<PAGE>   1
                  SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C. 20549

                              FORM 10-K
[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2000,
       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 number 0-3035

                       COGNITRONICS CORPORATION
        (Exact name of registrant as specified in its charter)

                 NEW YORK                        13-1953544
    (State or other jurisdiction of           (I.R.S. Employer
     incorporation or organization)          Identification No.)

      3 Corporate Drive, Danbury, Connecticut            06810
     (Address of principal executive offices)         (Zip Code)

Registrant's telephone number, including area code (203) 830-3400

Securities registered pursuant to Section 12(b) of the Act:


                                               Name of each exchange on
         Title of each class                       which registered

Common Stock, par value $0.20 per share         American Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:     None

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 and (2) has been subject to such filing
requirements for at least the past 90 days.
                       Yes   x       No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K. [   ]

The aggregate market value of the voting stock held by non-affiliates of
 the registrant as of March 1, 2001:

        Common Stock, par value $0.20 per share -- $38,113,000

The number of shares outstanding of each of the issuer's classes of common
 stock as of March 1, 2001:

      Common Stock, par value $0.20 per share --5,519,378 shares

Documents incorporated by reference:   Portions of the Proxy Statement for
the annual meeting of stockholders to be held on May 17, 2001 are incorporated
by reference into Part III.
<PAGE>   2

                          TABLE OF CONTENTS


                                PART I

Item                                                              Page

 1.   Business . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
 2.   Properties . . . . . . . . . . . . . . . . . . . . . . . . . . 5
 3.   Legal Proceedings. . . . . . . . . . . . . . . . . . . . . . . 5
 4.   Submission of Matters to a Vote of Security Holders. . . . . . 5
      Executive Officers of the Company. . . . . . . . . . . . . . . 6


                               PART II

 5.   Market for Company's Common Equity and Related Stockholder
       Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
 6.   Selected Financial Data. . . . . . . . . . . . . . . . . . . . 7
 7.   Management's Discussion and Analysis of Financial Condition
       and Results of Operations . . . . . . . . . . . . . . . . . . 7
 7a.  Market Risk. . . . . . . . . . . . . . . . . . . . . . . . . .10
 8.   Financial Statements and Supplementary Data. . . . . . . . . .10
 9.   Changes in and Disagreements with Accountants on Accounting
       and Financial Disclosure. . . . . . . . . . . . . . . . . . .24


                               PART III

10.   Directors and Executive Officers of the Company. . . . . . . .24
11.   Executive Compensation . . . . . . . . . . . . . . . . . . . .24
12.   Security Ownership of Certain Beneficial Owners and
       Management. . . . . . . . . . . . . . . . . . . . . . . . . .24
13.   Certain Relationships and Related Transactions . . . . . . . .24


                               PART IV

14.   Exhibits, Financial Statement Schedules, and Reports on Form
       8-K . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24















McIAS is a trademark of Cognitronics Corporation.
UNIX is a registered trademark of Santa Cruz Operation, Inc.
<PAGE>   3
                                PART I

Item 1.    Business

      (a)  Cognitronics Corporation (the "Company") was incorporated in January
1962 under the laws of the State of New York. The Company designs, manufactures
and markets voice processing systems.

 (b)  The Company operates in two segments of the voice processing industry.
In the United States, the Company designs, manufactures and sells equipment for
use in telephone central offices.  In Europe, the Company distributes equipment
for use on customers' premises.

 (c)  (i) A description of the fields of voice processing in which the Company
operates and its products are as follows:

Domestic Operations.   These products are sold directly to telecommunication
service providers or through switch manufacturers who distribute the Company's
products.

      Intelligent Announcers.  The Company's McIAS(TM) 16xx product family has
been primarily used by  Incumbent Local Exchange Carriers (ILECs) and
Competitive Local Exchange Carriers (CLECs) to provide voice announcements in
connection with custom calling features (CLASS), such as selective call
forwarding and caller originator trace.  Number change intercept is another
important feature provided.

       The 16xx is available in two versions: a lower cost configuration which
provides network announcement functionality, is available as a 1607/68 (1 T-1
span capacity) and a 1610/68 (3 T-1 span capacity). The second version of this
series is a UNIX(R)-based platform which utilizes many of the same components as
the /68 series and is known as McIAS 16xx/IP.  "IP" designates an Intelligent
Peripheral, indicating the ability to serve as a voice peripheral to any
manufacturer's switch and delivering multiple application capability.

      The McIAS 16xx/IP is available as a 1607/IP, a 1610/IP, and a 1623/IP.
Features include an open architecture, scalable processing power and disk
drives, and centralized administration.  Application examples include number
change with call completion, automated attendant, voice mail and time and
temperature announcements.

      A new product line, the CX Series, was announced and sales began in 1999.
This family of products provides greater capacity and increased functionality to
meet telecommunication service providers' network needs in Advanced Intelligent
Network ("AIN") and packet switched environments.  Included in the CX
capabilities are a new MultiResource Line Card and support for several key AIN
protocols such as SS7, SR-3511, GR-1129-CORE and ISDN-PRI.  The CX is also
designed and planned to be IP Telephony and ATM ready by providing key packet
switched network support such as MGCP, MEGACO, RTP/RTCP, H. 323, SIP and others.

      Passive Announcers.  These announcers are used by the ILECs and CLECs to
inform callers about network conditions or procedures to invoke the use of a
service.  The Company has been a major supplier to the industry of passive
announcers and incorporates these features in products such as the Model 688
Automatic Number Announcer, McIAS 950, and the McIAS 16xx product family.
<PAGE>   4
      Call Processors.  The Company's McIAS 950 is also an automated attendant
and audiotext system with the flexibility to offer the caller various choices
(dial an extension, revert to an operator, etc.).  The system also offers a wide
variety of menu-selected information to callers.  The McIAS 950 is designed for
use in both telephone network environments and the commercial business market.

European Distributorship Operations.  Dacon Electronics Plc., based in
Hertfordshire, England, distributes call management and voice processing
products, including products manufactured by the Company, in Europe.

       (ii)  Status of publicly announced new products or industry segments
requiring material investment.  Inapplicable.

       (iii)  The Company has adequate sources for obtaining raw materials,
components and supplies to meet production requirements and did not experience
difficulty during 2000 in obtaining such materials, supplies and components.

      (iv)  The Company relies on technological expertise, responsiveness to
users' needs and innovations and believes that these are of greater significance
in its industry than patent protection. There can be no assurance that patents
owned or controlled by others will not be encountered and asserted  against
the Company's voice processing products or that licenses or other rights under
such patents would be available, if needed. The Company has registered
trademarks and names which the Company considers important in promoting the
business of the Company and its products.

       (v)  Seasonality.   Inapplicable.

       (vi)  The discussion of liquidity and sources of capital as set forth in
Management's Discussion and Analysis of Financial Condition and Results of
Operations is included in Item 7 of this Annual Report on Form 10-K and is
incorporated herein by reference.

       (vii) In 2000, revenues included sales of $12.6 million to Siemens
Carrier Networks LLC. and $2.8 million to Nortel Inc.  The Company's U.K.
operations had sales of $3.7 million to British Telecommunications Plc in 2000.
Over the past several years, a major portion of the revenues of the domestic
operations has come from two or three large customers, and a significant portion
of the revenues of the UK operations has come from one customer.  Accordingly,
the loss of any of these customers could have a material adverse impact on the
Company's results of operations.

       (viii) The dollar amount of orders believed by the Company to be firm as
of December 31, 2000 and 1999, amounted to $1.1 million and  $.5 million,
respectively. Substantially all of the orders as of December 31, 2000, can
reasonably be expected to be filled during  2001.

       (ix) Business subject to renegotiation.  Inapplicable.

       (x)  The Company competes, and expects to compete, in fields noted for
rapid technological advances and the frequent introduction of new products and
services. The Company's products are similar to those manufactured, or capable
of being manufactured, by a number of companies, some of which are well-
established corporations with financial, personnel and technical resources
substantially larger than those of the Company. The Company's ability to
compete in the future depends on its ability to maintain the technological and
performance advantages of its current products and to introduce new products
and applications that achieve market acceptance. Future research and development
expenditures will be based, in part, on future results of operations. There are
<PAGE>   5
no assurances that the Company will be able to successfully develop and market
new products and applications.

       (xi) Expenditures for research and development activities, as determined
in accordance with generally accepted accounting principles, amounted to  $2.4
million in 2000, $2.1 million in 1999 and $2.0  million in 1998.   In addition,
the estimated dollar amount spent on the  improvement of existing products or
techniques was $.2 million in each of the years.

       (xii) Material effects of compliance with Federal, State or local
provisions regulating the discharge of materials into the environment or
otherwise relating to the protection of the environment.     Inapplicable.

