<PAGE>
 
--------------------------------------------------------------------------------

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549
                                 ______________

                                   FORM 10-Q

            X      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
           ___       OF THE SECURITIES EXCHANGE ACT OF 1934
                 For the Quarterly Period Ended March 31, 1998

           ___    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  000-22649

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

            WASHINGTON                                  91-1497147
  (State or other jurisdiction of                    (I.R.S. Employer 
   incorporation or organization)                  Identification Number)
 
       2229  112TH AVENUE N.E.                        (425) 372-2747
   BELLEVUE, WASHINGTON  98004-2936             (Registrant's telephone number,
(Address of principal executive office)             including area code)


     Indicate by check mark whether the registrant:

     (1)  Has filed all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file for such reports), and

     (2) Has been subject to such filing requirements for the past 90 days. 
         Yes [X]  No [_]

     The number of shares outstanding of the registrant's common stock as of
March 31, 1998 was 10,276,611.

--------------------------------------------------------------------------------
<PAGE>
 
                                   ARIS CORPORATION
                                       FORM 10-Q
 
 
INDEX                                                            PAGE

PART I.  FINANCIAL INFORMATION

Item 1   Financial Statements

         a)  Condensed Consolidated Balance Sheets
             as of March 31, 1998 and December 31, 1997       
                                                                   3
         b)  Condensed Consolidated Statements of             
             Income for the Quarters Ended March, 1998        
             and 1997.                                             4
                                                              
         c)  Condensed Consolidated Statements of             
             Cash Flows for the Quarters Ended March          
             31, 1998 and 1997                                     5
                                                              
         d)  Condensed Consolidated Statement of              
             Changes in Shareholders' Equity as of            
             March 31, 1998                                        6
                                                              
         e)  Notes to Condensed Consolidated                  
             Financial Statements                                6-8
                                                              
Item 2   Management's Discussion and Analysis of              
         Financial Condition and Results of                   
         Operations                                             9-14
                                                              
                                                              
PART II.  OTHER INFORMATION                                   

Item 1   Legal Proceedings                                        15

Item 2   Changes in Securities                                    15

Item 3   Defaults Upon Senior Securities                          16

Item 4   Submission of Matters to a Vote of                       16
         Security Holders                                     

Item 5   Other Information                                        16

Item 6   Exhibits and Reports on Form 8-K                         16

                                     Page 2
<PAGE>
 
                                     PART I
                             FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ARIS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except for share data)
_______________________________________________________________________________ 

<TABLE>
<CAPTION>
                                                                MARCH 31,      DECEMBER 31,
                                                                  1998             1997
                                                                ---------      ------------ 
                                                               (Unaudited)  
<S>                                                            <C>              <C>   
Assets                                                                      
Current assets:                                                             
   Cash                                                          $11,740         $ 9,400
   Cash equivalents and investments in marketable securities       7,099          15,464
   Accounts receivable, net of allowance for                                
    doubtful accounts of $751 and $651                            15,645          12,789
   Other current assets                                            2,627           2,621
                                                                 -------         ------- 
       Total current assets                                       37,111          40,274
                                                                            
Property and equipment, net                                       11,970           6,619
Intangible and other assets,  net                                  8,514           8,095
                                                                 -------         ------- 
       Total assets                                              $57,595         $54,988
                                                                 -------         -------  
                                                                            
Liabilities and Shareholders' Equity                                        
Current liabilities:                                                        
   Accounts payable                                              $ 2,337         $ 2,768
   Accrued liabilities                                             3,947           3,438
   Deferred revenue                                                2,759           2,305
   Other current liabilities                                       1,155             257
                                                                 -------         -------  
       Total current liabilities                                  10,198           8,768
                                                                 -------         -------  
Deferred income taxes                                                463             585
                                                                 -------         -------  
Commitments and contingencies                                               
Shareholder's equity:                                                       
   Preferred stock 5,000,000 shares authorized, none issued                 
    and outstanding                                                         
   Common stock, no par value; 100,000,000 shares authorized                
   Additional paid-in-capital                                     37,933          37,504
   Retained earnings                                               8,999           8,167
   Accumulated other comprehensive income                              2             (36)
       Total shareholders' equity                                 46,934          45,635
                                                                 -------         -------  
       Total liabilities and shareholders' equity                $57,595         $54,988
                                                                 =======         =======  
</TABLE>

