<PAGE>   1
                                                                   EXHIBIT 13.03


INDEPENDENT AUDITORS' REPORT

The Board of Directors and
Stockholders of
Ceridian Corporation:

We have audited the accompanying consolidated balance sheets of Ceridian
Corporation and subsidiaries as of December 31, 2000 and 1999, and the related
consolidated statements of operations, cash flows and stockholders' equity for
each of the years in the three-year period ended December 31, 2000. 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 auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the 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.

    In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Ceridian
Corporation and subsidiaries as of December 31, 2000 and 1999, and the results
of their operations and their cash flows for each of the years in the three-year
period ended December 31, 2000, in conformity with accounting principles
generally accepted in the United States of America.



Minneapolis, Minnesota
January 24, 2001



                   From Page 19 of the Ceridian Annual Report
<PAGE>   2
                                                                   EXHIBIT 13.03

<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF OPERATIONS                           (Dollars in millions, except per share data)
----------------------------------------------------------------------------------------------------------------
                                                                             Years Ended December 31,
                                                               -------------------------------------------------
                                                                   2000              1999             1998
----------------------------------------------------------------------------------------------------------------
<S>                                                            <C>                 <C>               <C>
Revenue                                                          $ 1,175.7         $ 1,127.0         $   967.6

Costs and Expenses
  Cost of revenue                                                    559.0             553.1             478.7
  Selling, general and administrative                                359.3             332.1             269.6
  Research and development                                            62.8              60.6              66.1
  Other expense (income)                                              31.7              (4.4)             (8.9)
                                                               -------------     -------------    --------------
     Total costs and expenses                                      1,012.8             941.4             805.5
                                                               -------------     -------------    --------------

EARNINGS BEFORE INTEREST AND TAXES                                   162.9             185.6             162.1

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

  Interest income                                                      4.7               6.4              10.4
  Interest expense                                                   (39.8)            (24.7)             (4.3)
                                                               -------------     -------------    --------------

EARNINGS BEFORE INCOME TAXES                                         127.8             167.3             168.2

Income tax provision                                                  48.3              62.9              42.9
                                                               -------------     -------------    --------------

EARNINGS FROM CONTINUING OPERATIONS                                   79.5             104.4             125.3

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

DISCONTINUED OPERATIONS
  Gain (Loss) on disposition                                          (6.9)               --              25.4
  Earnings from operations                                            27.6              40.9              36.6
                                                               -------------     -------------    --------------

NET EARNINGS                                                     $   100.2         $   145.3         $   187.3
                                                               =============     =============    ==============

BASIC EARNINGS PER SHARE
  Continuing operations                                          $    0.55         $    0.72         $    0.87
  Net earnings                                                   $    0.69         $    1.01         $    1.30

DILUTED EARNINGS PER SHARE
  Continuing operations                                          $    0.54         $    0.71         $    0.85
  Net earnings                                                   $    0.68         $    0.98         $    1.27

SHARES USED IN CALCULATIONS (IN THOUSANDS)
  Weighted average shares (basic)                                  145,229           144,524           144,070
  Dilutive securities                                                1,505             3,440             3,527
                                                               -------------     -------------    --------------
  Weighted average shares (diluted)                                146,734           147,964           147,597
                                                               =============     =============    ==============

----------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to consolidated financial statements.



                   From Page 20 of the Ceridian Annual Report
<PAGE>   3
                                                                   EXHIBIT 13.03

<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEETS                                          (Dollars in millions, except per share data)
------------------------------------------------------------------------------------------------------------------
                                                                                        December 31,
                                                                        ------------------------------------------
                                                                              2000                      1999
------------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>                         <C>
ASSETS
CURRENT ASSETS
Cash and equivalents                                                          $    118.5              $     58.5
Short-term investments                                                              40.1                    22.0
Trade and other receivables
   Trade, less allowance of $17.4 and $17.5                                        438.3                   399.0
   Other                                                                            22.6                    23.8
                                                                        ------------------          --------------
      Total
                                                                                   460.9                   422.8


Current portion of deferred income taxes                                            41.8                    74.2
Net assets of discontinued operations                                               28.2                      --
Other current assets                                                                25.9                    23.6
                                                                        ------------------          --------------
         Total current assets                                                      715.4                   601.1

------------------------------------------------------------------------------------------------------------------
Property, plant and equipment, net                                                 160.4                   188.1
Goodwill, net                                                                      897.9                   892.9
Other intangible assets, net                                                       128.4                   135.3
Software and development costs, net                                                 57.0                    48.0
Prepaid pension cost                                                               128.1                   118.3
Deferred income taxes, less current portion                                           --                     2.6
Other noncurrent assets                                                              0.8                     2.2

------------------------------------------------------------------------------------------------------------------
         Total assets                                                         $  2,088.0              $  1,988.5
                                                                        ==================          ==============

------------------------------------------------------------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term debt and current portion of long-term obligations                  $      0.3              $      0.2
Accounts payable                                                                    31.7                    41.6
Drafts and customer funds payable                                                  172.1                   136.9
Customer advances                                                                   14.5                    14.6
Deferred income                                                                     38.5                    33.7
Accrued taxes                                                                       76.0                    43.1
Employee compensation and benefits                                                  65.8                    61.5
Net liabilities of discontinued operations                                            --                    23.8
Other accrued expenses                                                              75.0                    71.0
                                                                        ------------------          --------------
         Total current liabilities                                                 473.9                   426.4

------------------------------------------------------------------------------------------------------------------
Long-term obligations, less current portion                                        500.3                   611.1
Deferred income taxes                                                               67.7                    10.3
Employee benefit plans                                                              75.7                    76.4
Deferred income and other noncurrent liabilities                                    34.2                    52.1
------------------------------------------------------------------------------------------------------------------
STOCKHOLDERS' EQUITY
Common Stock, $.50 par, authorized 500,000,000 shares,
    issued 161,685,596                                                              80.8                    80.8
Additional paid-in capital                                                       1,122.7                 1,126.2
Retained earnings (deficit)                                                         81.8                   (18.4)
Treasury common stock, 15,931,215 and 16,951,228 shares                           (342.9)                 (364.6)
Accumulated other comprehensive income                                              (6.2)                  (11.8)
                                                                        ------------------          --------------
         Total stockholders' equity                                                936.2                   812.2

------------------------------------------------------------------------------------------------------------------
         Total liabilities and stockholders' equity                           $  2,088.0              $  1,988.5
                                                                        ==================          ==============

------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to consolidated financial statements.



                   From Page 21 of the Ceridian Annual Report
<PAGE>   4
                                                                   EXHIBIT 13.03

<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF CASH FLOWS                                                           (Dollars in millions)
----------------------------------------------------------------------------------------------------------------------
                                                                                   Years Ended December 31,
                                                                     -------------------------------------------------
                                                                         2000                1999            1998
----------------------------------------------------------------------------------------------------------------------
<S>                                                                  <C>                 <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings                                                            $   100.2         $    145.3       $   187.3
Adjustments to reconcile net earnings to net cash provided by
operating activities:
    Earnings from discontinued operations                                   (27.6)             (40.9)          (36.6)
    Gain (Loss) on disposition of discontinued operations                     6.9                --            (25.4)
    Deferred income tax provision                                            45.4               62.2            40.6
    Impairment loss from asset write-offs                                    18.3                --              --
    Depreciation and amortization                                            87.6               72.2            46.5
    Other                                                                     2.8                3.8            (1.9)
    Decrease (Increase) in trade and other receivables                      (40.2)             (62.2)          (29.4)
    Increase (Decrease) in accounts payable                                  (8.2)               0.5           (11.3)
    Increase (Decrease) in drafts and customer funds payable                 33.5               (7.8)           (0.9)
    Increase (Decrease) in employee compensation and benefits                 4.0               (4.3)            8.0
    Increase (Decrease) in accrued taxes                                     25.1                9.8            (7.2)
    Increase (Decrease) in other current assets and liabilities              (3.4)             (28.4)          (53.8)
    Cash provided by operating activities of discontinued operations         24.8               47.5            47.8
                                                                     --------------      -------------    ------------
      Net cash provided by operating activities                             269.2              197.7           163.7
----------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Expended for property, plant and equipment                                  (66.5)             (75.3)          (45.0)
Expended for software and development costs                                 (30.5)             (29.5)          (14.5)
Proceeds from sales of businesses and assets                                 56.3                7.9            48.6
Proceeds from sales of short-term investments                                  --                3.2              --
Expended for business acquisitions, less cash acquired                      (65.1)            (714.9)         (218.4)
Cash used by investing activities of discontinued operations                 (2.1)              (3.6)          (16.2)
                                                                     --------------      -------------    ------------
      Net cash provided by (used for) investing activities                 (107.9)            (812.2)         (245.5)
----------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Revolving credit and overdrafts, net                                        (95.1)             108.4            57.2
Borrowings of other debt                                                       --              444.8              --
Repayment of other debt                                                     (20.6)              (0.3)           (0.4)
Repurchase of common stock                                                   (1.4)              (5.1)         (182.0)
Proceeds from exercise of stock options and other                            15.8               24.2            41.0
                                                                     --------------      -------------    ------------
      Net cash provided by (used for) financing activities                 (101.3)             572.0           (84.2)
----------------------------------------------------------------------------------------------------------------------
NET CASH FLOWS PROVIDED (USED)                                               60.0              (42.5)         (166.0)
Cash and equivalents at beginning of year                                    58.5              101.0           267.0
                                                                     --------------      -------------    ------------
Cash and equivalents at end of year                                     $   118.5         $     58.5       $   101.0
                                                                     ==============      =============    ============

----------------------------------------------------------------------------------------------------------------------
<CAPTION>
                                                                                   Years Ended December 31,
                                                                     -------------------------------------------------
INTEREST AND INCOME TAXES PAID (REFUNDED)                                2000                1999            1998
----------------------------------------------------------------------------------------------------------------------
<S>                                                                  <C>                  <C>              <C>
Interest paid                                                           $    40.3         $     21.0       $     4.2
Income taxes paid                                                       $    10.6         $      8.0       $    16.4
Income taxes refunded                                                   $    (5.4)        $     (0.5)      $    (0.2)
----------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to consolidated financial statements.




