10KSB/A

                 UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                  FORM 10-KSB/A

(X)  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT 
     FOR THE FISCAL YEAR 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:   33-18600-D

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

            DELAWARE                                   98-0132465
            --------                                   ----------
(State or other jurisdiction                         (IRS Employer
of incorporation or organization)                Identification Number)

          650 CASTRO STREET, SUITE 210, MOUNTAIN VIEW, CA 94041
          -----------------------------------------------------
                  (Address of Principal Executive Offices)

                              (415) 966-1214
                              --------------

     Securities registered pursuant to Section 12(b) of the Act: NONE

       Securities registered pursuant to Section 12 (g) of the Act:
                   COMMON SHARES, PAR VALUE $.001 PER SHARE
                   ----------------------------------------
                              (Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports 
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act 
of 1934 during the preceding 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 
                                                        ----     -----

Indicate by check mark if disclosure of delinquent filers pursuant to  Item 
405 of  Regulation S-B is not contained herein, and will not be contained, to 
the best of Registrant's knowledge, in definitive proxy or information 
statements incorporated by reference in Part III of this Form 10-KSB or any 
amendment to this Form 10-KSB (   )

Revenues for the twelve-month period ended June 30, 1996 were: $1,031,858.  
The aggregate market value of the common stock held by non-affiliates of the 
Issuer as of November 20, 1996 was $25,119,198.  The number of shares of 
Common Stock, par value $.001 per share, outstanding as of November 20, 1996 
was 17,266,531. 

Documents incorporated by reference:  NONE. 

Transitional Small Business Disclosure Format:  YES        NO  X 
                                                    -----     -----



                                    PART II

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULT OF OPERATIONS.

     The following discussion of the financial condition and results of 
operations of the Company should be read in conjunction with the Financial 
Statements and Notes thereto included elsewhere in this Report.  This section 
may contain forward looking statements regarding, among other matters, the 
Company's future strategy and prospects for growth.  The forward looking 
statements are made pursuant to the safe harbor provisions of the Private 
Securities Litigation Reform Act of 1995.  Forward looking statements address 
matters which are subject to a number of risks and uncertainties.  The 
Company's actual results may differ materially from the results discussed in 
the forward-looking statements.  The factors that might cause this difference 
include, but are not limited to, those discussed throughout this report. 

OVERVIEW

     QCS Corporation (the "Company") is an electronic commerce service 
provider serving the worldwide retail industry. The Company provides its 
users with computer software and related hardware to enable retailers and 
suppliers to conduct the purchase and sale of merchandise on a global basis.  
Using Lotus Notes-TM- and  industry standard networking protocols and 
transmitting data over leased "backbone" trunk lines, the Company maintains a 
secure yet open electronic network which helps retailers conduct on-line 
communication and transactions with their vendors and suppliers (the "QCS 
Network").  This communication and trading process is usually referred to in 
the retail industry as "sourcing."  High volumes of products and transaction 
data need to be exchanged between the retailers and their suppliers in order 
for buy-sell transactions to be initiated, negotiated and closed.  This 
critical sourcing process typically requires a substantial amount of time and 
attention from both the retail merchandise buyer and the salesperson of a 
manufacturer or a distributor.  The QCS Network and the Company's related 
software products and services are designed to help make this sourcing 
function substantially more effective and efficient and to facilitate the 
workflow management of retail industry buyers and sellers.
     
     The Company's revenues are derived from QCS's software products and 
services which include (1) application software and specific image capture 
hardware for a one time licensing/installation fee; (2) network access for 
which the Company charges a fixed monthly fee and/or volume-based recurring 
usage fees; and (3) consulting and engineering projects for which the Company 
receives a negotiated consulting fee.

     From inception in 1993 through June 30, 1996, the Company has generated 
an accumulated loss of  $7,139,967.  Since inception, the Company has 
incurred substantial costs to develop and enhance its technology, to create, 
introduce and enhance its product offerings, to establish marketing and 
distribution relationships, to recruit and train a sales and marketing group 
and to build an administrative organization.  The Company's prospects must be 
considered in light of the risks, expenses and difficulties frequently 
encountered by companies in their early 


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stage of development, particularly companies in new, unproven and rapidly 
evolving markets. The limited operating history of the Company makes the 
prediction of future results of operations difficult or impossible, and, 
therefore, there can be no assurance that the Company will sustain growth or 
achieve profitability.   The Company has only recently started to witness 
sustained and significant usage volume between and among trading partners on 
the QCS Network.  Additional staff and technical support personnel may need 
to be added in a rapid growth scenario.  If these resources are provided 
through a strategic partnership, synergistic coordination and cooperation is 
needed among the Company's sales and engineering teams and their counterparts 
at the strategic partner.  Difficulties and ineffectiveness in managing 
continued growth in liaison with a new strategic partnership could have a 
material adverse effect on the Company's business and results of operations.  
If the company creates its own infrastructure, substantial additional funding 
would be needed. There is no assurance that the needed funds could be raised 
or that the global staffing could be successfully implemented.  The Company's 
success depends to a significant degree upon the continued contributions of 
key management, engineering, sales and marketing, and finance personnel, 
certain of whom would be difficult to replace.  The loss of the services of 
any of the key personnel, the inability to attract or retain qualified 
personnel in the future or delays in hiring required personnel could have a 
material adverse effect on the Company's business, operating results or 
financial condition.