                            See accompanying notes

________________________________________________________________________________

                                     Page 3
<PAGE>
 
ARIS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except for share and per share data)  (Unaudited)
_______________________________________________________________________________ 

<TABLE>
<CAPTION>
                                                 For the Quarter Ended
                                           --------------------------------
                                             MARCH 31,            MARCH 31,
                                              1998                  1997
                                           -----------           ----------   
<S>                                        <C>                   <C>
Revenue, net: 
 Consulting......................          $     9,015           $    6,633
 Training........................                9,602                4,864
 Software........................                2,120                  533
                                           -----------           ----------   
   Total revenue.................               20,737               12,030
Cost of sales:                                   9,033                5,675
                                           -----------           ----------  
   Gross profit..................               11,704                6,355
Selling, general and 
 administrative..................               10,235                4,487
                                           -----------           ----------   
 
   Income from operations........                1,469                1,868
Other income (expense), net......                  366                  (39)
                                           -----------           ----------  
   Income before income tax......                1,835                1,829
Income tax expense...............                  790                  674
                                           -----------           ----------  
Net income.......................          $     1,045           $    1,155
                                           ===========           ==========    
Basic earnings per share.........                $0.10                $0.15
                                           ===========           ==========    
Weighted average number of                             
 common shares outstanding.......           10,235,000            7,940,000
                                           ===========           ==========    
Diluted earnings per share.......                $0.09                $0.14
                                           ===========           ==========     
Weighted average number of
 common and common equivalent                                               
 shares outstanding..............           11,082,000            8,393,000 
                                           ===========           ==========     
</TABLE>

                            See accompanying notes

________________________________________________________________________________

                                     Page 4
<PAGE>
 
ARIS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)(Unaudited)
_______________________________________________________________________________ 
<TABLE>
<CAPTION>
                                                                     For the Quarter Ended
                                                                   --------------------------
                                                                   March 31,        March 31,
                                                                     1998             1997
                                                                   ---------        ---------
<S>                                                                <C>              <C>
Net cash provided by (used in) operating activities................   $(531)          $  546
                                                                    -------           ------
Cash flows from investing activities:
Sales of investments in marketable securities......................   8,402                8
Acquisition of businesses, net of cash acquired....................                      (93)
Purchases of property and equipment................................  (5,641)            (493)
                                                                    -------           ------
Net cash provided by (used in) investing activities................   2,761             (578)
                                                                    -------           ------
Cash flows from financing activities:
Repurchase of common stock.........................................                   (4,026)
Payments on notes payable..........................................                   (2,100)
Proceeds from long-term debt.......................................                    6,450
Proceeds from exercise of stock options............................     279                1
Tax benefit of stock options exercised.............................      43
                                                                    -------           ------
Net cash provided by financing activities..........................     322              325
                                                                    -------           ------

Net increase in cash...............................................   2,552              293
Effect of exchange rate changes on cash and cash equivalents.......       1               14
Adjustment to conform fiscal year of Barefoot Computer
 Training Limited..................................................    (213)
Cash and cash equivalents at beginning of period...................   9,400              178
                                                                    -------           ------
Cash and cash equivalents at end of period......................... $11,740           $  485
                                                                    =======           ======
</TABLE>
                            See accompanying notes

________________________________________________________________________________

                                     Page 5
<PAGE>
 
ARIS CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(In thousands, except for share data) (Unaudited)
______________________________________________________________________________  
<TABLE>
<CAPTION>
                                             COMMON STOCK                                           ACCUMULATED 
                                         --------------------       ADDITIONAL                        OTHER            TOTAL 
                                         SHARES                      PAID-IN         RETAINED      COMPREHENSIVE    SHAREHOLDERS' 
                                         ISSUED        AMOUNT        CAPITAL         EARNINGS         INCOME           EQUITY 
                                       ----------      ------       ----------       --------      -------------    -------------   
<S>                                    <C>             <C>          <C>              <C>           <C>              <C> 
Balance at December 31, 1997           10,200,461      $    -        $37,504          $8,167           $(36)           $45,635
Adjustment to conform fiscal                                                                                    
 year of Barefoot Computer                                                                                      
 Training Limited                                                                       (213)                             (213)
Shares issued                               5,357                        150                                               150
Stock options exercised                    70,993                        279                                               279
Comprehensive income:                                                                                           
  Net income                                                                           1,045                    
  Other comprehensive income,                                                                                   
   net of tax:                                                                                                  
    Foreign currency translation                                                                                
     adjustments                                                                                          1     
    Unrealized gains on securities,                                                                             
     net of reclassification                                                                                    
     adjustment                                                                                          37     
       Comprehensive income                                                                                              1,083
                                       ----------      ------       ----------       --------      -------------    -------------   
Balance at March 31, 1998              10,276,811      $    -        $37,933          $8,999           $  2            $46,934
                                       ==========      ======       ==========       ========      =============    =============   
</TABLE>
                                                                                