       (xiii) At December 31, 2000, the Company and its subsidiaries
employed 103 people.

 (d)  Sales to foreign customers primarily represent sales of Dacon Electronics
Plc. (incorporated in the United Kingdom) of $7.3 million in 2000,  $7.2 million
in 1999 and $8.3 million in 1998.  Additional information about foreign
operations is included in Note K to Consolidated Financial Statements included
in Item 8 of this Annual Report on Form 10-K and is incorporated herein by
reference.

      Further, there were export-type sales (primarily North America) of
approximately $.2 million in 2000, $3.5 million in 1999 and $2.4 million in
1998.  Export sales do not involve any greater business risks than do sales to
domestic customers and, in certain instances, the Company obtains an irrevocable
letter of credit or payment prior to shipment of products to the customer.
Selling prices and gross profit margins on export-type sales are comparable
to sales to domestic customers.

Item 2.   Properties

       The facilities of the Company and its subsidiaries are
located as follows:
LOCATION                 DESCRIPTION                FEET           DATE
--------                 -----------               ------    ----------------
Danbury, Connecticut:    Office, engineering,       40,000        10/31/03
 3 Corporate Drive       production and service
                         facility

Hemel Hempstead          Office, distribution       12,000         7/31/01
Hertfordshire,           and service facility
United Kingdom
 1 Enterprise Way

      The Company considers each of these facilities to be in good condition
and adequate for the Company's business.


Item 3.   Legal Proceedings

      There are no material pending legal proceedings to which the Company or
any of its subsidiaries is a party or of which any of their property is the
subject.


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

      Inapplicable.
<PAGE>   6
                  Executive Officers of the Company

The executive officers of the Company, their positions with the Company and
ages as of March 1, 2001 are as follows:
  NAME                 POSITION(S) AND OFFICE(S)                      AGE
  ----                 -------------------------                      ---
  Brian J. Kelley      President and Chief Executive
                       Officer; Director                               49

  Kenneth G. Brix      Vice President                                  54

  Harold F. Mayer      Secretary                                       71

  Michael N. Keefe     Vice President                                  45

  Roy A. Strutt        Vice President; Director                        44

  Garrett Sullivan     Treasurer and Chief Financial Officer           55

  Emmanuel A. Zizzo    Vice President                                  60

      No family relationships exist between the executive officers of the
Company. Each of the executive officers was elected to serve until the next
annual meeting of the Board of Directors or until his successor shall have been
elected and qualified.

      Mr. Kelley has been President and Chief Executive Officer of the Company
since 1994. Prior to that he held senior management positions with
TIE/Communications, Inc. from 1986 to 1994.

      Mr.  Brix has been  a Vice President of the Company since 1994 with
responsibility for U.S. sales and marketing. Prior to that he held senior
management positions from 1987 to 1994.

      Mr. Mayer has been Secretary of the Company since 1975. He was Treasurer
from 1974 to 1989 and a Vice President of the Company from 1986 to 1996.

      Mr. Keefe has been a Vice President of the Company since 1993 with
responsibility for engineering, prior to which he was Manager of Software
Planning and Development from 1992 until 1993 and senior engineer for more than
five years. He has been employed by the Company since 1980.

      Mr. Strutt has been a Vice President of the Company since 1994 with
responsibility for European operations. Since 1992, he has been Managing
Director of Dacon Electronics Plc, which was acquired by the Company in 1992,
and Director of Sales and Operations from 1990 to 1992. Prior to that he was
Managing Director of Automatic Answering Ltd. for four years.

      Mr. Sullivan has been Treasurer and Chief Financial Officer of the
Company since 1989. Prior to that he was Treasurer and Chief Financial Officer
of Fundsnet, Inc., an electronic funds transfer company, from 1986 until 1989.
He was employed by The Singer Co. from 1977 to 1986, where his most recent
position was Vice President-Finance, Asia Division.

      Mr. Zizzo has been a Vice President of the Company since 1995 with
responsibility for operations, primarily manufacturing, purchasing and physical
facilities, prior to which he had been Director of Operations since 1994. He
was an independent consultant from 1993 to 1994. Prior to that he held senior
management positions with TIE/Communications, Inc.for more than five years.
<PAGE>   7
                               PART II

Item 5.   Market for Company's Common Equity and Related Stockholder
Matters

 (a) and (b) Cognitronics' Common Stock is traded on the American Stock
Exchange under the symbol CGN. On March 1, 2001, there were 711 stockholders of
record; the Company estimates that the total number of beneficial owners was
approximately 3,200.  Information on quarterly stock prices is set forth in
Item 8 of this Annual Report on Form 10-K and is incorporated herein by
reference.

 (c) The Company has never paid a cash dividend on its Common Stock and has
used its cash for the development of its business.  In 1998, 2000 and 2001,
the Company announced its intention to repurchase up to 300,000, 200,000 and
500,000 shares, respectively, of its Common Stock.  The Company repurchased 150
shares of its Common Stock in 1998, 105,750 in 1999 and 331,000 in 2000.  The
Company has no present intention of paying a cash dividend, and payment of any
future dividends will depend upon the Company's earnings, financial condition
and other relevant factors.

Item 6.  Selected Financial Data
                                         Year ended December 31,
                                    (in thousands except per share data)
OPERATING RESULTS                     2000     1999     1998     1997     1996
                                      ----     ----     ----     ----     ----
Revenues                           $31,836  $31,693  $28,917  $29,521  $17,343
Net income                           4,530    5,346    4,689    3,622    1,099
Net income per share:
      Basic                           $.79     $.94     $.85     $.69     $.22
      Diluted                          .74      .88      .78      .62      .20
Weighted average number of basic
      shares outstanding             5,754    5,670    5,543    5,233    5,074
Weighted average number of diluted
      shares outstanding             6,092    6,048    5,993    5,840    5,378

FINANCIAL POSITION
Working capital                    $25,830  $24,130  $18,281  $13,112  $ 8,745
Total assets                        32,998   35,102   27,080   23,123   17,511
Stockholders' equity                26,988   25,729   20,033   15,014   10,612
Stockholders' equity per share       $4.85    $4.40    $3.58    $2.73    $2.04
Cash dividends paid                   None     None     None     None     None


Included in 1997 is $956,000 (net of tax $598,000 or $.11 per basic share and
$.10 per diluted share) of settlement costs and legal fees related to class
action litigation.

The above Selected Financial Data should be read in conjunction with the
Consolidated Financial Statements of the Company, including the notes thereto,
and the unaudited quarterly financial data included in Item 8 of this Annual
Report on Form 10-K.


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

      The Company reported net income of $4.5 million, $5.3 million and $4.7
million for 2000, 1999 and 1998, respectively.
<PAGE>  8
      In 2000, sales value of the Company's domestic operations and its UK
distributorship operations were essentially the same as 1999.  The unit volume
in the domestic operations increased approximately 20% while the sales value
increased only $.1 million.  This was due to unfavorable distribution channel
mix and a volume discount given for a large purchase of McIAS 1623/IPs ($5.9
million) in the fourth quarter of 2000.  The increased sales due to this large
purchase were offset by lack of sales to Mexico in 2000 ($2.9 million in 1999)
and lower shipments to CLEC's.  The Company's backlog at December 31, 2000 was
$1.1 million versus $.5 million in 1999.  Recently, there have been reductions
in telecommunication infrastructure buildout, as reported by major
telecommunication equipment suppliers, and this is reflected in the Company's
sales order flow.  In both 2000 and 1999, a major portion of the Company's
domestic revenue came from one customer and a significant portion of its UK
distributorship revenue came from one customer.  The loss of either of these
customers would have a material adverse impact on the Company.

      Consolidated gross margin decreased 4% to 52% in 2000 from 56% in 1999
primarily due to a decrease of 4% in the domestic operation's gross margin
attributable to channel mix and a discount given on a large purchase.

      In 1999, sales increased 10% to $31.7 million due to increased sales of
$3.9 million (19%) by the Company's domestic operations, offset by decreased
sales of $1.1 million (13%) in its UK distributorship operations.  The
increased sales in the U.S. operations were due to increased direct sales of
$3.0 million and $.9 million of indirect sales.  The increase in direct sales
was primarily attributable to two customers and the increase in indirect sales
was attributable to increased sales of $5.7 million to three customers,
offset by a decrease of $4.9 million sales to another customer.  In 1999,
primarily in the third quarter, the Company sold $2.9 million to Alcatel Indetel
Industria de Telecomunicacion S.A. de C.V., up from $2.0 million in the fourth
quarter of 1998. This completed the project which began in the fourth quarter
of 1998.  The decreased sales in UK distributorship operations were due to
decreased demand from its primary customer, reflecting increased competition
faced by this customer and obsolescence of certain products distributed by the
Company.

