<PAGE>
 
                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                              ------------------

                                   FORM 10-Q

                                  (Mark one)

          [X]  Quarterly report pursuant to Section 13 or 15(d) of the
               Securities Exchange Act of 1934

                    FOR THE QUARTER ENDED SEPTEMBER 30, 1996

          [_]  Transition report pursuant to Section 13 or 15(d) of the
               Securities Exchange Act of 1934


                         Commission file number 0-26948

                              ------------------

                            SCOPUS TECHNOLOGY, INC.
             (Exact name of registrant as specified in its charter)


         CALIFORNIA                                   94-3134998
(State or other jurisdiction of            (IRS Employer Identification No.)
 incorporation or organization)


                           1900 POWELL ST., 7TH FLOOR
                             EMERYVILLE, CA  94608
              (Address of principal executive offices & zip code)
                                        
                 REGISTRANT'S TELEPHONE NUMBER:  (510)-597-5800

                              ------------------

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 ______
                                   -----         

 There were 11,926,521 shares of the registrant's $.001 par value Common Stock
                     outstanding as of September 30, 1996.

                                 Page 1 of 23
<PAGE>
 
                            SCOPUS TECHNOLOGY, INC.

                               TABLE OF CONTENTS

<TABLE> 
<CAPTION> 
                                                                            PAGE
                                                                            ----
<S>                                                                         <C>

PART I.  FINANCIAL INFORMATION

  Item 1.  Financial Statements
 
     Condensed Consolidated Balance Sheet                                     3
 
     Condensed Consolidated Statement of Operations                           4
 
     Condensed Consolidated Statement of Cash Flows                           5
 
     Notes to Condensed Consolidated Financial Statements                     6
 

  Item 2.  Management's Discussion and Analysis
             of Financial Condition and Results of Operations                 7

 
PART II. OTHER INFORMATION
 
  Item 6.  List of Exhibits and Reports on Form 8-K                          20
 
SIGNATURES                                                                   21
 
INDEX TO EXHIBITS                                                            22
</TABLE>

                                     Page 2
<PAGE>
 
               SCOPUS TECHNOLOGY, INC. AND SUBSIDIARY
                CONDENSED CONSOLIDATED BALANCE SHEET
                            (Unaudited)
                       (Amounts in thousands)
<TABLE> 
<CAPTION> 
                                           March 31,   September 30,
                                             1996          1996
                                           ---------   -------------
<S>                                        <C>         <C>
                 ASSETS  
                 ------

Current assets:
  Cash and cash equivalents                  $21,792      $17,411
  Short term investments                       7,462       10,701
  Accounts receivable, net                     7,530       11,453
 
  Prepaid expenses and other                     648          761
  Deferred income taxes                          574        1,103
                                             -------      -------

 
  Total current assets                        38,006       41,429
Property and equipment, net                    2,734        5,306
Other assets                                     841        1,607
                                             -------      -------
 
  Total assets                               $41,581      $48,342
                                             =======      =======
 
LIABILITIES, MANDATORILY REDEEMABLE
  CONVERTIBLE PREFERRED STOCK AND
     SHAREHOLDERS EQUITY
-----------------------------------
 
Current liabilities:
  Accounts payable                           $ 1,561      $ 2,779
  Accrued liabilities                          2,544        3,601
  Income taxes payable                           740          839
  Deferred revenue                             3,270        3,663
                                             -------      -------
 
  Total current liabilities                    8,115       10,882
  Deferred tax liabilities                        11            -
                                             -------      -------
  Total liabilities                            8,126       10,882
                                             -------      -------
 
Mandatorily redeemable convertible
 preferred stock                                   -            -
                                             -------      -------
 
Shareholders' equity:
  Capital stock                               29,956       31,521
  Retained earnings                            3,499        5,939
                                             -------      -------
 
  Total shareholders' equity                  33,455       37,460
                                             -------      -------
 
  Total liabilities, mandatorily
   redeemable preferred stock
   and shareholders' equity                  $41,581      $48,342
                                             =======      =======
 
</TABLE>

                            See accompanying notes

                                     Page 3
<PAGE>
 
                    SCOPUS TECHNOLOGY, INC. AND SUBSIDIARY
                CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                                  (Unaudited)
                 (Amounts in thousands, except per share data)
 
<TABLE> 
<CAPTION> 
                                           Three Months Ended    Six Months Ended
                                             September 30,        September 30,
                                           ------------------   ------------------
                                            1995       1996      1995       1996
                                           -------    -------   -------    -------
<S>                                        <C>        <C>       <C>        <C>
Revenues:
  Licenses                                 $ 4,037    $10,043   $ 7,704    $17,424
  Services and maintenance                   1,900      3,458     4,345      6,380
                                           -------    -------   -------    -------
 
  Total revenues                             5,937     13,501    12,049     23,804
                                           -------    -------   -------    -------
 
Cost of revenues:
  Licenses                                     504        244       626        839
  Services and maintenance                   1,511      2,217     4,028      4,178
                                           -------    -------   -------    -------
 
  Total cost of revenues                     2,015      2,461     4,654      5,017
                                           -------    -------   -------    -------
 
Gross margin                                 3,922     11,040     7,395     18,787
                                           -------    -------   -------    -------
 
