<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter ended March 31, 1997 Commission file number 2-31876
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ACADEMIC COMPUTER SYSTEMS, INC.
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(Exact name of registrant as specified in its charter)
New Jersey 22-1848316
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2 West 45th Street,
New York, New York 10036
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 532-3678
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Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during he preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No ____
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Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date:
Class Outstanding at April 28, 1997
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Common stock, par value $.05 per share 907,700
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PART I - FINANCIAL INFORMATION
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Item 1. Financial Statements:
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The following are the required financial statements, including an
index thereof:
ACADEMIC COMPUTER SYSTEMS, INC.
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INDEX
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<TABLE>
<CAPTION>
Page No.
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<S> <C>
Balance Sheet - March 31, 1997
- September 30, 1996 1
Statement of Income -
Three Months Ended March 31, 1997 and 1996
Six Months Ended March 31, 1997 and 1996 2
Statement of Retained Earnings -
Six Months Ended March 31, 1997 and 1996 3
Statement of Cash Flows -
Six Months Ended March 31, 1997 and 1996 4
Notes to Financial Statements 5
</TABLE>
Item 2. Management's Discussion and Analysis of Financial Condition and
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Results of Operations:
- ----------------------
There are no material changes in the operations of the Company.
The Company is presently seeking opportunities for investment and
preservation of its existing assets.
Management believes that all material adjustments have been included
herein.
PART II - OTHER INFORMATION
---------------------------
Not applicable.
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ACADEMIC COMPUTER SYSTEMS, INC.
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BALANCE SHEET
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ASSETS
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<TABLE>
<CAPTION>
March September
31, 30,
1997 1996
-------- --------
<S> <C> <C>
Current assets:
Cash and cash equivalents $631,819 $167,657
Interest receivable - 2,770
Prepaid federal income tax - 418
-------- --------
Total current assets 631,819 170,845
Long-term assets:
Marketable securities (Note 2) - 408,191
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$631,819 $579,036
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LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------------------
Current liabilities:
Taxes payable $ 54,319 $ 1,795
Accounts payable and accrued expenses 1,763 1,250
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Total current liabilities 56,082 3,045
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Commitments and contingencies (Note 3) - -
Deferred taxes payable (Note 4) - 38,437
Stockholders' equity:
Common stock, par value of $.05 per share;
authorized 1,250,000 shares, issued and
outstanding 910,000 shares at March 31,
1997 and September 30, 1996 45,500 45,500
Additional paid-in capital 312,571 312,571
Unrealized gain on securities reported at
fair value - 88,578
Retained earnings 219,822 93,061
-------- --------
577,893 578,147
Less treasury stock - at cost (2,300 shares) ( 2,156) ( 2,156)
575,737 575,991
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$631,819 $579,036
======== ========
</TABLE>
See Notes to Financial Statements.
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<PAGE>
ACADEMIC COMPUTER SYSTEMS, INC.
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STATEMENT OF INCOME
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<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
March 31, March 31,
------------------- ------------------
1997 1996 1997 1996
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<S> <C> <C> <C> <C>
Income:
Dividend income $ 1,145 $ 6,250 $ 6,274 $ 12,661
Interest income 1,940 1,499 4,797 2,334
Other income - - 1,690 -
Realized gain on sale of securities
(Note 2) 175,093 - 173,336 -
-------- -------- -------- --------
178,178 7,749 186,097 14,995
-------- -------- -------- --------
Costs and expenses:
Operating costs, selling, general
and administrative expense 2,141 1,322 3,095 2,180
-------- -------- -------- --------
Income before provision for taxes 176,037 6,427 183,002 12,815
-------- -------- -------- --------
Provision for income taxes:
Federal 51,179 481 52,159 958
State and local 3,918 94 4,082 115
-------- -------- -------- --------
55,097 575 56,241 1,073
-------- -------- -------- --------
Net income $120,940 $ 5,852 $126,761 $ 11,742
======== ======== ======== ========
Per share:
Net income $ .13 $ .01 $ .14 $ .01
======== ======== ======== ========
Shares outstanding 907,700 907,700 907,700 907,700
======== ======== ======== ========
</TABLE>
See Notes to Financial Statements.
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<PAGE>
ACADEMIC COMPUTER SYSTEMS, INC.
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STATEMENT OF RETAINED EARNINGS
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<TABLE>
<CAPTION>
Six Months Ended
March 31,
------------------
1997 1996
------------------
<S> <C> <C>
Balance - at beginning of period $ 93,061 $68,438
Net income 126,761 11,742
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Balance - at end of period $219,822 $80,180
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</TABLE>
See Notes to Financial Statements.