                   From Page 22 of the Ceridian Annual Report
<PAGE>   5
                                                                   EXHIBIT 13.03

<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY                                                             (Dollars in millions)
----------------------------------------------------------------------------------------------------------------------------------
                                                            Amount                                     Shares
                                             -------------------------------------------------------------------------------------
                                                 2000        1999        1998            2000            1999           1998
----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARES ISSUED                           $    80.8   $    80.8   $    80.8       161,685,596    161,685,596    161,685,596
----------------------------------------------------------------------------------------------------------------------------------
<S>                                          <C>           <C>         <C>          <C>               <C>            <C>
TREASURY STOCK - COMMON SHARES
Beginning balance                              $  (364.6)  $  (390.8)  $  (271.0)      (16,951,228)   (18,171,620)   (13,801,852)
Repurchases                                         (1.4)       (5.1)     (164.8)          (54,953)      (235,518)    (6,746,284)
Exercises of stock options                          16.4        27.2        57.8           762,875      1,265,599      2,804,050
Restricted stock awards, net                          --        (1.0)      (17.1)            1,350        (32,524)      (630,522)
Employee stock purchase plans                        6.7         5.1         4.3           310,741        239,369        202,988
Acquisitions                                          --          --          --                --        (16,534)            --
                                             -------------------------------------  ----------------------------------------------
Ending balance - treasury                      $  (342.9)  $  (364.6)  $  (390.8)      (15,931,215)   (16,951,228)   (18,171,620)
----------------------------------------------------------------------------------------------------------------------------------
COMMON SHARES OUTSTANDING                                                              145,754,381    144,734,368    143,513,976
----------------------------------------------------------------------------------  ==============================================
ADDITIONAL PAID-IN CAPITAL
Beginning balance                              $ 1,126.2   $ 1,110.5   $ 1,112.6
Exercises of stock options                          (6.0)       (8.3)      (21.3)
Tax benefit from stock options                       3.3        10.2        13.3
Restricted stock awards, net                         0.6         1.8         5.6
Employee stock purchase plans                       (1.4)        0.5         0.3
Acquisitions                                          --        11.5          --
                                             -------------------------------------  ----------------------------------------------
Ending balance                                 $ 1,122.7   $ 1,126.2   $ 1,110.5                 COMPREHENSIVE INCOME
----------------------------------------------------------------------------------  ----------------------------------------------
RETAINED EARNINGS (DEFICIT)                                                                   2000           1999           1998
                                                                                    ----------------------------------------------
Beginning balance                              $  (18.4)   $ (163.7)   $ (351.0)
Net earnings                                      100.2       145.3       187.3           $  100.2       $  145.3       $  187.3
                                             -------------------------------------
Ending balance                                 $   81.8   $   (18.4)  $  (163.7)
----------------------------------------------------------------------------------
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
FOREIGN CURRENCY TRANSLATION
Beginning balance                              $    (3.2)  $    (3.6)  $     2.0
Rate changes, net                                   (5.5)        0.4        (5.6)             (5.5)           0.4           (5.6)
                                             -------------------------------------
Ending balance                                      (8.7)       (3.2)       (3.6)
                                             -------------------------------------
UNREALIZED GAIN ON SECURITIES
Beginning balance                              $      --   $      --   $      --
Unrealized gain, net of
  income taxes of $6.4                              11.7          --          --              11.7             --             --
                                             -------------------------------------
Ending balance                                      11.7          --          --
                                             -------------------------------------
PENSION LIABILITY ADJUSTMENT
Beginning balance                              $    (8.6)  $    (9.5)  $    (9.5)
Pension liability change                            (0.6)        0.9          --             (0.6)            0.9             --
                                             -------------------------------------
Ending balance                                      (9.2)       (8.6)       (9.5)
                                             -------------------------------------
Total ending balance                           $    (6.2)  $   (11.8)  $   (13.1)
                                             -------------------------------------
TOTAL STOCKHOLDERS' EQUITY                     $   936.2   $   812.2   $   623.7
                                             =====================================  ----------------------------------------------
TOTAL COMPREHENSIVE INCOME                                                               $  105.8        $  146.6       $  181.7
                                                                                    ==============================================

----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to consolidated financial statements.




                   From Page 23 of the Ceridian Annual Report
<PAGE>   6
(Dollars in millions, except per share data)                       EXHIBIT 13.03




NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(For the three years ended December 31, 2000)

        INDEX TO NOTES
    24  A. Accounting Policies
    27  B. Income Taxes
    28  C. Supplementary Data to Statements of Operations
    30  D. Segment Data
    32  E. Capital Assets
    33  F. Investing Activity
    34  G. Retirement Plans
    36  H. Stock Plans
    38  I. Financing
    39  J. Commitments and Contingencies
    40  K. Legal Matters

A. ACCOUNTING POLICIES

BASIS OF CONSOLIDATION
The consolidated financial statements of Ceridian Corporation ("Ceridian")
include the accounts of subsidiaries and investments in which Ceridian has a
controlling interest.

    As discussed in Note C, Arbitron, a business segment of Ceridian, is
presented as a discontinued operation. The continuing operations of Ceridian are
reported in two business segments, Human Resource Services ("HRS") and Comdata.
Further information on business segments appears in Note D.

    Investments in other affiliated companies where Ceridian has significant
influence are accounted for by the equity method. Other investments are
accounted for by the cost method.

    All material intercompany transactions have been eliminated from the
consolidated financial statements.

NEW ACCOUNTING PRONOUNCEMENTS
FAS 133, "Accounting for Derivative Instruments and Hedging Activities," (as
amended) became effective for Ceridian in January 2001. FAS 133 requires all
derivatives to be recognized as assets or liabilities on the balance sheet and
measured at fair value on a marked-to-market basis. For Ceridian, FAS 133
applies to interest rate collars utilized in connection with its payroll and tax
filing trust investments. Along with the derivatives, the underlying hedged
items are also to be marked-to-market on an ongoing basis. These market value
adjustments are to be included either in net earnings or loss in the statement
of operations or in other comprehensive income (and accumulated in stockholders'
equity), depending on the nature of the transaction.

    Upon adoption, Ceridian will record an after-tax charge of $0.5, a liability
for the interest rate collars of $0.4, a credit to accumulated other
comprehensive income of $0.2 and an addition to deferred tax asset of $0.1.

STOCK-BASED COMPENSATION
Ceridian accounts for stock-based compensation under APB Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations.
Therefore, compensation expense is not recorded with respect to Ceridian's fixed
stock option plans, since the exercise price is set at the market price on the
date of grant, or for Ceridian's employee stock purchase plan. Compensation
expense for outstanding restricted stock awards, none of which is
performance-based, is recognized by charging the fair value of the award at the
time of grant to operations ratably over the vesting period. Grants of stock
options to consultants or independent contractors are accounted for under the
fair value method. Ceridian also reports under the disclosure-only provisions of
FAS 123, "Accounting for Stock-Based Compensation."

USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

CHANGES IN PRESENTATION
Prior year amounts for continuing operations have been restated to remove
amounts related to Arbitron which are separately reported as discontinued
operations. Additionally, certain prior year amounts have been reclassified to
conform to the current year's presentation.



                   From Page 24 of the Ceridian Annual Report
<PAGE>   7
(Dollars in millions, except per share data)                       EXHIBIT 13.03




CASH AND SHORT-TERM INVESTMENTS
Investments which are readily convertible to cash within three months of
purchase are classified in the balance sheet as cash equivalents. Investments
with longer maturities are considered available-for-sale under FAS 115 and
reported in the balance sheet as short-term investments.

    At December 31, 2000, short-term investments of $40.1 consisted of $22.0 of
marketable securities, primarily issued by U.S. government agencies, and $18.1
of HotJobs.com, Ltd. common stock. The government securities are reported at
cost, which approximates fair value and the HotJobs.com, Ltd. common stock is
reported at fair value (based on quoted market prices) as of December 31, 2000.

PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are carried at cost and depreciated for financial
statement purposes using straight-line and accelerated methods at rates based on
the estimated lives of the assets, which are generally as follows:


---------------------------------------
Buildings                      40 years
Building improvements        5-15 years
Machinery and equipment       3-8 years
Computer equipment            3-6 years
---------------------------------------

     Repairs and maintenance are expensed as incurred. Gains or losses on
dispositions are included in results of operations. Capitalized interest of $2.4
in 2000 and $1.7 in 1999 related to the construction of a new headquarters
facility in Bloomington, Minn., and the renovation of an office facility in St.
Petersburg, Fla., used by certain benefits services operations.

    The carrying value of long-lived assets is reviewed whenever events or
changes in circumstances such as market value, asset utilization, physical
change, legal factors or other matters indicate that the carrying value may not
be recoverable. When the review indicates that the carrying value of the asset
or group of assets representing the lowest level of identifiable cash flows
exceeds the sum of the expected future cash flows (undiscounted and without
interest charges), an impairment loss is recognized. The amount of the
impairment loss is the amount by which the carrying value exceeds the fair value
of the impaired asset or group of assets.

EARNINGS PER SHARE
Basic earnings per share represents earnings divided by the weighted average
number of common shares outstanding for the reporting period. Diluted earnings
per share represents earnings divided by the sum of the weighted average number
of common shares outstanding plus shares derived from potentially dilutive
securities. For Ceridian, potentially dilutive securities includes "in the
money" fixed stock options outstanding. The numbers of shares added for stock
options is determined by the treasury stock method, which assumes exercise of
these options and the use of any proceeds to repurchase a portion of these
shares at the average market price for the period. The option shares excluded
from the calculation of potentially dilutive securities, because the exercise
price exceeded the average market price for the year, at each December 31 were
5,747,000 for 2000, 849,000 for 1999 and 341,000 for 1998.

GOODWILL AND OTHER INTANGIBLES
Goodwill, which represents the excess purchase price over the fair value of net
assets of businesses acquired, is assigned to operating units based on the
benefits derived from the acquisition and amortized on a straight-line basis
over the expected periods to be benefited, ranging up to 40 years.

    Other intangible assets represents amounts assigned to intangible assets at
the time of a purchase acquisition and includes such items as customer lists and
bases, technology, covenants not to compete, tradenames, workforce-in-place and
other rights. Such costs are amortized on a straight-line basis over the
following periods:

-----------------------------------
Customer lists        10-15 years
Tradenames              30 years
Technology             7-8 years
Other                  3-20 years
-----------------------------------

    Recorded amounts are regularly reviewed and recoverability assessed. The
review considers factors such as whether the amortization of the goodwill and
other intangible assets for each operating unit over its remaining life can be
recovered through forecasted undiscounted cash flows.

SOFTWARE AND DEVELOPMENT COSTS
Ceridian capitalizes purchased software that is ready for service and
development costs for marketable software incurred from the time of
technological feasibility until the software is ready for use. Under the
provisions of SOP 98-1, Ceridian capitalizes costs associated with software
developed or obtained for internal use when both the preliminary project stage
is completed and Ceridian management has authorized further funding for the
project which it deems probable of completion and use for the function intended.
Capitalized internal-use software costs include only (1) external direct costs
of materials and services consumed in developing or obtaining the software, (2)
payroll and payroll-related costs for employees who are directly associated with
and who devote time to the project, and (3) interest costs incurred, when
material, while developing the software. Capitalization of such costs ceases no
later than the point at which the project is substantially complete and ready
for its intended purpose.