Operating expenses:
  Sales and marketing                        2,056      5,642     4,051      9,703
  Research and development                   1,259      2,080     2,283      3,860
  General and administrative                   390      1,201       752      2,050
                                           -------    -------   -------    -------
 
  Total operating expenses                   3,705      8,923     7,086     15,613
                                           -------    -------   -------    -------
 
Income from operations                         217      2,117       309      3,174
Other income, net                               14        265        51        576
                                           -------    -------   -------    -------
 
Income before provision for income taxes       231      2,382       360      3,750
Provision for income taxes                      85        881       133      1,401
                                           -------    -------   -------    -------

Net income                                 $   146    $ 1,501   $   227    $ 2,349
                                           =======    =======   =======    =======
 
Net income per share                       $  0.01    $  0.12   $  0.02    $  0.18
                                           =======    =======   =======    =======
 
Shares used in per share computation        10,925     12,773    10,786     12,757
                                           =======    =======   =======    =======
</TABLE>

                            See accompanying notes

                                     Page 4
<PAGE>
 
                    SCOPUS TECHNOLOGY, INC. AND SUBSIDIARY
                CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (Unaudited)
                            (Amounts in thousands)
<TABLE> 
<CAPTION> 
                                                     Six Months Ended
                                                       September 30,
                                                    -------------------
                                                      1995        1996
                                                    -------     -------
<S>                                                 <C>         <C>
Cash flows from operating activities:
 Net income                                         $   227     $ 2,349
 Adjustments to reconcile net income
  to net cash provided by (used in)
  operating activities:
  Depreciation and amortization                         399         830
  Noncash charges                                      (151)        429
  Changes in assets and liabilities:
   (Increase) in accounts receivable                 (2,438)     (3,923)
   Decrease (Increase) in prepaid 
    expenses and other                                 (171)       (893)
   (Increase) in deferred income taxes                   24        (526)
   Increase in accounts payable                         248       1,218
   Increase in accrued liabilities                      153       1,057
   (Decrease) Increase in income taxes  
    payable                                            (207)         99
   Increase in deferred revenue                       1,043         393
                                                    -------     -------
 Net cash provided by operating 
  activities                                           (873)      1,033
                                                    -------     -------
Cash flows used in investing activities:
 Purchase of investments                                  -      (8,138)
 Proceeds from sale of investments                      555       4,894
 Purchases of property and equipment                   (605)     (2,869)
 Proceeds from disposal of fixed assets                   3          45
                                                    -------     -------
 
 Net cash used in investing activities                  (47)     (6,068)
                                                    -------     -------
Cash flows from financing activities:
 Proceeds from exercise of common stock 
  options                                                11         654
 Proceeds from initial public offering                    -           -
 (Repayments) borrowings under line of  
  credit, net                                             -           -
                                                    -------     -------
 
 Net cash provided by financing   
  activities                                             11         654
                                                    -------     -------
 
 Net increase in cash and cash  
  equivalents                                          (909)      (4381)
 
Cash and cash equivalents at beginning   
 of year                                              3,001      21,792
                                                    -------     -------
Cash and cash equivalents at end of  
 period                                             $ 2,092     $17,411
                                                    =======     =======
</TABLE>

                            See accompanying notes

                                     Page 5
<PAGE>
 
                     SCOPUS TECHNOLOGY, INC. AND SUBSIDIARY
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)


NOTE 1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been
prepared on the same basis as the audited annual consolidated financial
statements and, in the opinion of management, include all adjustments,
consisting only of normal recurring adjustments, necessary for a fair
presentation of the financial position, results of operations and cash flows.
The results of operations for the three and six months ended September 30, 1996,
are not necessarily indicative of the results to be expected for the full year.
Certain information and footnote disclosures normally contained in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These condensed consolidated financial
statements should be read in conjunction with the Notes to Consolidated
Financial Statements contained in Scopus Technology, Inc.'s Prospectus dated
November 16, 1995.

NOTE 2. INITIAL PUBLIC OFFERING

In November 1995, Scopus Technology, Inc. (the "Company"), completed an initial
public offering of 2,760,000 shares of common stock at $12.00 per share. Of
this, 2,225,000 were issued by the Company and 535,000 from selling
shareholders. The Company received net proceeds of approximately $24.0 million.

In November 1996, the Company filed a registration statement relating to a
proposed public offering of 2,000,000 shares of common stock with the Securities
and Exchange Commission.  Of the total, 1,150,000 shares will be offered by the
Company and 850,000 shares will be offered by selling shareholders.  An
additional 300,000 shares may be offered by selling shareholders pursuant to an
over-allotment option granted to the underwriters.

                                     Page 6
<PAGE>
 
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS

  The discussion and analysis below contains trend analyses and other forward-
looking statements within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Actual results could differ materially from those projected in the
forward-looking statements as a result of the factors set forth below under
"Overview", "Other Factors that may Affect Future Performance" and elsewhere
in this report.

