##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2002

OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from      to

Commission File No. 000-17994

MACKENZIE INVESTMENT MANAGEMENT INC.
(Exact name of registrant as specified in its charter)

|                                                                                             |  |                                             
|-------------------------------------------------------------------------------------------- |  | --------------------------------------------
|Delaware
(State or other jurisdiction of incorporation or organization)                      |  | 59-2522153
(IRS Employer Identification No.)
|                                                                                             |  |                                             
|925 South Federal Highway, Suite 600
Boca Raton, FL
(Address of principal executive offices) |  | 33432
(Zip Code)                            

Registrants telephone number, including area code (561) 393-8900



---

(Former name, former address and former fiscal year, if changed since last report)


Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES [X] NO [  ]

As of November 6, 2002, there were 18,655,550 shares of the Registrants Common
Stock, par value $.01 per share, issued and outstanding.





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TABLE OF CONTENTS



|                                |                                                                                               |                                                                     |  |  |  |  |  | 
|------------------------------- | --------------------------------------------------------------------------------------------- | ------------------------------------------------------------------- |  |  |  |  |  | 
|PART 1.  FINANCIAL INFORMATION
|                                | Item 1. Condensed Financial Statements                                                       
|                                |                                                                                               | Condensed Consolidated Balance Sheets                              
|                                |                                                                                               | Condensed Consolidated Statements of Operations                    
|                                |                                                                                               | Condensed Consolidated Statement of Changes in Stockholders Equity
|                                |                                                                                               | Condensed Consolidated Statements of Cash Flows                    
|                                |                                                                                               | Notes to Condensed Consolidated Financial Statements               
|                                | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                | Item 3. Quantitative and Qualitative Disclosures About Market Risk                           
|                                | Item 4. Controls and Procedures                                                              
|PART II  OTHER INFORMATION    
|                                | Item 1. Legal Proceedings                                                                    
|                                | Item 2. Changes in Securities and Use of Proceeds                                            
|                                | Item 3. Defaults Upon Senior Securities                                                      
|                                | Item 4. Submission of Matters to a Vote of Security Holders                                  
|                                | Item 5. Other Information                                                                    
|                                | Item 6. Exhibits and Reports on Form 8-K                                                     
|                                | SIGNATURES                                                                                   
|TRANSACTION BONUS SUMMARY      
|CERTIFICATION OF THE C.E.O.    
|CERTIFICATION OF C.F.O.        



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##### Table of Contents



MACKENZIE INVESTMENT MANAGEMENT INC.

Index to Form 10-Q

Part I

FINANCIAL INFORMATION

|        |  |                                                            |  |  |       |      |  | 
|------- |  | ---------------------------------------------------------- |  |  | ----- | ---- |  | 
|        |  |                                                            |  |  |       | Page
|        |  |                                                            |  |  |       |     
|Item 1. |  | CONDENSED FINANCIAL STATEMENTS                             |  |  |       |     
|        |  | Condensed Consolidated Balance Sheets                      |  |  | 1     |     
|        |  | Condensed Consolidated Statements of Operations            |  |  | 2     |     
|        |  | Condensed Consolidated Statement of Changes in             |  |  |       |     
|        |  | Stockholders' Equity                                       |  |  | 3     |     
|        |  | Condensed Consolidated Statements of Cash Flows            |  |  | 4     |     
|        |  | Notes to Condensed Consolidated Financial Statements       |  |  | 5-7   |     
|Item 2. |  | MANAGEMENT'S DISCUSSION AND ANALYSIS OF                    |  |  |       |     
|        |  | FINANCIAL CONDITION AND RESULTS OF OPERATIONS              |  |  | 8-14  |     
|Item 3. |  | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |  |  | 14-15 |     
|Item 4. |  | CONTROLS AND PROCEDURES                                    |  |  | 15-16 |     
|        |  | Part II                                                    |  |  |       |     
|        |  | OTHER INFORMATION                                          |  |  |       |     
|Item 1. |  | LEGAL PROCEEDINGS                                          |  |  | 16    |     
|Item 2. |  | CHANGES IN SECURITIES AND USE OF PROCEEDS                  |  |  | 16    |     
|Item 3. |  | DEFAULTS UPON SENIOR SECURITIES                            |  |  | 16    |     
|Item 4. |  | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS        |  |  | 16    |     
|Item 5. |  | OTHER INFORMATION                                          |  |  | 16    |     
|Item 6. |  | EXHIBITS AND REPORTS ON FORM 8-K                           |  |  | 17    |     





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##### Table of Contents






PART 1.  FINANCIAL INFORMATION







Item 1. Condensed Financial Statements

MACKENZIE INVESTMENT MANAGEMENT INC.
Condensed Consolidated Balance Sheets

|                                                                                                                                |                                                                                                         |                                            |            |               |            |           |            |            |            | 
|------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ---------- | ------------- | ---------- | --------- | ---------- | ---------- | ---------- | 
|                                                                                                                                |                                                                                                         |                                            |            | September 30, |            |           |            |           
|                                                                                                                                |                                                                                                         |                                            |            | 2002          |            | March 31,
|                                                                                                                                |                                                                                                         |                                            |            | (Unaudited)   |            | 2002     
|                                                                                                                                |                                                                                                         |                                            |            |               |            |          
|ASSETS:                                                                                                                         |                                                                                                         |                                            |            |               |            |           |            |           
|Cash and cash equivalents                                                                                                       |                                                                                                         | $                                          | 45,820,255 |               |            | $         | 46,927,723 |           
|Marketable securities                                                                                                           |                                                                                                         |                                            | 1,763,521  |               |            |           | 2,271,247  |           
|Receivables:                                                                                                                    |                                                                                                         |                                            |            |               |            |           |            |           
|                                                                                                                                | Funds for fees and expense advances                                                                     |                                            |            | 969,445       |            |           |            | 1,645,813  |           
|                                                                                                                                | Other                                                                                                   |                                            |            | 534,242       |            |           |            | 727,831    |           
|Property and equipment, net of accumulated
depreciation of $769,089 as of September 30, 2002
and $926,346 as of March 31, 2002  |                                                                                                         |                                            | 2,215,518  |               |            |           | 2,493,398  |           
|Intangible assets, net of accumulated
amortization of $11,050,949 as of September 30, 2002
and $10,430,035 as of March 31, 2002 |                                                                                                         |                                            | 2,414,046  |               |            |           | 3,034,960  |           
|Deferred selling commissions                                                                                                    |                                                                                                         |                                            | 2,959,509  |               |            |           | 3,302,695  |           
|Other assets                                                                                                                    |                                                                                                         |                                            | 925,079    |               |            |           | 547,039    |           
|                                                                                                                                |                                                                                                         |                                            |            |               |            |           |            |           
|                                                                                                                                |                                                                                                         | Total assets                               |            | $             | 57,601,615 |           |            | $          | 60,950,706 | 
|                                                                                                                                |                                                                                                         |                                            |            |               |            |           |            |           
|LIABILITIES AND STOCKHOLDERS EQUITY:                                                                                           |                                                                                                         |                                            |            |               |            |           |            |           
|Liabilities:                                                                                                                    |                                                                                                         |                                            |            |               |            |           |            |           
|                                                                                                                                | Payable to Funds for purchases of Funds shares
and expense reimbursements                              |                                            | $          | 148,551       |            |           | $          | 302,272    |           
|                                                                                                                                | Accounts payable                                                                                        |                                            |            | 1,047,136     |            |           |            | 234,702    |           
|                                                                                                                                | Accrued expenses and other liabilities                                                                  |                                            |            | 2,282,254     |            |           |            | 3,253,239  |           
|                                                                                                                                | Restructuring costs                                                                                     |                                            |            |              |            |           |            | 224,835    |           
|                                                                                                                                |                                                                                                         |                                            |            |               |            |           |            |           
|                                                                                                                                |                                                                                                         | Total liabilities                          |            |               | 3,477,941  |           |            |            | 4,015,048  | 
|                                                                                                                                |                                                                                                         |                                            |            |               |            |           |            |           
|Commitments and contingencies                                                                                                   |                                                                                                         |                                            |            |               |            |           |            |           
|Stockholders equity:                                                                                                           |                                                                                                         |                                            |            |               |            |           |            |           
|                                                                                                                                | Capital stock, $0.01 par value, 100,000,000 shares authorized;
18,655,550 shares issued and outstanding |                                            |            | 186,556       |            |           |            | 186,556    |           
|                                                                                                                                | Additional paid-in capital                                                                              |                                            |            | 38,609,953    |            |           |            | 38,609,953 |           
|                                                                                                                                | Retained earnings                                                                                       |                                            |            | 15,600,867    |            |           |            | 18,095,975 |           
|                                                                                                                                | Accumulated other comprehensive (loss) income, net of tax                                               |                                            |            | (273,702      | )          |           |            | 43,174     |           
|                                                                                                                                |                                                                                                         |                                            |            |               |            |           |            |           
|                                                                                                                                |                                                                                                         | Total stockholders equity                 |            |               | 54,123,674 |           |            |            | 56,935,658 | 
|                                                                                                                                |                                                                                                         |                                            |            |               |            |           |            |           
|                                                                                                                                |                                                                                                         | Total liabilities and stockholders equity |            | $             | 57,601,615 |           |            | $          | 60,950,706 | 
|                                                                                                                                |                                                                                                         |                                            |            |               |            |           |            |           

The accompanying notes are an integral part of these condensed consolidated financial statements.