    Research and development costs and other computer software maintenance costs
related to software development are expensed as incurred. Software development
costs are amortized using the straight-line



                   From Page 25 of the Ceridian Annual Report
<PAGE>   8
(Dollars in millions, except per share data)                       EXHIBIT 13.03




method over a range of three to seven years, but not exceeding the expected life
of the product.

    The carrying value of software and development costs is regularly reviewed
by Ceridian, and a loss is recognized when the value of estimated undiscounted
cash flow benefit related to the asset falls below the unamortized cost.

INCOME TAXES
The provision for income taxes is based on income recognized for financial
statement purposes and includes the effects of temporary differences between
such income and that recognized for tax return purposes. Ceridian and its
eligible subsidiaries file a consolidated U.S. federal income tax return. Except
for selective dividends, Ceridian intends to reinvest the unremitted earnings of
its non-U.S. subsidiaries and postpone their remittance indefinitely.
Accordingly, no provision for U.S. income taxes was required on such earnings
during the three years ended December 31, 2000.

REVENUE RECOGNITION
Services revenue is recognized when the services are performed and billable,
except for certain services provided by Ceridian's Comdata subsidiary, Comdata
Network, Inc., and revenue from payroll and tax filing services described below.
Revenue from installation and conversion services for payroll and tax filing
customers is non-refundable, is determined on a time and materials basis and,
along with related costs, is recognized over the installation and conversion
period, generally two to four months.

    Revenue from Comdata funds transfer and regulatory permit services consists
of the transaction fees charged to customers. Such revenue does not include the
costs of goods and services for which funds are advanced by Comdata (e.g., fuel
purchased, permit provided or face amount of the Comchek purchased and cashed).
However, Comdata pays the issuing agent (e.g., truck stop or state agency) for
the full cost of the goods and services provided and, accordingly, bills the
customer for such cost as well as the transaction fee. As a result, Ceridian's
accounts receivable includes both the cost of the goods and services purchased
and the transaction fees. Ceridian's drafts and customer funds payable includes
the amount due to the issuing agent for the cost of the goods and services.
Revenue is recognized for the amount of the transaction fee at the time the
goods and services are purchased.

PAYROLL AND TAX FILING SERVICES
In connection with its U.S. payroll tax filing services, Ceridian collects funds
for payment of taxes due, holds such funds in trust until payment is due, remits
the funds to the appropriate taxing authority, files federal, state and local
tax returns, handles related regulatory correspondence and amendments, and
selectively absorbs regulatory charges for certain penalties and interest. For
such services, Ceridian derives its payroll tax filing revenue from fees charged
and from investment income it receives on tax filing deposits temporarily held
pending remittance on behalf of customers to taxing authorities. The trust
invests primarily in high quality collateralized short-term investments or money
market mutual funds. The trust also invests in U.S. Treasury and Agency
securities, AAA rated asset-backed securities and corporate securities rated
A3/A- or better.

    The aggregate amount of collected but unremitted funds in the U.S. payroll
tax filing trust varies significantly during the year and averaged $1,425.0 in
2000, $1,353.3 in 1999 and $1,320.1 in 1998. The amounts of such funds at
December 31, 2000 and 1999, were $2,371.1 and $1,619.2, respectively.

    Ceridian handles payroll as well as tax filing funds for its Canadian
customers. Ceridian collects funds for payment to clients' employees and tax
authorities and holds these funds in trust until remitted. The Canadian trust
invests in securities issued by the government and provinces of Canada, highly
rated Canadian banks and corporations, asset backed trusts and mortgages.
Ceridian earns income from the trust and fees for services similar to those
provided in the U.S. The aggregate balances in U.S. dollars for the Canadian
trust as of December 31, 2000 and 1999, respectively, were $573.9 and $652.5,
with average outstanding balances during those years of $490.9 and $436.3.

TRANSLATION OF FOREIGN CURRENCIES
Local currencies have been determined to be functional currencies for Ceridian's
international operations. Foreign currency balance sheets are translated at the
end-of-period exchange rates and earnings statements at the average exchange
rates for each period. The resulting translation gains or losses are described
as "foreign currency translation" and reported in "accumulated other
comprehensive income (loss)" in the accompanying Statements of Stockholders'
Equity. Gains and losses from translation of assets and liabilities denominated
in other than the functional currency of the operation are recorded in results
of operations as "other expense (income)."



                   From Page 26 of the Ceridian Annual Report
<PAGE>   9
(Dollars in millions, except per share data)                       EXHIBIT 13.03




B.  INCOME TAXES

At December 31, 2000, Ceridian had U.S. net operating loss carryforwards of
$69.4, the majority of which it expects to use prior to the spin-off. Unused
amounts, except for separate return limitation year carryforwards amounting to
$6.9 at December 31, 2000, will remain with Arbitron after the spin-off
described in Note C. The tax benefit of this item is reflected in the
accompanying table of deferred tax asset and liability.

    During 1998, Ceridian realized a $18.5 tax benefit related to the difference
between its tax and financial reporting basis in a subsidiary that was disposed
of during fourth quarter.

    Under tax sharing agreements existing at the time of the disposition of
certain former operations of Ceridian, Ceridian remains subject to income tax
audits in various jurisdictions for the years 1985-1992. Ceridian considers its
tax accruals adequate to cover any U.S. and international tax deficiencies not
recoverable through deductions in future years.


<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
COMPONENTS OF EARNINGS AND TAXES FROM        2000          1999          1998
CONTINUING OPERATIONS
---------------------------------------------------------------------------------
<S>                                      <C>           <C>           <C>
EARNINGS BEFORE INCOME TAXES
  U.S.                                   $   107.4     $   154.3     $   157.1
  International                               20.4          13.0          11.1
                                         -----------   -----------   ------------
       Total                             $   127.8     $   167.3     $   168.2
                                         ===========   ===========   ============
INCOME TAX PROVISION
  Current
     U.S.                                $     0.8     $      --     $      --
     State and other                           2.1           0.7           2.3
                                         -----------   -----------   ------------
                                               2.9           0.7           2.3
                                         -----------   -----------   ------------
  Deferred
     U.S.                                     35.0          55.0          36.7
     State and other                          10.4           7.2           3.9
                                         -----------   -----------   ------------
                                              45.4          62.2          40.6
                                         -----------   -----------   ------------
       Total                             $    48.3     $    62.9     $    42.9
                                         ===========   ===========   ============
---------------------------------------------------------------------------------
<CAPTION>
---------------------------------------------------------------------------------
EFFECTIVE RATE RECONCILIATION                2000          1999          1998
---------------------------------------------------------------------------------
<S>                                      <C>           <C>           <C>
U.S. statutory rate                            35%           35%           35%
                                         -----------   -----------   ------------

Income tax provision at
   U.S. statutory rate                   $    44.8     $    58.5     $    58.9
State income taxes, net                        1.6           1.6           0.8
Goodwill                                       8.5           6.3           3.0
Benefit from sale of business                   --            --         (18.5)
Other                                         (6.6)         (3.5)         (1.3)
---------------------------------------------------------------------------------
          Income tax provision           $    48.3     $    62.9     $    42.9
                                         ===========   ===========   ============
---------------------------------------------------------------------------------
</TABLE>


--------------------------------------------------------------------------------
TAX EFFECT OF ITEMS THAT COMPRISE A SIGNIFICANT PORTION OF THE NET DEFERRED
TAX ASSET AND DEFERRED TAX LIABILITY

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
                                                           December 31,
                                                ---------------------------------
                                                     2000              1999
---------------------------------------------------------------------------------
<S>                                           <C>                <C>
DEFERRED TAX ASSET
Net operating loss carryforwards              $          16.6    $         75.7
Restructuring and other accruals                         46.4              53.3
Other                                                    29.7              17.6
                                                ---------------    --------------
Total                                                    92.7             146.6
                                                ---------------    --------------

DEFERRED TAX LIABILITY
Employment related accruals                             (36.4)            (26.8)
Intangibles                                             (54.4)            (38.9)
Other                                                   (28.1)            (16.0)
                                                ---------------    --------------
Total                                                  (118.9)            (81.7)
                                                ---------------    --------------

NET DEFERRED TAX ASSET (LIABILITY)            $         (26.2)   $         64.9
                                                ===============    ==============


NET DEFERRED TAX ASSET (U.S.)
Current portion                               $          41.8    $         74.2
Noncurrent portion                                         --               2.6
                                                ---------------    --------------
Total                                         $          41.8    $         76.8
                                                ===============    ==============

DEFERRED TAX LIABILITY
Current portion                               $           0.3    $          1.6
Noncurrent portion                                       67.7              10.3
                                                ---------------    --------------
Total                                         $          68.0    $         11.9
                                                ===============    ==============


DEFERRED TAX LIABILITY BY GEOGRAPHY
United States                                 $          49.3    $          1.4
International                                            18.7              10.5
                                                ---------------    --------------
Total                                         $          68.0    $         11.9
                                                ===============    ==============

---------------------------------------------------------------------------------
</TABLE>




                   From Page 27 of the Ceridian Annual Report
<PAGE>   10
(Dollars in millions, except per share data)                       EXHIBIT 13.03




C.  SUPPLEMENTARY DATA TO STATEMENTS OF OPERATIONS


UNUSUAL LOSSES (GAINS)
In March 2000, Ceridian approved plans to streamline management and improve
customer service and the quality of operations, primarily in HRS, during 2000.
These plans resulted from a review by Ceridian executive and business unit
management teams announced in January 2000. To the extent that certain costs
related to these planned actions were appropriately recognized as liabilities
upon approval of the plan or related to impairments of asset values identified
in the current period, Ceridian recorded as other expense (income) charges of
$44.7 in first quarter 2000. These charges included $26.4 of accrued exit costs
and $18.3 for impairment of asset values ("asset write-downs"). Exit costs for
severance involved involuntary termination notices for approximately 500
employment positions, primarily in HRS, of which approximately 466 had been
eliminated by December 31, 2000. The other exit costs were incremental costs
directly related to terminated activities and not to continuing operations,
primarily the lease cost for idled facilities and contract termination fees.
With the exception of costs related to long-term leases, payment of accrued exit
costs is expected to take place by early 2001.