      In 1999, consolidated gross margin percentage improved 1% to 56% from 55%
in 1998, primarily due to an increase of 2.7% in the domestic operations' gross
margin attributable to improved product mix and higher volume.  This was offset,
in part, by a 3.5% decrease in the UK distributorship's gross margin due to
unfavorable product mix and exchange rates.

      In 2000 and 1999, research and development increased $.3 million (15%)
and $.1 million (7%), respectively, in each year versus the prior year due to
higher personnel costs.  The Company anticipates an acceleration in the rate of
increase in spending for research and development.

      Selling, general and administrative expenses for 2000 was approximately
the same as the prior year.  In 1999, these costs increased $.9 million (13%)
due to an increase of $.7 million (20%) in the domestic operations and $.1
million (5%) in the UK distributorship operations.  The increase in the domestic
operations was due to higher sales commissions and bonuses.

      Other income of $.6 million in 2000 and $.4 million in 1999 and 1998 is
primarily interest income.  The increase in 2000 from 1999 is due to higher
interest rates and higher balances of cash and marketable securities.

 The Company's effective tax rate for 2000 was 34% versus 36% for 1999 and
<PAGE>   9
1998.  The reduction in the effective rate in 2000 from 1999 is attributable to
a reversal of a $156,000 tax reserve.  The provision for income taxes is
discussed in Note G to Consolidated Financial Statements. Under Financial
Accounting Standards Board ("FASB") Statement No. 109, the Company has
recognized future tax benefits that management believes will be realized. In
order to realize these  benefits, the Company, exclusive of the results of
Dacon Electronics Plc, will have to generate pretax income of $4.1 million. The
current deferred tax benefit of $.7 million is primarily attributable to
inventory provisions, the recognition of such loss, for tax purposes, is, in
large measure, within the control of the Company. The non-current tax benefit,
$.8 million, primarily relates to deferred compensation and benefit plans and,
as such, would be recognized over a long period of time. The Company's U.S.
pretax income was $7.4 million, $8.4 million and $6.0 million in 2000, 1999 and
1998, respectively.  Based on this, management anticipates that the Company
will generate sufficient taxable income in the future to realize these benefits.

 The effect of inflation has not had a major impact on the operating results of
the Company over the past few years.  Technological advances and productivity
improvements are continually being applied to reduce costs, thus reducing
inflationary pressures on the operating results of the Company.

      Exchange rate changes will impact the reported dollar sales and cost of
sales of the Company's UK distributorship operations.  In addition, at December
31, 2000, the Company's UK distributorship operations had net assets of $1.9
million, which would be impacted by changes in foreign exchange rates.  However,
the impact of such rate change would be reflected in the translation adjustment
recorded in the equity section of the balance sheet.  The Company does not hedge
this foreign currency net asset exposure.

Liquidity and Sources of Capital

 Net cash provided by operations was $3.5 million, $3.0 million and $3.7
million in 2000, 1999 and 1998, respectively, primarily due to the results of
operations.  In 2000, cash provided by operating activities increased from 1999
due to a smaller net increase in working capital accounts.  In 1999, cash
provided by operating activities decreased from 1998 due to increased accounts
receivable, inventories and tax payments, offset, in part, by increases in
accounts payable.  Cash used by investing activities was $.7 million, $6.1
million and $1 million in 2000, 1999 and 1998, respectively.  Cash used for
investing activities included additions to property, plant and equipment of $.5
million in all years.  Also included in 2000 were loans to officers of $.7
million.  The Company had net sales of marketable securities of $.6 million in
2000 and net purchases of $5.6 million and $.5 million in 1999 and 1998,
respectively.  Cash used by financing activities of $3.2 million in 2000
primarily relates to the repurchase of the Company's common stock.  Cash
provided by financing activities was $.1 million in 1999 and 1998.

Working capital increased to $25.8 million at December 31, 2000 from $24.1
million at December 31, 1999 and $18.3 million at December 31, 1998.  The ratio
of current assets to current liabilities was 7.6:1 at December 31, 2000 versus
4.4:1 at December 31, 1999 and 4.9:1 at December 31, 1998. The increase in 2000
is due to the results of operations and the reduction in accounts payable,
offset, in part, by the repurchase of Company shares and reduction in inventory
levels.  The decrease in 1999 was due to a volume purchase of inventory items at
a favorable price occurring in the last quarter of 1999.

      The Company anticipates making capital expenditures of approximately $1
million, incurring increased research and development expenditures and the
<PAGE>  10
repurchase of up to 563,100 shares of its Common Stock in 2001.  Management
believes that the cash and cash equivalents  at December 31, 2000 and the cash
flow from operations in 2001 will be sufficient to meet its needs.


Certain Factors That May Affect Future Results

      From time to time, information provided by the Company, statements made
by its employees or information included in its filings with the Securities and
Exchange Commission (including this Form 10-K) may contain statements which are
not historical facts, so-called "forward-looking statements". These forward-
looking statements are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. The Company's actual future
results may differ significantly from those stated in any forward-looking
statements. Forward-looking statements involve a number of risks and
uncertainties, including, but not limited to:

       Product demand fluctuations in the timing and volume of customer requests
       for our products.

       Telecommunication systems industry and general economic conditions.

       Competitive pressure on selling prices.

       Market acceptance of our products and our customer's products.

       Costs associated with possible litigation or settlement, including those
       related to the use of ownership of intellectual property.

       Loss of a major customer.  A few customers account for a major portion
       of the Company sales.  A loss of such a customer would have a major
       adverse impact on the Company's results.

       Third party suppliers increase the risk that we may not have adequate
       supply to meet demand.

       Introduction of new products.  Our markets are subject to technological
       change, so our success depends on our ability to develop and introduce
       new products.

       The markets in which we compete are highly competitive.  Some of our
       competitors have significantly greater financial and other resources
       than us.

       Our future success is dependent on our ability to attract and retain our
       key design engineering, sales and executive personnel.  There is intense
       competition for qualified personnel, in particular, design engineers,
       and we may not be able to attract and train engineers and other
       qualified personnel necessary for the development and introduction of
       new products or to replace engineers or other qualified personnel that
       may leave our employ.

       Our expense levels, in the short term, are fixed.  Sales variances from
       quarter to quarter would have a significant effect on the results of
       operations.

       Other risk factors detailed in this Annual Report on Form 10-K and in
       the Company's other Securities and Exchange Commission Filings.
<PAGE>  11
Item 7.a  Market Risk

      The Company does not use derivative financial instruments.  The Company
is exposed to changes in interest rates.  The Company's marketable securities
consist of short-term and/or variable rate instruments and therefore a change
in interest rates would not have a material impact on the value of these
securities.



Item 8.  Financial Statements and Supplementary Data

                 QUARTERLY FINANCIAL DATA (UNAUDITED)
               (in thousands except per share amounts)

2000                                 FIRST      SECOND       THIRD      FOURTH
----                                 -----      ------       -----      ------
Sales                               $5,925      $8,437      $8,404      $9,070
Gross profit                         3,083       4,827       4,630       3,876
Net income                             475       1,516       1,505       1,034
Net income per share:
    Basic                             $.08        $.26        $.26        $.18
    Diluted                           $.08        $.25        $.25        $.18
Common Stock price range:
    High                            $27.25      $15.00      $15.50      $11.51
    Low                              11.13        8.63       10.75        8.00

1999                                 FIRST      SECOND       THIRD      FOURTH
----                                 -----      ------       -----      ------
Sales                               $7,804      $8,334      $9,662      $5,893
Gross profit                         4,401       4,738       5,560       3,095
Net income                           1,283       1,512       1,873         678
Net income per share:
    Basic                             $.23        $.27        $.33        $.12
    Diluted                           $.22        $.25        $.31        $.11
Common Stock price range:
    High                             $6.20      $12.17      $14.38      $18.63
    Low                               4.88        5.42        9.38        9.75


      The gross margin percentage in the fourth quarter of 2000 was 43% versus
55% for the nine months ended September 30, 2000 and 53% in the fourth quarter
of 1999 primarily due to channel mix and a discount given on a large purchase.

      The effective tax rates for the fourth quarter of 2000 and 1999 were
24.5% and 25.2%, respectively, versus the estimated effective rates of 36.7%
and 37.3% for the first nine months of 2000 and 1999, respectively.