1



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MACKENZIE INVESTMENT MANAGEMENT INC.
Condensed Consolidated Statements of Operations
(Unaudited)

|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |           | 
|------------------------------------------------------------------------------------------------------- | -------------------------------------------- | - | ------------------ | --------- | ---------------- | - | ---------- | --------- | ---- | - | ---------- | --------- | - | - | ---------- | --------- | 
|                                                                                                        |                                              |   | Three months ended |           | Six months ended
|                                                                                                        |                                              |   | September 30,      |           | September 30,   
|                                                                                                        |                                              |   |                    |           |                 
|                                                                                                        |                                              |   | 2002               |           | 2001             |   | 2002       |           | 2001
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |     
|Revenues:                                                                                               |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|                                                                                                        | Management fees                              |   | $                  | 1,666,299 |                  |   | $          | 3,139,254 |      |   | $          | 3,764,507 |   |   | $          | 6,883,285 | 
|                                                                                                        | Sub-advisory fees from Canadian Funds        |   |                    | 1,455,542 |                  |   |            | 1,781,059 |      |   |            | 3,117,307 |   |   |            | 3,731,896 | 
|                                                                                                        | 12b-1 Service and Distribution fees          |   |                    | 606,315   |                  |   |            | 1,057,664 |      |   |            | 1,350,772 |   |   |            | 2,307,521 | 
|                                                                                                        | Transfer agent fees                          |   |                    |          |                  |   |            |          |      |   |            |          |   |   |            | 627,384   | 
|                                                                                                        | Administrative services fees                 |   |                    | 199,241   |                  |   |            | 346,994   |      |   |            | 445,543   |   |   |            | 758,496   | 
|                                                                                                        | Fund accounting fees                         |   |                    | 164,483   |                  |   |            | 185,219   |      |   |            | 336,036   |   |   |            | 375,900   | 
|                                                                                                        | Underwriting fees                            |   |                    | 11,070    |                  |   |            | 12,624    |      |   |            | 32,085    |   |   |            | 33,787    | 
|                                                                                                        | Redemption fees                              |   |                    | 169,245   |                  |   |            | 222,412   |      |   |            | 356,305   |   |   |            | 548,149   | 
|                                                                                                        | Interest, dividends and other                |   |                    | 197,088   |                  |   |            | 325,974   |      |   |            | 402,294   |   |   |            | 839,896   | 
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|                                                                                                        |                                              |   | 4,469,283          |           |                  |   | 7,071,200  |           |      |   | 9,804,849  |           |   |   | 16,106,314 |          
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|Expenses:                                                                                               |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|                                                                                                        | Sales literature, advertising and promotion  |   |                    | 396,394   |                  |   |            | 458,376   |      |   |            | 690,272   |   |   |            | 1,279,594 | 
|                                                                                                        | 12b-1 Service fees                           |   |                    | 413,650   |                  |   |            | 757,582   |      |   |            | 951,905   |   |   |            | 1,676,422 | 
|                                                                                                        | Employee compensation and benefits           |   |                    | 2,555,508 |                  |   |            | 3,273,954 |      |   |            | 5,588,556 |   |   |            | 6,896,164 | 
|                                                                                                        | Sub-advisory fees                            |   |                    | 56,101    |                  |   |            | 72,475    |      |   |            | 120,435   |   |   |            | 163,443   | 
|                                                                                                        | Amortization of intangible assets            |   |                    | 310,457   |                  |   |            | 310,457   |      |   |            | 620,914   |   |   |            | 620,914   | 
|                                                                                                        | Amortization of deferred selling commissions |   |                    | 314,230   |                  |   |            | 448,710   |      |   |            | 638,480   |   |   |            | 1,038,833 | 
|                                                                                                        | Depreciation                                 |   |                    | 147,639   |                  |   |            | 140,044   |      |   |            | 305,632   |   |   |            | 301,630   | 
|                                                                                                        | General and administrative                   |   |                    | 1,761,238 |                  |   |            | 843,129   |      |   |            | 2,374,954 |   |   |            | 1,842,880 | 
|                                                                                                        | Occupancy and equipment rental               |   |                    | 295,630   |                  |   |            | 390,187   |      |   |            | 600,915   |   |   |            | 768,324   | 
|                                                                                                        | Reimbursement to Funds for expenses          |   |                    | 459,291   |                  |   |            | 532,146   |      |   |            | 917,782   |   |   |            | 973,833   | 
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|                                                                                                        |                                              |   | 6,710,138          |           |                  |   | 7,227,060  |           |      |   | 12,809,845 |           |   |   | 15,562,037 |          
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|(Loss) income before income taxes                                                                       |                                              |   | (2,240,855         | )         |                  |   | (155,860   | )         |      |   | (3,004,996 | )         |   |   | 544,277    |          
|                                                                                                        | (Benefit) provision for income taxes         |   |                    | (458,473  | )                |   |            | (33,694   | )    |   |            | (696,444  | ) |   |            | 236,921   | 
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|Net (loss) income                                                                                       |                                              | $ | (1,782,382         | )         |                  | $ | (122,166   | )         |      | $ | (2,308,552 | )         |   | $ | 307,356    |          
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|Basic (loss) earnings per share                                                                         |                                              | $ | (0.10              | )         |                  | $ | (0.01      | )         |      | $ | (0.12      | )         |   | $ | 0.02       |          
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|Weighted average number of common shares
outstanding used in basic calculation                          |                                              |   | 18,655,550         |           |                  |   | 18,667,529 |           |      |   | 18,655,550 |           |   |   | 18,667,529 |          
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|Diluted (loss) earnings per share                                                                       |                                              | $ | (0.10              | )         |                  | $ | (0.01      | )         |      | $ | (0.12      | )         |   | $ | 0.02       |          
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          
|Weighted average number of common and
common equivalent shares outstanding
used in diluted calculation* |                                              |   | 18,655,550         |           |                  |   | 18,667,529 |           |      |   | 18,655,550 |           |   |   | 18,677,962 |          
|                                                                                                        |                                              |   |                    |           |                  |   |            |           |      |   |            |           |   |   |            |          



| |  | Weighted average common stock equivalents of 523 and 993 for the three and six-month period ended September 30, 2002,
respectively, and 495 for the three month period ended September 30, 2001 have been excluded from the diluted calculation,
due to their anti-dilutive effect in a net loss period.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The accompanying notes are an integral part of these condensed consolidated financial statements.

2



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##### Table of Contents






MACKENZIE INVESTMENT MANAGEMENT INC.
Condensed Consolidated Statement of Changes in Stockholders Equity
For the six months ended September 30, 2002
(Unaudited)

|                                                |  |               |            |            |  |               |         |                |  |               |            |        |  |   |            |   |  |             |          |   |  |   |            |  
|----------------------------------------------- |  | ------------- | ---------- | ---------- |  | ------------- | ------- | -------------- |  | ------------- | ---------- | ------ |  | - | ---------- | - |  | ----------- | -------- | - |  | - | ---------- | -
|                                                |  |               |            |            |  |               |         |                |  |               |            |        |  |   |            |   |  | Accumulated |          |   |  |  
|                                                |  |               |            |            |  |               |         |                |  |               |            |        |  |   |            |   |  | Other       |          |   |  |  
|                                                |  | Capital Stock |            | Additional |  | Comprehensive |         | Total         
|                                                |  |               |            | Paid-in    |  | Retained      |         | Income (loss), |  | Stockholders'
|                                                |  | Shares        |            | Amount     |  | Capital       |         | Earnings       |  | net of tax    |            | Equity
|                                                |  |               |            |            |  |               |         |                |  |               |            |       
|Balance, March 31, 2002                         |  |               | 18,655,550 |            |  | $             | 186,556 |                |  | $             | 38,609,953 |        |  | $ | 18,095,975 |   |  | $           | 43,174   |   |  | $ | 56,935,658 |  
|Other comprehensive loss, net of tax            |  |               |           |            |  |               |        |                |  |               |           |        |  |   |           |   |  |             | (316,876 | ) |  |   | (316,876   | )
|Cash dividends on common stock, $0.01 per share |  |               |           |            |  |               |        |                |  |               |           |        |  |   | (186,556   | ) |  |             |         |   |  |   | (186,556   | )
|Net loss for the period                         |  |               |           |            |  |               |        |                |  |               |           |        |  |   | (2,308,552 | ) |  |             |         |   |  |   | (2,308,552 | )
|                                                |  |               |            |            |  |               |         |                |  |               |            |        |  |   |            |   |  |             |          |   |  |   |            |  
|Balance, September 30, 2002                     |  |               | 18,655,550 |            |  | $             | 186,556 |                |  | $             | 38,609,953 |        |  | $ | 15,600,867 |   |  | $           | (273,702 | ) |  | $ | 54,123,674 |  
|                                                |  |               |            |            |  |               |         |                |  |               |            |        |  |   |            |   |  |             |          |   |  |   |            |  