OVERVIEW

  The Company's quarterly operating results have varied substantially in the
past and are likely to vary substantially from quarter to quarter in the future
due to a variety of factors. In particular, the Company's period-to-period
operating results are significantly dependent upon the timing of the closing of
large license agreements. In this regard, the purchase of the Company's products
can require a significant capital investment from a potential customer which the
customer generally views as a discretionary cost that can be deferred or
canceled due to budgetary or other business reasons. Estimating future revenues
is also difficult because the Company ships its products soon after an order is
received and as such does not have a significant backlog. Thus, quarterly
license revenues are heavily dependent upon orders received and shipped within
the same quarter. Moreover, the Company has generally recorded 50% to 70% of its
total quarterly revenues in the third month of a quarter, with a concentration
of these revenues in the last half of that third month. This concentration of
revenues is influenced by customer tendencies to make significant capital
expenditures at the end of a fiscal quarter. The Company expects these revenue
patterns to continue for the foreseeable future. In addition, quarterly license
revenues are also dependent on the timing of revenue recognition, which can be
affected by many factors, including the timing of customer installations and the
fulfillment of acceptance criteria. In this regard the Company has from time to
time experienced delays in recognizing revenues with respect to certain orders.
Despite the uncertainties in its revenue patterns, the Company's operating
expenses are based upon anticipated revenue levels and such expenses are
incurred on an approximately ratable basis throughout the quarter. As a result,
if expected revenues are deferred or otherwise not realized in a quarter for any
reason, the Company's business, operating results and financial condition would
be materially adversely affected.

RESULTS OF OPERATIONS

  The following table sets forth for the periods indicated the percentage of
total revenues represented by, and the period to period changes in, the
Company's consolidated statement of operations:

                                     Page 7
<PAGE>
 
<TABLE>
<CAPTION>
                                    Three Months Ended      Six Months Ended
                                       September 30,          September 30,
                                    ------------------      ----------------
                                      1995      1996          1995     1996
                                    --------   -------      -------   ------

<S>                                 <C>        <C>          <C>       <C>
Revenues:
   Licenses                            68.0%    74.4%         63.9%    73.2%
   Services and maintenance            32.0     25.6          36.1     26.8
                                      -----    -----         -----    -----
          Total revenues              100.0    100.0         100.0    100.0
                                      -----    -----         -----    -----
 
Cost of revenues:
   Licenses                             8.5      1.8           5.2      3.5
   Services and maintenance            25.4     16.4          33.4     17.6
                                      -----    -----         -----    -----
          Total cost of revenues       33.9     18.2          38.6     21.1
                                      -----    -----         -----    -----
 
Gross margin                           66.1     81.8          61.4     78.9
                                      -----    -----         -----    -----
 
Operating expenses:
   Sales and marketing                 34.6     41.8          33.6     40.8
   Research and development            21.2     15.4          19.0     16.2
   General and administrative           6.6      8.9           6.2      8.6
                                      -----    -----         -----    -----
          Total operating expenses     62.4     66.1          58.8     65.6
                                      -----    -----         -----    -----
 
Income from operations                  3.7     15.7           2.6     13.3
Other income, net                       0.2      2.0           0.4      2.5
                                      -----    -----         -----    -----
Income before provision for
   income taxes                         3.9     17.7           3.0     15.7
Provision for income taxes              1.4      6.6           1.1      5.9
                                      -----    -----         -----    -----
Net income                              2.5%    11.1%          1.9%     9.8%
                                      =====    =====         =====    =====
</TABLE>

REVENUES

  The Company recognizes revenue in accordance with the provisions of Statement
of Position 91-1 "Software Revenue Recognition."  The Company generates revenue
primarily from licensing the rights to use its software products to end users
and to a lesser extent from sublicense fees from resellers.  The Company also
generates revenues from consulting, training and maintenance services performed
for customers who license its products.

  Revenues from perpetual software license agreements are recognized as revenue
upon receipt of an executed license agreement, (or an unconditional purchase
order under an existing license agreement), and shipment of the software, if
there is no significant post-delivery obligations and collection of the
receivables in probable.

  Revenues from maintenance services are recognized ratably over the term of the
maintenance periods which is typically one year.  If maintenance services are
included free of charge or discounted in a license agreement, such amounts are
unbundled from the license fee at their fair market value based upon the value
established by independent sales of such maintenance services to customers.

  Consulting and training revenues are generally recognized as the services are
performed.  Consulting services are typically performed under separate service

                                     Page 8
<PAGE>
 
agreements and are usually performed on a time and materials basis.  Such
services primarily consist of implementation services related to the
installation of the Company's products and do not include significant
customization to or development of the underlying software code.

  Licenses. License revenues increased 148% from $4.0 million for the three
months ended September 30, 1995 to $10.0 million for the three months ended
September 30, 1996, representing 68% and 74% of total revenues in the respective
periods. License revenues also increased 126% from $7.7 million for the six
months ended September 30, 1995 to $17.4 million for the six months ended
September 30, 1996 representing 64% and 73% of total revenues in the respective
periods. The increase in license revenues was primarily due to increasing market
awareness and acceptance of the Company's product offerings, continuing
enhancement and increasing breadth of the Company's product offerings, expansion
of the company's sales and marketing organization and sales to new industry
segments. The increase in license revenues as a percentage of total revenues
during both the three and six month periods reflects the company's continued
focus on the product side of its business and the increased use of outside third
party consulting firms to provide implementation services directly to the
Company's customers.