      The above financial information should be read in conjunction with the
Consolidated Financial Statements, including the notes  thereto.
<PAGE>  12
                    Report of Independent Auditors

Stockholders and Board of Directors
Cognitronics Corporation

We have audited the accompanying consolidated balance sheets of Cognitronics
Corporation and subsidiaries as of December 31, 2000 and 1999, and the related
consolidated statements of income and comprehensive income, stockholders'
equity, and cash flows for each of the three years in the period ended
December 31, 2000.  These financial statements are the responsibility of the
Company's management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation.  We believe that our audits provide a
reasonable basis for our opinion.

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



/s/ ERNST & YOUNG LLP



Stamford, Connecticut
March 2, 2001




<PAGE>  13
CONSOLIDATED BALANCE SHEETS
COGNITRONICS CORPORATION AND SUBSIDIARIES
(dollars in thousands)

                                                                 December 31,
                                                                2000      1999
                                                                ----      ----
ASSETS
CURRENT ASSETS
  Cash and cash equivalents                                  $ 3,499   $ 3,992
  Marketable securities                                        9,400    10,000
  Accounts receivable, less allowances of $53 and $37          7,760     6,752
  Inventories                                                  6,557     9,079
  Deferred income taxes                                          746       889
  Other current assets including loans to officers
   of $1,062 and $377                                          1,783       591
                                                             -------   -------
       TOTAL CURRENT ASSETS                                   29,745    31,303

PROPERTY, PLANT AND EQUIPMENT, net                             1,373     1,370
GOODWILL, less amortization of $2,726 and $2,394                 651       983
DEFERRED INCOME TAXES                                            762       685
OTHER ASSETS, less amortization of $148 and $11                  467       761
                                                             -------   -------
                                                             $32,998   $35,102
                                                             =======   =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
  Accounts payable                                           $ 1,560   $ 4,312
  Accrued compensation and benefits                            1,128     1,176
  Income taxes payable                                           532       734
  Current maturities of debt                                      43        49
  Other accrued expenses                                         652       902
                                                             -------   -------
       TOTAL CURRENT LIABILITIES                               3,915     7,173

LONG-TERM DEBT                                                    47        90
OTHER NON-CURRENT LIABILITIES                                  2,048     2,110

COMMITMENTS AND CONTINGENCIES (Note I)

STOCKHOLDERS' EQUITY
  Common Stock, par value $.20 a share; authorized
   10,000,000 shares; issued 5,863,829 and 5,841,153 shares    1,173     1,168
  Additional paid-in capital                                  14,123    14,050
  Retained earnings                                           15,218    10,688
  Cumulative other comprehensive income/(loss)                  (182)       66
  Unearned compensation                                         (332)     (243)
                                                             -------   -------
                                                              30,000    25,729
  Less cost of 300,550 common shares in treasury in 2000      (3,012)
                                                             -------   -------
       TOTAL STOCKHOLDERS' EQUITY                             26,988    25,729
                                                             -------   -------
                                                             $32,998   $35,102
                                                             =======   =======
The accompanying notes to consolidated financial statements are an integral
part of these statements.
<PAGE>  14
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
COGNITRONICS CORPORATION AND SUBSIDIARIES
(in thousands except per share data)
                                                    Year ended December 31,
                                                  2000        1999        1998
                                                  ----        ----        ----
SALES                                          $31,836     $31,693     $28,917
COSTS AND EXPENSES
  Cost of products sold                         15,420      13,899      13,083
  Research and development                       2,445       2,132       1,997
  Selling, general and administrative            7,351       7,422       6,564
  Amortization of goodwill                         332         333         332
  Other (income) expense, net                     (619)       (441)       (404)
                                               -------     -------     -------
                                                24,929      23,345      21,572
                                               -------     -------     -------
 Income before income taxes                      6,907       8,348       7,345
PROVISION FOR INCOME TAXES                       2,377       3,002       2,656
                                               -------     -------     -------
NET INCOME                                       4,530       5,346       4,689
      Currency translation adjustment             (248)       (100)        142
                                               -------     -------     -------
COMPREHENSIVE INCOME/(LOSS)                    $ 4,282     $ 5,246     $ 4,831
                                               =======     =======     =======
NET INCOME PER SHARE:
    Basic                                         $.79        $.94        $.85
    Diluted                                       $.74        $.88        $.78
<PAGE>  15
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Years ended December 31, 1998, 1999 and 2000
(dollars in thousands)
<TABLE>
                                     Common Stock   Additional               Compre-     Unearned    Treasury
                                     Shares            Paid-In    Retained    hensive     Compensa-    Shares
                                    Issued  Amount    Capital    Earnings     Income       tion       Amount
                                    ------  ------  ----------   --------    --------    ---------   --------
<S>                             <C>        <C>        <C>        <C>           <C>          <C>      <C>
Balance at January 1, 1998       5,500,861  $1,100     $13,209    $   700       $  24        $ (19)
Shares issued pursuant to
 employee stock plans               48,501      10         369         (3)                    (260)
Shares returned to pay
 statutory withholding tax          (5,800)     (1)        (29)       (23)
Repurchase of common shares                                                                           $    (1)
Exercise of Warrants                54,307      11          79         (4)
Currency translation adjustment                                                   142
Net income                                                          4,689                       40
                                 ---------  ------     -------    -------       -----        -----    -------
Balance at December 31, 1998     5,597,869   1,120      13,628      5,359         166         (239)        (1)
Shares issued pursuant to
 employee stock plans              243,284      48         422        (17)                    (188)       589
Repurchase of common shares                                                                              (588)
Currency translation adjustment                                                  (100)
Net income                                                          5,346                      184
                                 ---------  ------     -------    -------       -----        -----    -------
Balance at December 31, 1999     5,841,153   1,168      14,050     10,688          66         (243)         0
Shares issued pursuant to
 employee stock plans               22,676       5          73                                (235)       294
Repurchase of common shares                                                                            (3,306)
Currency translation adjustment                                                  (248)
Net income                                                          4,530                      146
                                 ---------  ------     -------    -------       -----        -----    -------
Balance at December 31, 2000     5,863,829  $1,173     $14,123    $15,218       $(182)       $(332)   $(3,012)
                                 =========  ======     =======    =======       ======       ======   =======
</TABLE>
The accompanying notes to consolidated financial statements are an integral
part of these statements.
<PAGE>  16
CONSOLIDATED STATEMENTS OF CASH FLOWS
COGNITRONICS CORPORATION AND SUBSIDIARIES
(in thousands)
                                                      Year ended  December 31,
                                                     2000      1999       1998
                                                     ----      ----       ----
OPERATING ACTIVITIES
 Net income                                        $4,530    $5,346     $4,689
 Adjustments to reconcile net income to net cash
  provided by operating activities:
   Income tax expense                               2,377     3,002      2,656
   Depreciation and amortization                      943       802        769
   (Gain) loss on disposition of assets                (5)      (15)         6
   Shares issued as compensation                      146       185         40
   Net (increase) decrease in:
    Accounts receivable                            (1,108)   (1,820)      (605)
    Inventories                                     2,363    (4,111)      (569)
    Other assets                                      215      (169)       284
   Net increase (decrease) in:
    Accounts payable                               (2,698)    2,738       (802)
    Accrued compensation and benefits                (107)       34        (60)
    Other accrued expenses                           (217)      (62)      (793)
                                                   ------    ------     ------
                                                    6,439     5,930      5,615
   Income taxes paid                               (2,971)   (2,760)    (1,956)
   NET CASH PROVIDED BY OPERATING ACTIVITIES       ------    ------     ------
                                                    3,468     3,170      3,659
                                                   -------   ------     ------
INVESTING ACTIVITIES
 Purchase of marketable securities                 (2,800)  (11,200)    (3,700)
 Sale of marketable securities                      3,400     5,600      3,200
 Loans to officers                                   (712)     (127)
 Proceeds from disposition of assets                   20        10         24
 Additions to property, plant and equipment          (534)     (483)      (539)
 Purchase of software licenses                        (50)
                                                   ------    ------     ------
  NET CASH USED BY INVESTING ACTIVITIES              (676)   (6,200)    (1,015)
                                                   ------    ------     ------
FINANCING ACTIVITIES
 Principal payments on debt                           (49)     (111)      (174)
 Issuance of debt                                                          196
 Shares issued pursuant to employee stock plans       107       783         22
 Shares issued pursuant to warrants                                         86
 Shares repurchased for treasury,331,000,
  105,750  and 150                                 (3,306)     (588)        (1)
 Shares returned to pay statutory withholding
  tax upon vesting of restricted stock                                     (53)
                                                   ------    ------     ------
  NET CASH (USED) PROVIDED BY FINANCING
   ACTIVITIES                                      (3,248)       84         76
                                                   ------    ------     ------
EFFECT OF EXCHANGE RATE DIFFERENCES                   (37)      (53)        83
                                                   ------    ------     ------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS     (493)   (2,999)     2,803
CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR       3,992     6,991      4,188
                                                   ------    ------     ------
CASH AND CASH EQUIVALENTS - END OF YEAR            $3,499    $3,992     $6,991
                                                   ======    ======     ======
The accompanying notes to consolidated financial statements are an integral
part of these statements.
<PAGE>  17
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
COGNITRONICS CORPORATION AND SUBSIDIARIES

NOTE A.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization.  The Company designs, manufactures and markets voice processing
products in the United States and, through a subsidiary, distributes call
management and voice processing equipment in Europe.