The accompanying notes are an integral part of these condensed consolidated financial statements.

3



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MACKENZIE INVESTMENT MANAGEMENT INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)

|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |            |           |            |  
|---------------------------------------------------- | -------------------------------------------------------------------------------------------------- | -------------------------------------------- | -------------------------------------------------------------------------- | ---------- | ---------------- | -------- | ---------- | ---------- | --------- | ---------- | -
|                                                     |                                                                                                    |                                              |                                                                            |            | Six months ended
|                                                     |                                                                                                    |                                              |                                                                            |            | September 30,   
|                                                     |                                                                                                    |                                              |                                                                            |            |                 
|                                                     |                                                                                                    |                                              |                                                                            |            | 2002             |          | 2001      
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |           
|Cash flows from operating activities:                |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|                                                     | Net (loss) income                                                                                  |                                              | $                                                                          | (2,308,552 | )                |          | $          | 307,356    |          
|                                                     | Adjustments to reconcile net (loss) income to net cash
(used in) provided by operating activities: |                                              |                                                                            |            |                  |          |            |            |          
|                                                     |                                                                                                    | Depreciation                                 |                                                                            |            | 305,632          |          |            |            | 301,630   |           
|                                                     |                                                                                                    | Loss on disposal of property and equipment   |                                                                            |            |                 |          |            |            | 66,111    |           
|                                                     |                                                                                                    | Amortization of intangible assets            |                                                                            |            | 620,914          |          |            |            | 620,914   |           
|                                                     |                                                                                                    | Amortization of deferred selling commissions |                                                                            |            | 638,480          |          |            |            | 1,038,833 |           
|                                                     |                                                                                                    | Amortization of unearned compensation        |                                                                            |            |                 |          |            |            | 80,068    |           
|                                                     |                                                                                                    | Deferred tax (benefit) expense               |                                                                            |            | (273,140         | )        |            |            | 298,407   |           
|                                                     |                                                                                                    | Payment of deferred selling commissions      |                                                                            |            | (295,294         | )        |            |            | (296,059  | )         
|                                                     |                                                                                                    | Change in assets and liabilities:            |                                                                            |            |                  |          |            |            |           |           
|                                                     |                                                                                                    |                                              | Receivables                                                                |            |                  | 869,957  |            |            |           | 1,114,764  |  
|                                                     |                                                                                                    |                                              | Other assets                                                               |            |                  | (23,912  | )          |            |           | (505,074   | )
|                                                     |                                                                                                    |                                              | Payable to Funds for purchases of Funds shares
and expense reimbursements |            |                  | (153,721 | )          |            |           | 35,484     |  
|                                                     |                                                                                                    |                                              | Restructuring costs                                                        |            |                  | (224,835 | )          |            |           | (1,300,746 | )
|                                                     |                                                                                                    |                                              | Accounts payable, accrued expenses and
other liabilities                   |            |                  | (48,356  | )          |            |           | 588,411    |  
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|Net cash (used in) provided by operating activities  |                                                                                                    |                                              | (892,827                                                                   | )          |                  |          | 2,350,099  |           
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|Cash flows from investing activities:                |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|                                                     | Purchases of property and equipment                                                                |                                              |                                                                            | (27,752    | )                |          |            | (1,575,327 | )        
|                                                     | Purchases of marketable securities                                                                 |                                              |                                                                            | (333       | )                |          |            | (1,314     | )        
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|Net cash used in investing activities                |                                                                                                    |                                              | (28,085                                                                    | )          |                  |          | (1,576,641 | )         
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|Cash flows from financing activities:                |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|                                                     | Capital contribution                                                                               |                                              |                                                                            |           |                  |          |            | 372,475    |          
|                                                     | Dividends paid                                                                                     |                                              |                                                                            | (186,556   | )                |          |            | (187,418   | )        
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|Net cash (used in) provided by financing activities  |                                                                                                    |                                              | (186,556                                                                   | )          |                  |          | 185,057    |           
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|Net (decrease) increase in cash and cash equivalents |                                                                                                    |                                              | (1,107,468                                                                 | )          |                  |          | 958,515    |           
|Cash and cash equivalents, beginning of period       |                                                                                                    |                                              | 46,927,723                                                                 |            |                  |          | 44,797,238 |           
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |           
|Cash and cash equivalents, end of period             |                                                                                                    | $                                            | 45,820,255                                                                 |            |                  | $        | 45,755,753 |           
|                                                     |                                                                                                    |                                              |                                                                            |            |                  |          |            |           

The accompanying notes are an integral part of these condensed consolidated financial statements.

4



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##### Table of Contents






MACKENZIE INVESTMENT MANAGEMENT INC.
Notes to Condensed Consolidated Financial Statements
September 30, 2002
(Unaudited)



|1. |  | Basis of Presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | The unaudited interim condensed consolidated financial statements of
Mackenzie Investment Management Inc. (MIMI) and its consolidated
subsidiaries (the Company) included herein have been prepared in
accordance with accounting principles generally accepted in the United
States of America for interim financial information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly,
they do not include all footnote disclosures normally included in
consolidated financial statements prepared in accordance with accounting
principles generally accepted in the United States of America. In the
opinion of management, these condensed consolidated financial statements
include all appropriate adjustments, consisting of normal recurring
adjustments, necessary for a fair presentation of the financial position and
results of operations for the periods shown. Certain prior year amounts
have been reclassified to conform to current year presentation. The results
of operations for the six-month period ended September 30, 2002 are not
necessarily indicative of the results of operations to be expected for the
year ended March 31, 2003 (See Note 6 Sale and Dissolution of MIMI).
These interim condensed consolidated financial statements should be read in
conjunction with the Companys audited consolidated financial statements for
the fiscal year ended March 31, 2002.
|  
|2. |  | Comprehensive (loss) income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|  
|   |  | For the three and six-month periods ended September 30, 2002 and 2001,
comprehensive (loss) income consisted of the following:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

|                            |                                                                 |   |                    |          |                  |   |          |          |      |   |            |          |   |   |         |          |  
|--------------------------- | --------------------------------------------------------------- | - | ------------------ | -------- | ---------------- | - | -------- | -------- | ---- | - | ---------- | -------- | - | - | ------- | -------- | -
|                            |                                                                 |   | Three months ended |          | Six months ended
|                            |                                                                 |   | September 30,      |          | September 30,   
|                            |                                                                 |   |                    |          |                 
|                            |                                                                 |   | 2002               |          | 2001             |   | 2002     |          | 2001
|                            |                                                                 |   |                    |          |                  |   |          |          |     
|Net (loss) income           |                                                                 | $ | (1,782,382         | )        |                  | $ | (122,166 | )        |      | $ | (2,308,552 | )        |   | $ | 307,356 |         
|                            |                                                                 |   |                    |          |                  |   |          |          |      |   |            |          |   |   |         |         
|Other comprehensive loss:   |                                                                 |   |                    |          |                  |   |          |          |      |   |            |          |   |   |         |         
|                            | Unrealized holding losses arising
during the period, net of tax |   |                    | (235,184 | )                |   |          | (233,957 | )    |   |            | (316,876 | ) |   |         | (216,986 | )
|                            |                                                                 |   |                    |          |                  |   |          |          |      |   |            |          |   |   |         |         
|                            | Other comprehensive loss                                        |   |                    | (235,184 | )                |   |          | (233,957 | )    |   |            | (316,876 | ) |   |         | (216,986 | )
|                            |                                                                 |   |                    |          |                  |   |          |          |      |   |            |          |   |   |         |         
|Comprehensive (loss) income |                                                                 | $ | (2,017,566         | )        |                  | $ | (356,123 | )        |      | $ | (2,625,428 | )        |   | $ | 90,370  |         
|                            |                                                                 |   |                    |          |                  |   |          |          |      |   |            |          |   |   |         |         