<TABLE>
<CAPTION>
----------------------------------------------------------------------------------
                                                     Years Ended December 31,
                                              ------------------------------------
OTHER EXPENSE (INCOME)                             2000         1999       1998
----------------------------------------------------------------------------------
<S>                                           <C>          <C>          <C>
Asset write-downs                             $     18.3   $       --   $     --
Accrued exit costs, net of recovery                 12.2           --         --
Foreign currency translation expense (income)        0.5          0.5         --
Loss (Gain) on sale of assets                        0.2         (5.5)       0.2
Unusual losses (gains)                                --           --       (9.2)
Minority interest and equity in operations
of affiliates                                        0.8          2.0         --
Other expense (income)                              (0.3)        (1.4)       0.1
                                              ------------ -----------------------
Total                                         $     31.7   $     (4.4)  $   (8.9)
                                              ============ ============ ==========
----------------------------------------------------------------------------------
</TABLE>

    Asset write-downs included the write-off of capitalized software amounts
related to a software development contract that was terminated in the first
quarter 2000, certain property and equipment abandoned at a number of idled
facilities, and various goodwill and intangible asset balances with respect to
two previous acquisitions. The impairment of goodwill and intangible assets
considered situations in which the sum of related estimated future cash flows
(undiscounted and without interest) was less than the carrying amount of such
assets, including attributed portions of unallocated excess cost over net assets
acquired. The amount of the impairment loss was the excess of the carrying
amount of the impaired asset over the fair value of the asset. Generally, fair
value represented the expected future cash flows from the use of the asset or
group of assets, discounted at a rate commensurate with the risks involved.

    With respect to accrued amounts related to certain actions taken by Ceridian
in 1997, Ceridian paid $6.4 of accrued costs during the year ended December 31,
2000. Additionally, during first quarter 2000, Ceridian credited other expense
(income) with a recovery of $14.2 of unused accruals established in connection
with these 1997 actions. This recovery relates to the reversal of the amount
accrued in excess of the settlement amount for the securities litigation matter
related to the CII software project termination for which the U.S. District
Court approved the finalized settlement on March 31, 2000.

    The 1998 unusual gains of $9.2 ($5.8 after-tax) are related primarily to the
sale in fourth quarter of land not used in operations.


<TABLE>
<CAPTION>
                                                                           OTHER CASH CHARGES
                                                           ----------------------------------------------------
                                          NON-CASH ASSET                    OCCUPANCY    CONTRACT    LEGAL AND
                                          --------------                    ---------    --------    ---------
                                            WRITE-OFFS       SEVERANCE        COSTS     TERMINATION    OTHER     TOTAL
                                            ----------       ---------        -----     -----------    -----     -----
<S>                                       <C>              <C>             <C>          <C>          <C>       <C>
1997 UNUSUAL CHARGES
--------------------
Total accrued costs                                          $   17.7      $   13.0      $   14.3     $  58.2  $ 103.2
Utilization:
  1997 cash payments                                             (7.1)         (4.4)        (11.4)      (18.2)   (41.1)
  1998 cash payments                                             (8.6)         (4.8)         (2.9)      (11.6)   (27.9)
  1999 cash payments                                             (2.0)         (2.8)           --        (4.3)    (9.1)
  1999 accrual reversal                                            --            --            --        (4.5)    (4.5)
  2000 cash payments                                               --          (1.0)           --        (5.4)    (6.4)
  2000 accrual reversal                                            --            --            --       (14.2)   (14.2)
                                                           -------------------------------------------------------------
Balance of accruals at December 31, 2000                     $     --      $     --      $     --     $    --  $    --
                                                           =============================================================

2000 UNUSUAL CHARGES
--------------------
Total initial charges                            $   18.3    $   16.4      $    8.7      $    1.3     $    --    $44.7
Less non-cash asset write-offs                      (18.3)         --            --            --          --    (18.3)
                                         -------------------------------------------------------------------------------
Total accrued costs                              $     --    $   16.4      $    8.7      $    1.3     $    --  $  26.4
                                         ==================
Utilization:
  2000 cash payments                                             (9.2)         (5.1)         (1.3)         --    (15.6)
                                                           -------------------------------------------------------------
                                                             $    7.2      $    3.6      $     --     $    --  $  10.8
                                                           =============================================================
</TABLE>



                   From Page 28 of the Ceridian Annual Report
<PAGE>   11
(Dollars in millions, except per share data)                       EXHIBIT 13.03




DISCONTINUED OPERATIONS
On July 18, 2000, Ceridian announced its intention to separate its human
resource services division and subsidiaries and Comdata subsidiaries from its
media information division and subsidiaries, Arbitron, into two independent,
publicly traded companies. The separation is expected to be effected through a
tax-free distribution to the stockholders of Ceridian (the "spin-off") of all of
the shares of common stock of a newly formed, wholly owned subsidiary
corporation (New Ceridian Corporation) comprising the human resource services
division and subsidiaries and Comdata subsidiaries of Ceridian. The media
information division and subsidiaries would then represent the only remaining
business within Ceridian. At the time of the spin-off, Ceridian would change its
name to "Arbitron Inc." and New Ceridian Corporation would change its name to
"Ceridian Corporation." Shares of Ceridian Corporation would then represent the
human resource services business division and subsidiaries and Comdata
subsidiaries and the shares of Arbitron Inc. would represent Ceridian's former
media information business.

    For purposes of, among other things, governing certain of the ongoing
relations between Ceridian and Arbitron as a result of the spin-off as well as
to allocate certain tax, employee benefit and other liabilities arising prior to
the spin-off, the companies have entered into various agreements.

    In November 2000, Ceridian received a private letter ruling from the
Internal Revenue Service that the spin-off will qualify as a tax-free
distribution under Section 355 of the Internal Revenue Code. The distribution
date for the spin-off has been set for March 30, 2001 for stockholders of record
on March 16, 2001.

    Due to the relative significance of the human resource services and Comdata
business segments to Ceridian, New Ceridian will be treated as the "accounting
successor" to Ceridian for financial reporting purposes, notwithstanding the
legal form of the spin-off described above. The spin-off will be accounted for
pursuant to Accounting Principles Board Opinion No. 29, "Accounting for
Non-Monetary Transactions," based upon the recorded amounts of the net assets
being spun-off (there was no impairment of value). New Ceridian will charge
directly to equity as a dividend the carrying amount of the net assets of
Arbitron. As a result of the payment made under the distribution agreement, New
Ceridian's equity is expected to increase by approximately $190.0. Summarized
operating results, loss on disposition and net assets of Arbitron as a
discontinued operation are presented in accompanying tables.

    Estimated spin-off charges include $27.0 for a pre-payment premium related
to the required early retirement of the senior notes, $3.4 for the write-off of
deferred debt discount and expenses and $20.0 for other spin-related costs,
primarily for investment banker, legal and accounting fees.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------
               SUMMARIZED OPERATING RESULTS AND GAIN (LOSS) ON DISPOSITION
                                OF DISCONTINUED OPERATIONS
-----------------------------------------------------------------------------------
                                                        YEARS ENDED DECEMBER 31,
                                                     ------------------------------
                                                       2000       1999      1998
                                                     ---------  --------  ---------
<S>                                                  <C>        <C>       <C>
EARNINGS FROM OPERATIONS
Revenue of Arbitron                                     $ 206.8    $ 190.1   $  173.8
Earnings before income taxes of Arbitron                $  77.3    $  65.9   $   57.6
Net earnings of Arbitron                                $  47.6    $  40.9   $   36.6
Less net earnings after measurement date of
  July 18, 2000 applied against loss on disposition       (20.0)        --         --
                                                         --------   -------   --------
Earnings from discontinued operations of Arbitron       $  27.6    $  40.9   $   36.6
                                                         ========   =======   ========

GAIN (LOSS) ON DISPOSITION
Spin-off charges (net of income taxes of $11.0)         $ (39.4)
2000 earnings after measurement date applied against
  loss on disposition (net of income taxes of $12.5)       20.0
2001 estimated earnings until spin-off date (net of
  income taxes of $7.5)                                    12.5
                                                         --------
Loss on disposition of Arbitron                         $  (6.9)
                                                         ========
Additional gain from recovery of accrual from
  1997 sale of Computing Devices International                               $   25.4
                                                                              ========

DISCONTINUED OPERATIONS PER SHARE RESULTS
Earnings from operations per basic share                $  0.19    $  0.28   $   0.25
Earnings from operations per diluted share              $  0.19    $  0.28   $   0.25

Loss from disposition per basic share                   $ (0.05)   $    --   $   0.18
Loss from disposition per diluted share                 $ (0.05)   $    --   $   0.18

Shares used in basic calculation (in thousands)         145,229    144,524    144,070
Shares used in diluted calculation (in thousands)       146,734    147,964    147,597

<CAPTION>
------------------------------------------------------------------------------------------
                     SUMMARIZED NET ASSETS OF DISCONTINUED OPERATIONS
------------------------------------------------------------------------------------------
                                                              AT DECEMBER 31,
                                                       ----------------------------
                                                           2000           1999
                                                       -------------- -------------
<S>                                                    <C>            <C>
Current assets                                          $        51.7  $       40.0
Noncurrent assets                                                45.1          33.2
                                                       --------------  ------------
Total assets                                                     96.8          73.2
Current liabilities                                              66.5          90.2
Noncurrent liabilities                                            2.1           6.8
                                                        -------------  ------------
Net assets (liabilities)                                $        28.2  $      (23.8)
                                                        ============= =============
</TABLE>


                   From Page 29 of the Ceridian Annual Report
<PAGE>   12
(Dollars in millions, except per share data)                       EXHIBIT 13.03





D.  SEGMENT DATA

Ceridian operates in the information services industry principally in the U.S.
and provides products and services to the human resource and transportation
information markets. These businesses collect, manage and analyze data and
process transactions on behalf of customers, report information resulting from
such activities to customers, and provide customers with related software
applications and services. The technology-based products and services of these
businesses are typically provided through long-term customer relationships that
result in a high level of recurring revenue. The business segments are
distinguished primarily by reference to the markets served and the nature of the
services provided. Selected business segment information is provided in an
accompanying table.

    Human Resource Services offers a broad range of services and software
designed to help employers more effectively manage their work forces and
information that is integral to human resource processes. These products and
services include transaction-oriented administrative services and software
products, primarily in areas such as payroll processing and tax filing, as well
as management support software and services in areas such as benefits
administration, qualified plan administration, skills management, regulatory
compliance, employee training, work-life effectiveness and employee assistance
programs. Revenue from payroll and tax filing services also includes investment
income earned by Ceridian from deposits temporarily held pending remittance on
behalf of customers to taxing authorities and customers' employees. These
activities are conducted primarily in the U.S. and, to a lesser extent, through
subsidiaries in the United Kingdom ("UK") and, beginning in 1998, Canada.