  Services and Maintenance.  Services and maintenance revenues increased 82%
from $1.9 million for the three months ended September 30, 1995  to $3.5 million
for the three months ended September 30, 1996, representing  32% and 26% of
total revenues in the respective periods.  Services and maintenance revenues
also increased 47% from $4.3 million for the six months ended September 30, 1995
to $6.4 million for the six months ended September 30, 1996, representing 36%
and 27% of total revenues in the respective periods.  The decrease in services
and maintenance revenues as a percentage of total  revenues reflects the
Company's increased use of outside third party consulting firms to provide
implementation services directly to the Company's customers and increased out of
the box functionality of the Company's products which results in less
implementation services related to certain customer installations.

Cost of Revenues

  Licenses. Cost of license consists primarily of royalty and other payments
to third party vendors and costs of product media, duplication and packaging.
Cost of licenses decreased from $504,000 for the three months ended September
30, 1995 to $244,000 for the three months ended September 30, 1996, representing
12% and 2% of license revenues respectively. Cost of  licenses increased from
$626,000 for the six months ended September 30, 1995 to $839,000 for the six
months ended September 30, 1996 representing 8% and 5% of license revenues in
the respective periods.  The decrease in cost of licenses in absolute dollars
for the three months ended September 30, 1996 and as a percentage of license
revenues in both the three month and six month periods in the current fiscal
year is primarily a result of lower royalty fees paid to third party software
vendors because of a lower level of sales of third party software during these
periods compared to the same periods in the prior year.  Although the Company
does not expect revenues and costs from the distribution of third party software
vendors to be significant in future periods, period to period fluctuations in
the level of such revenues may occur 

                                     Page 9
<PAGE>
 
and the Company's gross margins and results of operations could be materially
adversely affected.

  Services and Maintenance. Cost of services and maintenance increased from
$1.5 million and  $4.0 million for the three month and six month periods ended
September 30, 1995 to $2.2 million and  $4.2 million for the comparable periods
in 1996. Cost of  services and maintenance revenues as a percentage of services
and maintenance revenues were 80% and 93% for the three month and six month
periods ended September 30, 1995 compared to 64% and 65% for the comparable
periods in current fiscal year. The decrease in cost of services and maintenance
as percentage of services and maintenance revenues reflects improvements in
productivity and efficiencies in both the professional service and technical
support organizations. Additionally, maintenance revenues as a percentage of
total services and maintenance revenues increased during the three and six month
periods ended September 30, 1996 and costs associated with providing maintenance
services are generally lower as a percentage of revenues than the costs
associated with consulting services.

Operating expenses

  Sales and Marketing. Sales and marketing expenses increased from $2.1
million and $4.1 million for the three and six month periods ended September 30,
1995 to $5.6 and $9.7 for the comparable periods in the current fiscal year.
Sales and marketing expenses represented 35% and 34% of total revenues for the
three month and six month periods ended September 30, 1995 and 42% and 41% for
the comparable periods in the current fiscal year. The increase in sales and
marketing expenses in absolute dollars and as a percentage of total revenues is
primarily the result of costs associated with the expansion of the Company's
sales and marketing organization, both domestically and internationally, and the
additional investments being made as the Company implements its vertical market
strategy.

  Research and Development. Research and development expenses increased from
$1.3 million and $2.3 million for the three and six month periods ended
September 30, 1995 to $2.1 million and $3.9 million for the comparable periods
in the current fiscal year.  Research and development expenses represented 21%
and 19% of total revenues for the three and six month periods ended September
30, 1995 and 15% and 16% for the comparable periods in the current fiscal year.
The increased investment in research and development expenses in absolute
dollars primarily reflects increased expenses related to salaries and other
expenses for the addition of software engineers and reflects the Company's
continued investment in enhancing existing products and developing new product
offerings.

  General and Administrative.  General and administrative expenses increased
from $390,000 and $752,000 for the three and six month periods ended September
30, 1995 to $1.2 million and $2.0 million for the comparable periods in the
current fiscal year. General and administrative expenses as a percentage of
total revenues were 7% and 6% for the three and six month periods ended
September 30, 1995 and 9% for both the three and six month periods in the
current fiscal year. The increase in expenses both in 

                                    Page 10
<PAGE>
 
absolute dollars and as a percentage of total revenues reflects the Company's
decision to continue its investment in the enhancement of infrastructure to
support it growth.


LIQUIDITY AND CAPITAL RESOURCES

  In November 1995, the Company completed an initial public offering of
2,760,000 shares of common stock, of which 2,225,000 shares were issued by the
Company and 535,000 by selling shareholders, and the Company recorded net
proceeds of $23.9 million from such offering.  Prior to its initial public
offering, the Company funded its operations primarily through private sales of
its equity securities and cash generated from operations.

  The Company began to generate cash from operating activities during the last
half of fiscal 1995.  The Company generated cash of $1.2, $3.4 and $1.0 million
from operating activities during fiscal 1995 and 1996 and for the first six
months of fiscal 1997, respectively.  The increase was primarily a result of
increases in net income during the periods which were offset in part by
increases in accounts receivables.  From March 31, 1995 to September 30, 1996,
the Company's accounts receivables increased from $5.6 million to $11.5 million.
The increase in accounts receivables resulted from the growth in revenues during
the same period.  The average days sales outstanding as a ratio of quarter-end
accounts receivables to the sum of quarterly revenues decreased during the same
period from 87 days at March 31, 1995 to 76 days at September 30, 1996.  The
levels of accounts receivables at each quarter end will be affected by the
concentration of revenues in the final weeks of each quarter and may be
negatively affected by expanded international revenues in relation to total
revenues as licenses to international customers often have longer payment terms.

