ATS MONEY SYSTEMS INC
10QSB, 1996-08-09
CALCULATING & ACCOUNTING MACHINES (NO ELECTRONIC COMPUTERS)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 2054

FORM 10-QSB

(MARK ONE)

(X)  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES                    EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD
ENDED JUNE 30,                1996.   



( )  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES                EXCHANGE ACT OF 1934 FOR THE TRANSITION
PERIOD FROM 

     _____________________________ TO_________________________________.

	Commission File Number:  0-17773



___________________________ATS Money Systems,Inc._______________________

	     (Exact name of small business issuer as specified
in its charter) 

____________Nevada_____________ ___________13-3442314__________________

 (State or other jurisdiction of   (I.R.S. EmployerIdentification No.)

  incorporation or organization)



25 Rockwood Place________Englewood, NewJersey________07631______________

 (Address of principal executive offices)          
(Zip Code)



________________________201/894-1700___________________________________ 

		     (Issuer's telephone number)


Check whether the issuer (1) filed all reports
required to be filed by Section 13 or 15(d) of the Exchange Act
during the past 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.  
__X__Yes  _____No

State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest practicable
date:

As of  August 8, 1996, - 5,876,486 shares of common
stock, $.001 par value.

Transitional Small Business Disclosure Form   Yes_____  No __X__

<TABLE>
<CAPTION>


Part I.  FINANCIAL INFORMATION
Item I.  Financial Statements

ATS MONEY SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS

							JUNE 30   DECEMBER 31
ASSETS:                                                    1996     1995
						      (UNAUDITED)
</CAPTION>
<S>                                                   
CURRENT ASSETS:                                    <C>             <C>
 Cash and cash equivalents                         $  1,224,209    $   164,548
 Trade accounts receivable, less allowance 
  for doubtful accounts of $74,183 in 1996
and $92,363 in 1995                                  1,654,874      1,560,626    

 Inventories                                            471,488        520,996
 Prepaid expenses and other current assets              238,356        172,221

     Total current assets                             3,588,927      2,418,391

PROPERTY - At Costs:
Office furniture                                         98,561         52,912
Office machinery and e quipment                        126,804        100,520                        

     Subtotal                                            217,365       153,432
 
    Less Accumulated depreciation                         84,198        68,796
 
 Property - net                                          133,167       84,636                                
 
OTHER ASSETS:
Software costs, less accumulated amortization
 of $458,909 in 1996 and $361,641 in 1995                 708,094      631,568
Deposits                                                   50,676       65,073

     Total other assets                                   724,144      696,641
                                                							  ________    _________  

TOTAL                                                 $ 4,480,864   $3,199,668  

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
 Accounts payable - trade                          $      85,506     $155,808         
 Accrued expenses                                         386,638      418,058
 Deferred revenue                                       1,195,297      247,602
 Other liabilities                                        163,757      115,636
							                                                  _________     _______ 

     Total current liabilities                          1,831,198      937,104 


LONG-TERM-Deferred Credit, less amortization of
$51,551 in 1996 and $39,211 in1995                        231,699      245,956

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
Common stock - $.001 par value, 25,000,000
shares authorized, 5,876,486 shares issued 
at June 30, 1996 and 5,835,794 shares      
issued at December 31, 1995                                5,876         5,836
Additional paid-in capital                             2,370,075     2,319,920 
Retained earnings                                         42,116     (309,048)
Treasury stock - 100,000 shares at par value              (  100)    (    100)
                                                 							__________  __________
     Total stockholders' equity                         2,417,967   2,016,608       

                                          						       ___________ ___________ 

TOTAL                                                  $ 4,480,864  $3,199,668

See notes to consolidated financial statements. 

</TABLE>
<TABLE>
<CAPTION>




ATS MONEY SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTH PERIODS ENDED JUNE 30, 1996 AND 1995
(UNAUDITED)

							JUNE 30       JUNE 30     
							  1996          1995
</CAPTION>
<S>                                                 <C>           <C>
REVENUE:
Equipment and systems sales                        $  1,517,522   $ 1,759,478   
Equipment maintenance and service revenue                564,295       587,654

Total revenue                                          2,081,817     2,347,132

COST AND EXPENSES:
Cost of goods sold and service expense:
Equipment and systems                                    667,570       743,253
Equipment maintenance and service                        234,873       245,292 
Selling, general and administrative expenses             956,122       900,116

Total costs and expenses                              1,858,565     1,888,661          


INCOME FROM OPERATIONS                                   223,252       458,471

INTEREST INCOME                                           16,188         6,505

INCOME BEFORE INCOME TAXES                                239,440      464,976

INCOME TAXES                                               86,000       95,310

NET INCOME                                          $    153,440     $369,666    

EARNING PER COMMON SHARE: 
Primary and fully diluted                                    $.03         $.06

WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING                                             5,930,240    5,855,258

See notes to consolidated financial statements.