Risks and Uncertainties.  A major portion of the Company's domestic revenues is
generated by sales to two customers, and a significant portion of its European
distributorship revenue comes from one customer.  The loss of any of these
customers would have a material adverse impact on the Company. The Company's
receivables are primarily from major, well-established companies in the
telecommunications industry, and at December 31, 2000, one such company
accounted for 75% of the Company's accounts receivable.  The Company's markets
are subject to rapid technological change and frequent introduction of new
products. The Company's products are similar to those manufactured, or capable
of being manufactured, by a number of companies, some of which are well
established with financial, personnel and technical resources substantially
larger than those of the Company. The Company's ability to compete in the
future depends on its ability to maintain the technological and performance
advantages of its current products and to introduce new products and
applications that achieve market acceptance.

Principles of Consolidation.  The financial statements include the accounts of
the Company and its subsidiaries, all of which are wholly-owned. Intercompany
accounts and transactions have been eliminated in consolidation.

Revenue.  Revenue is recognized when earned.  The Company generally recognizes
revenue from product sales upon shipment and in certain instances upon
acceptance by the customer.

Use of Estimates.  The preparation of the financial statements in conformity
with accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the amounts reported
in the financial statements and accompanying notes. Actual results could differ
from those estimates.

Fair Value of Financial Instruments.  The carrying amounts of the Company's
financial instruments (trade receivables/payables and other short-term and
long-term debt) due to their terms and maturities approximate fair value.

Cash and Cash Equivalents.  The Company considers financial instruments with a
maturity of three months or less from the date of purchase to be cash
equivalents. At December 31, 2000, essentially all of the Company's cash and
cash equivalent balances were with two financial institutions.

Marketable Securities.  Marketable securities are classified as available for
sale and are reported at cost.  Due to their short maturities and/or reset
provisions, their carrying value approximates fair value.

Inventories.  Inventories are stated at the lower of cost (first-in, first-out
method) or market.

Property, Plant and Equipment.  Property, plant and equipment is carried at
cost less allowances for depreciation, computed in accordance with the straight-
line method based on estimated useful lives.  The estimated lives for machinery
and equipment are 5 to 12 years and for furniture and fixtures are 4 to 10
years.  Repairs and maintenance are expensed when incurred.
<PAGE>  18
Foreign Exchange.  Results of operations for the Company's foreign subsidiary
were translated into U.S. dollars using average exchange rates during the
period, while assets and liabilities were translated using current rates at
the end of the period.

Stock Based Compensation. The Company grants stock options for a fixed number
of shares to employees with an exercise price equal to the fair value at the
date of grant. The Company  accounts for stock option grants in accordance with
Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock
Issued to Employees", and therefore recognizes no compensation expense for
stock options granted.

Income Per Share.  In computing basic earnings per share, the dilutive effect
of stock options and warrants are excluded, whereas for diluted earnings per
share they are included.  The shares used in the basic earnings per share
calculations were 5,753,734, 5,670,023 and 5,542,804 and in the diluted
earnings per share were 6,091,964, 6,047,636 and 5,993,077 for 2000, 1999 and
1998, respectively.

Goodwill.  The Company has classified as goodwill the cost in excess of fair
value of the net assets of companies acquired in purchase transactions.
Goodwill is amortized using the straight-line method over its estimated useful
life (10 years). Goodwill in excess of associated expected operating cash flows
is considered to be impaired and is written down to fair value.

Stock Split.  All share and per share amounts have been restated to give
retroactive effect to a 3 for 2 split in the form of a dividend declared in
July 1999.  The par value of the additional shares of common stock issued in
connection with the stock split was credited to common stock and charged to
retained earnings.

NOTE B. VALUATION AND QUALIFYING ACCOUNTS

The allowance for doubtful accounts was increased by $16,000, $10,000 and
$24,000 in 2000,  1999 and 1998, respectively, by charges to costs and
expenses.  The Company wrote off uncollectible accounts, net of recoveries, of
$10,000 and $18,000 in 1999 and 1998, respectively.

NOTE C.  INVENTORIES (IN THOUSANDS):
                                                                 2000     1999
                                                                 ----     ----
Finished and in process                                        $4,320   $3,947
Materials and purchased parts                                   2,237    5,132
                                                               ------   ------
                                                               $6,557   $9,079
                                                               ======   ======

NOTE D.  PROPERTY, PLANT AND EQUIPMENT (IN THOUSANDS):
                                                                 2000     1999
                                                                 ----     ----
Machinery and equipment                                        $1,995   $1,768
Furniture and fixtures                                          2,110    2,100
                                                               ------   ------
                                                                4,105    3,868
Less allowances for depreciation                                2,732    2,498
                                                               ------   ------
                                                               $1,373   $1,370
                                                               ======   ======

<PAGE>  19
NOTE E.  OTHER NON-CURRENT LIABILITIES (IN THOUSANDS):
                                                                 2000     1999
                                                                 ----     ----
Accrued officers' supplemental pension                         $  553   $  593
Accrued deferred compensation                                     291      305
Accrued pension                                                   568      607
Accrued postretirement benefit                                    825      800
                                                               ------   ------
                                                                2,237    2,305
Less current portion                                              189      195
                                                               ------   ------
                                                               $2,048   $2,110
                                                               ======   ======

NOTE F.  DEBT AND CREDIT ARRANGEMENTS

Dacon Electronics Plc has a bank line of credit of $145,000 expiring in 2001.
During 2000 and 1999, no amounts were borrowed under this facility.

Long term debt (in thousands):
                                                                    2000  1999
                                                                    ----  ----
Installment finance agreements, interest at 8% to 12% per annum
 expiring through 2003                                               $90  $139
 Less current maturities of debt                                      43    49
                                                                     ---  ----
                                                                     $47  $ 90
                                                                     ===  ====
Payments on the installment finance agreements in each of the three years in
the period ending December 31, 2003 are $43,000, $35,000 and $12,000,
respectively.

Interest of $31,000, $30,000 and $42,000 was paid in 2000, 1999 and 1998,
respectively.

NOTE G.  INCOME TAXES

At December 31, 2000, consolidated retained earnings included approximately
$1.1 million of retained earnings applicable to Dacon Electronics Plc, a
foreign subsidiary. If the undistributed earnings were remitted, any resulting
federal tax would be substantially reduced by foreign tax credits.
<PAGE>  20
The components of the provision (benefit) for income taxes for the years ended
December 31 are as follows (in thousands):
                                                        2000     1999     1998
                                                        ----     ----     ----
Current:
 Federal                                              $1,989   $2,428   $1,565
 Foreign                                                 (24)      62      377
 State                                                   346      419      370
                                                      ------   ------   ------
       Total current                                   2,311    2,909    2,312
                                                      ------   ------   ------
Deferred:
 Federal                                                  55       84      344
 State                                                    11        9
                                                      ------   ------   ------
       Total deferred                                     66       93      344
                                                      ------   ------   ------
                                                      $2,377   $3,002   $2,656
                                                      ======   ======   ======
Not reflected in the 2000, 1999 and 1998 tax provisions are $29,000, $73,000
and $94,000, respectively, of income tax benefits related to employee stock
plans; such amounts were credited to additional paid-in capital.  The provision
for 2000 reflects the reversal of a $156,000 tax reserve.

Domestic and foreign pretax income (loss) for the years ended December 31 are
as follows (in thousands):
                                                          2000    1999    1998
                                                          ----    ----    ----
Domestic operations                                     $7,439  $8,484  $6,357
Foreign Operations                                        (532)   (136)    988
                                                        ------  ------  ------
                                                        $6,907  $8,348  $7,345
                                                        ======  ======  ======

Deferred income taxes reflect the net tax effects of temporary differences
between carrying amounts of assets and liabilities for financial reporting
purposes and amounts used for income tax purposes. Significant components of
the Company's deferred tax liabilities and assets as of December 31, 2000 and
1999 are as follows (in thousands):
                                                                 2000     1999
                                                                 ----     ----
Deferred tax liabilities                                       $  187   $  238
                                                               ------   ------
Deferred tax assets:
 Inventory valuation                                              504      701
 Accrued liabilities and employee benefits                        445      380
 Accrued deferred compensation                                    309      333
 Other postretirement benefits                                    312      304
 Separate return federal operating loss carryforwards
  expiring in 2008 and 2009                                       445      445
 Other                                                            125       94
                                                               ------   ------
      Total deferred tax assets                                 2,140    2,257
 Valuation allowance                                             (445)    (445)
                                                               ------   ------
                                                                1,695    1,812
                                                               ------   ------
        Net deferred tax assets                                $1,508   $1,574
                                                               ======   ======
<PAGE>  21
No amounts have been credited or charged to tax expense for the valuation
allowance in 2000 or 1999.