  During fiscal 1994 and 1995, the Company's principal uses of cash for
investing activities were the purchase of fixed assets of $492,000 and $1.5
million, respectively.  During fiscal 1996 and for the first half of fiscal
1997, the Company invested $7.5 and $8.1 million, respectively, in short term
investments and invested $1.8 and $2.9 million in fixed assets, which related
primarily to computer hardware and software to support the growing organization.
As of September 30, 1996 there were no significant capital commitments.

  Cash provided by financing activities included $400,000 and $3.8 million from
the issuance of preferred stock in fiscal 1994 and 1995, respectively, and in
fiscal 1996 consisted primarily of $23.9 million in proceeds from the Company's
initial public offering.

  The Company believes that with cash flows from operations and existing cash
and cash investments, balances will be sufficient to meet its needs for at least
the next twelve months.

OVERVIEW AND OTHER FACTORS THAT MAY AFFECT FUTURE PERFORMANCE

  Variability of Operating Results; Uncertainty of Future Operating Results.
The Company was incorporated in March 1991 and introduced its first product in
February 

                                    Page 11
<PAGE>
 
1992. Although the Company has been profitable each fiscal year since inception,
there can be no assurance that the Company will be able to sustain profitability
on a quarterly or annual basis in the future. In addition, the Company's
revenues and operating results have varied substantially in the past and are
likely to vary substantially in the future due to a variety of factors,
including (i) the timing and size of the Company's individual license
transactions, and, in particular, the fact that the Company's revenues in any
quarter can be largely dependent on a limited number of large licenses, (ii) the
fact that a significant portion of the Company's revenues in any given quarter
are recognized in the last month, weeks or even days of the quarter, (iii) the
relatively long sales cycle for the Company's software products, which is
typically six to nine months, (iv) the relative proportion of total revenues
derived from license revenues and services and maintenance revenues, (v) the
timing of the introduction of new products or product enhancements by the
Company and its competitors, (vi) the extent of customization required by any
individual license transaction, which can result in deferral of significant
revenues until completion or acceptance of certain customized portions of the
software, (vii) changes in customers budgets, (viii) seasonality of technology
purchases by customers and general economic conditions, (ix) the mix of revenues
among various distribution channels and between domestic and international
customers, (x) the relative proportion of implementation services performed by
the Company for which the Company engaged independent contractors, which are
typically more costly than internal personnel and (xi) the relative proportion
of license revenues derived from third party products distributed by the Company
in conjunction with its products. Therefore, the Company believes that period to
period comparisons of its revenues and operating results are not necessarily
meaningful and that such comparison cannot be relied upon as indicators of
future performance. During the quarter ended September 30, 1996, the Company
experienced a license revenue growth rate of 36% compared to the immediately
preceding quarter. The Company does not anticipate sustaining such sequential
quarterly growth rates in the future.

  Estimating future revenues is difficult because the Company ships its products
soon after an order is received and as such does not have a significant backlog.
Thus, quarterly license revenues are heavily dependent upon orders received and
shipped within the same quarter.  Moreover, the Company has generally recorded
50% to 70% of its total quarterly revenues in the third month of the quarter,
with a concentration of these revenues in the last half of that third month.
This concentration of revenues is influenced by customer tendencies to make
significant capital expenditures at the end of a fiscal quarter.  The Company
expects these revenue patterns to continue for the foreseeable future.  In
addition, quarterly license revenues are dependent on the timing of revenue
recognition, which can be affected by many factors, including the timing of
customer installations, completion of customization activity and the fulfillment
of acceptance criteria.  The Company has from time to time experienced delays in
recognizing revenues with respect to certain orders.  Despite the uncertainties
in its revenue patterns, the Company's operating expenses are based upon
anticipated revenue levels and such expenses are incurred on an approximately
ratable basis throughout the quarter.  As a result, if expected revenues are
deferred or otherwise not realized in a quarter for any reason, the Company's
business, operating results and financial condition would be materially
adversely affected.

                                    Page 12
<PAGE>
 
  The Company intends to continue to increase its research and development
expenditures in order to pursue its strategy of developing applications tailored
to the requirements of specific additional vertical markets, and to continue to
increase sales and marketing expenditures significantly as the Company expands
its domestic and international sales and marketing staff and develops indirect
sales and distribution channels.  In addition, general and administrative
expenses have increased each quarter since the quarter ended September 30, 1995
as the Company began to invest in the infrastructure needed to support is
growing operations.  Accordingly, to the extent that such expenses precede or
are not subsequently followed by increased revenues, the Company's business,
operating results and financial condition will be materially adversely affected.

  Due to all of the foregoing factors, it is likely that in some future quarter
the Company's total revenues or operating results will be below the expectations
of public market analysts and investors.  In such event, the price of the
Company's Common Stock would likely decline, perhaps substantially.  