<TABLE>
<S>                                                       <C>
Disclosure of reclassification amount:
  Unrealized holding gain arising during the period       $33          
    Less:  reclassification adjustment for losses                      
             included in net income                         4          
                                                          ---          
  Net unrealized gains on securities                      $37          
                                                          ===          
</TABLE>

ARIS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
______________________________________________________________________________  

1.   The unaudited financial information furnished herein, in the opinion of
     management, reflects all adjustments consisting only of normal, recurring
     adjustments which are necessary to state fairly the condensed consolidated
     balance sheets, and condensed consolidated statements of income, statements
     of cash flows and statement of changes in shareholders' equity of ARIS
     Corporation ("ARIS" or the "Company") as of and for the periods indicated.
     ARIS presumes that users of the interim financial information herein have
     read or have access to the Company's audited consolidated financial
     statements and Management's Discussion and Analysis of Financial Condition
     and Results of Operations for the preceding fiscal year and that the
     adequacy of additional disclosure needed for a fair presentation, except in
     regard to material contingencies or recent significant events, may be
     determined in that context. Accordingly, footnote and other disclosures
     which would substantially duplicate the disclosures contained in the
     Company's Annual Report on Form 10-K filed on March 30, 1998, have been
     omitted.

2.   On February 28, 1998, the Company completed its acquisition of Barefoot
     Computer Training Limited ("Barefoot"), a company that provides information
     technology training services in London, England. The acquisition was
     accounted for as a pooling of interests, in which the Company issued
     278,611 shares of common stock in exchange for all of the outstanding
     shares of Barefoot common stock. Accordingly, all

                                     Page 6
<PAGE>
 
     periods included in the financial information furnished herein have been
     restated to give effect to the acquisition. Barefoot had a November 30
     fiscal year end and, accordingly, the Barefoot balance sheet at November
     30, 1997, has been combined with the balance sheet of ARIS at December 31,
     1997, and Barefoot's statements of income and cash flows for the quarter
     ended February 28, 1997, have been combined with the ARIS statements of
     income and cash flows, respectively, for the quarter ended March 31, 1997.
     In order to conform Barefoot's year end to ARIS's year end, Barefoot's
     financial statements for the month of December are not included in the
     statements of income or cash flows for the quarter ended March 31, 1998.

     A reconciliation of amounts of revenue and earnings for the quarter ended
     March 31, 1997, previously reported by ARIS to the combined amounts
     presented herein follows:

<TABLE>
<CAPTION>
                          AS REPORTED        ADJUSTMENT         COMBINED 
                          -----------        ----------         -------- 
                             ARIS             BAREFOOT                   
                          -----------        ----------                  
     <S>                 <C>                 <C>              <C>        
     Revenue              $10,409,000        $1,621,000       $12,030,000
     Net income           $ 1,044,000        $  111,000       $ 1,155,000 
</TABLE>

3.   Basic earnings per share is calculated as income available to common
     stockholders divided by the weighted average number of common shares
     outstanding during the periods. Diluted earnings per share is based on the
     weighted average number of shares of common stock and common stock
     equivalents outstanding during the periods, including options and warrants
     computed using the treasury stock method. All earnings per share amounts
     from prior periods have been restated to conform with the current period
     presentation.

     The difference between the weighted average number of common shares
     outstanding used to calculate basic earnings per share and the weighted
     average number of common and common equivalent shares outstanding used to
     calculate diluted earnings per share is the incremental shares attributed
     to outstanding options and warrants to purchase common stock computed using
     the treasury stock method:

<TABLE>
<CAPTION>
                                          For the Quarter Ended March 31, 
                                          -------------------------------
                                             1998                 1997    
                                          ----------            --------- 
      <S>                                <C>                    <C>       
      Weighted average number of                                          
       common shares outstanding          10,235,000            7,940,000 
                                          ----------            --------- 
      Effect of dilutive securities:                                      
        Warrants                               4,000                      
        Options                              843,000              453,000 
                                          ----------            --------- 
                                             847,000              453,000 
                                          ----------            --------- 
      Weighted average number of                                          
       common and common equivalent                                       
       shares outstanding                 11,082,000            8,393,000 
                                          ==========            =========  
</TABLE>


