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 SEPTEMBER 30, 1998

                                       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: 000-26622

                       COMPUTER MANAGEMENT SCIENCES, INC.
             (Exact name of registrant as specified in its charter)


              FLORIDA                                   59-2264633
  (State or other jurisdiction of                   (I.R.S. Employer 
  incorporation or organization)                   Identification Number)

8133 Baymeadows Way, Jacksonville, Florida                32256
 (Address of principal executive offices)               (zip code)

                                 (904) 737-8955
              (Registrant's telephone number, including area code)

                                       N/A
                 (Former name, former address and former fiscal
                      year, if changed since last report)
                       -----------------------------------


Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934,
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                                  Yes X No ____

As of October 31, 1998 there were 14,626,852  shares of the Registrant's  common
stock, $0.01 par value, outstanding.



<PAGE>



                       COMPUTER MANAGEMENT SCIENCES, INC.

                               Index to Form 10-Q
                    For the Quarter Ended September 30, 1998





                                                                        Page
                         PART I - FINANCIAL INFORMATION


Item 1    Financial Statements

              Consolidated Balance Sheets                                3-4
              Consolidated Statements of Operations                       5
              Consolidated Statements of Cash Flows                       6
              Notes to Consolidated Financial Statements                  7


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

              Results of Operations                                     8-10
              Liquidity, Capital Resources and                         
                Year 2000 System Conversion                             11-12

                   PART II - OTHER INFORMATION


Items 1-6     Other Information                                          13

Signatures                                                               14




                                       2
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

                           Consolidated Balance Sheets




                                                    September 30,   December 31,
                                                        1998            1997
                                                     (unaudited)

Current assets:
     Cash and cash equivalents                   $    7,751,288      14,550,323
     Accounts receivable, net                        17,322,846      11,720,377
     Revenue earned in excess of billings             1,439,899       2,461,228
     Investments                                      3,204,202       2,805,072
     Refundable income taxes                              -           4,358,250
     Other receivables                                  451,644         251,407
     Notes receivable                                 7,307,434         619,328
     Other current assets                               182,827         127,289
                                                   ------------    ------------

              Total current assets                   37,660,140      36,893,274
                                                   ------------    ------------

Property and equipment:
     Land                                             3,588,000       2,562,000
     Buildings and improvements                      14,748,629       9,100,902
     Computers and software                           5,741,821       3,934,806
     Office furniture and equipment                   3,331,546       2,586,417
     Vehicles                                           433,944         391,750
                                                   ------------    ------------
                                                     27,843,940      18,575,875
     Less accumulated depreciation                    4,323,719       3,077,243
                                                   ------------    ------------

              Net property and equipment             23,520,221      15,498,632
                                                   ------------    ------------

Other assets:
     Intangible assets, net of accumulated
         amortization of $1,247,457 and $872,230      3,841,306       3,516,531
     Land held for investment, at cost                  424,065         424,065
     Investments                                      8,905,394       8,137,146
     Notes receivable, less current portion           3,582,592         829,792
     Other                                            1,080,608         823,830
                                                   ------------    ------------

              Total other assets                     17,833,965      13,731,364
                                                   ------------    ------------

              Total assets                       $   79,014,326      66,123,270
                                                   ============    ============

                                                                    (continued)


                                       3
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

                     Consolidated Balance Sheets, continued




                                                    September 30,   December 31,
                                                        1998            1997
                                                    (unaudited)

Liabilities and Shareholders' Equity

Current liabilities:
     Accounts payable                            $   1,076,971          106,320
     Accrued expenses                                5,996,303        4,341,936
     Unearned revenue                                  201,894          376,556
     Income taxes payable                              113,687             -
     Deferred income taxes                             135,690           50,623
                                                   -----------      -----------

              Total current liabilities              7,524,545        4,875,435
                                                   -----------      -----------

Long-term liabilities:
     Deferred income taxes                              57,401          249,553
     Other                                              31,731           35,594
                                                   -----------      -----------

              Total long term liabilities               89,132          285,147
                                                   -----------      -----------

Shareholders' equity:

     Preferred stock, $.01 par value; 5,000,000 
         shares authorized, no shares issued 
         and outstanding in 1998 and 1997                 -                -
     Common stock, $.01 par value; 40,000,000
         shares authorized, 14,622,164 and 
         14,455,337 shares issued and 
         outstanding in 1998 and 1997                  146,223          144,554
     Paid-in capital                                39,931,802       38,605,137
     Retained earnings                              31,211,798       22,054,155
     Accumulated comprehensive income, net of
         income tax                                    110,826          158,842
                                                   -----------      -----------

              Total shareholders' equity            71,400,649       60,962,688
                                                   -----------      -----------

              Total liabilities and 
                 shareholders' equity            $  79,014,326       66,123,270
                                                   ===========      ===========







See accompanying notes to consolidated financial statements.