  Intense Competition.  The customer information management software market is
relatively new, intensely competitive, highly fragmented, subject to rapid
change, and highly sensitive to new product introductions and marketing efforts
by industry participants.  The Company competes with a variety of other
companies depending on the target market for their products.  These competitors
include (i) a select number of companies, such as Clarify Inc. and The Vantive
Corporation, targeting the enterprise-wide customer information market; (ii) a
substantial number of small private companies and certain public companies, such
as Remedy Corporation, Siebel Systems, Inc., Aurum Software, Inc. and Software
Artistry, Inc., which offer products targeted at one or more specific markets,
including the customer support market, the help desk market, the quality
assurance market and the sales and marketing automation market; (iii)
professional services organization, such as Anderson Consulting, that design and
develop customer systems; (iv) large information technology providers such as
International Business Machines Corporation ("IBM") and Computer Associates
International, Inc.; and (v) the internal information technology departments of
potential customers, which develop proprietary customer information management
applications.  Among the Company's potential competitors are also a number of
large hardware and software companies that may develop or acquire products that
compete with the Company's products.  In this regard, SAP AG and Oracle
Corporation have each introduced a customer support module as part of their
application suites.  The Company believes that many existing competitors and new
market entrants will attempt to develop fully integrate customer information
management systems that will compete with the Company's products. 

  Current and potential competitors have established or may establish
cooperative relationships among themselves or with third parties to increase the
ability of their products to address the needs of the Company's prospective
customers.  Accordingly, it is possible that new competitors or alliances among
competitors may emerge and rapidly 

                                    Page 13
<PAGE>
 
acquire significant market share. Increased competition is likely to result in
price reductions, reduced operating margins and loss or market share, any one of
which could materially adversely affect the Company's business, results or
operations or financial condition. Many of the Company's current and potential
competitors have significantly greater financial, technical, marketing and other
resources than the Company. As a result, they may be able to respond more
quickly to new or emerging technologies and to changes in customer requirements,
or to devote greater resources to the development, promotion and sale of their
products, than can the Company. There can be no assurance that the Company will
be able to compete successfully against current or future competitors or that
competitive pressures will not materially adversely affect the Company's
business operating results and financial condition.

  Dependence on Implementation Relationships.  The Company historically relied
on internal resources and subcontracted consultants on an as-needed basis to
provide consulting and implementation services for the Company's products.  In
recent periods, the Company has sought to increase the use of third party
consultants and system integrators to provide implementation, customization and
consulting services directly to the Company's customers.  The Company's
increasing reliance on such third party consultants and systems integrators
poses several risks that could have a material adverse effect on the Company's
business, operating results or financial condition.  For example, there can be
no assurance that these third party providers, who will have direct obligations
to the Company's customers, will be able to provide a level of quality of
service required to meet the needs of such customers.  If the Company is unable
to develop further and to maintain effective, long term relationships with these
third parties, or if these third parties fail to meet the needs of the Company's
customers in a timely fashion, the Company's business, operating results and
financial condition will be materially and adversely affected.  Further, there
can be no assurance that these third party providers, many of whom have
significantly greater financial, technical, personnel and marketing resources
than the Company, will not market software products that compete with the
Company's products, or will not otherwise reduce or discontinue their
relationship with or support of the Company and its products.  Finally, many of
these current and potential third party providers have existing relationships or
may undertake relationships with the Company's direct competitors,  The
inability to recruit, or the loss of, important third party systems integrators
or professional consulting firms would have a material adverse effect on the
Company's business, operating results and financial condition.

  Rapid Technological Change; Dependence on Product Development:  The market for
the Company's products is characterized by rapid technological advances,
evolving industry standards in computer hardware and software technology,
changes in customer requirements and frequent new product introductions and
enhancements.  The Company is currently investing significant resources in
product development and expects to continue to do so in the future.  The
Company's future success will depend on its ability to continue to enhance its
current product line and to continue to develop and introduce new products that
keep pace with competitive product introductions and technological developments,
satisfy diverse and evolving customer requirements and otherwise achieve market
acceptance.  There can be no assurance that the Company will be successful in

                                    Page 14
<PAGE>
 
continuing to develop and market on a timely and cost effective basis fully
functional product enhancements or new products that respond to technological
advances by others, or that these products will achieve market acceptance.   In
addition, the Company has in the past experienced delays in the development,
introduction and marketing of new enhanced products, and there can be no
assurance that the Company will not experience similar delays in the future.
Any failure by the Company to anticipate or respond adequately to changes in
technology and customer preferences, or any significant delays in product
development or introduction, would have a material adverse effect on the
Company's business, operating results and financial condition. 

  Due to the complexity and sophistication of the Company's software products,
the Company's products from time to time contain defects or "bugs" which can be
difficult to correct.  Furthermore, as the Company continues to develop and
enhance its products, there can be no assurance that the Company will be able to
identify and correct defects in such a manner as will permit the timely
introduction of such products.  Moreover, despite extensive testing, the Company
has from time to time discovered defects only after its products have been used
by many customers.  There can be no assurance that software defects will not
cause delays in product introductions and shipments, result in increased costs,
require design modifications, or impair customer satisfaction with the Company's
products.  Any such event could materially adversely affect the Company's
business, operating results and financial condition.