</TABLE>
<TABLE>
<CAPTION>
ATS MONEY SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
SIX MONTH PERIODS ENDED JUNE 30, 1996 AND 1995
(UNAUDITED)

							JUNE 30      JUNE 30
							  1996        1995
</CAPTION>
<S>                                                   <C>         <C>
REVENUE:
Equipment and systems sales                           $ 3,044,037 $  2,744,475
Equipment maintenance and service revenue               1,208,913    1,150,946

Total revenue                                           4,252,950    3,895,421

COSTS AND EXPENSES:
Cost of goods sold and service expense:
Equipment and systems                                   1,273,890    1,252,432
Equipment maintenance and service                         492,836      490,269
Selling, general and administrative expenses            1,947,932    1,775,984

Total costs and expenses                                3,714,658    3,518,685

INCOME FROM OPERATIONS                                    538,292      376,736

INTEREST INCOME                                           19,872       15,934   

INCOME BEFORE INCOME TAXES                                558,164      392,670

INCOME TAXES                                              207,000       95,545 

NET INCOME                                              $ 351,164   $  297,125

EARNINGS PER COMMON SHARE:
Primary and fully diluted                                    $.06         $.05

				     
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING                                             5,928,753    5,820,161


See notes to consolidated financial statements.

</TABLE>
<TABLE>
<CAPTION>


 ATS MONEY SYSTEMS, INC.
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 SIX MONTH PERIODS ENDED JUNE 30, 1996 AND 1995
 (UNAUDITED)

							 JUNE 30     JUNE 30  
							   1996        1995
</CAPTION>
<S>                                                   <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income                                            $   351,164   $  297,125
Adjustments to reconcile net income to cash
provided by (used in) operating activities:
Depreciation and amortization                             100,330      102,386 
Compensation expense recorded for common  
  stock issued under stock option plan*                    50,198         - 
Changes in current assets and liabilities:
 Trade accounts receivable - net                       (   94,248) (   43,409)
 Inventories                                               49,508  (  141,598) 
 Prepaid service contract costs                              -     (  329,204)
 Prepaid expenses and other assets                     (  51,738) (   20,684)   
 Accounts payable - trade                               (  70,302) (  119,615) 
 Accrued expenses                                       (  31,420)      29,478 
 Deferred revenue                                         947,695      717,460
 Other liabilities                                         46,201        1,373

Net cash provided by operating activities               1,297,388      493,312

CASH FLOWS FROM INVESTING ACTIVITIES:
Capitalization of software development costs            ( 173,794) (  216,730)
Property additions                                     (   63,933) (   24,425)

Net cash used in investing activities                  (  237,727) (  241,155)

NET INCREASE IN CASH AND
CASH EQUIVALENTS                                        1,059,661      252,157

CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD                                       164,548      527,369 

CASH AND CASH EQUIVALENTS, END OF PERIOD              $1,224,209   $  779,526     

SUPPLEMENTAL DISCLOSURE OF CASH FLOW 
INFORMATION:
Cash paid during the period for:
  Income Taxes                                       $    90,000   $    20,000 

*Non cash transactions - common stock 
issued under stock option plan                       $    50,198    $     -    


See notes to consolidated financial statements.



</TABLE>

ATS MONEY SYSTEMS, INC.
Notes to Consolidated Financial Statements
(Unaudited)
June 30, 1996


Note 1 - Unaudited Information:

In the opinion of management, the accompanying
unaudited financial statements reflect all adjustments (which
comprise only normal recurring accruals) necessary to present
fairly the Company's consolidated financial position as of June
30, 1996, and the results of its operations for the three month
and six month periods ended June 30, 1996 and 1995 and cash
flows for the six month periods ended June 30, 1996 and 1995.
Information included in the consolidated balance sheet as of
December 31, 1995 has been derived from the Company's audited
financial statements in its Annual Report on Form 10-KSB for the
year ended December 31, 1995, to which reference is made.  