                                       4
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

                      Consolidated Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>


                                                        For the Three Month              For the Nine Month
                                                    Period Ended September 30,        Period Ended September 30,
                                                      1998              1997            1998             1997
<S>                                           <C>                  <C>               <C>           <C>    


Revenue                                        $    23,019,251        18,160,441       66,233,072     51,934,107
Direct costs                                        13,908,779        11,022,348       39,871,389     31,756,016
                                                 -------------    --------------    -------------  -------------
     Gross profit                                    9,110,472         7,138,093       26,361,683     20,178,091

Selling, general and administrative
     expenses                                        4,394,408         3,722,474       12,730,892     10,752,888
                                                   -----------     -------------   --------------   ------------
              Income from operations                 4,716,064         3,415,619       13,630,791      9,425,203

Other income (expense):
     Investment and other income                       491,653           470,626        1,099,168      1,264,193
     Interest expense                                   -                   (665)          (2,316)       (11,110)
                                                 -------------    --------------    -------------  -------------
                                                       491,653           469,961        1,096,852      1,253,083
                                                 -------------    --------------    -------------  -------------

     Income before income taxes                      5,207,717         3,885,580       14,727,643     10,678,286

Provision for income taxes                           2,005,000         1,465,000        5,570,000      4,085,000
                                                 -------------    --------------    -------------  -------------
Net income                                     $     3,202,717         2,420,580        9,157,643      6,593,286
                                                 =============    ==============    =============  =============



Net income per share - basic                   $          0.22             0.18              0.63           0.50
                                                 =============    =============     =============  =============

Weighted average number of common
     shares outstanding - basic                     14,610,662        13,512,361       14,588,319     13,256,650

Net income per share - diluted                 $          0.21             0.16              0.60           0.43
                                                 =============    =============     =============  =============

Weighted average number of common
     and common equivalent shares
         outstanding - diluted                      15,232,775        15,205,959       15,287,039     15,160,143

</TABLE>


See accompanying notes to consolidated financial statements.


                                       5
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

                      Consolidated Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                                    For The Nine Months
                                                                                     Ended September 30,
                                                                                 1998                1997
                                                                                 ----                ----
<S>                                                                   <C>                      <C>    

Cash flow from operating activities:
     Net income                                                          $     9,157,643           6,593,286
     Adjustments to reconcile net income to
         net cash provided by operating activities:
              Depreciation and amortization                                    1,588,597           1,049,860
              Net loss (gain) on disposition of property and equipment             3,711             (70,386)
              Deferred income tax benefit                                        (75,453)            (86,224)
     Change in assets and liabilities:
         Increase in accounts and other receivables                           (4,781,377)         (2,740,734)
         Increase in other current assets                                        (55,538)           (113,392)
         Increase in other assets                                               (256,778)           (357,856)
         Increase in accounts payable and accrued expense                      2,625,018             574,680
         Decrease in unearned revenue                                           (174,662)           (116,421)
         Increase in income taxes payable                                      5,324,376           1,609,578
                                                                           -------------       -------------

              Net cash provided by operating activities                       13,355,537           6,342,391
                                                                           -------------       -------------

Cash flow from investing activities:
     Purchases of property and equipment                                      (9,401,015)         (7,230,541)
     Proceeds from the sale of property and equipment                            162,343             117,435
     Purchase of investments, net                                             (1,247,026)           (166,327)
     Increase in intangible assets                                              (700,000)         (1,450,000)
     (Increase) decrease in notes receivable                                  (9,440,906)            447,061
                                                                           --------------      -------------

              Net cash used in investing activities                          (20,626,604)         (8,282,372)
                                                                           --------------      -------------

Cash flow from financing activities:
     Repayment of notes payable                                                   (3,863)           (940,275)
     Proceeds from issuance of common stock                                      475,895             411,797
                                                                           -------------       -------------

              Net cash provided by (used in) financing activities                472,032            (528,478)
                                                                           -------------       -------------

              Net decrease in cash and cash equivalents                       (6,799,035)         (2,468,459)

Cash and cash equivalents at beginning of period                              14,550,323          14,201,624
                                                                           -------------       -------------

Cash and cash equivalents at end of period                               $     7,751,288          11,733,165
                                                                           =============       =============

</TABLE>

See accompanying notes to consolidated financial statements.