  Expansion of Distribution Channels.  The Company has historically sold its
products through its direct sales force and a limited number of distributors.
The Company's ability to achieve significant revenue growth in the future will
depend in large part on its success in recruiting and training sufficient sales
personnel and establishing relationships with distributors, resellers and
systems integrators.  The Company is currently investing, and plans to continue
to invest, significant resources to expand its domestic and international direct
sales force and develop distribution relationships with certain third party
distributors, resellers and systems integrators.  The Company's existing
distribution relationships are generally non-exclusive and can be terminated by
either party without cause.  The Company's distributors also sell or can
potentially sell products offered by the Company's competitors.  There can be no
assurance that the Company will be able to retain or attract a sufficient number
of  its existing or future third party distribution partners or that such
partners will recommend, or continue to recommend, the Company's products.  The
inability to establish or maintain successful relationships with distributors,
resellers or systems integrators could have a material adverse effect on the
Company's business, operating results or financial condition.  In addition,
there can be no assurance that the Company will be able to successfully expand
its direct sales force or other distribution channels.  Any failure by the
company to expand its direct sales force or other distribution channels would
materially adversely affect the Company's business, operating results and
financial condition.

  Expansion of International Operations; Foreign Currency Fluctuations.  An
important element of the Company's strategy is to expand its international
operations.  In 

                                    Page 15
<PAGE>
 
this regard, although the Company has established subsidiaries in the United
Kingdom, Canada and France and is currently investing significant resources in
its international operations, including the development of certain third party
distributor relationships and the hiring of additional sales representatives,
international sales to date have been limited and there can be no assurance that
the Company will be successful in expanding its international operations. In the
event the Company is able to increase international revenues as a percentage of
total revenues, the Company's business, operating results or financial condition
could be materially adversely affected by risks inherent in conducting business
internationally, such as changes in currency exchange rates, longer payment
cycles, difficulties in staffing and managing international operations, problems
in collecting accounts receivable, seasonal reductions in business activity
during the summer months in Europe and certain other parts of the world,
increases in tariffs, duties, price controls or other restrictions on foreign
currencies and trade barriers imposed by foreign nationalities. In this regard,
to the extent the Company's international operations expand, the Company expects
that an increasing portion of its international license revenues will be
denominated in foreign currencies. In addition, the Company has only limited
experience in developing localized versions of its products and marketing and
distributing it products internationally. There can be no assurance that the
Company will be able to successfully localize, market, sell and deliver its
products internationally. The inability of the Company to successfully expand
its international operations in a timely manner could materially adversely
affect the Company's business, operating results or financial condition.

  Management of Growth.  The Company's business has grown rapidly, with total
revenues increasing from $15.3 million in fiscal 1995 to $28.6 million in fiscal
1996 and $23.8 million in the first six months of fiscal 1997.  The  growth of
the Company's business and expansion of its customer base has placed and it
expected to continue to place a significant strain on the Company's management
and operations.  The Company's future operation results will depend on its
ability to continue to broaden the Company's senior management group.  In this
regard, certain key members of the Company's management, including its Chief
Financial officer and Vice President, Europe have recently joined the Company.
From time to time, engineers and other employees have left the Company for
various reasons, and the Company's future success will depend on its ability to
attract, hire and retain skilled employees and to hire replacements for
employees that leave the Company.  The Company's expansion has also resulted in
substantial growth in the number of its employees and the burden placed upon its
operation and financial systems, resulting in increased responsibility for both
existing and new management personnel.  In addition, the Company's ability to
effectively manage and support its growth will be substantially dependent on its
ability to continue to build upon its financial and management controls,
reporting systems and procedures on a timely basis and to expand and maintain
highly trained internal and third party resources to provide product
customization, implementation, training and other support services.  The Company
also expects to increase its customer support operations to the extend the
installed base of the Company's products continues to grow.  Accordingly, the
Company's future operation results will depend on the ability of its management
and other key employees to continue to implement and improve its systems for
operations, financial control and information management, to recruit, train and
manage its employee 

                                    Page 16
<PAGE>
 
base, in particular, its direct sales force and customer support organization,
and to work effectively with third party consulting and implementation service
providers. There can be no assurance that the Company will be able to manage or
continue to manage its recent or any future growth successfully, and any
inability to do so would have a material adverse effect on the Company's
business, operating results and financial condition. There also can be no
assurance that the Company will be able to sustain the rates of revenue growth
that it has experienced in the past.

  Developing Markets; Product Concentration.  The Company's future financial
performance will depend in large part of the growth in demand for individual
customer information management applications as well as the number of
organizations adopting comprehensive customer information systems for their
client/server computing environments.  The markets for these applications are
relatively new and developing.  If the demand for customer information
management applications develops more slowly than the Company currently
anticipates, it would have a material adverse effect on the demand for the
Company's applications and on its business, operating results and financial
condition.  The Company currently markets five application products, together
with related application service modules and a customization tool which are
licensed for use in conjunction with the Company's applications.  Although the
Company's application service modules and customization tool are offered
separately from the Company's applications, the Company believes it is unlikely
that any significant revenues could be derived from such modules and such tool
unless the customer is using at least one of the Company's applications.
Accordingly, in the event the Company's applications are not accepted by the
marketplace, the Company's business, operating results and financial condition
would be materially adversely affected.