Note 2 - Inventories

Inventories are stated at the lower of cost or
market.  Cost is determined by the first-in, first-out method
for machine parts and specific identification for machines held
for sale.

Note 3 - Capitalized Software Costs

The Company capitalizes computer software development
costs in accordance with the provisions of Statement of
Financial Accounting Standards No. 86, "Accounting for the Costs
of Computer Software to be Sold, Leased or Otherwise Marketed".
Costs incurred to establish the technological feasibility of
computer software are expensed as incurred.  Costs incurred for
product enhancements, subsequent to establishing technological
feasibility, are capitalized and stated at the lower of cost or
net realizable value.  Capitalized costs are amortized using the
straight-line method over five years, which approximates the
estimated remaining useful life of the product.  Amortization of
computer software costs amounted to $97,268 and $82,856 for the
six month periods ended June 30, 1996 and 1995, respectively and
$50,013 and $40,957 for the three month periods ended June 30,
1996 and 1995, respectively. 

Note 4 - Revenue Recognition

Revenue from equipment and systems sales is
recognized upon shipment to the buyer and satisfaction of
related obligations by the Company.  Revenue from software
licensing is recognized on delivery of the software if
collectibility is probable and any remaining insignificant
obligations of the Company are accounted for by deferring a pro
rata portion of revenue and recognizing it either ratably as the
obligations are fulfilled or on completion of performance or by
recording a current year expense for the remaining costs
associated with completing the project.

Note 5 - Equipment Maintenance and Service Revenue

Equipment maintenance and service revenue is
recognized as earned over the term of the contract, which is
generally a maximum of one year in length.  Deferred revenue
represents the unearned portion of equipment maintenance and
service fees.


Note 6 - Income Taxes

The Company accounts for income taxes under the
provision of Statement of Financial Accounting Standards No. 109
("SFAS 109"), "Accounting for Income Taxes". 

Deferred income taxes reflect the net tax effect of
temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts
used for income tax  purposes, and operating loss carryforwards.

The income tax provision for the six month period
ended June 30, 1996 and 1995 was $207,000 and $95,545,
respectively.  For the three month period ended June 30, 1996
and 1995, the provision was $86,000 and $95,310, respectively. 
Provisions in 1996 related solely to current and deferred
federal and state income tax expenses whereas, in 1995, they
included a change in valuation allowances from utilization of a
net operating loss carryforward. 

Note 7 - Stockholders' Equity

Common Stock - The authorized capital stock of the
Company consists of 25,000,000 shares of noncumulative, voting,
common stock, with a par value of $.001 per share.                      

Stock Option Plans - In January 1993, the Company
adopted a common stock incentive option plan (the "Plan"),
approved by the stockholders at the annual meeting in May 1993,
which authorizes the issuance, within ten years, of options
covering up to 280,000 shares of common stock to certain
employees and other individuals of importance to the Company. 
The Plan is intended to provide incentive to continued
employment of certain employees and other individuals by
enabling them to acquire a proprietary interest in the Company. 
Options granted under the Plan may be either "incentive stock
options" or "non-qualified stock options." Incentive stock
options, granted only to certain employees of the Company,
expire within ten years (five years for a 10% beneficial owner
of the Company's securities) from the date granted and are
exercisable from time to time in accordance with the terms of
such options.  The exercise price of an incentive stock option
must be at least equal to the fair market value of the common
stock on the date of grant (110% for a 10% beneficial owner of
the Company's securities).  Non-qualified stock options can be
granted to certain employees of the Company and advisors and
consultants to the Company.  Such stock options are exercisable
on or after the date of grant and the exercise price is not
limited and may be below fair market value.  

The Company did not grant any options in 1995,
however, on October 31, 1995, an additional 200,000 shares were
authorized.  During 1995, 15,653 options were exercised at a
price of $.28125 per share.

On September 27, 1995, the Board of Directors
approved the ATS Money Systems, Inc., 1995 Director Stock Plan
pursuant to which the Company's non-employee directors, upon
first being elected to the Board, would be granted 10,000 shares
of the Company's common stock, and on the date of election of
directors at each annual stockholder meeting thereafter (if such
person continues to serve as a director) would be granted
options to purchase 5,000 shares of the Company's common stock
with an exercise price equal to the then fair market value of
such shares.  The Plan was approved at the 1995 Annual Meeting
of Stockholders.  The non-employee directors were granted 30,000
shares effective October 31, 1995, which were issued on January
2, 1996.  Another 10,000 shares were granted and issued on
February 27, 1996.