<TABLE>
<CAPTION>
------------------------------------ ------------------------------------
                                          YEARS ENDED DECEMBER 31,
                                     ------------------------------------
GEOGRAPHIC SEGMENT DATA                 2000          1999        1998
------------------------------------------------  ----------- -----------
<S>                                  <C>          <C>         <C>
U.S. OPERATIONS
Revenue                               $ 1,013.4    $   979.7     $ 847.1
Property, plant and equipment
   at December 31                         147.8        176.9        78.4

NON-U.S. OPERATIONS
UNITED KINGDOM OPERATIONS
Revenue                               $    61.3    $    57.8     $  51.5
Property, plant and equipment
   at December 31                           3.9          4.1         4.6
CANADIAN OPERATIONS
Revenue                                   101.0         89.5        69.0
Property, plant and equipment
   at December 31                           8.7          7.1         4.2
                                    ------------  ----------- -----------
TOTAL NON-U.S. OPERATIONS
Revenue                               $   162.3    $   147.3     $ 120.5
Property, plant and equipment
   at December 31                          12.6         11.2         8.8
                                    ------------  ----------- -----------

TOTAL WORLDWIDE
Revenue                               $ 1,175.7    $ 1,127.0     $ 967.6
Property, plant and equipment
   at December 31                         160.4        188.1        87.2
-------------------------------------------------------------------------
</TABLE>

    Comdata provides transaction processing and decision support services to the
transportation industry, primarily trucking companies, truck stops and truck
drivers, in both the long haul and local markets in the U.S. These services
primarily involve the use of a proprietary funds transfer card which facilitates
truck driver transactions and provides transaction control and trip information
for trucking firms. Additionally, Comdata provides assistance in obtaining
regulatory permits and other compliance services, driver relations services,
local fueling services and discounted telecommunications services in its
markets. In 1999, Comdata established its Payment Services division for
extending Comdata's products and services to customers outside the
transportation industry.

    The Other segment includes the unallocated amounts related to corporate
center operations. The assets of corporate center operations include cash and
equivalents as well as deferred income tax and pension assets.

    Ceridian measures business segment results by reference to earnings before
interest and taxes ("EBIT"), adjusted for unusual gains and losses. Unusual
gains and losses in 2000 and 1998 are discussed in Note C. Expenses incurred by
corporate center operations are charged or allocated to the business segments.

     Revenue from sales between business segments is not material. The
operations of Ceridian are conducted primarily in the U.S and revenue from sales
between U.S. and non-U.S. entities is not material. Non-U.S. operations in
Canada and the UK relate largely to the Human Resource Services segment.
Geographic data for or at the end of each of the last three years, presented
above, is determined by reference to the location of operation.



                   From Page 30 of the Ceridian Annual Report
<PAGE>   13
(Dollars in millions, except per share data)                       EXHIBIT 13.03




<TABLE>
<CAPTION>
BUSINESS SEGMENTS
-----------------------------------------------------------------------------------------------
                                                             Years Ended December 31,
                                                   --------------------------------------------
                                                       2000           1999            1998
                                                   -------------  ------------   --------------
<S>                                                <C>            <C>            <C>
HUMAN RESOURCE SERVICES
Revenue                                            $     866.9    $    828.1     $      700.3

EBIT before unusual losses and gains               $     109.5    $    113.4     $      100.5
Unusual (losses) gains                                   (37.0)           --               --
                                                   -------------  ------------   --------------
EBIT                                               $      72.5    $    113.4     $      100.5

Total assets                                       $   1,264.7    $  1,296.4     $      471.5
Depreciation and amortization                      $      78.1    $     63.5     $       40.0
Expended for property, plant and equipment         $      43.3    $     37.8     $       35.8
-----------------------------------------------------------------------------------------------
COMDATA
Revenue                                            $     308.8    $    298.9     $      267.3

EBIT before unusual losses and gains               $      83.9    $     72.2     $       52.4
Unusual (losses) gains                                    (2.6)           --               --
                                                   -------------  ------------   --------------
EBIT                                               $      81.3    $     72.2     $       52.4

Total assets                                       $     572.6    $    468.4     $      398.6
Depreciation and amortization                      $      18.5    $     15.6     $       13.4
Expended for property, plant and equipment         $       7.9    $     11.7     $        6.7
-----------------------------------------------------------------------------------------------
OTHER
EBIT before unusual losses and gains               $        --    $       --     $        --
Unusual (losses) gains                                     9.1            --              9.2
                                                   -------------  ------------   --------------
EBIT                                               $       9.1    $       --     $        9.2

Total assets                                       $     250.7    $    223.7     $      346.8
Depreciation and amortization                      $      (9.0)   $     (6.9)    $       (6.9)
Expended for property, plant and equipment         $      15.3    $     25.8     $        2.5
-----------------------------------------------------------------------------------------------
TOTAL CERIDIAN
Revenue                                            $   1,175.7    $  1,127.0     $      967.6

EBIT before unusual losses and gains               $     193.4    $    185.6     $      152.9
Unusual (losses) gains                                   (30.5)           --              9.2
                                                   -------------  ------------   --------------
EBIT                                               $     162.9    $    185.6     $      162.1

Total assets                                       $   2,088.0    $  1,988.5     $    1,216.9
Depreciation and amortization                      $      87.6    $     72.2     $       46.5
Expended for property, plant and equipment         $      66.5    $     75.3     $       45.0

-----------------------------------------------------------------------------------------------
</TABLE>



                   From Page 31 of the Ceridian Annual Report
<PAGE>   14
(Dollars in millions, except per share data)                       EXHIBIT 13.03





E. CAPITAL ASSETS
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------
                                                                                     December 31,
                                                                           --------------------------------
                                                                               2000              1999
-----------------------------------------------------------------------------------------------------------
<S>                                                                        <C>               <C>
PROPERTY, PLANT AND EQUIPMENT
Land                                                                         $     12.1        $     14.8
Machinery and equipment                                                           235.0             222.6
Buildings and improvements                                                         80.7              60.2
Construction in progress                                                             --              54.7
                                                                           --------------    --------------
                                                                                  327.8             352.3
Accumulated depreciation                                                         (167.4)           (164.2)
                                                                           --------------    --------------
Property, plant and equipment, net                                           $    160.4        $    188.1
                                                                           ==============    ==============

-----------------------------------------------------------------------------------------------------------
GOODWILL
Goodwill                                                                     $    988.1        $    951.0
Accumulated amortization                                                          (90.2)            (58.1)
                                                                           --------------    --------------
Goodwill, net                                                                $    897.9        $    892.9
                                                                           ==============    ==============

-----------------------------------------------------------------------------------------------------------
OTHER INTANGIBLES
Customer lists                                                               $     36.1        $     32.1
Trademarks                                                                         49.2              49.3
Technology                                                                         43.7              42.6
Other                                                                              35.1              36.9
                                                                           --------------    --------------
Total other intangible assets                                                     164.1             160.9
Accumulated amortization                                                          (35.7)            (25.6)
                                                                           --------------    --------------
Other intangible assets, net                                                 $    128.4        $    135.3
                                                                           ==============    ==============

-----------------------------------------------------------------------------------------------------------
SOFTWARE AND DEVELOPMENT COSTS
Purchased software                                                           $     29.8        $     29.7
Software development costs                                                         60.0              45.7
                                                                           --------------    --------------
                                                                                   89.8              75.4
Accumulated amortization                                                          (32.8)            (27.4)
                                                                           --------------    --------------
Software and development costs, net                                          $     57.0        $     48.0
                                                                           ==============    ==============
<CAPTION>
-----------------------------------------------------------------------------------------------------------
                                                                      Years Ended December 31,
                                                          -------------------------------------------------
DEPRECIATION AND AMORTIZATION                                 2000             1999              1998
-----------------------------------------------------------------------------------------------------------
<S>                                                       <C>              <C>               <C>
Depreciation and amortization
  of property, plant and equipment                         $     39.2       $      36.5        $     30.6
Amortization of goodwill                                         34.5              25.3              10.2
Amortization of other intangible assets                          14.4              11.1               9.6
Amortization of software and development costs                    9.1               7.2               4.0
Pension credit                                                   (9.6)             (7.9)             (7.9)
                                                          -------------    --------------    --------------
    Total                                                  $     87.6       $      72.2        $     46.5
                                                          =============    ==============    ==============
</TABLE>




                   From Page 32 of the Ceridian Annual Report
<PAGE>   15
(Dollars in millions, except per share data)                       EXHIBIT 13.03





F.  INVESTING ACTIVITY

In May 2000, Comdata completed the acquisition of Stored Value Systems, Inc.
("SVS") by exercising an option to purchase the remaining interest and paying
$50.9. Comdata had acquired a majority interest in SVS in March 1999 for $20.3.
As a result of the acquisition, Comdata recorded goodwill and intangibles
totaling $63.4 to be amortized over periods of 2 to 15 years. Other business
acquisitions during 2000 resulted in payments of $14.2, principally for a
payroll service that operates primarily in the UK.

    Proceeds from sales of assets during 2000 primarily involved the November
sale and leaseback of the real property constituting the newly constructed
Ceridian headquarters facility for $41.0. The gain of $1.2 from this transaction
will be recognized over the term of the lease. The September sale of property in
Palm Harbor, Fla., formerly used in Ceridian's benefits services operations,
provided proceeds of $12.8 and the excess of the proceeds over the carrying
value of the property reduced goodwill related to the acquisition of ABR
Information Services, Inc. ("ABR").

    At December 31, 2000, Ceridian held 1,580,023 registered shares of the
common stock of HotJobs.com, Ltd. (159,459 of which remain in escrow until May
2001) that were received in 2000 in exchange for preferred stock received in
connection with the sale of Resumix, Inc. in 1998. The fair value of $11.44 per
share (based on quoted market prices at December 31, 2000) for these securities
is reflected in short-term investments with a corresponding credit, net of
deferred income taxes, reported as unrealized gain on marketable securities
within accumulated other comprehensive income in stockholders' equity. Any gain
related to these securities will be recognized at the time of sale.

    As of June 7, 1999, Ceridian acquired ABR as a result of a tender offer for
all outstanding shares of ABR common stock at a price of $25.50 per share in
cash and a subsequent merger on July 22, 1999. ABR provided comprehensive
benefits administration, payroll and human resource services to employers of all
sizes.

    The purchase price of $751.8 included $720.9 for tendered shares, $12.7 for
ABR shares converted to the right to receive $25.50 per share and $6.7 for
Ceridian direct acquisition costs. The purchase price also included the exchange
of Ceridian stock options valued at $11.5 for any unexercised ABR stock options
outstanding.

    The value assigned to the net assets of ABR, including adjustments during
the year following the acquisition, amounted to $71.2, and goodwill and
intangibles of $680.6 is being amortized over a 30-year period.

    The 1999 net investing cash outflows related to the ABR acquisition, after
reduction for cash and equivalents acquired of $77.4, amounted to $681.5. These
outflows included payments of $720.9 for shares tendered in June, $12.7
deposited in July for the remaining shares, and payments of $6.4 for Ceridian
direct acquisition costs and $18.9 for ABR liabilities directly related to the
acquisition. The directly related ABR liabilities assumed included payments
during 1999 of $11.4 paid in July to buy out vested ABR stock options and $7.5
for investment consulting fees.