4.   On May 5, 1998, the Company filed a Registration Statement on Form S-4 (the
     "S-4") in connection with the proposed merger (the "Merger") of InTime
     Systems International, Inc. ("InTime") with and into the Company. The
     Company will be the surviving entity in the Merger. The Merger, Merger
     Agreement and the transactions contemplated thereby have been approved by
     the Board of Directors of both the Company and InTime. The S-4 must be
     declared effective by the Securities and Exchange Commission prior to the
     mailing of the proxy statement/prospectus contained in the S-4 to the
     stockholders of InTime. In order for the Merger to be consummated it must
     also be approved by the stockholders of InTime, as well as the completion
     of other conditions precedent to closing or contained in the Merger
     Agreement.

5.   On April 30, 1998, Oxford Computer Group Limited, the Company's wholly-
     owned United Kingdom subsidiary ("OCG"), entered into an Agreement for the
     Sale and Purchase of the Entire Issued Share  

                                     Page 7
<PAGE>
 
     Capital of MMT Computing (Reading) Limited ("MMT"), among OCG and the
     shareholders of MMT. The Board of Directors of the Company approved a
     contribution of capital to OCG of up to $3 million to acquire MMT. The
     acquisition will be accounted for under the purchase method of accounting.
     Goodwill resulting from this acquisition will be amortized over fifteen
     years.

6.   The Financial Accounting Standards Board issued SFAS No. 130, "Reporting
     Comprehensive Income," in June 1997. The statement establishes new
     standards for reporting and displaying comprehensive income in the
     financial statements. In addition to net income, comprehensive income
     includes charges or credits to equity that is not the result of
     transactions with shareholders. This statement is effective for fiscal
     years beginning after December 15, 1997. The Company has adopted this
     standard as of March 31, 1998.

                                     Page 8
<PAGE>
 
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

     ARIS provides an integrated information technology ("IT") solution
consisting of consulting and training services primarily focused on Oracle
Corporation ("Oracle"), Microsoft Corporation ("Microsoft") and Lotus
technologies. ARIS currently focuses on three core consulting competencies:
packaged application implementation, custom application development and systems
architecture planning and deployment. The Company offers instructor-led training
for IT professionals conducted at ARIS' training centers and at client
facilities. The Company also develops, markets and supports proprietary software
products that enhance Oracle database management and Oracle packaged
applications. The Company believes that its ability to provide clients with an
integrated IT solution, coupled with its focus on leading-edge technologies,
provide it with a unique competitive advantage.

     This commentary should be read in conjunction with the sections of the
following documents for a full understanding of the Company's financial
condition and results of operations:  from the Company's Registration Statement
on Form S-1 filed April 18, 1997, as amended, and its Prospectus dated June 18,
1997, the Risk Factors, pages 3 to 10, Management's Discussion and Analysis of
Financial Condition and Results of Operations, pages 15 to 25, and the
Consolidated Financial Statements and Notes to Consolidated Financial Statements
on pages F-1 to F-31; the Company's Annual Report on Form 10-K for the year
ended December 31, 1997; the Company's Quarterly Reports on Form 10-Q for the
periods ending September 31, 1997 and June 30, 1997; the Company's Current
Report on Form 8-K filed September 26, 1997 in connection with the Company's
acquisition of Enterprise Computing Inc. (doing business as Buller Owens &
Associates) and the Company's Registration Statement on Form S-4 filed May 5,
1998 in connection with the Company's proposed acquisition of InTime Systems
International, Inc., including the Consolidated Financial Statements and Notes
to Consolidated Financial Statements, pages F1 to F40.

     All statements, trend analysis and other information contained herein
relative to markets for the Company's services and products and trends in
revenue, gross margin and anticipated expense levels, as well as other
statements including words such as "seek," "anticipate," "believe," "plan,"
"estimate," "expect," "intend," and other similar expressions, constitute
forward-looking statements.  These forward-looking statements are subject to
business and economic risks, and the Company's actual results of operations may
differ materially from those contained in the forward-looking statements.