On February 3, 1996, when the fair market value of
the common stock was $1.03125 per share, the Company granted
46,001 incentive stock options at such price ($1.1344 per share
for one employee).  During 1996, 692 of the incentive stock
options were exercised at a price of $.28125 per share.  At June
30, 1996, there were 226,301 options outstanding at prices
ranging from $.28125 to $1.375 per share of which 139,666 were
exercisable.

Note 8 - Commitments and Contingencies

At June 30, 1996, the Company was committed under
noncancelable, operating leases for office space, automobiles
and office equipment, expiring at various dates through April
2000, requiring minimum rental payments as follows:
<TABLE>
<CAPTION>

Year Ending December 31:
</CAPTION>
<S>                         <C>
1996 (balance of year)      $   154,393                         
1997                            286,738
1998                            273,519
1999                            121,228 
2000                             32,852

				868,730   
</TABLE>
Rental expense for the six month periods ended June
30, 1996 and 1995 was $176,289 and $155,867 respectively.

For the three month periods ended June 30, 1996 and
1995, the rental expense was $88,099 and $78,292 respectively.



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN
OF OPERATION

Reference is made to Item 6 - "Management's
Discussion and Analysis of Plan of Operation," contained in the
Company's Annual Report on Form 10-KSB for its year ended
December 31, 1995 for a discussion of the Company's financial
condition as of December 31, 1995 including a discussion of the
Company's anticipated liquidity and working capital requirements
during 1996.

COMPARISON OF CONSOLIDATED OPERATIONS FOR THE SIX
MONTHS ENDED JUNE 30, 1996 TO THE SIX MONTHS ENDED JUNE 30, 1995.

Total revenues for the first six months of 1996 were
$4,252,950 which was an increase of $357,529 (9.2%) over the
first half of 1995.  Equipment and systems sales rose $299,562
(10.9%) over the comparable six month periods.  Both ATS Money
Systems, Inc. - Parent Company and Innovative Electronics Inc.,
shared in this increase with $178,617 (6.5%) and $120,945
(11.5%) increases respectively.  Consolidated maintenance
revenue rose $57,967 (5.0%) to $1,208,913 in the six month
period of 1996 compared to the first six months of 1995.  This
was due to an increased  number of systems of large retailers
being under contract.



Cost of equipment and system sales decreased from
45.6% of sales in the first six months of 1995 to 41.8% in the
comparable period of 1996.  This decrease was primarily due to
Innovative Electronics' sales of software which carries higher
margins as well as ATS Money Systems - Parent Company sales of
more profitable systems.  Combined maintenance costs declined
from 42.5% of revenue in the first half of 1995 to 40.7% in the
first half of 1996 primarily due to lower cost of Innovative
Electronics maintenance. 



Selling, general and administrative expenses were
$1,947,932 in the first six months of 1996 compared to
$1,775,984 in the first six months of 1995.  This increase of
$171,948 (9.7%) is primarily due to increased professional fees
and commissions.  Also, in the six month period ended June 30,
1995, Innovative Electronics, Inc., recovered certain accounts
receivable which had been previously written off.  A similar
reduction of expense did not occur in 1996.



Interest income for the first six months of 1996 was
$19,872 compared to $15,934 in the first half of 1995 due to a
larger amount of short term investments.



As a result of the foregoing, the first six months of
1996 produced income before taxes of $558,164 compared to
$392,670, an increase of $165,494 (42.1%).  The provision for
income taxes for the six months of 1996 was $207,000 with an
after tax profit of $351,164.  This was $54,039 (18.2%) greater
than the first six months of 1995.



COMPARISON OF CONSOLIDATED OPERATIONS FOR THE THREE
MONTHS ENDED JUNE 30, 1996 TO THE THREE MONTHS ENDED JUNE 30,
1995.



Revenues for the three month period ended June 30,
1996 were $2,081,817, a decrease of $265,315 (11.3%) from the
three month period ended June 30, 1995.  Equipment and systems
sales declined $241,956 (13.8%) primarily due to a decrease in
software sales of Innovative Electronics, Inc., of $168,458
(28.2%) and Parent Company system sales of $73,498 (6.3%). 
Combined maintenance revenue of $564,295 was $23,359 (4.0%) less
than the three months ended June 30, 1995.