    During first quarter 1998, Ceridian, through a Canadian subsidiary, acquired
the payroll services businesses of two Canadian banks for a total cash payment
of $140.7 of which $70.4 was borrowed from the sellers. The acquisitions
resulted in the recording of $123.5 of goodwill. In November 1998, Ceridian
acquired the work-life services business of Work/Family Directions, Inc. The
acquisition resulted in a cash payment of $77.5 and the recording of $66.5 of
goodwill.

    In January 1998, Comdata exchanged its gaming services business for First
Data Corporation's NTS transportation services business and $50.5 in cash. The
transaction was accounted for as a monetary exchange at fair value. The net cash
inflow from the exchange was $30.1 and the net reduction in goodwill was $44.1.
During 1998, Ceridian sold its Resumix and Tesseract operations, along with
other smaller businesses and assets. The aggregate net cash proceeds from these
sales were $19.4 with no material gain or loss.



                   From Page 33 of the Ceridian Annual Report
<PAGE>   16
(Dollars in millions, except per share data)                       EXHIBIT 13.03




G.  RETIREMENT PLANS

PENSION BENEFITS
Ceridian maintains a defined benefit pension plan for U.S. employees that closed
to new participants effective January 2, 1995. Assets of the plan consist
principally of equity securities, U.S. government securities, and other fixed
income obligations and do not include securities issued by Ceridian. Benefits
under the plan are generally calculated on final or career average earnings and
years of participation in the plan. Most participating employees are required to
contribute to the plan as a condition of active participation. Certain former
employees are inactive participants in the plan. The plan is funded in
accordance with funding requirements under the Employee Retirement Income
Security Act of 1974, based on determinations of an independent consulting
actuary.

    The funded status of the plan at September 30, 2000 and 1999 measurement
dates and changes in funded status for the annual periods then ended are shown
in the accompanying tables, along with the net periodic pension cost and
assumptions used in calculations for each of the last three years.

    Ceridian also sponsors a nonqualified supplemental retirement plan. The
projected benefit obligations at September 30, 2000 and 1999 for this plan were
$24.7 and $23.2, respectively, and the net periodic pension costs were $3.3 for
2000, $3.0 for 1999 and $2.8 for 1998. The related intangible asset amounts
included in prepaid pension cost were $1.3 at December 31, 2000 and $1.5 at
December 31, 1999. At December 31, 2000 and 1999, respectively, prepaid pension
cost also included $7.9 and $7.5 held in benefit protection trusts for certain
plan participants.

    The costs recognized by Ceridian with respect to its defined contribution
retirement plans were $9.2 in 2000, $7.8 in 1999 and $8.8 in 1998.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------
FUNDED STATUS OF DEFINED BENEFIT                                September 30,
                                                        ---------------------------
RETIREMENT PLAN AT MEASUREMENT DATE                         2000           1999
-----------------------------------------------------------------------------------
<S>                                                     <C>           <C>
CHANGE IN PROJECTED BENEFIT OBLIGATION DURING THE PERIOD
At beginning of period                                  $     554.1   $      567.7
Service cost                                                    2.1            2.6
Interest cost                                                  41.5           39.7
Actuarial (gain) loss                                          (8.7)         (11.9)
Benefits paid                                                 (47.7)         (44.0)
                                                        ------------- -------------
At end of period                                        $     541.3   $      554.1
                                                        ------------- -------------

CHANGE IN FAIR VALUE OF PLAN ASSETS DURING THE PERIOD
At beginning of period                                  $     576.3   $      552.5
Actual return on plan assets                                   91.6           67.8
Benefits paid                                                 (47.7)         (44.0)
                                                        ------------- -------------
At end of period                                        $     620.2   $      576.3
                                                        ------------- -------------

FUNDED STATUS OF PLAN                                   $      78.9   $       22.2
Unrecognized net loss                                          34.5           78.1
Unrecognized prior service cost                                 5.5            9.0
                                                        ------------- -------------
Net pension asset recognized
   in the consolidated balance sheet                    $     118.9   $      109.3
                                                        ===========   =============
-----------------------------------------------------------------------------------
<CAPTION>
-----------------------------------------------------------------------------------
ASSUMPTIONS USED IN CALCULATIONS                          2000       1999     1998
-----------------------------------------------------------------------------------
                                                        ---------------------------
<S>                                                     <C>          <C>      <C>
Discount rate                                             7.75%      7.50%    7.00%
Rate of compensation increase                             4.00%      4.00%    4.00%
Expected return on plan assets                            9.50%      9.50%    9.50%

-----------------------------------------------------------------------------------
<CAPTION>
-----------------------------------------------------------------------------------
NET PERIODIC PENSION COST (CREDIT)                         2000      1999     1998
-----------------------------------------------------------------------------------
                                                       ----------------------------
<S>                                                    <C>        <C>       <C>
Service cost                                            $   2.1    $  2.6   $  2.0
Interest cost                                              41.6      39.7     42.1
Expected return on plan assets                            (56.8)    (54.9)   (53.8)
Net amortization and deferral                               3.5       4.7      1.8
                                                       ---------- --------- -------
          Total                                         $  (9.6)   $ (7.9)  $ (7.9)
                                                       ========== ========= =======
-----------------------------------------------------------------------------------
</TABLE>

    Plan amounts include those related to participating employees of Arbitron
discontinued operations. Pension obligations and related plan assets, determined
in accordance with the Internal Revenue Code, will be transferred to Arbitron at
the time of the spin-off. Ceridian will retain responsibility for all
participants in the qualified and nonqualified defined benefit plans who
terminated employment before January 1, 2001, or were receiving benefits under
Ceridian's long-term disability insurance plan immediately before January 1,
2001.


                   From Page 34 of the Ceridian Annual Report
<PAGE>   17
(Dollars in millions, except per share data)                       EXHIBIT 13.03



POSTRETIREMENT BENEFITS
Ceridian provides health care and life insurance benefits for eligible retired
employees, including individuals who retired from operations of Ceridian that
were subsequently sold or discontinued. Ceridian sponsors several health care
plans in the U.S. for both pre- and post-age 65 retirees. Company contributions
to these plans differ for various groups of retirees and future retirees.
Employees hired on or after January 1, 1992 may enroll at retirement in
company-sponsored plans with no company subsidy. Employees hired before and
retiring after that date may enroll in plans that subsidize pre-age 65 coverage
only. Employees who retired prior to 1992 are subject to various cost-sharing
policies depending on when retirement began and eligibility for Medicare. This
is a closed group. Most retirees outside the United States are covered by
governmental health care programs, and Ceridian's cost is not significant.

    The following tables present the amounts and changes in the aggregate
benefit obligation at the beginning and end of and for each of the last two
measurement periods and the components of net periodic postretirement benefit
cost for the plans for the last three years. Ceridian does not prefund these
costs.

<TABLE>
<CAPTION>
-----------------------------------------------
FUNDED STATUS OF POSTRETIREMENT
HEALTH CARE AND LIFE INSURANCE PLANS
-----------------------------------------------
                                 2000     1999
<S>                             <C>     <C>
CHANGE IN BENEFIT OBLIGATION
At beginning of period          $41.8   $ 44.6
Service cost                      0.2      0.1
Interest cost                     3.0      3.0
Participant contributions         1.0      1.1
Actuarial loss (gain)            (4.9)    (4.1)
Benefits paid                    (3.5)    (2.9)
                               ----------------
At end of period                $37.6   $ 41.8
                               ----------------

CHANGE IN PLAN ASSETS
At beginning of period          $  --   $   --
Company contributions             2.5      1.8
Participant contributions         1.0      1.1
Benefits paid                    (3.5)    (2.9)
                               ----------------
At end of period                $  --   $   --
                               ----------------

FUNDED STATUS OF PLAN
Benefit obligation, net         $37.6   $ 41.8
Unrecognized actuarial gain      14.8     10.4
                               ----------------
At end of period                $52.4   $ 52.2
                                =====   ======
-----------------------------------------------

Current portion                 $ 6.0   $  6.0
Noncurrent portion               46.4     46.2
                               ----------------
  Total                         $52.4   $ 52.2
                                =====   ======
-----------------------------------------------
<CAPTION>
------------------------------------------------------------
NET PERIODIC POSTRETIREMENT BENEFIT COST
------------------------------------------------------------
                                     2000     1999    1998
                                     ----     ----    ----
<S>                                 <C>      <C>     <C>
Service cost                        $ 0.2    $ 0.1   $ 0.1
Interest cost                         3.0      3.0     3.0
Actuarial gain amortization          (0.5)    (0.2)   (0.2)
Other                                  --       --     0.4
------------------------------------------------------------
  Net periodic benefit cost         $ 2.7    $ 2.9   $ 3.3
                                    =====    =====   =====

------------------------------------------------------------
</TABLE>

    The assumed health care cost trend rate used in measuring the benefit
obligation is 8% for pre-age 65 and 5.75% for post-age 65 in 2000, with pre-age
65 rates declining at a rate of 1% per year to an ultimate rate of 5.75% in
2003. A one percent increase in this rate would increase the benefit obligation
at September 30, 2000 by $2.4 and the aggregate service and interest cost for
the 2000 measurement period by $0.2. A one percent decrease in this rate would
decrease the benefit obligation at September 30, 2000 by $2.3 and the aggregate
service and interest cost for the 2000 measurement period by $0.2. The weighted
average discount rates used in determining the benefit obligation at the
measurement dates were 7.75% for 2000 and 7.5% for 1999.

    Plan amounts include those related to participating employees of the
Arbitron discontinued operations. Ceridian's postretirement and postemployment
plans will continue to provide coverage for all eligible Arbitron employees who
terminated employment covered by the plan on or prior to the spin-off. Arbitron
intends to maintain similar plans providing postretirement health care and life
insurance benefits following the spin-off. Ceridian's unfunded benefit
obligation for these benefits will be allocated to Arbitron after reduction for
active Arbitron employees who do not elect to commence retirement at or prior to
the spin-off.



                   From Page 35 of the Ceridian Annual Report
<PAGE>   18
(Dollars in millions, except per share data)                       EXHIBIT 13.03



H.  STOCK PLANS

During the three-year period ended December 31, 2000, Ceridian maintained
stock-based compensation plans for directors, officers, other employees,
consultants and independent contractors.

    The 2000 Director Performance Incentive Plan authorizes the issuance of up
to 350,000 shares in connection with awards of stock options and non-performance
restricted stock to non-employee directors of Ceridian and its adoption resulted
in the expiration of 16,166 unawarded shares authorized under a predecessor plan
with similar terms. An annual grant of a non-qualified stock option to purchase
4,000 shares is made to each eligible director with such grants becoming fully
exercisable six months after the date of grant. The exercise price of the
options is the fair market value of the underlying stock at the date of grant,
and the options expire in ten years.