| |  | At September 30, 2002 and March 31, 2002, the Companys accumulated other
comprehensive (loss) income consists of unrealized appreciation and
depreciation on marketable securities.
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | At September 30, 2002 and March 31, 2002, gross unrealized gains and losses
on marketable securities were as follows:                                                               

|                        |                               |   |               |          |           |   |        |        | 
|----------------------- | ----------------------------- | - | ------------- | -------- | --------- | - | ------ | ------ | 
|                        |                               |   | September 30, |          | March 31,
|                        |                               |   | 2002          |          | 2002     
|                        |                               |   |               |          |          
|Gross unrealized gains  |                               | $ | 20,844        |          |           | $ | 69,223 |       
|Gross unrealized losses |                               |   | (459,680      | )        |           |   |       |       
|                        |                               |   |               |          |           |   |        |       
|                        | Net unrealized (losses) gains |   | $             | (438,836 | )         |   | $      | 69,223 | 
|                        |                               |   |               |          |           |   |        |       

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|3. |  | Earnings Per Share                                                                                                                                                                                         
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | The following table reconciles the weighted average shares outstanding used
to calculate basic and diluted earnings (loss) per share for the three and
six-month periods ended September 30, 2002 and 2001:

|                                                                                                                              |  |                    |            |                  |  |      |            |      |  |  |            |  |  |  |            | 
|----------------------------------------------------------------------------------------------------------------------------- |  | ------------------ | ---------- | ---------------- |  | ---- | ---------- | ---- |  |  | ---------- |  |  |  | ---------- | 
|                                                                                                                              |  | Three months ended |            | Six months ended
|                                                                                                                              |  | September 30,      |            | September 30,   
|                                                                                                                              |  |                    |            |                 
|                                                                                                                              |  | 2002               |            | 2001             |  | 2002 |            | 2001
|                                                                                                                              |  |                    |            |                  |  |      |            |     
|Weighted average number of common shares
outstanding used in basic calculation                                                |  |                    | 18,655,550 |                  |  |      | 18,667,529 |      |  |  | 18,655,550 |  |  |  | 18,667,529 | 
|Effect of dilutive stock options                                                                                              |  |                    |           |                  |  |      |           |      |  |  |           |  |  |  | 10,433     | 
|                                                                                                                              |  |                    |            |                  |  |      |            |      |  |  |            |  |  |  |            | 
|Weighted average number of common and
common equivalent shares outstanding used in
the diluted calculation                    |  |                    | 18,655,550 |                  |  |      | 18,667,529 |      |  |  | 18,655,550 |  |  |  | 18,677,962 | 
|                                                                                                                              |  |                    |            |                  |  |      |            |      |  |  |            |  |  |  |            | 
|Options to purchase common stock excluded
from the computation of diluted earnings per
share due to their antidilutive effect |  |                    | 1,079,000  |                  |  |      | 1,446,000  |      |  |  | 1,079,000  |  |  |  | 1,435,567  | 
|                                                                                                                              |  |                    |            |                  |  |      |            |      |  |  |            |  |  |  |            | 



|4. |  | Restructuring                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | During the fourth quarter of the year ended March 31, 2001, the Company
recorded a $3,032,000 restructuring charge to cover costs associated with
the plan of outsourcing the transfer agency operations and downsizing the
sales, marketing and other various support functions. During the same
period, the Company made payments totaling approximately $1,262,000 for
these costs. For the six-month period ended September 30, 2002, the Company
made payments totaling approximately $225,000. As of September 30, 2002,
all of the fiscal year 2001 restructuring costs have been paid in full.
|  
|5. |  | Intangible Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|  
|   |  | Intangible assets consist principally of the cost of investment advisory and
service contracts. At September 30, 2002 and March 31, 2002, the gross cost
of these assets was $13,464,994.                                                                                                                                                                                                                                                                                                                                                                                                             
|  
|   |  | At September 30, 2002, the estimated remaining aggregate amortization
expense for intangible assets is as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

|                                |            |       |           |         |           | 
|------------------------------- | ---------- | ----- | --------- | ------- | --------- | 
|Six months ended March 31, 2003 |            | $     | 620,900   |        
|Year ended March 31,
2004       |            |       | 1,241,800 |        
|                                |            | 2005  |           |         | 100,200   | 
|                                |            | 2006  |           |         | 100,200   | 
|                                |            | 2007  |           |         | 100,200   | 
|                                | thereafter |       |           | 250,700 |          
|                                |            |       |           |        
|                                |            | Total |           | $       | 2,414,000 | 
|                                |            |       |           |        

6



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##### Table of Contents





|6. |  | Sale and Dissolution of MIMI                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | On August 29, 2002, MIMI, Mackenzie Financial Corporation (MFC), the
indirect parent of MIMI, and Ivy Acquisition Corporation (IAC), a
wholly-owned subsidiary of MFC and majority shareholder of MIMI, entered
into an agreement with Waddell & Reed Financial, Inc. (W&R), pursuant to
which MIMI is being indirectly sold to W&R (the Transaction). In
connection with the Transaction, MFC transferred its ownership interest in
MIMI to IAC. The Transaction is structured as a dissolution followed by a
stock purchase valued at approximately $74 million, subject to certain
adjustments.                                                                            
|  
|   |  | Following the expected approval by the MIMI shareholders of a plan of
complete liquidation and dissolution of MIMI, MIMI will, upon dissolution,
make a cash payment to shareholders of MIMI, other than IAC, and distribute
all of its remaining assets and liabilities, including MIMIs ownership
interest in its subsidiaries, to IAC. MFC will then sell, and W&R has
agreed to purchase, all of the outstanding shares of IAC, subject to certain
closing conditions. Upon the closing of the Transaction, it is anticipated
that MIMI will dissolve and each of MIMIs subsidiaries will become
wholly-owned subsidiaries of IAC and indirect wholly-owned subsidiaries of
W&R.
|  
|   |  | In connection with the Transaction, which is scheduled to close in December
2002, the Company incurred certain transaction costs. Such costs, totaling
approximately $807,000 for the three and six month periods ended September
30, 2002, are included in General and administrative expenses in the
Statement of Operations. Such amounts are expensed as incurred.                                                                                                                                                                                                                                                                                                              
|  
|7. |  | Cash Dividend on Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|  
|   |  | On July 8, 2002, the Company declared a $0.01 per common share cash dividend
to shareholders of record on July 18, 2002. The dividend was paid on July
26, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|  
|8. |  | New Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|  
|   |  | On April 1, 2002, the Company adopted Statement of Financial Accounting
Standards No. 142, Goodwill and Other Intangible Assets, and No. 144,
Accounting for the Impairment or Disposal of Long-Lived Assets. The
adoption of the statements did not impact the Companys financial position,
results of operations or cash flows.                                                                                                                                                                                                                                                                                                                                                

7



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

FORWARD-LOOKING STATEMENTS

Certain statements in the Quarterly Report on Form 10-Q under the caption
Managements Discussion and Analysis of Financial Condition and Results of
Operations, and elsewhere in this report constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors, which may cause the actual results,
performance or achievements of the Company to be materially different from any
future results, performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, the following:
general economic and business conditions; the loss of, or the failure to
replace, any significant sub-advisory relationships; changes in the relative
investment performance; and investor sentiment for international investing.
The Company wishes to caution readers not to place undue reliance on such
forward-looking statements and remind readers that these forward-looking
statements speak only as of the date of this Quarterly Report. The Company
expressly disclaims any obligation or undertaking to release publicly any
updates or revisions to any forward-looking statements contained herein to
reflect any change in the Companys expectations with regard thereto or any
change in events, conditions or circumstances on which any such statement is
based.

GENERAL

MIMI is a public company listed on the Toronto Stock Exchange. Its majority
shareholder is Ivy Acquisition Corporation (IAC), which owns approximately
86% of the outstanding common shares of MIMI at September 30, 2002. During the
three month period ended September 30, 2002, Mackenzie Financial Corporation
(MFC) transferred its ownership interest in MIMI to IAC. IAC is a wholly
owned subsidiary of MFC, a Toronto-based investment counsel and mutual fund
management company. MFC is a wholly owned subsidiary of Investors Group Inc.
MIMI is an investment adviser and has three wholly owned subsidiaries, as
follows:



| |  |  | Ivy Management, Inc. (IMI), an investment adviser;            
| | - |  | ----------------------------------------------------------------
|
| |  |  | Ivy Mackenzie Distributors, Inc. (IMDI), a broker/dealer; and 
|
| |  |  | Ivy Mackenzie Service Corp. (IMSC), formerly a transfer agent.