                                       6
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

                   Notes to Consolidated Financial Statements



(1)    Organization and Basis of Presentation

       Computer  Management  Sciences,  Inc. (the  Company),  provides  computer
       systems  and  information  technology  consulting,   project  management,
       systems analysis and design, and programming services to a broad range of
       industries and  software/hardware  platforms.  The Company's services are
       generally  an  outside   resource   supplementing  a  client's   internal
       information  technology (IT) capabilities,  and include various technical
       services,  such as technology support services, IT solutions services and
       strategic IT consulting.

       The interim financial  information included herein is unaudited.  Certain
       information and footnote  disclosures  normally included in the financial
       statements  have been  condensed  or  omitted  pursuant  to the rules and
       regulations of the Securities and Exchange Commission (SEC), although the
       Company  believes  that the  disclosures  made are  adequate  to make the
       information  presented not misleading.  These financial statements should
       be read in  conjunction  with the financial  statements and related notes
       contained in the Company's  annual report on Form 10-K filed with the SEC
       on March 30,  1998.  Other than as indicated  herein,  there have been no
       significant  changes from the financial data published in that report. In
       the  opinion of  management,  such  unaudited  information  reflects  all
       adjustments,   consisting   of  normal   recurring   accruals  and  other
       adjustments   necessary  for  a  fair   presentation   of  the  unaudited
       information.

       The results of operations  for such interim  periods are not  necessarily
       indicative of the results for the full year.

(2)    Newly Issued Accounting Pronouncement

       The Company  adopted the provisions of Statement of Financial  Accounting
       Standards No. 130, "Reporting Comprehensive Income", effective January 1,
       1998. This Statement  establishes  standards for reporting and display of
       comprehensive  income and its  components.  Comprehensive  income for the
       nine  months  ended  September  30,  1998  and 1997  was  $9,109,627  and
       $6,698,745,  respectively.  This  amount  differs  from net income due to
       changes in the net unrealized  gains on marketable  securities  available
       for sale.

(3)    Earnings Per Share

       Net income per share of common stock is computed  based upon the weighted
       average number of common shares and share equivalents  outstanding during
       the  period.  Stock  options,  when  dilutive,   are  included  as  share
       equivalents.   Weighted  average  shares   outstanding  under  the  basic
       calculation  differs from that under the diluted  calculation  due to the
       weighted  average  effect of dilutive  stock  options  using the treasury
       stock method for all period presented.

(4)    Subsequent Event

       On October 30, 1998, the Company acquired substantially all of the assets
       of Competitive Systems Advantage, Inc. (CSA), a Chicago-based information
       technology firm specializing in providing systems integration  consulting
       services to the insurance and banking  industries.  The purchase price of
       the acquisition was approximately  $5.6 million in cash at closing and up
       to $3 million in additional cash consideration which is contingent on CSA
       meeting certain revenue and gross profit thresholds during 1999 and 2000.





                                       7
<PAGE>

     


                       COMPUTER MANAGEMENT SCIENCES, INC.

         Management's Discussion and Analysis of Financial Condition and
                              Results of Operations


Forward Looking Statements

      This  Report  on Form  10-Q may  contain  certain  information  and  trend
statements that constitute  "forward-looking  statements"  within the meaning of
the  Private   Securities   Litigation  Reform  Act,  which  involve  risks  and
uncertainties.  Actual results may differ  materially from the results described
in the  forward-looking  statements.  When  used in  this  document,  the  words
"anticipate", "believe", "estimate", "expect", "intend", "project", "target" and
other  similar  expressions,  as they  relate to the  Company,  are  intended to
identify forward-looking  statements.  Such statements reflect the current views
of the Company with respect to future  events and are subject to certain  risks,
uncertainties  and  assumptions  that  include,  but are not limited to,  growth
through business  combinations and internal expansion,  the Company's ability to
attract   and  retain   qualified   consultants,   dependence   on   significant
relationships  and  the  absence  of  long-term  contracts,  project  risk,  the
Company's ability to effectively  manage a large and rapidly changing  business,
pricing and margin  pressures,  and competition.  Please refer to discussions of
these and other  factors in this Report and other Company forms on file with the
Securities  and  Exchange  Commission.  The  Company  disclaims  any  intent  or
obligation to update  publicly these  forward-looking  statements,  whether as a
result of new information, future events or otherwise.