    A one-time award of non-performance restricted shares is made to each
non-employee director when the director first joins the Board with restrictions
on transfer that will ordinarily lapse annually over a five-year period. The
number of shares awarded will have a fair market value equal to two and one-half
times the then current annual retainer paid to non-employee directors.

    Additionally, at least one-half of the annual retainer for each non-employee
director is also provided in the form of restricted stock, deferred stock or a
combination of the two. The restrictions on transfer of the retainer awards will
lapse at the conclusion of the director's service.

    The 1999 Stock Incentive Plan ("1999 SIP") authorizes the issuance until
February 2, 2009 of up to 12,695,048 common shares, which includes remaining
shares that were authorized and available for grant under a predecessor plan, in
connection with awards of stock options, restricted stock awards and performance
unit awards to eligible participants. Eligible participants in the 1999 SIP
include all employees of Ceridian and any non-employee director, consultant and
independent contractor of Ceridian.

    Stock options awarded under the 1999 SIP and its predecessor plans generally
vest annually either over a three-year period or on a specific date if certain
performance criteria were satisfied, have 10-year terms and have an exercise
price that may not be less than the fair market value of the underlying stock at
the date of grant.

    The 1999 SIP gives discretion to the Compensation and Human Resources
Committee (the committee of the Board of Directors of Ceridian that administers
the 1999 SIP) to determine the effect that a change of control of Ceridian will
have upon awards made under that plan. The vesting of stock option awards
granted in 1999 and 2000 under the 1999 SIP will accelerate upon a change of
control of Ceridian. The predecessor employee plans also provide for the
accelerated exercisability of options and the accelerated lapse of transfer
restrictions on restricted stock if a participant's employment terminates for
specified reasons within two years of a change of control of Ceridian.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
                                                                                                       Weighted-
STOCK PLANS                                                                                              Average
                                                                                                        Exercise
                                        Option Price                                      Available        Price
                                           Per Share    Outstanding      Exercisable      for Grant   of Options
-----------------------------------------------------------------------------------------------------------------
<S>                                   <C>                <C>            <C>               <C>         <C>
   At December 31, 1997               $0.89 - $26.13     12,247,194        5,049,286      5,964,436      $17.18
-----------------------------------------------------------------------------------------------------------------
   Authorized                                                                             3,006,000
   Granted                             18.63 - 33.16      5,109,000                      (5,109,000)      27.42
   Became exercisable                   4.43 - 28.10                       2,200,162
   Exercised                            0.89 - 26.13     (2,804,050)      (2,804,050)                     13.00
   Canceled                             6.47 - 33.16     (1,058,196)         (82,194)       980,448       20.68
   Expired                                      5.92         (2,280)          (2,280)      (360,062)       5.92
   ESPP purchases                                                                          (202,988)
   Restricted stock, net                                                                    630,522
   Performance units forfeited                                                                8,000
-----------------------------------------------------------------------------------------------------------------
   At December 31, 1998               $3.09 - $33.16     13,491,668        4,360,924      4,917,356      $21.65
-----------------------------------------------------------------------------------------------------------------
   Authorized                                                                            12,695,048
   ABR conversion                       5.08 - 42.64        844,393          428,335
   Granted                             19.94 - 38.97      3,891,970                      (3,891,970)      22.73
   Became exercisable                   6.47 - 34.58                       3,038,429
   Exercised                            3.76 - 29.00     (1,265,599)      (1,265,599)                     14.98
   Canceled                             6.47 - 36.78     (1,031,166)         (70,019)       932,488       25.36
   Expired                                      7.65         (1,860)          (1,860)    (2,695,048)       7.65
   ESPP purchases                                                                          (239,073)
   UK Plan purchases                                                                           (296)
   Restricted stock, net                                                                     37,864
   Performance units forfeited                                                               14,660
-----------------------------------------------------------------------------------------------------------------
   At December 31, 1999               $3.09 - $42.64     15,929,406        6,490,210     11,771,029      $22.26
-----------------------------------------------------------------------------------------------------------------
   AUTHORIZED                                                                               333,834
   GRANTED                             16.00 - 27.88      1,466,653                      (1,466,653)      22.55
   BECAME EXERCISABLE                  10.53 - 38.97                       3,116,997
   EXERCISED                            3.09 - 27.41       (762,875)        (762,875)                     13.70
   CANCELED                            11.82 - 38.97     (2,990,630)        (672,055)       884,531       24.99
   EXPIRED                                      7.15         (4,000)          (4,000)                      7.15
   ESPP PURCHASES                                                                          (310,379)
   UK PLAN PURCHASES                                                                           (362)
   RESTRICTED STOCK, NET                                                                    (17,366)
-----------------------------------------------------------------------------------------------------------------
   AT DECEMBER 31, 2000               $3.76 - $42.64     13,638,554        8,168,277     11,194,634      $22.18
-----------------------------------------------------------------------------------------------------------------

COMMON SHARES RESERVED FOR FUTURE ISSUANCE AT DECEMBER 31, 2000 WERE 24,833,188.
-----------------------------------------------------------------------------------------------------------------
</TABLE>



                   From Page 36 of the Ceridian Annual Report
<PAGE>   19
(Dollars in millions, except per share data)                       EXHIBIT 13.03



    During 1998, Ceridian reserved 1,000,000 common shares for a new stock-based
compensation plan ("UK Plan") for certain employees in its operations in the
United Kingdom.

    The Employee Stock Purchase Plan ("ESPP") provides for the issuance of up to
3,000,000 shares of newly issued or treasury common stock of Ceridian to
eligible employees. The purchase price of the stock to ESPP participants is 85%
of the lesser of the fair market value on either the first day or the last day
of the applicable three-month offering period.

    As reported in Note A, Ceridian adopted the disclosure-only provisions of
FAS 123 and continues to account for stock-based compensation as in prior years.
Therefore, no expense is recorded with respect to Ceridian's stock option or
employee stock purchase plans.

    At the time of the spin-off, holders of Ceridian stock options will have
their options adjusted in number, kind and exercise price to preserve the
intrinsic value of their holdings based upon their employment status. Other
terms of the options would not be changed. Ceridian stock options outstanding at
December 31, 2000 included 1,718,528 held by Arbitron participants of which
1,173,039 were exercisable at that date.

    The following disclosure, including referenced tables, is provided with
respect to the provisions of FAS 123. Ceridian employs the Black-Scholes option
pricing model for determining the fair value of stock option grants and ESPP
purchases, as presented in an accompanying table. Weighted average exercise
prices for stock option activity and options outstanding at December 31, 2000,
1999 and 1998 are included in the Stock Plans table.

    Further information on outstanding and exercisable stock options by exercise
price range as of the end of the current year is disclosed in an accompanying
table. Ceridian is required to report the pro forma effect on net earnings and
earnings per share that would have resulted if the fair value method of
accounting for stock-based compensation issued in those years had been adopted.
The application of the fair value method would have resulted in the
determination of compensation cost for grants of stock options and purchases
under the ESPP. Such compensation cost would then be allocated to the related
period of service. The results of this calculation and the assumptions used
appear in the accompanying pro forma table.

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------
STOCK OPTION INFORMATION AS OF DECEMBER 31, 2000
---------------------------------------------------------------------------------------
                             Options Outstanding                Options Exercisable
                   ----------------------------------------  --------------------------

                                    Weighted
                                     Average     Weighted                     Weighted
                                   Remaining      Average                      Average
       Range of         Number   Contractual     Exercise          Number     Exercise
Exercise Prices    Outstanding          Life        Price     Exercisable        Price
-----------------  ------------  -------------  -----------  ------------  ------------
<S>                <C>           <C>            <C>          <C>           <C>
 $  3.76 - $19.64     1,770,079         4.73       $13.05     1,543,779         $12.36
  $19.65 - $19.94     2,742,975         8.81       $19.93       578,976         $19.94
  $19.95 - $22.37     3,591,675         6.48       $20.86     3,022,140         $20.80
  $22.38 - $27.40     2,007,963         7.38       $24.72     1,164,538         $24.96
  $27.41 - $27.68     2,501,234         7.81       $27.41     1,156,717         $27.41
  $27.69 - $42.64     1,024,628         7.57       $30.82       702,127         $31.40
--------------------------------------------------------------------------------------
 $  3.76 - $42.64    13,638,554         7.17       $22.18     8,168,277         $21.58
--------------------------------------------------------------------------------------
<CAPTION>
--------------------------------------------------------------------------------------
PRO FORMA EFFECT OF FAIR VALUE ACCOUNTING           2000           1999         1998
--------------------------------------------------------------------------------------
<S>                                               <C>            <C>          <C>
Net earnings as reported                          $100.2         $145.3       $187.3
Pro forma net earnings                             $87.1         $126.3       $173.3
Diluted earnings per share as reported             $0.68          $0.98        $1.27
Pro forma diluted earnings per share               $0.59          $0.85        $1.17
--------------------------------------------------------------------------------------
Weighted-Average Assumptions
Expected lives in years                              4-8            4-8          4-8
Expected volatility                                40.4%          37.4%        34.5%
Expected dividend rate                                --             --           --
Risk-free interest rate                             5.0%           6.3%         4.8%
--------------------------------------------------------------------------------------
<CAPTION>
--------------------------------------------------------------------------------------------
WEIGHTED AVERAGE FAIR VALUES OF GRANTS, AWARDS AND PURCHASES
--------------------------------------------------------------------------------------------
                             2000                         1999                 1998
                     SHARES    FAIR VALUE    Shares     Fair Value      Shares    Fair Value
                   -------------------------------------------------------------------------
<S>                <C>         <C>          <C>          <C>          <C>        <C>
Stock options      1,466,653     $7.65      3,891,970      $7.97      5,109,000     $8.82
ESPP                 310,379     $4.95        239,073      $6.85        202,988     $5.53
</TABLE>




                   From Page 37 of the Ceridian Annual Report
<PAGE>   20
(Dollars in millions, except per share data)                       EXHIBIT 13.03




I.  FINANCING


On June 10, 1999, Ceridian completed a Rule 144A senior notes offering with
registration rights and a face amount of $450.0, which notes were subsequently
exchanged for registered senior notes. The original issue discount of $4.4,
recorded as an offset to senior notes, and capitalizable issue costs of $0.8,
recorded as other noncurrent assets, are being amortized to interest expense
over the term of the senior notes. The senior notes have a five-year term, a
coupon interest rate of 7.25% per annum payable semiannually beginning December
1, 1999, and mature on June 1, 2004.

    Ceridian applied the net proceeds from the sale of the senior notes, along
with Ceridian funds and an advance of $210.0 on Ceridian's $250.0 domestic
revolving credit agreement, to provide funding for the acquisition of ABR
Information Services, Inc. During first quarter 2000, Ceridian repurchased, on
the open market, senior notes with a face amount of $20.0. Based on quoted
market prices for the same or similar securities or current rates offered to
Ceridian for debt of the same maturities, the estimated fair value of the senior
notes at December 31, 2000 was $435.4.