On August 29, 2002, MIMI, MFC, the indirect parent of MIMI, and IAC, a
wholly-owned subsidiary of MFC and majority shareholder of MIMI, entered into
an agreement with Waddell & Reed Financial, Inc. (W&R), pursuant to which
MIMI is being indirectly sold to W&R (the Transaction). In connection with
the Transaction, MFC transferred its ownership interest in MIMI to IAC. The
Transaction is structured as a dissolution followed by a stock purchase valued
at approximately $74 million, subject to certain adjustments.

Following the expected approval by the MIMI shareholders of a plan of complete
liquidation and dissolution of MIMI, MIMI will, upon dissolution, make a cash
payment to shareholders of MIMI, other than IAC, and distribute all of its
remaining assets and liabilities, including MIMIs ownership interest in its
subsidiaries, to IAC. MFC will then sell, and W&R has agreed to purchase, all
of the outstanding shares of IAC, subject to certain closing conditions. Upon
the closing of the Transaction, it is anticipated that MIMI will dissolve and
each of MIMIs subsidiaries will become wholly-owned subsidiaries of IAC and
indirect wholly-owned subsidiaries of W&R.

The Companys principal business activities are carried on solely in the United
States and include:

8



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##### Table of Contents





| |  |  | Managing public mutual funds offered in the U.S. by Ivy Fund (the
U.S. Funds) which is a U.S. open-end series investment company
registered under the Investment Company Act of 1940, as amended;                                                                                  
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | Providing investment advisory services to the U.S. Funds and
sub-advisory services to fifteen Universal Funds at September 30, 2002
sold only in Canada and managed by MFC (the Canadian Funds);                                                                                   
|
| |  |  | Providing sub-advisory services to three Premier Funds (the
Premier Funds) at September 30, 2002 sold in the U.K., Ireland and
Luxembourg and managed by Premier Asset Management PLC (Premier); MFC
has a less than 25% beneficial interest in Premier as of September 30,
2002;
|
| |  |  | Underwriting, selling and otherwise distributing redeemable shares
of the U.S. Funds in the U.S. through various distribution channels;
and                                                                                                                                          
|
| |  |  | Providing administrative and fund accounting services to the U.S.
Funds.                                                                                                                                                                                                             

The Company derives its revenues principally from on-going management fees and
sub-advisory fees, calculated as a percentage of average daily net assets under
management, and from fees related to services performed for the U.S. Funds
under contracts for administrative and fund accounting services. The level of
net assets under management is affected by gross sales, redemptions and changes
in market values of the mutual funds portfolio of investments. As the level
of assets under management fluctuates so do management, sub-advisory,
distribution, and administrative services fee revenue.

RESULTS OF OPERATIONS

Six Months Ended September 30, 2002 Compared to Six Months Ended September 30, 2001

Assets Under Management

Average net assets under management for the U. S. Funds decreased $633 million,
or 43%, to $842 million for the six-month period ended September 30, 2002, from
$1,475 million for the six-month period ended September 30, 2001. The Canadian
Funds average net assets decreased to $1,416 million for the six-month period
ended September 30, 2002 from $2,031 million for the six-month period ended
September 30, 2001, representing a decrease of $615 million or 30%.

The comparison of net assets under management for the U.S. Funds, Canadian
Funds and Premier Funds is as follows:

(In millions, except percentages)

|                                              |                  |                                    |       |                  |      |        |       |         |      |   |       |   |      |   |       |   |       |  
|--------------------------------------------- | ---------------- | ---------------------------------- | ----- | ---------------- | ---- | ------ | ----- | ------- | ---- | - | ----- | - | ---- | - | ----- | - | ----- | -
|                                              |                  |                                    |       | Six Months Ended |      | Dollar |       | Percent
|                                              |                  |                                    |       | September 30,    |      |        |       |        
|                                              |                  |                                    |       |                  |      |        |       |         |      |   |       |  
|U.S. Funds:                                   |                  | 2002                               |       | 2001             |      | Change |       | Change 
|                                              |                  |                                    |       |                  |      |        |       |        
|Beginning net assets, March 31st              |                  | $                                  | 1,005 |                  |      | $      | 1,587 |         |      |   | ($582 | ) |      |   | (36.7 | )
|                                              | Period activity: |                                    |       |                  |      |        |       |         |      |   |       |   |      |   |       |   |      
|                                              |                  | Sales                              |       |                  | 110  |        |       |         | 204  |   |       |   | (94  | ) |       |   | (46.1 | )
|                                              |                  | Redemptions                        |       |                  | (232 | )      |       |         | (423 | ) |       |   | (191 | ) |       |   | (45.2 | )
|                                              |                  |                                    |       |                  |      |        |       |         |      |   |       |   |      |   |       |   |       |  
|                                              |                  | Net Sales (Redemptions)            |       |                  | (122 | )      |       |         | (219 | ) |       |   | 97   |   |       |   | 44.3  |  
|                                              |                  | Market Appreciation (Depreciation) |       |                  | (231 | )      |       |         | (238 | ) |       |   | 7    |   |       |   | 2.9   |  
|                                              |                  |                                    |       |                  |      |        |       |         |      |   |       |   |      |   |       |   |       |  
|Ending net assets, September 30th             |                  | $                                  | 652   |                  |      | $      | 1,130 |         |      |   | (478  | ) |      |   | (42.3 | )
|Canadian Funds net assets at September 30th: |                  | $                                  | 1,151 |                  |      | $      | 1,626 |         |      |   | (475  | ) |      |   | (29.2 | )
|Premier Funds net assets at September 30th:  |                  | $                                  | 41    |                  |      | $      | 42    |         |      |   | (1    | ) |      |   | (2.4  | )

9



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Ivy International Fund continues to represent a significant portion of the
assets under management and the underlying net redemption activity. The
following chart reflects this concentration:

(In millions, except percentages)

|                                                         |                                         |   |                     |      |         |   |       |      |   |  |      |   |  |  |       |   | 
|-------------------------------------------------------- | --------------------------------------- | - | ------------------- | ---- | ------- | - | ----- | ---- | - |  | ---- | - |  |  | ----- | - | 
|                                                         |                                         |   | Six Months          |      |         |   |       |      |   |  |     
|                                                         |                                         |   | ended September 30, |      | Changes
|                                                         |                                         |   |                     |      |        
|                                                         |                                         |   | 2002                |      | 2001    |   | $     |      | %
|                                                         |                                         |   |                     |      |         |   |       |      |  
|U.S. Funds net assets at September 30th                 |                                         | $ | 652                 |      |         | $ | 1,130 |      |   |  | (478 | ) |  |  | (42.3 | )
|Ivy International Funds net assets at September 30th    |                                         |   | 213                 |      |         |   | 514   |      |   |  | (301 | ) |  |  | (58.6 | )
|                                                         | as a percent of U.S. Funds net assets  |   |                     | 32.7 | %       |   |       | 45.5 | % |  |      |   |  |  |       |   | 
|U.S. Funds sales                                        |                                         | $ | 110                 |      |         | $ | 204   |      |   |  | (94  | ) |  |  | (46.1 | )
|Ivy International Funds sales                           |                                         |   | 52                  |      |         |   | 105   |      |   |  | (53  | ) |  |  | (50.5 | )
|                                                         | as a percent of U.S. Funds sales       |   |                     | 47.3 | %       |   |       | 51.5 | % |  |      |   |  |  |       |   | 
|U.S. Funds redemptions                                  |                                         | $ | 232                 |      |         | $ | 423   |      |   |  | (191 | ) |  |  | (45.2 | )
|Ivy International Funds redemptions                     |                                         |   | 116                 |      |         |   | 227   |      |   |  | (111 | ) |  |  | (48.9 | )
|                                                         | as a percent of U.S. Funds redemptions |   |                     | 50.0 | %       |   |       | 53.7 | % |  |      |   |  |  |       |   | 
|Net sales/(redemptions) excluding Ivy International Fund |                                         | $ | (58                 | )    |         | $ | (97   | )    |   |  | 39   |   |  |  | 40.2  |  

Revenues

As described in further detail below, total revenues decreased by 39% for the
six-month period ended September 30, 2002 as compared to the six-month period
ended September 30, 2001.