A reconciliation of the statutory federal income tax rate to the effective tax
rate on income for the years ended December 31, is as follows:

                                                            2000   1999   1998
                                                            ----   ----   ----
Statutory federal income tax rate                           34.0%   34.0% 34.0%
State income taxes, net of federal tax benefit               3.4     3.4   3.6
Lower foreign tax rate                                              (0.1) (1.0)
Research & Development Credit                               (0.3)   (1.0) (1.6)
Nontaxable interest income                                  (1.7)   (1.2) (0.7)
Goodwill amortization                                        1.2     1.0   1.5
Other                                                       (2.2)    (.1)  0.4
                                                            ----    ----  ----
                                                            34.4%   36.0% 36.2%
                                                            ====    ====  ====

NOTE H.  OTHER (INCOME) EXPENSE, NET (IN THOUSANDS):
                                                       Year Ended December 31,
                                                       2000     1999      1998
                                                       ----     ----      ----
Interest expense                                      $  50    $  49     $  73
Interest income                                        (669)    (490)     (477)
                                                      -----    -----     -----
                                                      $(619)   $(441)    $(404)
                                                      =====    =====     =====

NOTE I. COMMITMENTS

Leases.  Total rental expense amounted to $500,000 in 2000, $532,000 in 1999
and $465,000 in 1998.  Future annual payments for long-term noncancellable
leases for each of the five years in the period ending December 31, 2006 are
approximately $424,000, $327,000,$253,000, $4,000 and $0, respectively, and
no amounts thereafter.

Pension Plan.  The Company and its domestic subsidiaries have a defined benefit
pension plan covering substantially all employees.  The benefits are based on
years of service and the employee's compensation.   No additional service cost
benefits were earned subsequent to June 30, 1994.  The Company's funding policy
is to contribute amounts to the plan sufficient to meet the minimum funding
requirements set forth in the Employee Retirement Income Security Act of 1974,
plus such additional amounts as the Company may determine to be appropriate
from time to time.

The components of net cost of the plan for the years ended December 31 are as
follows (in thousands):
                                                              2000  1999  1998
                                                              ----  ----  ----
Interest cost on projected benefit obligation                 $116  $117  $115
Actual (return)/loss on plan assets                             25   (50) (120)
Net amortization and deferral                                 (123)  (44)    31
                                                              ----  ----  ----
      Net periodic pension cost                               $ 18  $ 23  $ 26
                                                              ====  ====  ====
<PAGE>  22
The following table sets forth the plan's funded status and the accrued pension
liability recognized in the Company's Consolidated Balance Sheets at
December 31 (in thousands):
                                                                  2000    1999
                                                                  ----    ----
Projected benefit obligation for services rendered to date
  Beginning of year                                             $1,586  $1,773
    Gain due to change in estimates                                (33)   (152)
    Interest cost                                                  116     116
    Less benefits paid                                            (102)   (151)
                                                                ------  ------
  End of year                                                    1,567   1,586
                                                                ------  ------
Plan assets at fair value
  Beginning of year                                              1,220   1,258
    Actual return on plan assets                                   (25)     50
    Contribution                                                    56      63
    Less benefits paid                                            (102)   (151)
                                                                ------  ------
  End of year                                                    1,149   1,220
                                                                ------  ------

Plan assets less than projected benefit obligation                (418)   (366)
Unrecognized net asset, less accumulated amortization
 of $172 and $164                                                   (8)    (17)
Unrecognized net gain                                             (142)   (224)
                                                                ------  ------
Accrued pension liability (included in other non-current
 liabilities)                                                   $ (568) $ (607)
                                                                ======  ======
The discount rates used in determining the projected benefit obligation were
7.5 % in 2000 and 7.75% in 1999.  The expected long-term rate of return on
plan assets used in determining the net periodic pension cost was 7% for all
years presented.

The plan assets at December 31, 2000 and 1999 were principally invested in
corporate debt and equity securities.

401(k) Retirement Plan.  The Company has a defined contribution plan covering
substantially all domestic employees. The Company's contribution is based upon
the participants' contributions. The expense was $54,000, $53,000 and $52,000
in 2000, 1999 and 1998, respectively.

Officers' Supplemental Pension Plan.  The Company has an unfunded,
noncontributory defined benefit pension plan covering certain retired officers.

The components of net pension cost of the plan for the years ended December 31
are as follows (in thousands):

                                                            2000   1999   1998
                                                            ----   ----   ----
Interest cost on projected benefit obligation                $32    $34    $35
Amortization of actuarial gains                               (3)    (2)    (3)
                                                             ---    ---    ---
Net periodic pension cost                                    $29    $32    $32
                                                             ===    ===    ===
<PAGE>  23
The following table sets forth the plan's status and the accrued pension
liability recognized in the Company's Consolidated Balance Sheets at
December 31 (in thousands):
                                                                   2000   1999
                                                                   ----   ----
Projected benefit obligations
  Balance at beginning of period                                   $508   $543
      Interest expense                                               32     34
      Less benefits paid                                            (68)   (69)
                                                                   ----   ----
  Balance at end of period                                          472    508
Unrecognized net gain                                                81     85
                                                                   ----   ----
Accrued pension liability (included in other non-current
 liabilities)                                                      $553   $593
                                                                   ====   ====
The discount rate used in determining the projected benefit obligation was
6.75% for all three years presented.  All participants are retired and
receiving benefits under the Plan and therefore future increases in
compensation are not applicable.

Other Postretirement Benefit Plans.  In addition to the Company's pension
plans, the Company has a contributory, unfunded defined benefit plan providing
certain health care benefits for domestic employees who retired prior to
March 31, 1996. The participants' contributions are adjusted periodically and
are based on age and length of service at time of retirement. The assumed rate
of increase in the per capita cost of covered benefits used for 1999 was 9%
decreasing to 5% after 8 years and for 2000 was 10% decreasing to 5% after 10
years.  Increasing the health care cost trend rate by one percentage point each
year would increase the accumulated postretirement benefit obligation by
$83,000 at December 31, 2000 and the aggregate service and interest cost
component of net periodic postretirement benefit cost for 2000 by $6,000.
The corresponding impact for a 1% decrease are $73,000 and $5,000,
respectively.  The weighted average discount rates used in determining the net
periodic postretirement benefit cost and accumulated benefit obligation were
7.5% and 7.75% for 2000 and 1999, respectively.

The following sets forth the plan's status and accrued postretirement benefit
liability recognized in the Company's Consolidated Balance Sheets at
December 31 (in thousands):
                                                                   2000   1999
                                                                   ----   ----
Actuarial present value of accumulated postretirement benefit
obligation:                                                        $834   $733
Unrecognized net gain/(loss)                                         (9)    67
                                                                   ----   ----
Accrued postretirement benefit liability (included in other
 non-current liabilities)                                          $825   $800
                                                                   ====   ====

The components of postretirement benefit cost for the years ended December 31,
are as follows (in thousands):
                                                            2000   1999   1998
                                                            ----   ----   ----
       Interest cost                                         $61    $53    $42
       Net amortization                                                     (8)
                                                             ---    ---    ---
           Net periodic cost                                 $61    $53    $34
                                                             ===    ===    ===
<PAGE>  24
Deferred Compensation. At December 31, 2000 and 1999, the liability relating to
a deferred compensation arrangement between the Company and a director and
former officer of the Company was $291,000 and $305,000, respectively.

NOTE J.  STOCK PLANS

At December 31, 2000, the Company has reserved 176,575 shares of its common
stock for grant to key employees under the 1990 Stock Option Plan. The plan
provides for the grant, at fair market value on the date of grant, of
nonqualified stock options and incentive stock options. Options generally
become exercisable in three equal annual installments on a cumulative basis
commencing six months from the date of grant and expire five years (ten years
for awards granted after 1999) after the date granted.

The Company also has the 1967 Employee Stock Purchase Plan under which 52,478
shares were reserved for grant at December 31, 2000 The purchase price is 85%
of the fair market value of the stock on the date offered. Generally, rights
to purchase shares under this plan expire 12 months (maximum 27 months) after
the date of grant.