  Intellectual Property Rights.  The Company's success is dependent on its
ability to protect its proprietary technology.  The Company licenses its
products in object code form only, although it has source code escrow
arrangement with certain customers.  The Company relies on a combination of
copyright, trademark and trade secret laws, as well as confidentiality
agreements and licensing arrangements, to establish and protect its proprietary
rights.  The Company does not have any patents or patent applications pending,
and existing copyright, trademark and trade secret laws afford only limited
protection.  In addition, the laws of certain countries do not protect the
Company's proprietary rights against unauthorized third party copying or use,
which could materially adversely affect the Company's business, operating
results or financial condition.

  Despite the Company's efforts to protect its proprietary rights, attempts may
be made to copy or reverse engineer aspects of the Company's products or to
obtain and use information that the Company regards as proprietary.  Moreover,
there can be no assurance that others will not develop products that infringe
the Company's proprietary rights, or that are similar or superior to those
developed by the Company.  Policing the unauthorized use of the Company's
products is difficult.  Litigation may be necessary in the future to enforce the
Company's intellectual property rights, to protect the Company's trade secrets
or to determine the validity and scope of the proprietary right of others.  

                                    Page 17
<PAGE>
 
Such litigation could result in substantial costs and diversion of resources and
could have a material adverse effect on the Company's business, operating
results or financial condition.

  As is common in the software industry, the Company from time to time receives
notices from third parties claiming infringement by the Company's products of
third party proprietary rights.  While the Company is not currently subject to
any such claim, the Company expect its software products will increasingly be
subject to such claims as the number of products and competitors in the
Company's industry segments grows and the functionality of product overlaps.
Any such claim, with or without merit, could result in significant litigation
costs and require the Company to enter into royalty and licensing agreements,
which could have a material adverse effect on the Company's business, operating
results or financial condition.  Such royalty and licensing agreements, if
required, may not be available on terms acceptable by the Company or at all.

  The Company also relies on certain technology which it licenses from third
parties, including software which is integrated with internally developed
software and used in the Company's products to perform key functions.  There can
be no assurance that these third party technology licenses will continue to be
available to the Company on commercially reasonable terms.  The loss of or
inability of the Company to maintain any of these technology licenses could
result in delays or reductions in product shipments until equivalent technology
could be identified, licensed and integrated.  Any such delays or reductions in
product shipments would materially adversely affect the Company's business,
operating results and financial condition.

  Dependence on Key Personnel.  The Company's success depends to a significant
extent upon a limited number of members of senior management and other key
employees, including Ori Sasson, the Company's Chairman, President and Chief
Executive officer.  The Company does not maintain key man life insurance on any
such persons.  The loss of the service of one or more key manages or other
employees could have a material adverse effect upon the Company's business,
operating results or financial condition.  In addition, the Company believes
that its future success will depend in large part upon its ability to attract
and retain additional highly skilled technical, management, sales and marketing
personnel.  Competition for such personnel in the computer software industry is
intense.  There can be no assurance the Company will be successful in attracting
and retaining such personnel, and, the failure to do so, could have a material
adverse effect on the Company's business, operating results or financial
condition.

  Product Liability.  Although the Company has not experienced any product
liability claims to date, the sale and support of products by the Company and
the incorporation of products from other companies may entail the risk of
product liability claims.  The Company's license agreements with its customers
typically contain provisions intended to limit the Company's exposure to such
claims, but such provision may not be effective in limiting the Company's
exposure.  A successful product liability action brought against the Company
could have a material adverse effect upon the Company's business, operating
results or financial condition.

                                    Page 18
<PAGE>
 
  Volatility of Share Price.  The market price for the Company's Common Stock
has been and is expected to continue to be significantly affected by factors
such as the announcement of new products or product enhancements by the Company
or its competitors, technological innovations by the Company or its competitors,
quarterly variations in the Company's results of operations or the results of
operations of the Company's competitors, changes in earnings estimated or
recommendations by securities analysts and general market conditions.  In
particular, the stock prices for many companies in the technology and emerging
growth sector have experienced wide fluctuations which have often been unrelated
to the operating performance of such companies.  Such fluctuations may adversely
affect the market price of the Company's Common Stock.

                                    Page 19
<PAGE>
 
PART II.  OTHER INFORMATION

   Item 6. Exhibits and Reports on Form 8-K

       List of Exhibits
       ----------------

           11.1   Statement of Computation of Net Income per Share

           27     Financial Data Schedule
 
       Reports on Form 8-K:  None
       -------------------       

                                    Page 20
<PAGE>
 
                                   SIGNATURE


Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                            SCOPUS TECHNOLOGY, INC.
                            -----------------------
                                  (Registrant)


Dated: February 14, 1996
                             /s/ Ori Sasson
                             _______________________________
                             Ori Sasson
                             Chairman of the Board, President and
                             Chief Executive Officer
                             (Principal Executive Officer)

 


                             /s/ Michele Axelson
                             _______________________________
                             Michele Axelson
                             Chief Financial Officer
                             (Principal Financial and Accounting Officer)

                                    Page 21
<PAGE>
 
                            SCOPUS TECHNOLOGY, INC.

                               INDEX TO EXHIBITS

<TABLE> 
<CAPTION> 

     Exhibit  Description                                           Page
     -------  -----------                                           ----
     <S>      <C>                                                   <C> 
       11.1   Statement of Computation of Net Income per Share       17

       27     Financial Data Schedule
</TABLE> 

                                    Page 22