      The following  discussion and analysis should be read in conjunction with,
and is  qualified in its entirety  by, the  consolidated  financial  statements,
including the notes  thereto,  and the Company's 1997 Annual Report on Form 10-K
on file with the Securities and Exchange  Commission.  Historical events are not
necessarily  indicative  of trends in operating  results for any future  period.
Reference  is also made to the  above  paragraph,  with  regard to the risks and
uncertainties associated with forward-looking statements.

Results of Operations

       The  information  in the following  table is presented as a percentage of
revenue for the period indicated:

                                          Percentage of Total Revenue
                                 Three Months Ended         Nine Months Ended
                                    September 30,             September 30,

                                 1998         1997         1998         1997
                                 ----         ----         ----         ----

  Revenue                        100.0%        100.0%       100.0%       100.0%
  Direct Costs                    60.4%         60.7%        60.2%        61.1%
  Gross Profit                    39.6%         39.3%        39.8%        38.9%
  Selling, general, and 
       administrative expenses    19.1%         20.5%        19.2%        20.7%
  Income from operations          20.5%         18.8%        20.6%        18.1%
  Other income, net                2.1%          2.6%         1.7%         2.4%
  Income before income taxes      22.6%         21.4%        22.2%        20.6%
  Provision for income taxes       8.7%          8.1%         8.4%         7.9%
  Net income                      13.9%         13.3%        13.8%        12.7%




                                       8
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

         Management's Discussion and Analysis of Financial Condition and
                        Results of Operations, continued


Revenue:

    Revenue for the third quarter ended September 30, 1998 was $23.0 million,  a
    27% increase over revenue of $18.2 million  recorded in the third quarter of
    1997.  Revenue for the nine months ended  September 30, 1998 increased $14.3
    million to $66.2 million,  reflecting a 28% improvement  over the comparable
    1997 period.  Consulting  service  revenue,  which  represents  99% of total
    revenue for the third  quarter and year to date 1998,  increased 28% and 29%
    over the quarter and nine months ended September 30, 1997, respectively. The
    increase in revenue during the current quarter was primarily attributable to
    an increase in volume of services  which was  sustained by the growth in the
    average billable consultant  headcount from 600 in the third quarter of 1997
    to 724 for the current  quarter,  a 21% increase.  Also  contributing to the
    increase  in revenue  was an increase in the number and value of IT solution
    fixed bid projects  undertaken  by the Company,  which  positively  impacted
    average  billing  rates and enhanced the  Company's  ability to leverage its
    Systems  Outsourcing  Center (SOC) model. The Company's  ability to execute,
    manage and leverage  fixed bid projects  via its SOC network  translates  to
    "virtual"  headcount growth (i.e.  increased  revenue per consultant).  As a
    percentage of revenue, fixed bid projects remained consistent at 8% of total
    revenue  for the third  quarter  of 1998 and 1997,  but for the nine  months
    ended September 30, 1998,  fixed bid revenue  comprised 13% of total revenue
    versus 7% for the comparable period in 1997. Year to date, revenue has grown
    at a rate  consistent  with the  current  quarter  as a result of  increased
    consultant headcount and improved billing rates as discussed above.


Gross Profit:

    Gross profit for the third quarter of 1998 was $9.1 million,  representing a
    $2.0 million, or 28%, improvement over gross profit for the third quarter of
    1997. For the current nine month period, gross profit increased 31% to $26.4
    million compared to $20.2 million for the same period in 1997.  Expressed as
    a percentage of revenue, gross profit was 39.8% in the third quarter of 1998
    versus 38.9% in the 1997 third quarter.  This improvement is attributable to
    the increase in IT solution fixed bid projects,  which generally  results in
    the realization of stronger margins when compared to technology support time
    and materials  engagements.  As mentioned above, the success and leverage of
    the  SOCs has  contributed  to an  increase  in  outsourced  and  fixed  bid
    projects, which improved the gross profit percentage. This has also resulted
    in an increase of  approximately  4% in average hourly billing rates for the
    third  quarter  over the  average  hourly  billing  rates for the 1997 third
    quarter.  Year to date,  the gross  profit  percentage  is above that of the
    comparable  period for the prior year due to increased fixed bid margins and
    billing rates as discussed above.  The increased dollar amount,  in both the
    current  quarter  and year to  date,  is  attributable  to the  increase  in
    revenue.