The Company also has a time accelerated restricted stock plan ("Restricted
Stock Plan") under which 14,687 shares are available for grant. The plan
provides for the award of shares to key employees; generally, the awards vest
in five equal annual installments commencing two years after the date of the
award.  Vesting may be accelerated based on the achievement of certain
financial performance goals.


Share information pertaining to these plans is as follows:



                                                                    Restricted
                                                 Option   Purchase     Stock
                                                  Plan      Plan        Plan
                                                 ------   --------  ----------
Outstanding at January 1, 1998                  521,826          0      22,950
      Granted                                   175,725     28,603      39,000
      Cancelled or expired                       (2,000)
      Vested                                                           (20,550)
      Exercised                                  (9,501)
                                                -------     ------      ------
Outstanding at December 31, 1998                686,050     28,603      41,400
      Granted                                   142,875                 21,000
      Cancelled or expired                       (4,101)      (913)
      Vested                                                           (12,480)
      Exercised                                (300,497)   (27,690)
                                                -------     ------      ------
Outstanding at December 31, 1999                524,327          0      49,920
      Granted                                   202,900                 26,000
      Cancelled or expired                       (5,225)                  (600)
      Vested                                                            (8,280)
      Exercised                                 (27,126)
                                                -------     ------      ------
Outstanding at December 31, 2000                694,876          0      67,040
                                                =======     ======      ======

The exercise price for options granted in 1998 was $6.67, for options granted
in 1999 was $9.00 and for options granted in 2000 ranged from $9.06 to $9.70.
<PAGE>  25
The weighted average exercise price for the 694,876 options outstanding under
the Option Plan is $6.73 with expiration dates ranging from 2001 to 2010.
Options were exercised under the Option Plan at weighted average exercise
prices of $1.98, $2.08 and $3.95 in 1998, 1999 and 2000, respectively. Shares
exercisable under the Option Plan at December 31, 1998, 1999 and 2000 were
419,577, 316,027 and 457,943, respectively.

Rights were granted under the Purchase Plan at an exercise price of $5.67 in
1998.  Shares were exercised under the Purchase Plan at a weighted average
price of $5.67 in 1999.

Under the Restricted Stock Plan compensation expense was $146,000, $184,000
and $30,000 in 2000, 1999 and 1998, respectively.

During 1998, the Company established a stock option plan for non-employee
directors and officers.  The plan provided for an initial grant of options to
purchase 3,000 shares to each participant (18,000 in total) at $5.50, the
fair market value on the date of grant, and additional grants of 1,500 shares
for each participant on August 1st of subsequent years at the then fair market
value.  Effective August 1, 1999, an additional 1,500 shares were granted to
each participant (9,000 in all) at an exercise price of $11.17.  In 2000, an
additional grant of 3,000 shares (18,000 in all) was awarded at an exercise
price of $12.63.  Through December 31, 2000, no grants under this plan have
been exercised.  At December 31, 2000, the Company has reserved 7,500 shares
of its Common Stock for grant.

The Company has elected to follow APB No. 25 and related interpretations in
accounting for its stock option plans, and has adopted the disclosure-only
provisions of  SFAS No. 123.  If the Company had elected to recognize
compensation expense for the 1990 Stock Option Plan and the 1967 Stock Purchase
Plan based on the fair value at the grant date , consistent with the method
presented by SFAS No. 123, the pro forma net income and net income per share
would be as follows (in thousands except per share information):


                                                          2000    1999    1998
                                                          ----    ----    ----

      Net income              As reported               $4,530  $5,346  $4,689
                                                        ======  ======  ======
                              Pro forma                 $3,928  $4,859  $4,442
                                                        ======  ======  ======

      Net income per share    As reported      Basic      $.79    $.94    $.85
                                                          ====    ====    ====
                                               Diluted    $.74    $.88    $.78
                                                          ====    ====    ====
                              Pro forma        Basic      $.68    $.86    $.80
                                                          ====    ====    ====
                                               Diluted    $.65    $.81    $.75
                                                          ====    ====    ====

The estimated weighted average fair value per share of stock options granted
were $4.82, $5.16 and $3.21 for 2000, 1999 and 1998, respectively.  The fair
value for the stock options was estimated at the date of grant using a Black-
Scholes option pricing model with the following weighted-average assumptions
for 2000, 1999 and 1998, respectively: risk-free interest rates of 5.1%, 5.5%
and 4.5%; no dividend yields; volatility factors of the expected market price
of the Company's common stock of .74 in 2000, .61 in 1999 and .64 in
<PAGE>  26
1998; and a weighted average expected life of the option of 3.8 in
all years, and 5 years for the Directors and Officers Plan.

The Black-Scholes option valuation model was developed for use in estimating
the fair value of traded options which have no vesting restrictions and are
fully transferable.  In addition, option valuation models require the input
of highly subjective assumptions including the expected stock price volatility.
Because the Company's employee stock options have characteristics significantly
different from those of traded options, and because changes in the subjective
input assumptions can materially affect the fair value estimate, in
management's opinion, the existing models do not necessarily provide a reliable
single measure of the fair value of its employee stock options.

In 1998, warrants to purchase 54,307 shares of common stock at $1.58 per share
were exercised and 20,693 expired.
<PAGE>  27
NOTE K.  OPERATIONS BY INDUSTRY SEGMENT AND GEOGRAPHIC AREAS

The Company operates in two segments of the voice processing industry.  In
the United States, the Company designs, manufactures and sells equipment for
use in telephone central offices.  In Europe (United Kingdom), the Company
distributes equipment for use in customers' premises. Information about the
Company's operations by segment and geographic area for the years ended
December 31, is as follows (in thousands):
                                                      2000      1999      1998
                                                      ----      ----      ----
Net sales
      United States:
       Unaffiliated customers (North America)      $24,511   $24,462   $20,603
       Intercompany transfers                           55       194        98
                                                   -------   -------   -------
                                                    24,566    24,656    20,701
      Europe                                         7,325     7,231     8,314
      Eliminations                                     (55)     (194)      (98)
                                                   -------   -------   -------
                                                   $31,836   $31,693   $28,917
                                                   =======   =======   =======
Operating profit
      United States                                $ 8,139   $ 9,433   $ 7,247
      Europe                                          (529)     (138)      878
       Intercompany eliminations                         8       (10)       18
                                                   -------   -------   -------
                                                     7,618     9,285     8,143
General corporate expenses                           1,330     1,378     1,202
Other (income) expense, net                           (619)     (441)     (404)
                                                   -------   -------   -------
Income before income taxes                         $ 6,907   $ 8,348   $ 7,345
                                                   =======   =======   =======
Total assets
      United States                                $29,262   $31,238   $21,461
      Europe                                         3,779     3,919     5,670
       Intercompany eliminations                       (43)      (55)      (51)
                                                   -------   -------   -------
                                                   $32,998   $35,102   $27,080
                                                   =======   =======   =======
Long-lived assets
      United States                                $ 1,545   $ 1,718   $ 1,531
      Europe                                           973     1,432     1,757
       Intercompany eliminations                       (27)      (36)      (16)
                                                   -------   -------   -------
                                                   $ 2,491   $ 3,114   $ 3,272
                                                   =======   =======   =======
Expenditures for long-lived assets
      United States                                $   486   $   300   $   384
      Europe                                            98       246       155
       Intercompany eliminations                         0       (63)        0
                                                   -------   -------   -------
                                                   $   584   $   483   $   539
                                                   =======   =======   =======
Depreciation and amortization
      United States                                $   452   $   279   $   261
      Europe                                           494       540       525
       Intercompany eliminations                        (3)      (17)      (17)
                                                   -------   -------   -------
                                                   $   943   $   802   $   769
                                                   =======   =======   =======
<PAGE>  28
Gross profit margin on intercompany transfers are comparable to sales to third
parties.  The United States operations had net sales of $2.8 million, $1.9
million and $6.8 million in 2000, 1999 and 1998, respectively, to one major
customer; sales of $12.6 million, $7.3 million and $5.2 million in 2000, 1999
and 1998, respectively, to another major customer; sales of $2.9 million in
1999 to another customer and export sales of $2.9 million and $2.0 million in
1999 and 1998, respectively, to another customer.  The European operations had
sales of $3.7 million, $4.6 and $5.2 million in 2000, 1999 and 1998,
respectively, to one customer.


Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure

      None.


                               PART III

Item 10.   Directors and Executive Officers of the Registrant

      1.   (a) The identification of the directors of the Company as of
March 1, 2001 and persons nominated to become directors set forth under the
caption Information Concerning Nominees in the Proxy Statement for the annual
meeting of stockholders to be held on May 17, 2001 is incorporated herein by
reference.