Management fees decreased 45% for the six-month period ended September 30, 2002
as compared to the six-month period ended September 30, 2001 as a result of the
decrease in the U.S. Funds net assets under management.

Sub-advisory fees from the Canadian Funds decreased 16% for the six-month
period ended September 30, 2002 as compared to the six-month period ended
September 30, 2001 as a result of the decrease in the average net assets of the
Canadian Funds.

12b-1 Service and Distribution fees decreased 41% for the six-month period
ended September 30, 2002 as compared to the six-month period ended September
30, 2001 due to the decrease in the U.S. Funds net assets under management.

Administrative services, fund accounting and transfer agent fees collectively
decreased 56% for the six-month period ended September 30, 2002 as compared to
the six-month period ended September 30, 2001 due to the decline in net assets
under management and the outsourcing of the Companys internal transfer agency
as of June 30, 2001.

For the six-month period ended September 30, 2002 as compared to the six-month
period ended September 30, 2001, underwriting fees have been consistent due to
comparable Class A share sales sold subject to an initial sales charge and
redemption fees have decreased 35%, due to a decrease in redemptions of Class B
and C shares.

Interest, dividends and other revenue decreased 52% for the six-month period
ended September 30, 2002 compared to the six-month period ended September 30,
2001 due to a decrease in investment income earned as a result of declining
interest rates.

10



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##### Table of Contents



Expenses

As described in further detail below, total expenses for the six-month period
ended September 30, 2002 decreased 18% compared to the six-month period ended
September 30, 2001.

Sales literature, advertising and promotion decreased 46% for the six-month
period ended September 30, 2002 compared to the six-month period ended
September 30, 2001 due to a reduction in expenditures on advertising and other
promotional activities in line with our general cost-savings efforts.

12b-1 Service fees paid to broker/dealers decreased 43% for the six-month
period ended September 30, 2002 compared to the six-month period ended
September 30, 2001 due to the decrease in net assets under management.

Employee compensation and benefits decreased 19% for the six-month period ended
September 30, 2002 compared to the six-month period ended September 30, 2001.
The decrease is due to an overall decrease in the number of employees as of
September 30, 2002, which was 74 as compared to 89 at September 30, 2001, a
comparative decrease of 17%.

Amortization of deferred selling commissions decreased 39% for the six-month
period ended September 30, 2002 compared to the six-month period ended
September 30, 2001 due to a lower Class B and C share asset base as a result of
Class B and C share sale and redemption activity.

General and administrative expenses increased 29% for the six-month period
ended September 30, 2002 compared to the six-month period ended September 30,
2001. The increase was attributable to approximately $807,000 in transaction
costs incurred in the current period in connection with the indirect sale of
MIMI to W&R (See Note 6 Sale and Dissolution of MIMI). The effect of the
transaction costs was partially offset by the general cost savings realized as
a result of the fiscal year 2001 restructuring, specifically the outsourcing of
the transfer agency.

Occupancy and equipment rental decreased 22% for the six-month period ended
September 30, 2002 compared to the six-month period ended September 30, 2001.
The decrease is due to the portion of the current fiscal year occupancy expense
that was accrued as part of the restructuring charge recorded in fiscal year
2001. Excluding the impact of the restructuring charge, occupancy and
equipment rental expenses would have been comparative period to period.

Three Months Ended September 30, 2002 Compared to Three Months Ended September
30, 2001

Assets Under Management

Average net assets under management for the U.S. Funds decreased $594 million,
or 44%, to $744 million for the three-month period ended September 30, 2002
from $1,338 million for the three-month period ended September 30, 2001. The
Canadian Funds average net assets decreased to $1,261 million for the
three-month period ended September 30, 2002 from $1,884 million for the
three-month period ended September 30, 2001, representing a decrease of $623
million or 33%.

The change in net assets under management for the U.S. Funds is as follows:

11



---



##### Table of Contents



(In millions, except percentages)

|                                  |                  |                                    |     |                    |      |         |       |         |      |   |      |   |     |   |       |   |       |  
|--------------------------------- | ---------------- | ---------------------------------- | --- | ------------------ | ---- | ------- | ----- | ------- | ---- | - | ---- | - | --- | - | ----- | - | ----- | -
|                                  |                  |                                    |     | Three Months Ended |      |         |       |         |      |   |      |  
|                                  |                  |                                    |     | September 30,      |      |         |       |        
|                                  |                  |                                    |     |                    |      | Dollar  |       | Percent
|U.S. Funds:                       |                  | 2002                               |     | 2001               |      | Changes |       | Changes
|                                  |                  |                                    |     |                    |      |         |       |        
|Beginning net assets, June 30th   |                  | $                                  | 869 |                    |      | $       | 1,523 |         |      | $ | (654 | ) |     |   | (42.9 | )
|                                  | Period activity: |                                    |     |                    |      |         |       |         |      |   |      |   |     |   |       |   |      
|                                  |                  | Sales                              |     |                    | 56   |         |       |         | 48   |   |      |   | 8   |   |       |   | 16.7  |  
|                                  |                  | Redemptions                        |     |                    | (114 | )       |       |         | (165 | ) |      |   | (51 | ) |       |   | (30.9 | )
|                                  |                  |                                    |     |                    |      |         |       |         |      |   |      |   |     |   |      
|                                  |                  | Net Sales (Redemptions)            |     |                    | (58  | )       |       |         | (117 | ) |      |   | 59  |   |       |   | 50.4  |  
|                                  |                  | Market Appreciation (Depreciation) |     |                    | (159 | )       |       |         | (276 | ) |      |   | 117 |   |       |   | 42.4  |  
|                                  |                  |                                    |     |                    |      |         |       |         |      |   |      |   |     |   |      
|Ending net assets, September 30th |                  | $                                  | 652 |                    |      | $       | 1,130 |         |      |   | (478 | ) |     |   | (42.3 | )

Ivy International Fund continues to represent a significant portion of the
assets under management and the underlying net redemption activity. The
following chart reflects this concentration:

(In millions, except percentages)

|                                                         |                                         |   |                     |      |         |   |       |      |   |   |      |   |  |  |       |   | 
|-------------------------------------------------------- | --------------------------------------- | - | ------------------- | ---- | ------- | - | ----- | ---- | - | - | ---- | - |  |  | ----- | - | 
|                                                         |                                         |   | Three Months        |      |         |   |       |      |   |   |     
|                                                         |                                         |   | ended September 30, |      | Changes
|                                                         |                                         |   |                     |      |        
|                                                         |                                         |   | 2002                |      | 2001    |   | $     |      | %
|                                                         |                                         |   |                     |      |         |   |       |      |  
|U.S. Funds net assets at September 30th                 |                                         | $ | 652                 |      |         | $ | 1,130 |      |   | $ | (478 | ) |  |  | (42.3 | )
|Ivy International Funds net assets at September 30th    |                                         |   | 213                 |      |         |   | 514   |      |   |   | (301 | ) |  |  | (58.6 | )
|                                                         | As a percent of U.S. Funds net assets  |   |                     | 32.7 | %       |   |       | 45.5 | % |   |      |   |  |  |       |   | 
|U.S. Funds sales                                        |                                         | $ | 56                  |      |         | $ | 48    |      |   | $ | 8    |   |  |  | 16.7  |  
|Ivy International Funds sales                           |                                         |   | 30                  |      |         |   | 31    |      |   |   | (1   | ) |  |  | (3.2  | )
|                                                         | As a percent of U.S. Funds sales       |   |                     | 53.6 | %       |   |       | 64.6 | % |   |      |   |  |  |       |   | 
|U.S. Funds redemptions                                  |                                         | $ | 114                 |      |         | $ | 165   |      |   | $ | (51  | ) |  |  | (30.9 | )
|Ivy International Funds redemptions                     |                                         |   | 60                  |      |         |   | 87    |      |   |   | (27  | ) |  |  | (31.0 | )
|                                                         | As a percent of U.S. Funds redemptions |   |                     | 52.6 | %       |   |       | 52.7 | % |   |      |   |  |  |       |   | 
|Net sales/(redemptions) excluding Ivy International Fund |                                         | $ | (28                 | )    |         | $ | (61   | )    |   | $ | 33   |   |  |  | 54.1  |  

Revenues

As described in further detail below, total revenues decreased by 37% for the
three-month period ended September 30, 2002 as compared to the three-month
period ended September 30, 2001.

Management fees decreased 47% for the three-month period ended September 30,
2002 as compared to the three-month period ended September 30, 2001 as a result
of the decrease in the U.S. Funds net assets under management.