S,G&A Expenses:

    Selling,  general and  administrative  expenses totaled $4.4 million for the
    third quarter of 1998, an increase of $672 thousand,  or 18%, over the third
    quarter of 1997.  Expressed  as a  percentage  of  revenue,  however,  S,G&A
    expenses  decreased from 20.5% in the third quarter of 1997 to 19.1% for the
    third  quarter of 1998.  For the current nine month period,  S,G&A  expenses
    decreased as a percentage of revenue to 19.2% from 20.7% for the  comparable
    1997 period. The improved percentage,  for both the current quarter and year
    to date,  resulted from increased  revenue and cost containment of marketing
    and other fixed expenses.  Partially offsetting this percentage  improvement
    were  increases of $178  thousand and $863 thousand in the third quarter and
    year to date 1998,  respectively,  for the Resource  Development Program, an
    internal technical  training program,  which was a new initiative during the
    second half of 1997. Also  contributing to the increased  dollar amount were
    increases  in  depreciation  resulting  from our SOC  additions  and  profit
    sharing expense.



                                       9
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

         Management's Discussion and Analysis of Financial Condition and
                        Results of Operations, continued


Net Income:

    Net income  increased  32% to $3.2  million  for the third  quarter of 1998,
    compared to net income of $2.4 million for the third  quarter of 1997.  This
    translates  into third  quarter  1998  diluted  earnings  per share of $0.21
    versus $0.16 in the third quarter of 1997, a 32%  increase.  For the current
    nine month period, net income was $9.2 million,  an increase of $2.6 million
    over net income for the comparable  1997 period.  This improved  performance
    for both the third  quarter and nine month  period was a result of increased
    revenue,  improved billing rates and cost containment of S,G&A expenses,  as
    discussed  above.  Also  contributing  to the increase year to date,  was an
    improvement in the effective  income tax rate,  which declined from 38.3% of
    income before income taxes in 1997 to 37.8% in 1998. The improved  effective
    tax rate is a result of state and local tax  planning  strategies  that were
    implemented  in the  fourth  quarter  of 1997.  Net  income  expressed  as a
    percentage  of revenue  was 13.9% and 13.8% for the  quarter  and nine month
    period ended  September  30, 1998 versus 13.3% and 12.7% for the same period
    in 1997.



                                       10
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

          Liquidity, Capital Resources and Year 2000 System Conversion


Liquidity and Capital Resources

       During the nine months ended  September  30, 1998,  cash  decreased  $6.8
       million and working  capital  decreased  $1.9 million.  While a number of
       factors  contributed  to the decrease in cash, the main  components  were
       increases in accounts  receivable,  notes receivable,  intangible assets,
       investments  and property and equipment,  as discussed  below.  Partially
       offsetting  these  uses of cash were  income  tax  refunds  as well as an
       increase in accounts  payable and accrued  liabilities.  The  increase in
       notes   receivable  is  attributable   primarily  to  the  following  two
       related-party notes receivable:  (i) approximately $2.5 million principal
       amount due from Jerry W. Davis,  the  Company's  CEO,  under a promissory
       note dated April 17, 1998, the proceeds of which were used to pay federal
       income tax obligations  arising from the exercise in late 1997 of certain
       non-qualified  stock options of the Company;  and (ii) approximately $4.7
       million  principal  amount due from a limited  partnership  controlled by
       Jerry W. Davis and Anthony V. Weight,  the  Company's CEO and acting CEO,
       respectively, under a promissory note dated July 2, 1998, the proceeds of
       which were used to purchase an  aircraft  that is used for both  personal
       and  business  purposes.  Both of these  notes bear  interest at 5.6% per
       annum and are payable interest only monthly until maturity,  December 31,
       1998,  when the full unpaid  principal  and interest are due and payable.
       The decrease in working capital is primarily due to an increase in income
       taxes  payable in the current  period  versus a $4.4  million  income tax
       receivable at the end of last year.

       As of December 31, 1997, $9.8 million was invested in funds with original
       maturity of ninety days or less and were classified as cash  equivalents,
       versus $4.8 million at September  30, 1998.  The timing of  maturities of
       governmental bonds as well as the reinvestment of short-term  investments
       in  commercial  paper  with  maturities  greater  than  ninety  days have
       resulted in a decrease in cash equivalents with  corresponding  decreases
       in short-term investments.  By the end of the third quarter, $3.2 million
       was  invested in current  securities  and $8.9  million  was  invested in
       various  corporate and governmental  bonds with maturities  exceeding one
       year.