       (b) The identification of the executive officers of the Company and
their positions with the Company and ages as of March 1, 2001 is set forth
under the caption Executive Officers of the Company in Part I of this Annual
Report on Form 10-K.

      2.   The information regarding compliance with Section 16(a) of the
Securities Exchange Act of 1934 set forth under the caption Section 16(a)
Beneficial Ownership Reporting Compliance in the Proxy Statement for the
annual meeting of stockholders to be held on May 17, 2001 is incorporated
herein by reference.

Item 11.   Executive Compensation

       The information on executive compensation set forth under the caption
Executive Compensation in the Proxy Statement for the annual meeting of
stockholders to be held on May 17, 2001 is incorporated herein by reference.

Item 12.   Security Ownership of Certain Beneficial Owners and Management

       (a) and (b)  Security ownership of certain beneficial owners and
management set forth under the caption Security Ownership in the Proxy
Statement for the annual meeting of stockholders to be held on May 17, 2001 is
incorporated herein by reference.

       (c) Changes in Control.  None.

Item 13.   Certain Relationships and Related Transactions

       The information on certain relationships and related transactions set
forth under the caption Certain Relationships and Related Transactions in the
Proxy Statement for the annual meeting of stockholders to be held on May 17,
2001 is incorporated herein by reference.
<PAGE>  29
                               PART IV
Item 14.   Exhibits, Financial Statement Schedules, and Reports on Form 8-K

 (a)(1) and (2) and (d)  The response to this portion of Item 14 is submitted
as a separate section beginning on page 26 of this Annual Report on Form 10-K.

 (a)(3) and (c)  The response to this portion of Item 14 is submitted as a
separate section beginning on page 27 of this Annual Report on Form 10-K.

 (b)  There were no reports filed on Form 8-K during the fourth quarter of 2000.
<PAGE>  30
                              SIGNATURES
    Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, on March 23, 2001.

                                                    COGNITRONICS CORPORATION
                                                            Registrant
                                                    by /s/  Garrett Sullivan
                                                    -------------------------
                                                         Garrett Sullivan
                                                             Treasurer

 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
registrant and in the capacities indicated on March 23, 2001.

 Signature                                               Title
 ---------                                               -----
Chief Executive Officer:
 /s/ Brian J. Kelley
 -------------------                                      President and Chief
      Brian J. Kelley                                     Executive Officer


Chief Financial and Accounting Officer:
 /s/ Garrett Sullivan                                      Treasurer
 --------------------
     Garrett Sullivan

A Majority of the Board of Directors:
 /s/ John T. Connor                                         Director
 ------------------
     John T. Connor

 /s/ Edward S. Davis                                        Director
 -------------------
     Edward S. Davis

 /s/ William A. Merritt                                     Director
 ----------------------
     William A. Merritt

 /s/ Timothy P. Murphy                                      Director
 ---------------------
     Timothy P. Murphy

 /s/ David H. Shepard                                       Director
 ---------------------
     David H. Shepard
<PAGE>  31
Form 10-K -- Item 14 (a) (1) and (2) and (d)

 (a) (1)  Financial Statements

The following financial statements of the Company are included in Item 8.

Financial Statements Covered by Report of Independent Auditors:          PAGE

Report of Independent Auditors . . . . . . . . . . . . . . . . . . . . . . 11

Consolidated Balance Sheets, December 31, 2000 and December 31, 1999 . . . 12

Consolidated Statements of Income and Comprehensive Income for each
 of the three years in the period ended December 31, 2000. . . . . . . . . 13

Consolidated Statements of Stockholders' Equity for each of the
 three years in the period ended December 31, 2000 . . . . . . . . . . . . 13

Consolidated Statements of Cash Flows for each of the three years in
 the period ended December 31, 2000. . . . . . . . . . . . . . . . . . . . 14

Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . 15


     (2) and (d) Financial Statement Schedules

Schedules for which provision is made in the applicable accounting regulation
of the Securities and Exchange Commission are not required under the related
instructions, are inapplicable, or the information has been included in the
Company's financial statements. and, therefore, have been omitted.
<PAGE>  32
                        Item 14(a)(3) and (c)

                          INDEX TO EXHIBITS

Exhibit

3.1      Certificate of Incorporation as filed on January 2, 1962 (Exhibit
         3-1-A to Form S-1 Registration Statement No. 2-27439 and incorporated
         herein by reference).

3.2      Amendment, dated June 28, 1965 (Exhibit 3-1-B to Form S-1 Registration
         Statement No. 2-27439 and incorporated herein by reference).

3.3      Amendment, dated October 3, 1966 (Exhibit 3-1-C to Form S-1
         Registration Statement No. 2-27439 and incorporated herein by
         reference).

3.4      Amendment, dated October 30, 1967 (Exhibit 3-1-D to Form S-1
         Registration Statement No. 2-27439 and incorporated herein by
         reference).

3.5      Amendment, dated July 27, 1981 (Exhibit 3.5 to Annual Report on
         Form 10-K for the fiscal year ended December 31, 1983 and incorporated
         herein by reference).

3.6      Amendment, dated September 27, 1984 (Exhibit 3.6 to Annual Report on
         Form 10-K for the fiscal year ended December 31, 1984 and incorporated
         herein by reference).

3.7      Amendment dated June 13, 1988 (Exhibit 3.7 to Annual Report on
         Form 10-K for the fiscal year ended December 31, 1988 and incorporated
         herein by reference).

3.8      Amendment dated November 3, 1994 (Exhibit 3.8 to Annual Report on
         Form 10-K for the year ended December 31, 1994 and incorporated
         herein by reference).

3.9      Amendment, dated July 25, 2000 (Exhibit 3.1 to Quarterly
         Report on Form 10-Q for the period ended June 30, 2000 and
         incorporated herein by reference)

3.10     By-laws of the Company (Exhibit 3.9 to Annual Report on
         Form 10-K for the year ended December 31, 1994 and
         incorporated herein by reference).

4.       Specimen Certificate for Common Stock (Exhibit 4-1 to Form
         S-1 Registration Statement No. 2-27439 and incorporated
         herein by reference).

10.1     1990 Stock Option Plan, as amended (Exhibit 10.1 to
         Quarterly Report on Form 10-Q for the period ended June 30,
         2000 and incorporated herein by reference).

10.2     Lease, dated April 30, 1993, between Seymour R. Powers and The Danbury
         Industrial Corporation, landlord, and Cognitronics Corporation, tenant
         (Exhibit 10.3 to Annual Report on Form 10-K for the year ended
         December 31, 1993 and incorporated herein by reference).
<PAGE>  33
EXHIBIT

10.3     Form of Indemnity Agreement, dated October 27, 1986, between each
         Director (with equivalent form for each Officer) and Cognitronics
         Corporation (Exhibit 10.7 to Annual Report on Form 10-K for the year
         ended December 31, 1986 and incorporated herein by reference).

10.4     Supplemental Pension Plan for Officers, as amended November 2, 1993
         (Exhibit 10.6 to Annual Report on Form 10-K for the year ended
         December 31, 1993 and incorporated herein by  reference).

10.5     2000 Executive Bonus Plan (attached as Exhibit 10.5 to this
         Annual Report on Form 10-K).

10.6     Cognitronics Corporation Restricted Stock Plan (Exhibit
         10.2 to Quarterly Report on Form 10-Q for the period ended
         June 30, 2000 and incorporated herein by reference).

10.7     Form of Executive Severance Agreement between certain
         officers and Cognitronics Corporation  ( Exhibit 10.8 to
         Annual Report on Form 10-K for the year ended December 31,
         1997 and incorporated herein by reference).

10.8     Addendum to Executive Severance Agreement between certain
         officers and Cognitronics Corporation (Exhibit 10.8 to
         Annual Report on Form 10-K for the year ended December 31,
         1999 and incorporated herein by reference).

10.9     The Directors' Stock Option Plan, as amended  (attached as
         Exhibit 10.3 to Quarterly Report on Form 10-Q for the
         period ended June 30, 2000 and incorporated herein by
         reference).

22.      List of subsidiaries of the Company as of December 31, 2000
         (attached as Exhibit 22 to this Annual Report on Form 10-K).

23.      Consent of Independent Auditors, dated April 2, 2001
         (attached as Exhibit 23 to this Annual Report on Form 10-K).

 Copies of the Exhibits to this Annual Report on Form 10-K are
available upon written request to the Secretary of the Company at 3
Corporate Drive, Danbury, CT 06810-4130 and payment of $35.00 for a
complete set of the Exhibits or $.25 per page for any part thereof
(minimum $5.00).