 136,000 - 136,000
Common stock, $1 par value; 100 shares
authorized, actual--100 shares
issued and outstanding; pro forma--none 100 (100) (a) 0
issued and outstanding as of December 31, 1996
Additional paid in capital 35,581,344 1,900 (1,900) (a) 35,581,344
Retained earnings 865,343 7,891,892 ($7,891,892) (a) 865,343
------------ ----------- -----------
Total Stockholders' Equity 36,582,687 7,893,892 36,582,687
------------ ----------- -----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $39,859,612 $11,157,936 $62,421,346
============ =========== ============
The accompanying notes to the financial statements are an integral part of these statements.
</TABLE>
10
<PAGE>
(2) UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
The following unaudited pro forma consolidated statement of operations combines
the Company's operating results for the year ended January 31, 1997, with YAR's
operating results for the year ended December 31, 1996. The unaudited pro forma
consolidated statements of operations are not necessarily indicative of the
future results of operations of the Company or the results of operations which
would have resulted had the Company and YAR been combined during the periods
presented. In addition, the pro forma results are not intended to be a
projection of future results.
The Leap Group, Inc. --- YAR Communications, Inc.
-------------------------------------------------
Unaudited Pro Forma Consolidated Statement of Operations
--------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Pro Forma
LEAP YAR Other Statement
Actual Actual Adjustments of Operations
----------- ----------- -------------- -------------
Revenues $16,087,986 $18,473,924 $34,561,910
Direct and related expenses 8,847,323 4,091,118 12,938,441
Salaries and related expenses 4,252,019 7,932,023 (550,691)(a) 11,633,351
General & administrative expenses 1,602,644 3,741,138 603,969 (b) 5,947,751
----------- ----------- -----------
Total Operating Expenses 14,701,986 15,764,279 $30,519,543
Operating Income 1,386,000 2,709,645 $ 4,042,367
Interest income/(expense) 456,293 38,054 (1,274,000)(d) (779,653)
----------- ----------- -----------
Pretax Income 1,842,293 2,747,699 3,262,714
Income taxes (536,362) (227,733) (508,364)(c) (1,272,459)
----------- ----------- -----------
Net Income $ 1,305,931 $ 2,519,966 $ 1,990,255
Per share data:
Net income per share $0.12 $0.18
Weighted Average Shares 11,126,162 11,126,162
</TABLE>
The accompanying notes to the financial statements are an integral part of
these statements.
11
<PAGE>
THE LEAP GROUP, INC.--YAR COMMUNICATIONS, INC.
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
Substantially all of the assets and certain liabilities of YAR Communications,
Inc. ("YAR") were purchased by the Company for $20,000,000 in cash. In addition,
YAR will also have the right to receive additional payments if they attain
certain earnings goals, described below, during fiscal years 1998, 1999 and
2000.
The following adjustments have been reflected in the unaudited pro forma
consolidated balance sheet.
(a) To eliminate certain assets and related liabilities associated with
the acquisition which are excluded pursuant to the Purchase Agreement.
(b) To record the allocation of purchase price to the net assets of YAR as
follows:
<TABLE>
<CAPTION>
<S> <C>
Fair value of tangible net assets
of YAR after adjustment (a) $ 8,145,557
Goodwill 12,079,372
-----------
Total purchase price $20,224,929
</TABLE>
(c) To reclassify restricted collateral cash balances from current assets
to other assets.
The actual allocation of the purchase price will depend upon the composition of
YAR's net assets on the closing date and the Company's evaluation of the fair
value of such net assets as of such date. Consequently, the ultimate allocation
of purchase price could differ from that presented above.
The acquisition agreement also provides for additional cash payments equal to
50% of the excess, if any, of the Annual Pre-Tax Income Targets, defined below,
for each of the calendar years 1997, 1998 and 1999, provided, however, that the
corresponding Annual Revenue Targets for those years are met or exceeded.
<TABLE>
<CAPTION>
Year Annual Pre-Tax Income Targets Annual Revenue Targets
---- ----------------------------- ----------------------
<S> <C> <C>
1997 $3,937,500 $22,500,000
1998 $4,725,000 $27,000,000
1999 $5,670,000 $32,400,000
</TABLE>
The earnings and revenue targets are set at a minimum annual growth rate of 20%.
There is no limit to the amount of cash payments that could be paid under this
plan so as to further incent maximum performance. In the event such payments are
made, additional goodwill will be recorded and amortized over its remaining
estimated life.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
The following adjustments have been reflected in the unaudited pro forma
consolidated statements of operations:
(a) To reflect the anticipated change in salary expense as if the
employment agreements entered into in conjunction with the acquisition
had been in effect from the beginning of the periods presented.
(b) To record amortization of goodwill over an estimated life of 20 years.
(c) To reflect the income tax expense at the combined statutory rate as a
result of the pro forma adjustments and the termination of YAR's S
Corporation status effective upon the closing.
(d) To record interest expense on the $20 million note payable raised to
finance the acquisition purchase price.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Amendment to be signed on its behalf by the
undersigned hereunto duly authorized.
THE LEAP GROUP, INC.
By: /s/ PETER VEZMAR
---------------------------------
Peter Vezmar
Chief Financial Officer
Date: June 12, 1997
13
<PAGE>
EXHIBIT 23.1
CONSENT OF FINKLE, ROSS & ROST, INDEPENDENT AUDITORS
INDEPENDENT AUDITORS' REPORT
----------------------------
The Board of Directors of
The Leap Group, Inc.:
We consent to the incorporation by reference into the Registration Statement
on Form S-8 (File No. 333-24389) of The Leap Group, Inc. of our report dated
April 30, 1997, with respect to the balance sheets of YAR Communications, Inc.
as of December 31, 1995 and 1996, and the related statements of income and
retained earnings and cash flows for each of the years in the three year period
ended December 31, 1996, which report appears in the report on Form 8-K/A of The
Leap Group, Inc., filed with the Securities and Exchange Commission on June 12,
1997.
/s/ FINKLE, ROSS & ROST
June 12, 1997
14