RESULTS OF OPERATIONS

     Please note, when comparing  fiscal years 1995 and 1996, the financial 
results are not directly comparable due to the acceleration of the Company's 
growth and related expenses throughout the two periods. 

REVENUES

     Net revenues increased 114% from $482.1 thousand in fiscal 1995 (FY95) 
to $1.032 million in fiscal 1996 (FY96).  This increase in revenues was due 
primarily to adding retailers and suppliers to the network with the resultant 
installation charges and increased monthly access fees.  Also, retail and 
service providers increased the amount of activity on the network resulting 
in added usage fee revenues. In addition, there was a material year-end 
adjustment to the 4th quarter ended June 30, 1996 for revenue recognition of 
$325.6 thousand.  With respect to this reduction in recorded revenues, in the 
course of its annual year-end audit, the Company became aware of a 
deterioration in the aging profile of its accounts receivable balances which 
related primarily to difficulties with the collection of certain accounts 
receivable balances, primarily in Asia.  After a thorough review of accounts 
receivable, the Company elected to make the revenue recognition adjustment as 
described above for the accounts which the Company no longer believed 
collection was probable.  Since the adjustment, the Company has and will 
continue to recognize revenue from these sales when payment is received.  In 
future periods the Company does not expect to maintain materially significant 
accounts receivable balances because its new Internet-based product requires 
advance payments by credit card.

     The Company's revenue is derived from selling and installing software to 
access the QCS Network and monthly access and volume usage fees for accessing 
the Network.  Consulting 


                                       2


services are provided on a limited basis (1% in fiscal year 1997 to date) to 
assist customers in using the Network.  During fiscal year 1996, the Company 
did not record QCS Network revenue in the separate components described 
above.  Beginning in fiscal year 1997, the Company is now separately 
recording revenue for each distinct service and product and in future filings 
will report its revenues accordingly.  For the three months and nine months 
ended March 31, 1997, revenue from monthly service and access fees 
represented 88% and 76% of total revenue, respectively, and revenue from 
installation fees represented 12% and 22% of total revenue, respectively.

GROSS MARGIN

     Gross margin represents revenues less cost of revenues.  Cost of 
revenues consists mainly of the following: (1) labor costs of installing the 
hardware and software at the customers site; this includes QCS employee costs 
and subcontracted costs; (2) the costs of the network backbone and hub 
providers; (3) 3rd party software costs; and (4) engineering costs for 
specific revenue generating consulting or product enhancement efforts.  Gross 
margin increased by 589% from $69.4 thousand in FY95 to $477.8 thousand in 
FY96.  Gross margin as a percent of revenues increased from 14% in FY95 to 
46% in FY96.  This improvement in gross margin was caused partially by 
economies of scale provided by the large increase in revenues and the fact 
that network management was performed by QCS's operations staff in FY96 after 
incurring start-up assistance charges from an external contractor in FY95.

     Historically, the Company has not separately recorded its cost of sales 
with respect to its three different revenue sources (service and access fees, 
installation fees and consulting fees).  In addition, the Company expects 
that in future periods its only material revenue source will be from service 
and access fees.  This is due to an expected decline in the number of sales 
and installations of the Lotus Notes product in favor of the new, 
Internet-based product which does not require on-site installation.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

     Selling, general and administrative expenses (S,G & A) increased 80% 
from $1.777 million in FY95 to $3.204 million in FY96.  The Company's 
operating expenses have increased substantially since inception as the 
investments to assist in growing the business have been made in advance of 
the resulting revenue increases.  The Company believes that continued 
expansion of its operations is essential to achieving its objectives and, 
therefore, intends to continue to increase expenditures in these areas in the 
future. 