       Accounts  receivable  increased $4.8 million during the first nine months
       of 1998.  The number days of sales  outstanding  as of September 30, 1998
       and December 31, 1997 were  approximately  63 and 61 days,  respectively.
       Therefore,  the increase in accounts receivable is primarily a reflection
       of increased sales volume experienced during the period.

       During the current nine month  period,  the Company  spent  approximately
       $9.4 million for capital  expenditures.  Of these  capital  expenditures,
       $1.8 million was spent for building  improvements  and renovations to the
       Denver SOC, the new  Jacksonville SOC and the Nashville SOC; $2.6 million
       was spent for computer  equipment,  software and furniture for the Denver
       SOC,  Nashville SOC and corporate  purposes;  $3.9 million was spent on a
       building for a future SOC in Richmond;  and $850  thousand was spent on a
       building  for a future  SOC in  Nashville.  The  Company  also  paid $700
       thousand in connection with the second contingent  consideration  payment
       due under the  acquisition  agreement  to purchase  Pathways  Consulting,
       Inc., dated July 31, 1996.

       The Company maintains a $4 million line of credit with a commercial bank.
       The line of credit is unsecured,  but is  contingent  on meeting  certain
       financial  covenants  measured  on a  quarterly  basis.  The  Company  is
       currently in compliance  with such covenants and management  expects that
       the Company will continue to meet such covenants in future  periods.  The
       credit facility has been inactive during 1998.

       The Company  currently  anticipates  that its existing cash and operating
       cash flow are  sufficient to meet both the Company's  short and long-term
       working  capital  requirements  and to fund  its  expansion  through  the
       establishment of additional branch offices,  SOC locations,  and possible
       acquisitions.



                                       11
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

     Liquidity, Capital Resources and Year 2000 System Conversion, continued


Year 2000 System Conversion

       The Company has conducted a comprehensive  review of its computer systems
       to identify the systems that could be affected by the "Year 2000" problem
       and has  implemented  new  systems  to resolve  the issue.  The Year 2000
       problem is the result of computer programs being written using two digits
       rather  than four to define the  applicable  year.  Any of the  Company's
       programs  that have time  sensitive  software may  recognize a date using
       "00" as the year 1900 rather than 2000. This could result in major system
       failure  and   miscalculations.   During  1997,  the  Company   commenced
       implementation  of a new  enterprise  wide  packaged  financial  software
       system,  which is Year 2000  compliant.  The supplier of the software has
       received  ITAA  2000  certification   from  The  Information   Technology
       Association of America,  the industry's century date change certification
       program.  The new  enterprise  wide  software  was  implemented  and live
       effective  April 1,  1998 and has cost  the  Company  approximately  $800
       thousand.  Management  believes  that the  effect of the Year 2000 on its
       internal  information  systems  will  have an  immaterial  impact  on the
       Company.  The Company is also reviewing the Year 2000 system  conversions
       of other  companies  with which it does  business  in order to  determine
       their compliance.



                                       12
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

                           Part II - Other Information

Item 1 -  Legal Proceedings - None

Item 2 - Changes in Securities and Use of Proceeds:
     (a)  Changes in Securities - None
     (b)      Use of Proceeds - Not applicable

Item 3 - Defaults Upon Senior Securities - None

Item 4 - Submission of Matter to a Vote of Security Holders - None

Item 5 - Other Information - None

Item 6 - Exhibits and Reports on Form 8-K
     (a)   Exhibits -
           Exhibit         27-  Financial  Data  Schedule as of and for the nine
                           months ended September 30, 1998,  pursuant to Article
                           5 of Regulation S-X.
           Exhibit         27.1 - Restated Financial Data Schedule as of and for
                           the nine months ended September 30, 1997, pursuant to
                           Article 5 of Regulation S-X.
     (b)   Reports:  None




                                       13
<PAGE>




                       COMPUTER MANAGEMENT SCIENCES, INC.

                                   Signatures



       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.


                                             COMPUTER MANAGEMENT SCIENCES, INC.
                                             (Registrant)




Date:  November 13, 1998                      /s/ Anthony Colaluca
                                             --------------------
                                             Anthony Colaluca
                                             Vice President and 
                                             Chief Financial Officer