FIRST QUARTER 1998 COMPARED TO FIRST QUARTER 1997

     RECENT ACQUISITION AND RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL
     STATEMENTS

     Effective February 28, 1998 the Company acquired all of the outstanding
stock of Barefoot Computer Training Limited ("Barefoot"), an IT training company
with operations in

                                     Page 9
<PAGE>
 
London, England in exchange for 278,611 shares of the Company's common stock.
The acquisition has been accounted for as a pooling of interests of the Company
and Barefoot. Accordingly, financial statements of the Company have been
restated to include the accounts of Barefoot for all periods and for all
comparable statistics presented.

     TOTAL REVENUE

     Total revenues increased $8,707,000 to $20,737,000 for the quarter ended
March 31, 1998 from $12,030,000 for the quarter ended March 31, 1997,
representing a 72% increase. Revenues during the first quarter of 1998 include
revenues from the following acquisitions: Oxford Computer Group Limited acquired
in February 1997, Enterprise Computing Inc. acquired in October 1997, Absolute!,
Inc. and Agiliti, Inc. acquired in November 1997. Both 1997 and 1998 first-
quarter revenues include those of Barefoot Computer Training Limited acquired in
February 1998. On a pro forma basis (assuming all companies acquired by ARIS
subsequent to February 28, 1997 had been owned during the first quarter of
1997), total revenues increased approximately 32%. As discussed below, increases
in revenues were reflected in all three lines of business.

     CONSULTING REVENUE

     Consulting revenue increased as a result of an overall increase in the
level of consulting activity. The Company employed or contracted for the
services of an average of 208 full-time consultants and project managers during
the quarter ended March 31, 1998 compared to 152 during the same quarter in
1997. Consulting revenues increased $2,382,000 to $9,015,000 for the quarter
ended March 31, 1998 from $6,633,000 for the quarter ended March 31, 1997
representing a 36% increase. Consulting operations were conducted from seven
consulting offices in the United States and the United Kingdom. Comparative
consulting revenues were negligibly impacted by acquisitions.

     TRAINING REVENUE

     Training revenue increased $4,738,000 to $9,602,000 for the quarter ended
March 31, 1998 from $4,864,000 for the quarter ended March 31, 1997,
representing a 97% increase. A significant portion of the increase in training
revenues for the first quarter of 1998 is attributable to business units
acquired subsequent to February 28, 1997. Training revenues for the first
quarter of 1998 includes revenue from the following acquisitions: Oxford
Computer Group Limited acquired in February 1997, Enterprise Computing Inc.,
Absolute!, Inc. and Agiliti, Inc. Both 1997 and 1998 first-quarter revenues
include those of Barefoot Computer Training Limited acquired in February 1998.
On a pro forma basis (assuming the companies acquired by ARIS subsequent to
February 28, 1997 had been owned during the first quarter of 1997), total
training revenues increased approximately 14%. Revenues increased in the first
quarter of 1998 as a result of a significant increase in the number of classes
and class training days offered. The Company offered 1,621 classes and 4,207
training days in the quarter ended March 31, 1998 as compared to 527 classes and
1,438 training days in the quarter ended March 31, 1997.

                                    Page 10
<PAGE>
 
     SOFTWARE REVENUE

     Software revenue increased $1,587,000 to $2,120,000 for the quarter ended
March 31, 1998 from $533,000 in the quarter ended March 31, 1997, representing
an increase of 298%. The increase in revenue is primarily attributable to sales
of the NoetixViews suite of products developed by ARIS Software, Inc. (formerly
Noetix Corporation), a wholly-owned subsidiary of the Company.

     COST OF SALES

     Cost of sales consists primarily of salaries and employee benefits for
consultants, project managers and instructors; subcontractor fees; non-
reimbursable travel expenses related to consulting and training activities and
the cost of production of software modules and amortization of capitalized
software costs. Cost of sales increased $3,358,000 to $9,033,000 in the quarter
ended March 31, 1998 from $5,675,000 in the quarter ended March 31, 1997. The
increase in cost of sales is primarily a reflection of the increase in sales.
Cost of sales as a percentage of sales decreased from 47% for the quarter ended
March 31, 1997 to 44% for the quarter ended March 31, 1998. This reduction is a
result of the relative increase in proportion of training and software revenues
to total revenue. Training and software operations typically have lower cost of
sales and higher selling, general and administrative ("SG&A") expenses when
compared to consulting operations. Training operations utilize a lower
proportion of professional labor and benefits, which are included in cost of
sales, and higher proportions of marketing, facilities and general office
administration costs which are included in SG&A expense.