-3-
<PAGE>
ACADEMIC COMPUTER SYSTEMS, INC.
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STATEMENT OF CASH FLOWS
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<TABLE>
<CAPTION>
Six Months Ended
March 31,
------------------------
1997 1996
------------------------
<S> <C> <C>
Cash flows derived from operating activities:
Interest and dividends received $ 13,840 $ 14,693
Cash paid to suppliers ( 2,566) ( 2,930)
Income taxes paid ( 1,624) ( 4,009)
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Net cash provided by operating activities 9,650 7,754
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Cash flows derived from investing activities:
Sale of securities 1,054,601 -
Purchase of securities ( 600,089) -
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Net cash provided by investing activities 454,512 -
---------- --------
Net increase in cash and cash equivalents 464,162 7,754
Cash and cash equivalents, beginning of period 167,657 149,375
---------- --------
Cash and cash equivalents, end of period $ 631,819 $157,129
========== ========
Reconciliation of net income to net cash provided
by operating activities:
Net income $ 126,761 $ 11,742
Adjustments to reconcile net income to net cash
provided by operating activities:
(Realized gain) on sale of securities ( 173,336) -
(Increase) decrease in other current assets 3,188 ( 1,017)
Increase (decrease) in accounts payable 513 ( 750)
Increase (decrease) in taxes payable 52,524 ( 2,221)
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Net cash provided by operating activities $ 9,650 $ 7,754
========== ========
</TABLE>
See Notes to Financial Statements.
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<PAGE>
ACADEMIC COMPUTER SYSTEMS, INC.
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NOTES TO FINANCIAL STATEMENTS
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MARCH 31, 1997 AND 1996
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1. Statement of Significant Accounting Policies:
---------------------------------------------
The Company records its investment income on the accrual basis.
In the opinion of management, the accompanying financial statements
contain all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the financial position of the Company as of
March 31, 1997, and the results of operations and cash flows for the six
months ended March 31, 1997 and March 31, 1996. Such financial statements
do not include all disclosures required by generally accepted accounting
principles.
These financial statements should be read in conjunction with the
Company's audited financial statements for the years ended September 30,
1996 and 1995 included in the Company's annual report filed on Form 10K.
2. Marketable Securities:
----------------------
The Company has adopted Statement of Financial Accounting Standards
(SFAS) No. 115, "Accounting for Certain Investments in Debt and Equity
Securities." Under SFAS No. 115, debt and equity securities are classified
into three categories: trading, available-for-sale, and held-to-maturity.
Management determines the appropriate classification of its
investments at the time of purchase, and reevaluates such determination at
each balance sheet date. The Company had categorized its marketable
securities as available-for-sale. SFAS No. 115 requires available-for-sale
securities to be carried at fair value with unrealized gains and unrealized
losses reported as a separate component of shareholders' equity. Realized
gains and losses are determined on a specific identification basis. A
decline in market value of any available-for-sale security below cost that
is deemed other than temporary is charged to earnings, resulting in the
establishment of a new cost basis for the security. During the six months
ended March 31, 1997, the Company liquidated all of its investments in debt
and equity securities.
3. Commitments and Contingencies:
------------------------------
The Company's income tax returns have not been audited by the Internal
Revenue Service.
The Company is not involved in any litigation.
4. Deferred Taxes:
---------------
Temporary differences arise from unrealized gains on securities that
are reported as an adjustment to stockholders' equity for financial
reporting but are not recorded in the tax return until the securities are
sold. The Company uses the liability method for calculating the deferred
tax provision and charges the tax effect directly to stockholders' equity.
The deferred taxes relate solely to the available-for-sale securities, and,
as such, have no effect on the components of net income. As of March 31,
1997, the Company had no unrealized gains on securities, having liquidated
its entire portfolio prior to that date (see Note 2).
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<PAGE>
SIGNATURES
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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 of the undersigned, thereunto duly authorized.
ACADEMIC COMPUTER SYSTEMS, INC.
By /s/ Milton Fisher
____________________________________
Milton Fisher, President
(Principal Executive, Financial
and Accounting Officer)
Dated: May 13, 1997
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> MAR-31-1997
<CASH> 631,819
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 631,819
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 631,819
<CURRENT-LIABILITIES> 56,082
<BONDS> 0
0
0
<COMMON> 45,500
<OTHER-SE> 530,237
<TOTAL-LIABILITY-AND-EQUITY> 631,819
<SALES> 0
<TOTAL-REVENUES> 186,097
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,095
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 183,002
<INCOME-TAX> 56,241
<INCOME-CONTINUING> 126,761
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 126,761
<EPS-PRIMARY> .14
<EPS-DILUTED> .14
</TABLE>