Sub-advisory fees from the Canadian Funds decreased 18% for the three-month
period ended September 30, 2002 as compared to the three-month period ended
September 30, 2001 as a result of the decrease in the average net assets of the
Canadian Funds.

12b-1 Service and Distribution fees decreased 43% for the three-month period
ended September 30, 2002 as compared to the three-month period ended September
30, 2001 due to the decrease in the U.S. Funds net assets under management.

12



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##### Table of Contents



Administrative services and fund accounting fees collectively decreased 32% for
the three-month period ended September 30, 2002 as compared to the three-month
period ended September 30, 2001 due to a decline in net assets under
management.

For the three-month period ended September 30, 2002 as compared to the
three-month period ended September 30, 2001, underwriting fees have decreased
12% due to a decline in Class A sales. Redemption fees have decreased 24%, due
to decreases in redemptions of Class B and C shares.

Interest, dividends and other revenue decreased 40% for the three-month period
ended September 30, 2002 compared to the three-month period ended September 30,
2001 due to a decrease in investment income earned as a result of declining
interest rates.

Expenses

As described in further detail below, total expenses for the three-month period
ended September 30, 2002 decreased 7% compared to the three-month period ended
September 30, 2001.

Sales literature, advertising and promotion decreased 14% for the three-month
period ended September 30, 2002 compared to the three-month period ended
September 30, 2001 due to a reduction in expenditures on advertising and other
promotional activities in line with our general cost-savings efforts.

12b-1 Service fees paid to broker/dealers decreased 45% for the three-month
period ended September 30, 2002 compared to the three-month period ended
September 30, 2001 due to the decrease in net assets under management.

Employee compensation and benefits decreased 22% for the three-month period
ended September 30, 2002 compared to the three-month period ended September 30,
2001. The decrease is due to an overall decrease in the number of employees as
of September 30, 2002, which has decreased 17% to 74 as compared to 89 at
September 30, 2001.

Amortization of deferred selling commissions decreased 30% for the three-month
period ended September 30, 2002 compared to the three-month period ended
September 30, 2001 due to a lower Class B and C share asset base as a result of
Class B and C share sale and redemption activity.

General and administrative expenses increased 109% for the three-month period
ended September 30, 2002 compared to the three-month period ended September 30,
2001. The increase was attributable to: (1) an increase in legal and
insurance costs and (2) approximately $807,000 in transaction costs incurred in
the current period in connection with the indirect sale of MIMI to W&R (See
Note 6 Sale and Dissolution of MIMI).

Occupancy and equipment rental decreased 24% for the three-month period ended
September 30, 2002 compared to the three-month period ended September 30, 2001.
The decrease is due to the portion of the current fiscal year occupancy
expense that was accrued as part of the restructuring charge recorded in fiscal
year 2001. Excluding the impact of the restructuring charge, occupancy and
equipment rental expenses would have been comparative period to period.

13



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##### Table of Contents



LIQUIDITY AND CAPITAL RESOURCES

The Companys liquidity and capital resources at September 30, 2002 were
primarily derived from historical operating cash flows received by the Company
from managing and providing investment advisory services to the Ivy Funds and
from providing sub-advisory services to the Canadian Funds. The Company
manages its resources to ensure the availability of sufficient cash flows to
meet all of its financial commitments. The Company believes the cash and cash
equivalents at September 30, 2002, will be sufficient to meet working capital
requirements and required capital expenditures for at least the next twelve
months although the Company anticipates the dissolution of the Company in
connection with the acquisition by W&R which is scheduled to close in December
2002 (see Note 6, Sale and Dissolution of MIMI).

The Companys cash and cash equivalents decreased by approximately $1,107,000
for the six-month period ended September 30, 2002. The decrease resulted from:
(1) cash used in operating activities of approximately $893,000, primarily
related to the net loss for the period, reductions in accrued expenses and
other liabilities, restructuring costs and the payment of deferred selling
commissions; (2) cash used in investing activities of approximately $28,000,
primarily related to purchases of property and equipment; and (3) cash used in
financing activities of approximately $187,000 for the payment of cash
dividends on common stock.

The payment of deferred selling commissions to broker/dealers was approximately
$295,000 for the six-month period ended September 30, 2002 as compared to
approximately $296,000 for the six-month period ended September 30, 2001.
Class B and C fund share sales were consistent during the six-month period
ended September 30, 2002. Commission payments made during the six-month
periods ended September 30, 2002 and 2001 were funded internally from
operations.




Item 3. Quantitative and Qualitative Disclosures About Market Risk

Competition

The financial services industry is highly competitive and has increasingly
become a global industry. There are numerous open-end investment companies of
varying sizes, investment policies and objectives whose shares are being
offered to the public in the U.S. Given the large number of competitors in the
U.S., the Company has focused its efforts on becoming an investment specialist
with a worldwide perspective offering mutual funds with an emphasis on
international investing. With this focus, the Company considers that it has
narrowed the competitive field to a certain extent as it competes primarily
with mutual fund managers that provide specialty mutual funds, such as
international funds, to investors.

The Company competes with the financial services and other investment
alternatives offered by stock brokerage and investment banking firms, insurance
companies, banks, savings and loan associations and other financial
institutions. Many of the Companys competitors have substantially greater
resources than the Company. In addition, there has been a trend of
consolidation in the mutual fund industry, which has resulted in stronger
competitors. Such competition could negatively impact the Companys market
share, revenues and net income.

Asset Mix

The Companys revenues are derived primarily from investment management
activities. Broadly speaking, the direction and fluctuation in the net assets
of the U.S. Funds, the Canadian Funds, and the Premier Funds (collectively, the
Funds) depend upon two factors: (1) the level of sales of shares of the Funds
as compared to redemptions of the shares of the Funds; and (2) the increase or
decrease in the market value of the securities owned by the Funds. The Company
is subject to an increased risk of volatility from changes in the global equity
markets.

14



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##### Table of Contents



Market values are affected by many things, including the general condition of
national and world economics and the direction and volume of changes in
interest rates and/or inflation rates. Fluctuations in interest rates and in
the yield curve will have an effect on fixed-income net assets under management
as well as on the flow of monies to and from fixed-income funds and, as a
result, will affect the Companys revenues from such funds. The effects of the
foregoing factors on equity funds and fixed-income funds often operate
inversely and it is, therefore, difficult to predict the net effect of any
particular set of conditions on the level of net assets under management.

Certain portions of the Companys managed portfolios are invested in various
securities of corporations located or doing business in developing regions of
the world, commonly known as emerging markets. These portfolios and the
Companys revenues derived from the management of such portfolios are subject
to significant risks of loss from, among other factors, unfavorable political
and diplomatic developments, currency fluctuations, social instability, changes
in governmental policies, expropriation, nationalization, confiscation of
assets and changes in legislation relating to foreign ownership. Foreign
trading markets, particularly in some emerging market countries, are often
smaller, less liquid, less regulated and significantly more volatile.

Investor Sentiment for International Investing

Given the risk associated with investing in foreign and emerging markets,
investors may from time to time be less supportive of investing in
international funds than in U.S. equity or fixed income funds and sales of
those Funds, which invest in these areas, may decrease.

Regulatory Environment

Virtually all aspects of the Companys business are subject to various federal
and state laws and regulations. The Company and its subsidiaries are
registered with federal and state governmental agencies. These supervisory
agencies have broad administrative powers, including the power to limit or
restrict the Company from carrying on its business if it fails to comply with
applicable laws and regulations. In the event of non-compliance, the possible
sanctions that may be imposed include suspending individual employees, limiting
the Companys ability to engage in business for specified periods of time,
revoking the investment advisor or broker-dealer registrations and censures and
fines.

Absence of Public Trading Market

IAC, which is a wholly owned subsidiary of MFC, owns approximately 86% of the
issued and outstanding common shares of the Company as of September 30, 2002.
The shares have been thinly traded. Further, the number of common shares of
MIMI held by persons other than IAC is very small by market standards and this
may have an adverse impact on liquidity and trading of the common shares.




Item 4. Controls and Procedures

For the period ending September 30, 2002 (the Evaluation Date), the Company
carried out an evaluation, under the supervision and with the participation of
its management, including the President and Chief Executive Officer and the
Vice President and Chief Financial Officer (the principal finance and
accounting officer), of the effectiveness of the design and operation of the
Companys disclosure controls and procedures pursuant to Rules 13a-14 and
15d-14 under the Securities Exchange Act of 1934, as amended (the Exchange
Act). Based upon this evaluation, the President and Chief Executive Officer
and the Vice President and Chief Financial Officer concluded that, as of
September 30, 2002, the Companys disclosure controls and procedures were
adequate to ensure that information required to be disclosed by the Company in
the reports filed or submitted by it under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the
rules and forms of the Commission.