     SELLING, GENERAL AND ADMINISTRATIVE EXPENSE

     SG&A expense consists of salaries and employee benefits for executive,
managerial, administrative and sales personnel; facility leases; amortization of
capitalized computer hardware and equipment costs; software license fees, travel
and business development costs. SG&A expense increased $5,748,000 to $10,235,000
for the quarter ended March 31, 1998 from $4,487,000 for the quarter ended March
31, 1997 which represents an increase of 128%. Total SG&A expense as a
percentage of total revenue increased from 37% for the quarter ended March 31,
1997 to 49% for the quarter ended March 31, 1998.

     The increase in SG&A is primarily the result of four factors: (i) expenses
associated with acquisitions completed during the quarter ended March 31, 1998,
amounting to $1,257,000 or 6% of revenue, compared to $21,000 in acquisition-
related costs during the quarter ended March 31, 1997; (ii) a change in the
revenue mix, with software increasing from 4% of total revenue during the
quarter ended March 31, 1997 to 10% of total revenue during the quarter ended
March 31, 1998 and training increasing from 40% of total revenue to 46% of total
revenue during the same periods. Both software and training operations have
lower cost of sales but higher SG&A; (iii) general increase in the number of
management, sales and administrative staff from 194 at March 31, 1997 to 285 at
March 31, 1998 required to support the growth of the company; and (iv) an
increase in the amortization of intangible assets resulting from companies

                                    Page 11
<PAGE>
 
acquired from $64,000 during the quarter ended March 31, 1997 to $121,000 during
the quarter ended March 31, 1998.


     OTHER INCOME, NET

     Other income, net, consists primarily of interest income on cash and cash
equivalents and gain on sale of equity investments, which is partially offset by
interest associated with short-term borrowings. Other income (expense), net,
increased $405,000 from ($39,000) for the quarter ended March 31, 1997 to
$366,000 for the quarter ended March 31, 1998. The increase is primarily
attributable to the Company's investment yield on proceeds from the Company's
initial public offering completed on June 19, 1997. Proceeds from the offering,
net of underwriters discount, amounted to $31,200,000. Average invested proceeds
during the quarter ended March 31, 1998 were $20,285,000.

     INCOME TAX EXPENSE

     Income tax expense increased $116,000 to $790,000 in the quarter ended
March 31, 1998 from $674,000 in the quarter ended March 31, 1997, as a result of
increased revenues and net income before tax. As a percentage of revenues,
income tax expense decreased from 5.6% to 3.8% and the effective tax rate
increased from 37% to 43%. The effective tax rate increase is primarily
attributable to the costs incurred for acquisition of Barefoot Computer Training
Ltd., a substantial portion of which are not deductible in determination of
United States or United Kingdom taxes. The effective tax rate is additionally
influenced by the mix of United Kingdom and United States tax rates, as well as
the tax rates of the various states in which the Company conducts its
operations.

     NET INCOME

     Net income decreased $110,000 to $1,045,000 for the quarter ended March 31,
1998, from $1,155,000 for the quarter ended March 31, 1997. Net income as a
percentage of sales decreased from 10% to 5%, primarily as a result of the
inclusion of acquisition costs in the quarter ended March 31, 1998. The
cumulative effect of acquisition costs including taxes amounted to $852,000 or
4.1% of revenue. Excluding costs of acquisitions, net income in the quarter
ended March 31, 1997 was $1,168,000 or 10% of revenue, compared to net income of
$1,897,000 or 9% of revenue for the quarter ended March 31, 1998.

     SUBSEQUENT EVENTS

     On April 30, 1998, Oxford Computer Group Limited, the Company's wholly-
owned United Kingdom subsidiary ("OCG"), entered into an Agreement for the Sale
and Purchase of the Entire Issued Share Capital of MMT Computing (Reading)
Limited ("MMT") among OCG and the shareholders of MMT. The Board of Directors of
the Company approved a contribution of capital to OCG of up to $3 million to
acquire MMT. The acquisition will be accounted for under the purchase method of
accounting. Goodwill resulting from this acquisition will be amortized over
fifteen years.