Cost of equipment and systems as a percentage of
sales increased to 43.9% for the three months ended June 30,
1996, from 42.2% in the comparable quarter of 1995 primarily due
to a somewhat different product mix.  Cost of maintenance for
the three month periods ended June 30, 1996, and June 30, 1995,
remained fairly constant at 41.6% and 41.7%, respectively.



Selling, general and administrative expenses for the
second calendar quarter of 1996 were $956,122 compared to
$900,116 for the same period of 1995.  This increase of $56,006
(6.2%) was primarily due to increased commissions. 



As a result of the foregoing, income from operations
decreased $235,219 (51.3%) from $458,471 in the three months
ended June 30, 1995, to $223,252 in the three months ended June
30, 1996.



Interest income, in the second quarter of 1996, was
$16,188 which was $9,683 greater than the $6,505 interest income
in the second quarter of 1995.  This is due to a larger amount
of short term investments.



For the three months ended June 30, 1996, the income
tax provision of $86,000 consisted of federal and state tax
accruals whereas in the three month period ended June 30, 1995,
the provision of $95,310 also included valuation allowances from
utilization of a net operating loss carryforward. 



The resulting net income for the three months ended
June 30, 1996, was $153,440 which was $216,226 (58.5%) below the
three month period ended June 30, 1995.



Financial Condition



At June 30, 1996, cash and cash equivalents amounted
to approximately $1,224,000 and, in addition, the Company did
not have any outstanding borrowings.  During the first three
months of the year, many customers prepay their annual
maintenance contract which increases the Company's cash and,
correspondingly, its deferred revenue liability.



In April 1996, First Union National Bank renewed a
$750,000 discretionary line of credit for the Company's
short-term needs, at an interest rate equal to such bank's base
rate plus 1/2%.  All advances under this line of credit are
required to be secured by a lien on substantially all of the
Company's assets.  The Company has not drawn against this line
of credit.



Other



The Company is considering expanding its operations
and is currently negotiating a possible acquisition for shares
of the Company's common stock.  As of the date of this filing,
no definitive agreements have yet been reached.



PART II - OTHER INFORMATION


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



(a)  Exhibits



     11.  Statement re:  computation of per share
earnings - not required               since such computation can
be earlier determined from the material

	  contained in this report on Form 10-QSB.



     27.  Financial Data Schedule.



(b)  No reports on Form 8-K were filed during the
quarter for which this report was filed. 




SIGNATURES


In accordance with the requirements of the Exchange
Act, the registrant caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.


						     ATS Money Systems, Inc.

							    (Registrant)


_____        August 8, 1996______          _______________________________
	(Date)                                     Gerard F. Murphy
						   Chief Executive Officer
							  President



	     August 8, 1996_____________ __________________________________
		(Date)                           Joseph M. Burke
						 Vice President - Finance




<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
EXHIBIT 27 - FINANCIAL DATA SCHEDULE
This schedule contains summary financial information extracted from the
Consolidated Balance Sheet as ofJune 30, 1996 and the Consolidated
Statement of Operations for the six months ended June 30, 1996 and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
       
<S>                             <C>
<PERIOD-TYPE>                   6-MOS 
<FISCAL-YEAR-END>                          DEC-31-1996
<PERIOD-END>                               JUN-30-1996
<CASH>                                       1,224,209
<SECURITIES>                                         0
<RECEIVABLES>                                1,729,057
<ALLOWANCES>                                    74,183
<INVENTORY>                                    471,488
<CURRENT-ASSETS>                             3,588,927
<PP&E>                                         217,365
<DEPRECIATION>                                  84,198
<TOTAL-ASSETS>                               4,480,864
<CURRENT-LIABILITIES>                        1,831,198
<BONDS>                                              0
<COMMON>                                         5,876
                                0
                                          0
<OTHER-SE>                                   2,412,091
<TOTAL-LIABILITY-AND-EQUITY>                 4,480,864
<SALES>                                      3,044,037
<TOTAL-REVENUES>                             4,252,950
<CGS>                                        1,273,890
<TOTAL-COSTS>                                1,766,726
<OTHER-EXPENSES>                             1,966,112
<LOSS-PROVISION>                               (18,180)
<INTEREST-EXPENSE>                              19,872
<INCOME-PRETAX>                                558,164
<INCOME-TAX>                                   207,000
<INCOME-CONTINUING>                            351,164
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                   351,164
<EPS-PRIMARY>                                      .06
<EPS-DILUTED>                                      .06
        

</TABLE>


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