15



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##### Table of Contents



Additionally, the President and Chief Executive Officer and Vice President and
Chief Financial Officer determined, as of September 30, 2002, that there were
no significant changes in our internal controls or in other factors that could
significantly affect the Companys internal controls subsequent to the date of
their evaluation.




PART II  OTHER INFORMATION




Item 1. Legal Proceedings

There are currently no material legal proceedings pending to which the Company
or any of its subsidiaries is a party or of which any of its property is the
subject. Further, there are no material legal proceedings to which any
director, officer, or affiliate of the Company or any associate thereof is a
party, which is adverse to the Company. There are no material administrative
or judicial proceedings pending or known to be contemplated by any governmental
authorities.




Item 2. Changes in Securities and Use of Proceeds

None




Item 3. Defaults Upon Senior Securities

None




Item 4. Submission of Matters to a Vote of Security Holders

At the Companys Annual Meeting of Shareholders held on September 25, 2002, the
election of the Board of Directors nominees was approved and the appointment
of the auditors and the authorization of the Board of Directors to fix the
remuneration of the auditors was approved.

Item 1: The shareholders voted to elect the nominees for directors as follows:

|                       |  |           |            |               |  |             |   |  |  |  |     | 
|---------------------- |  | --------- | ---------- | ------------- |  | ----------- | - |  |  |  | --- | 
|Name                   |  | Votes For |            | Votes Against |  | Abstentions
|                       |  |           |            |               |  |            
|James W. Broadfoot III |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 
|Keith J. Carlson       |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 
|Alan J. Dilworth       |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 
|James L. Hunter        |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 
|Ed Lill                |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 
|Neil Lovatt            |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 
|Alasdair J. McKichan   |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 
|Allan S. Mostoff       |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 
|Michael R. Peers       |  |           | 16,135,685 |               |  |             |  |  |  |  | 400 | 

Item 2: The shareholders voted to approve the appointment of
PricewaterhouseCoopers LLP as the Companys auditors and for the directors to
fix the remuneration of the auditors as follows:

|           |               |             |   |  |  |  |     | 
|---------- | ------------- | ----------- | - |  |  |  | --- | 
|Votes For  | Votes Against | Abstentions
|           |               |            
|16,135,685 |               |             |  |  |  |  | 400 | 




Item 5. Other Information

None

16



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##### Table of Contents






Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits:

The following exhibit is filed herewith or incorporated by reference as
indicated below.

|          |  |                                                                                                                                                                                                           |  |                                                                                                                                                                                                              
|--------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit # |  | Description                                                                                                                                                                                               |  | Document if Incorporated by Reference                                                                                                                                                                        
|          |  |                                                                                                                                                                                                           |  |                                                                                                                                                                                                              
|2.1       |  | Stock Purchase Agreement, dated as
of August 29, 2002, by and among
Mackenzie Financial Corporation,
Mackenzie Investment Management
Inc., Ivy Acquisition Corporation
and Waddell & Reed Financial, Inc. |  | Previously filed as Appendix B to the
Companys preliminary proxy statement
on Schedule 14A, as filed with the
Securities and Exchange Commission
on September 20, 2002 and incorporated
herein by reference.
|2.2       |  | Plan of Complete Liquidation and
Voluntary Dissolution                                                                                                                                                    |  | Previously filed as Appendix A to the
Companys preliminary proxy statement
on Schedule 14A, as filed with the
Securities and Exchange Commission
on September 20, 2002 and incorporated
herein by reference.
|10.51     |  | Transaction Bonus  Summary                                                                                                                                                                               |  | Filed herewith                                                                                                                                                                                               
|99.1      |  | Certification Pursuant to 18 U.S.C.
Section 1350 As Adopted Pursuant
To Section 906 of the Sarbanes
Oxley Act of 2002                                                                                     |  | Filed herewith                                                                                                                                                                                               
|99.2      |  | Certification Pursuant to 18 U.S.C.
Section 1350 As Adopted Pursuant
To Section 906 of the Sarbanes
Oxley Act of 2002                                                                                     |  | Filed herewith                                                                                                                                                                                               

(b) Reports on Form 8-K:



| |                                                                                                         
| | --------------------------------------------------------------------------------------------------------
| | The Company filed the following Current Reports on Form 8-K during the
quarter ended September 30, 2002:



|1. |  | On September 6, 2002, the Company filed a Form 8-K under Item 5
announcing a definitive agreement respecting the sale of the Company
and its entire operations to Waddell & Reed Financial, Inc.                                                                                                                                                                                                                         
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | On August 2, 2002, the Company filed a Form 8-K under Item 5
announcing a change to the date and time of its Annual Meeting of
Shareholders from Thursday, September 12, 2002 at 10:00 am to
Wednesday, September 25, 2002 at 9:00 am.                                                                                                                                                                                   
|  
|3. |  | On July 9, 2002, the Company filed a Form 8-K under Item 5
announcing its financial results for the fourth quarter and year ended
March 31, 2002. In addition, the Company restated their results of
operations and the corresponding statements of financial condition for
each of the years ended March 31, 1999 through March 31, 2001 and the
quarters ended June 30, 2001, September 30, 2001 and December 31, 2001.
|  
|4. |  | On July 8, 2002, the Company filed a Form 8-K under Item 5
announcing the declaration of a dividend of U.S. $0.01 per share to
shareholders of record on July 18, 2002 with a payable date of July 26,
2002.                                                                                                                                                                                                             

17



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##### Table of Contents






SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Company and in the capacities and on the dates indicated.

|                                       |  |                                            |  |                 
|-------------------------------------- |  | ------------------------------------------ |  | ----------------
|Name                                   |  | Capacity                                   |  | Date            
|                                       |  |                                            |  |                 
|                                       |  |                                            |  |                 
|                                      
|/s/ KEITH J. CARLSONKeith J. Carlson   |  | President and
Chief Executive Officer      |  | November 7, 2002
|                                      
|                                       |  |                                            |  |                 
|                                      
|/s/ BEVERLY YANOWITCHBeverly Yanowitch |  | Vice President and
Chief Financial Officer |  | November 7, 2002

18



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##### Table of Contents



CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 302 OF
THE SARBANES OXLEY ACT OF 2002

I, Keith J. Carlson, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of Mackenzie
Investment Management Inc.;                                                                                                                                                                                                                                   
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly present
in all material respects the financial condition, results of operations
and cash flows of the registrant as of, and for, the periods presented
in this quarterly report;                   
|  
|4. |  | The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:                                                                                                      



| | a) |  | designed such disclosure controls and procedures to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the
Evaluation Date); and                                                                                                  
|
| | c) |  | presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and procedures
based on our evaluation as of the Evaluation Date;                                                                                                                        

5.     The registrants other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrants auditors and
the audit committee of registrants board of directors (or persons
performing the equivalent function):



| | a) |  | all significant deficiencies in the design or operation
of internal controls which could adversely affect the
registrants ability to record, process, summarize and report
financial data and have identified for the registrants auditors
any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | any fraud, whether or not material, that involves
management or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                             |  |                     
|------------------------------------------------------------ |  | --------------------
|/s/ KEITH J. CARLSONKeith J. Carlson
Chief Executive Officer |  | November 7, 2002Date

19



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##### Table of Contents



CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 302 OF
THE SARBANES OXLEY ACT OF 2002

I, Beverly Yanowitch, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of Mackenzie
Investment Management Inc.;                                                                                                                                                                                                                                   
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly present
in all material respects the financial condition, results of operations
and cash flows of the registrant as of, and for, the periods presented
in this quarterly report;                   
|  
|4. |  | The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:                                                                                                      



| | a) |  | designed such disclosure controls and procedures to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the
Evaluation Date); and                                                                                                  
|
| | c) |  | presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and procedures
based on our evaluation as of the Evaluation Date;                                                                                                                        



|5. |  | The registrants other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrants auditors and
the audit committee of registrants board of directors (or persons
performing the equivalent function):
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | all significant deficiencies in the design or operation
of internal controls which could adversely affect the
registrants ability to record, process, summarize and report
financial data and have identified for the registrants auditors
any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | any fraud, whether or not material, that involves
management or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                               |  |                     
|-------------------------------------------------------------- |  | --------------------
|/s/ BEVERLY YANOWITCHBeverly Yanowitch
Chief Financial Officer |  | November 7, 2002Date

20