                                    Page 12
<PAGE>
 
     On May 5, 1998 the Company filed a Registration Statement on Form S-4 (the
"S-4") in connection with the proposed merger (the "Merger") of InTime Systems
International, Inc. ("InTime") with and into the Company whereby the Company
will be the surviving entity in the Merger. The Merger, Merger Agreement and the
transactions contemplated thereby have been approved by the Board of Directors
of both the Company and InTime. The S-4 must be declared effective by the
Securities and Exchange Commission prior to the mailing of the proxy
statement/prospectus contained in the S-4 to the stockholders of InTime. At
closing and subject to the provisions contained in the Merger Agreement, each
outstanding share of InTime common stock (the "InTime Stock") will be exchanged
for 0.266 shares (the "Exchange Ratio") of the Company's common stock. Options
and warrants to purchase InTime Stock will be converted into options and
warrants of like tenor and quality to purchase that number of shares of the
Company's Common Stock at a price and in an amount as determined by applying the
Exchange Ratio. The Exchange Ratio is subject to adjustment in the event that
the average closing price for one share of the Company's common stock (as
reported by the Nasdaq National Market) for the 10 trading days immediately
preceding the closing date has dropped below $31.50, in which case the Exchange
Ratio shall be adjusted to reflect the lower average closing price. If the
Exchange Ratio is adjusted, each outstanding InTime option and warrant will also
be adjusted into the right to receive a greater number of the Company's shares
of Common Stock at a lesser exercise price.

LIQUIDITY AND CAPITAL RESOURCES

     Operating cash flows decreased $1,077,000 from $546,000 in the quarter
ended March 31, 1997 to an operational cash flow deficit of $531,000 for the
quarter ended March 31, 1998. This deficit is primarily attributable to the
Company's expenditures in the quarter ended March 31, 1998 for the acquisition
of Barefoot Computer Training Limited. Acquisition costs included fees paid to
advisors of Barefoot, legal and accounting fees for both parties to the
transaction, and other costs associated with the acquisition.

     On June 18, 1997, the company completed an initial public offering of its
common stock. Net proceeds from the offering provided $31,242,000, $4,000,000 of
which was immediately used to pay down a bank loan during the second quarter of
1997. The Company has retained a substantial portion of the proceeds (the
average invested balance during the quarter ended March 31, 1998 was
$20,285,000). A portion of the proceeds were used during 1997 for the
acquisition of Enterprise Computing Inc., Absolute!, Inc. and Agiliti, Inc. In
the quarter ended March 31, 1998 the Company expended $5,641,000 for property
and equipment, including the acquisition of an office building and related
furniture and fixtures.

     Cash flows from investing activities increased $3,339,000 to $2,761,000 in
the quarter ended March 31, 1998, compared to an investing cash flow deficit of
$578,000 in the quarter ended March 31, 1997. The Company sold $8,402,000 of its
investments in short term debt securities in the first quarter of 1998 to
finance capital expenditures.

     During the quarter ended March 31, 1997, the Company borrowed $6,450,000,
in part to acquire its own common stock and in part to repay other borrowings
within the period. As a

                                    Page 13
<PAGE>
 
result of these transactions, financing activities provided cash of $325,000
during the first quarter of 1997. In the first quarter of 1998, the Company
received cash in the amount of $279,000 from holders exercising stock options
and $43,000 as a tax benefit on the stock options exercised for a net increase
in cash from financing activities of $322,000.

     At March 31, 1998, the Company had cash and equivalents of $11,740,000
compared to $485,000 for the quarter ended March 31, 1997.

     The Company anticipates that capital expenditures related to expected
expansion will continue in the coming year and will continue to be financed by
operational cash flows generated as well as utilization of invested funds, if
needed. Management anticipates that in 1998 cash and marketable securities will
be employed for general corporate purposes including the opening of new offices,
potential acquisitions of companies and other business opportunities which may
arise.

     At March 31, 1998, the Company had accounts receivable of $15,645,000 and
days sales outstanding of 69 days. At March 31, 1997, accounts receivable were
$12,789,000 and days sales outstanding were 97 days. The substantial improvement
of days sales outstanding is a result of improvement of collection and account
maintenance procedures.

     The Company has an $8 million line of credit with US Bank, a division of
First Bank Systems. The credit line provides funds for general business purposes
as well as the acquisition of companies and is secured by substantially all of
the Company's assets. The credit line contains various affirmative and negative
covenants, which require, among other things, maintenance of a certain level of
working capital and a certain current ratio. The Company is in compliance with
all requirements of the agreement. During 1997 the Company utilized the line of
credit to acquire 415,000 shares of its common stock and borrowed $4 million on
the line of credit. Proceeds from the Company's initial public offering were
utilized to repay the borrowing in June 1997. At March 31, 1998 there were no
borrowings against the credit line. The credit line expires on June 1, 1998.
Management anticipates that the credit line will be renewed in an amount
suitable to meet its requirements upon expiration of the existing agreement.