     The Company invested strongly in FY96 in several key areas to get into 
position to create, accommodate, and sustain potential, substantial growth in 
the coming quarters. First, the retail industry is truly global in nature.  
To properly address the appropriate worldwide markets, increased sales and 
marketing staff and management were added in FY96. These expenses were 
increased at all three major sales locations; Hong Kong, France and the U. S. 
 The initial steps of a worldwide marketing plan, and improved attention to 
customer account management, were also funded in FY96.  Second, general and 
administrative expenses also grew in relation to the growth in revenue and 
broadening, global scope of  the operating plans. Third, engineering 
headcount 


                                       3


and expenses were increased to continue to refine and enhance the current 
product and service offerings.  To maintain competitiveness in the very 
fast-moving software industry, additional engineering expenses also were 
spent on the analysis and design of future products.  The FY96 Net Loss was 
($2.712) million, or ($0.20) per share versus a FY95 Net Loss of ($1.735) 
million or ($0.11) per share. There was a material year-end adjustment to the 
4th quarter ended June 30, 1996 for compensation expense of $199.6 thousand 
related to stock options.  The stock option compensation expense arose due to 
the vesting of options to purchase shares of the Company's common stock which 
were originally granted at a price less than fair market value.  This expense 
was not recorded until the fourth quarter of the fiscal year.  On an ongoing 
basis, the Company has instituted procedures whereby the Company's Board of 
Directors will promptly report all option grants to the Company's finance 
personnel.  Accordingly, the Company will record stock option compensation 
expense, if any, as it arises.

LIQUIDITY AND CAPITAL RESOURCES

     FY96 year-ending cash and short-term investments of $2.607 million was 
an increase of $509 thousand over the FY95 year-ending balance of $2.098 
million. This increase was generated by $2.5 million raised in equity 
financing which was partially offset by $2.0 million in cash used for 
operations and capital expenditures.

     The Company's business plan for FY97 calls for continued increases in 
funding for product development, selling expenses and key management 
additions. This plan also depends on a continuing growth in the revenue base 
which will thereby generate increased cash receipts to partially offset the 
spending growth.  The Company does not currently have a bank credit line, but 
does intend to apply for one in FY97.  There can be no assurance that this 
attempt will be successful.  Additional funds will be realized in early FY97 
from the receipt of the remaining investment dollars from the equity 
financing which took place at approximately FY96 year-end.  The Company 
believes that the cash resources available at 6/30/96, the anticipated 
receipt of the previously mentioned additional equity funds, coupled with at 
least some growth in collectable revenues, will be sufficient to fund 
operations for the next year. 
     
     However, if the Company were to continue to sustain significant losses, 
beyond the current business plan, the Company may be required to attempt to 
raise further debt or equity funds.  Whether of not these fund raising 
efforts would be successful, the Company might have to reduce operating 
spending resulting in possible additional negative impacts on the achievement 
of the Company's objectives. 


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                                   SIGNATURES 

     PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(d) OF THE SECURITIES 
AND EXCHANGE ACT OF 1934, AS AMENDED, THE REGISTRANT HAS DULY CAUSED THIS 
REPORT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY 
AUTHORIZED.

Date:  June 23, 1997

                                        QCS CORPORATION
                                          (Registrant)
                                             
                                             
                                        By: /s/ Marcel van Heesewijk
                                            --------------------------------
                                        Marcel van Heesewijk, President,   
                                        Chief Executive Officer, Acting
                                        Principal Accounting and
                                        Financial Officer, Director



                                       5



INDEX TO EXHIBITS


                                                                SEQUENTIALLY
EXHIBIT                                                           NUMBERED 
NUMBER                   DESCRIPTION                                PAGES

3.1       Amended Certificate of Incorporation is incorporated 
          by reference to Exhibit 28(ii) to Form 8-K filed 
          November 22, 1994*

3.2       Bylaws are incorporated by reference to Exhibit 28(viii)
          to Form 8-K filed November 22, 1994*

          Instruments defining rights of holders the Company's
          Series A Convertible Preferred Stock are incorporated by
          reference to Exhibits 28 (i), (ii), (iii) & (iv) to Form 8-K
          filed November 22, 1994*

11        Statement re: Computation of per share earnings (loss)
          See page F-3 of the Financial Statements filed under Item 7 
          hereof*
          
21        Subsidiaries of the Registrant*

27        Financial Data Schedule*

99        Report of Independent Accountants

_________________________________

*  Previously filed


                                       6

EX-99

    
                                                          EXHIBIT 99



                    REPORT OF INDEPENDENT ACCOUNTANTS


To the Board of Directors and Stockholders of
  QCS Corporation:

We have audited the accompanying consolidated balance sheets of QCS 
Corporation and subsidiaries ("the Company") as of June 30, 1996 and 1995, 
and the related consolidated statements of operations, cash flows and 
stockholders' equity for the years ended June 30, 1996 and 1995. 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 consolidated 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.

As described in Note 13 to the consolidated financial statements, the Company 
reversed a foreign currency transaction gain on the conversion of 
intercompany debt to equity in a transaction involving its French subsidiary 
in fiscal 1995. The financial statements for the year ended June 30, 1995 have 
been restated for the effects of this adjustment.

In our opinion, the consolidated financial statements referred to above 
present fairly, in all material respects, the consolidated financial position 
of the Company as of June 30, 1996 and 1995, and the consolidated results of 
its operations and its cash flows for the years then ended in conformity with 
generally accepted accounting principles.


                             Coopers & Lybrand L.L.P.


San Francisco, California
November 26, 1996



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