    At December 31, 2000 and 1999, the advances outstanding under a $250.0
domestic revolving credit facility, arranged with a commercial bank syndicate in
July 1997, amounted to $ 50.0 and $125.0, respectively, along with $1.7 and $3.5
of letters of credit at the respective dates. Interest rates on outstanding
amounts during 2000 and 1999 averaged 6.79% and 5.71%, respectively. No amount
of advances was outstanding at December 31, 1998. The domestic credit facility
is unsecured and has a final maturity of July 31, 2002. The full amount of the
credit facility may be utilized for revolving loans and up to $75.0 of the
credit facility may be used to obtain standby letters of credit. The pricing of
the credit facility for both loans and letters of credit is determined based on
Ceridian's senior unsecured debt ratings. Under the terms of the credit
facility, Ceridian's consolidated debt must not exceed its stockholders' equity
as of the end of any fiscal quarter, and the ratio of Ceridian's EBIT to
interest expense on a rolling four quarter basis must be at least 2.75 to 1. The
credit facility also limits liens, subsidiary debt, contingent obligations,
operating leases, minority equity investments and divestitures. At December 31,
2000, Ceridian was in compliance with all covenants contained in the credit
facility.

    During first quarter 1998 and in connection with the purchases of two
payroll services businesses in Canada, Ceridian entered into two revolving
credit arrangements which expire on July 31, 2002 with Canadian banks through a
Canadian subsidiary. The initial borrowings amounted to $70.4 in the aggregate,
had average interest rates in 2000 and 1999 of 6.14% and 5.52% per annum and
aggregate outstanding balances at December 31, 2000 and 1999 of $19.1 and $38.7,
respectively. No additional advances have been drawn against the Canadian credit
arrangements since the initial borrowings.

    In connection with the spin-off in 2001, Ceridian entered into a new
five-year, $350.0 revolving credit facility with a $50.0 letter of credit
sub-facility in January 2001. Proceeds from drawing on the new facility are
expected to be applied, along with internally generated cash and proceeds from
Arbitron's new credit facility and issuance of senior notes, to the
extinguishment of Ceridian's senior notes and any amount outstanding under the
1997 domestic revolving credit facility. Further information on the spin-off
appears in under the heading "Discontinued Operations" in Note C.
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------
                                                                         December 31,
                                                                -----------------------------
DEBT OBLIGATIONS                                                       2000         1999
---------------------------------------------------------------------------------------------
<S>                                                             <C>           <C>
Revolving credit agreements and overdrafts                       $     69.1   $    163.7
Senior notes, net of discount                                         430.0        446.1
Other long-term debt obligations                                        1.5          1.5
                                                                -----------------------------
Total debt obligations                                                500.6        611.3
  Less short-term debt and current portions of long-term debt           0.3          0.2
                                                                -----------------------------
Long-term obligations, less current portions                     $    500.3   $    611.1
                                                                =============================

---------------------------------------------------------------------------------------------
</TABLE>



                   From Page 38 of the Ceridian Annual Report
<PAGE>   21
(Dollars in millions, except per share data)                       EXHIBIT 13.03





J.  COMMITMENTS AND CONTINGENCIES

COMMITMENTS
In 1995, Comdata extended its contract arrangements with IBM Global Services for
substantially all data processing functions for a term of ten years. Under the
terms of the agreement as amended, the minimum monthly fee was $1.6 in 1998 and
$1.8 in 1999 and 2000. The expenses incurred under these contract arrangements
were $26.8 in 2000, $23.1 in 1999 and $20.8 in 1998. Comdata has given notice in
2001 of its intent to cancel this contract. Such cancellation will require
payment of a termination fee of $6.6.

INTEREST RATE COLLARS
During 2000, Ceridian maintained in effect interest rate collars for the purpose
of hedging interest rate risk on invested customer deposits held in its U.S. tax
filing and Canadian payroll trusts. The counterparties to these arrangements are
commercial banks with debt ratings of A or better. Neither the collar
arrangements nor the related trust investments and offsetting liability to
customers are reflected in Ceridian's balance sheets. These arrangements, which
do not require collateral, require the banks to pay Ceridian the amount by which
a certain index of short-term interest rates falls below a specified floor
strike level. Alternatively, when that index exceeds a specified cap strike
level, Ceridian is required to pay out the excess above the cap strike level.

    At December 31, 2000, Ceridian had twelve collar transactions in effect with
an aggregate notional amount of $933.4, remaining terms of 2 to 41 months, floor
strike levels ranging from 4.75% to 6.0% (averaging 5.20%) and cap strike levels
ranging from 5.6% to 8.18% (averaging 6.67%). The risk of accounting loss
through non-performance by the counterparties under any of these arrangements is
considered negligible.

LEASING
Ceridian conducts a substantial portion of its operations in leased facilities.
Most of these leases contain renewal options and require payments for taxes,
insurance and maintenance. Ceridian remains secondarily liable for future rental
obligations related to assigned leases totaling $3.7 at December 31, 2000.
Ceridian does not anticipate any material non-performance by the assignees of
these leases.

    Virtually all leasing arrangements for equipment and facilities are
operating leases and the rental payments under these leases are charged to
operations as incurred. The amounts in the accompanying tables do not include
assigned leases or obligations recorded as liabilities.

    In November 2000, Ceridian sold and leased back under an operating lease
real property constituting its newly constructed headquarters facility. Under
the terms of the lease, annual rental costs will be $4.2 over a 20-year period.

    The amounts of rental expense and sublease income for each of the three
years ended December 31, 2000 appear in the Rental Expense table.

<TABLE>
<CAPTION>
------------------------------------------
RENTAL EXPENSE       2000     1999   1998
------------------------------------------

<S>                 <C>      <C>    <C>
Rental expense      $39.8    $35.9  $31.6
Sublease rental
  income             (0.3)    (1.8)  (2.2)

------------------------------------------
Net rental expense  $39.5    $34.1  $29.4
                    =====    =====  =====
------------------------------------------
</TABLE>


    Future minimum noncancelable lease payments on operating leases existing at
December 31, 2000, and which have an initial term of more than one year, are
described in the Future Minimum Lease Payments table.
<TABLE>
<CAPTION>
------------------------------------
FUTURE MINIMUM LEASE PAYMENTS
------------------------------------
<S>                        <C>
2001                       $40.6
2002                        38.6
2003                        35.0
2004                        28.8
2005                        23.9
Thereafter                 118.0
------------------------------------
</TABLE>



                   From Page 39 of the Ceridian Annual Report
<PAGE>   22
(Dollars in millions, except per share data)                       EXHIBIT 13.03





K.  LEGAL MATTERS

Ceridian and its subsidiaries are involved in a number of judicial and
administrative proceedings considered normal in the nature of their current and
past operations, including employment-related disputes, contract disputes,
government proceedings, customer disputes, and tort claims. In some proceedings,
the claimant seeks damages as well as other relief, which, if granted, would
require substantial expenditures on the part of Ceridian.

    Some of these matters raise difficult and complex factual and legal issues,
and are subject to many uncertainties, including the facts and circumstances of
each particular action, and the jurisdiction, forum and law under which each
action is proceeding. Because of this complexity, final disposition of some of
these proceedings may not occur for several years. As such, Ceridian is not
always able to estimate the amount of its possible future liabilities. There can
be no certainty that Ceridian may not ultimately incur charges in excess of
presently or future established accruals or insurance coverage. Although
occasional adverse decisions (or settlements) may occur, it is the opinion of
management that the final disposition of these proceedings will not, considering
the merits of the claims and available reserves, have a material adverse effect
on Ceridian's financial position or results of operations.

FLYING J AND NCR
Flying J, Inc., which operates a chain of truck stops, and its affiliated
entities, TCH, LLC, CFJ Properties, Inc., TFJ and TON Services, Inc., filed a
complaint in the United States District Court for the Northern District of Utah
against Comdata Network, Inc., a wholly-owned subsidiary of Ceridian, alleging
violations of federal and state antitrust laws and asserting state law claims of
interference with contractual relations and unfair competition. The complaint,
which was originally filed on July 11, 1996, has subsequently been amended four
times. In addition, NCR Corporation has intervened in this lawsuit as an
additional plaintiff, filing a complaint on September 10, 1999, alleging claims
similar to those asserted by the original plaintiffs (which this document refers
to as the "Flying J plaintiffs"). This lawsuit is presently set for a jury trial
beginning in June 2001. Flying J's motion to add Ceridian as a defendant was
denied three times. On November 15, 2000, Flying J served and filed a complaint
based on a similar allegation against Ceridian in the same court accompanied by
a motion to stay following Ceridian's answer. Ceridian has answered and will
file dispositive motions.

    The Flying J plaintiffs allege that Comdata unlawfully interfered with their
efforts to market a point-of-sale device called "ROSS," a kiosk device called
"Roadlinks," and a fuel card called the "TCH" card. Specifically, the Flying J
plaintiffs allege that Comdata has unlawfully refused to accept the TCH card on
Comdata's Trendar point-of-sale system. Flying J also alleges that Comdata
unlawfully caused TIC Financial Systems, Inc., a payment card company acquired
by Comdata, to cease doing business with Flying J and that Comdata acquired the
assets of NTS, Inc., a card company, in order to harm Flying J. Flying J alleges
further that Comdata unlawfully terminated the acceptance of Comdata's Comchek
card at Flying J locations in response to Flying J's marketing efforts, which
allegedly resulted in lost fuel sales at Flying J branded locations. NCR alleges
that it would have been the designated third-party support representative for
ROSS and, as a result, has allegedly suffered lost profits arising from lost
hardware sales, support fees, and installation revenue because it has not
participated in any successful sales or support effort for ROSS outside the
Flying J network to date.

    The plaintiffs in this lawsuit seek compensatory and punitive damages and
injunctive relief requiring Comdata to allow Comchek and FDIS (a data capture
and reporting feature presently only processed through the Trendar point-of-sale
system) transactions to be processed on ROSS and requiring Comdata to allow TCH
transactions to be processed on the Trendar point-of-sale system. In addition,
with respect to antitrust claims, the plaintiffs are seeking to be awarded three
times their claimed actual damages. Comdata believes that the amount of actual
damages that will be claimed by the plaintiffs will be in the range of $200 to
$300 million prior to trebling. Comdata believes the plaintiffs' claims are
without merit and that the damage claims are grossly inflated, unsupported by
the evidence and highly speculative. Comdata is contesting each of the claims
asserted by the plaintiffs, and intends to continue to defend this matter
vigorously.


                   From Page 40 of the Ceridian Annual Report