RECENT ACCOUNTING PRONOUNCEMENT

In June 1997 the Financial Accounting Standards Board issued SFAS No. 131,
"Disclosures about Segments of an Enterprise and Related Information." SFAS no.
131 establishes new standards for reporting information about operating segments
in interim and annual financial statements. This statement is effective for
fiscal years beginning after December 15, 1997. The Company is currently
evaluating the impact, if any, this statement will have on disclosures in the
consolidated financial statements.

                                    Page 14
<PAGE>
 
                                    PART II
                               OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

     The Company is involved from time to time in routine legal proceedings
incidental to its business.  As of March 31, 1998, the Company was not involved
in any material legal proceedings.

ITEM 2.  CHANGES IN SECURITIES

     In connection with the Company's initial public offering (the "Offering")
of its common stock, without par value (the "Common Stock"), the Company filed a
Registration Statement on Form S-1 on April 18, 1997 (Registration No. 333-
25409), as amended (the "Registration Statement"), pursuant to which the Company
registered 2,320,800 shares of its Common Stock, of which 2,300,000 shares were
sold by the Company, and the remaining 20,800 shares were sold by certain
selling shareholders.  The Registration Statement was declared effective by the
Securities and Exchange Commission on June 17, 1997.  Deutsche Morgan Grenfell
was the managing underwriter of the Offering.  The Offering commenced on June
18, 1997, and terminated following the sale of all of the securities registered
under the Registration Statement.  The Common Stock was offered, and sold, to
the public at $15.00 per share, for aggregate consideration of $34,812,000, of
which the Company received gross proceeds of $32,085,000, the selling
shareholders received gross proceeds of $290,160, and the remaining $2,436,840
was allocated as the underwriting discount.

     From the effective date of the Registration Statement through March 31,
1998, the Company has incurred an estimated $3,255,000 in expenses for the
Company's account in connection with the issuance and distribution of the Common
Stock, including underwriting discounts and commissions ($2,415,000) and other
expenses ($840,000).  No finders' fees or expenses were paid to or for the
underwriters.  The Company believes that none of these payments were made,
directly or indirectly, to: (i) directors or officers of the Company, or their
associates; (ii) persons owning ten percent or more of any class of equity
securities of the Company; or (iii) affiliates of the Company.

     From the effective date of the Registration Statement through March 31,
1998, the Company has applied $4,000,000 of the Offering proceeds to the
repayment of the Company's revolving bank loan.  The Company believes that none
of these payments were made, directly or indirectly, to: (i) directors or
officers of the Company, or their associates; (ii) persons owning ten percent or
more of any class of equity securities of the Company; or (iii) affiliates of
the Company.  To date, the Company believes that it has used the Offering
proceeds in a manner consistent with the use of proceeds described in the
Registration Statement.  The remaining $18,839,000 of the Offering proceeds is
invested in short term marketable debt securities and money market funds.

                                    Page 15
<PAGE>
 
ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     Not applicable.

ITEM 5.  OTHER INFORMATION

     Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (A)  EXHIBITS

          See Exhibit Table on page 18.

     (B)  REPORTS ON FORM 8-K

     The Company filed a Current Report Form 8-K on March 13, 1998, reporting
the issuance of shares of the Company's common stock pursuant to Regulation S of
the Securities Act of 1933, as amended.  The issuance was made in connection
with the acquisition of Barefoot Computer Training Limited ("Barefoot") whereby
the entire share capital of Barefoot was exchanged for 278,611 shares of common
stock of ARIS.  Because the filing was to report the issuance of shares in
reliance upon Regulation S, the Company did not file financial statements with
that Current Report on Form 8-K.

                                    Page 16
<PAGE>
 
                                   SIGNATURE
                                        
     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

Dated this 15th day of                       ARIS Corporation
May 1998.
 
 
                                       By:  /s/ Thomas W. Averill
                                           --------------------------------
                                           Thomas W. Averill
                                           Vice President, Finance;
                                           Chief Financial Officer
                                           (Principal Financial and Accounting
                                           Officer and Duly Authorized Officer)

                                    Page 17
<PAGE>
 
                                    EXHIBITS

   Page         Exhibit Number                      Exhibit Name
-----------     ---------------     --------------------------------------------
                     2.1            Plan of Acquisition, Reorganization,
                                    Arrangement, Liquidation or Succession
                    27.1            Financial Data Schedule

                                    Page 18