The telephone system of the present invention is realized by a unique dynamic time slice architecture which allows for up to 480 transfers of data. A dual port RAM is utilized in which are stored two pages of data, containing time slice information identifying the sending and receiving devices for each time slice slot within the frame. The time slice configuration can be easily modified to accommodate a change in the current system configuration, for example, a handset connecting or disconnecting from a central office line, or the initiation of a conference call. The time slice configuration is modified by updating the second page and swapping the two pages at the beginning of the next frame so that the time slice controller accesses the second page and the configurations specified therein. Thus the system can be updated and controlled in real time with no delays to the users of the telephone system. The telephone system of the present invention further provides a dynamic conferencing capability which can accommodate a large number of users with no additional circuitry and little additional system overhead. The conferencing circuit linearly combines digitized audio data received from different sources over successive time slice slots in a single frame on a real time basis wherein parties can be added or removed simply by adding or removing the connections to the time slice slots.