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, 2003

                         COMMISSION FILE NUMBER: 0-24484

                                 MPS GROUP, INC.
             (Exact name of registrant as specified in its charter)

                Florida                                     59-3116655
--------------------------------------               -------------------------
(State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

 1 Independent Drive, Jacksonville, FL                       32202
----------------------------------------                 --------------
(Address of principal executive offices)                   (Zip Code)

      (Registrant's telephone number including area code): (904) 360-2000

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

    Common Stock, Par Value $0.01 Per Share             New York Stock Exchange
           (Title of each class)                      (Name of each exchange on
                                                           which registered)

     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
    ---    ---

     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 or any amendment to this
Form 10-K. [X]

     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the Act).

Yes  X  No
    ---    ---

     The aggregate  market value of the voting stock held by  non-affiliates  of
the  Registrant,  based upon the closing sale price of common stock on, June 30,
2003, the last business day of the registrant's  most recently  completed second
fiscal quarter,  as reported by the New York Stock Exchange,  was  approximately
$695,179,314.

     As of March 1, 2004 the number of shares  outstanding  of the  Registrant's
common stock was 103,177,129.

     DOCUMENTS  INCORPORATED BY REFERENCE.  Portions of the  Registrant's  Proxy
Statement  for its 2003  Annual  Meeting of  shareholders  are  incorporated  by
reference in Part III.
<PAGE>
FORWARD LOOKING STATEMENTS

This Annual Report on Form 10-K  contains  forward-looking  statements  that are
subject to certain risks,  uncertainties  or assumptions  and may be affected by
certain factors,  including but not limited to the specific factors discussed in
Part II,  Item 5 under  'Market  for  Registrant's  Common  Equity  and  Related
Stockholder Matters',  'Liquidity and Capital Resources,' and 'Factors Which May
Impact Future Results and Financial  Condition.' In some cases, you can identify
forward-looking  statements  by  terminology  such as 'will,'  'may,'  'should,'
'could,' 'expects,' 'plans,' 'indicates,' 'projects,' 'anticipates,' 'believes,'
'estimates,'  'appears,' 'predicts,'  'potential,'  'continues,' 'can,' 'hopes,'
'perhaps,'  'would,'  or  'become,'  or the  negative  of  these  terms or other
comparable   terminology.   In  addition,   except  for  historical  facts,  all
information  provided in Part II, Item 7A, under  'Quantitative  and Qualitative
Disclosures About Market Risk' should be considered forward-looking  statements.
Should one or more of these risks,  uncertainties or other factors  materialize,
or should underlying assumptions prove incorrect, actual results, performance or
achievements  of the  Company  may  vary  materially  from any  future  results,
performance  or  achievements  expressed  or  implied  by  such  forward-looking
statements.

Forward-looking statements are based on beliefs and assumptions of the Company's
management and on information  currently  available to such management.  Forward
looking  statements  speak  only as of the date they are made,  and the  Company
undertakes  no  obligation  to  publicly  update  any of  them in  light  of new
information  or  future  events.  Undue  reliance  should  not be placed on such
forward-looking   statements,   which   are  based  on   current   expectations.
Forward-looking statements are not guarantees of performance.

<PAGE>

                                     PART I

ITEM 1. BUSINESS

                                  Introduction

MPS  Group,  Inc.  ('MPS' or the  'Company')  is a leading  global  provider  of
business  services with over 170 offices  throughout the United States,  Canada,
the United Kingdom, and continental Europe. MPS delivers consulting,  solutions,
and staffing  services to virtually all industries in the following  disciplines
and through the following brands:

  Discipline                            Brand(s)

  Information Technology (IT) Services  Modis
  Accounting and Finance                Badenoch & Clark, Accounting Principals
  Engineering                           Entegee
  Legal                                 Special Counsel
  IT Solutions                          Idea Integration
  Health Care                           Soliant Health
  Executive Search                      Diversified Search
  Human Capital Automation              Beeline


MPS operates  these  brands under three  divisions:  the  professional  services
division;  the IT services division;  and the IT solutions division. The Company
generated  revenue of $1.10 billion in 2003, of which 64% was  contributed  from
the United States.  The remainder was earned  internationally,  primarily in the
United  Kingdom.  Note 16 to the  Company's  Consolidated  Financial  Statements
provides segment and geographic  information for the three years ending December
31, 2003.

MPS's common stock is listed on the New York Stock  Exchange  ('NYSE') under the
ticker symbol 'MPS'. The Company's Internet address is www.mpsgroup.com  and its
principal  executive offices are located at 1 Independent  Drive,  Jacksonville,
Florida 32202 (telephone: 904-360-2000). The Company makes available through its
Internet  website  its annual  reports on Form 10-K,  quarterly  reports on Form
10-Q, and current reports on Form 8-K, as soon as reasonably  practicable  after
filing such material  with, or  furnishing  it to, the  Securities  and Exchange
Commission.  The  information  contained on the Company's  website,  or on other
websites linked to its website, is not part of this document.


                                   Operations

Professional Services division

The  professional  services  division  represented  approximately  47% of  MPS's
revenue  and 51% of its  gross  profit  for  2003.  This  was up from 41% of its
revenue  and  47%  of  its  gross  profit  for  2002.  Approximately  61% of the
division's  revenue  was  generated  in the  United  States  with the  remainder
contributed from the United Kingdom.

The professional  services division provides  professional business staffing and
solutions to a wide variety of clients, through its network of approximately 100
offices in the  United  States and the United  Kingdom.  The  division  provides
expertise  in a wide  variety of  disciplines  operating  through the Badenoch &
Clark,  Accounting  Principals,  Special Counsel,  Entegee,  Soliant Health, and
Diversified Search brands.

     Badenoch & Clark is a professional  services  recruitment  consultancy with
     offices  located  across  the United  Kingdom,  primarily  specializing  in
     finance & accounting. Badenoch & Clark has served clients for over 20 years
     with a  professional,  consultative  approach to  permanent,  temporary and
     interim hiring solutions.

     Entegee  provides  a  strategic  work  force  solution  for  technical  and
     engineering  needs  through  its  domestic  network  of  national  practice
     branches.  From on-site management consulting and in-house project services
     to temporary and direct placement,  Entegee combines industry knowledge and
     experience  to fill highly  skilled  technical and  engineering  positions.
     Entegee also provides  engineering  and drafting  design  services  through
     company-owned centers that utilize state-of-the-art computer technology.

     Special Counsel provides  customized  legal workforce  solutions to Fortune
     1000 companies and law firms through its network of offices  located across
     the United States. Special Counsel provides temporary,  temporary-to-direct
     hire,  and  direct  hire  solutions  for  workload  management,  litigation
     support,   business  transaction   support,   pre-litigation  and  document
     management support, as well as trial-related services.

     Accounting   Principals  provides  professional  services  recruitment  and
     placement of  accounting  and finance  professionals  with offices  located
     across the United States.  Accounting Principals offers a complete range of
     workforce solutions in accounting,  finance,  mortgage, and banking through
     its nationwide branch network and team of experienced professionals.

     Soliant  Health  provides  specialized   healthcare  staffing  services  in
     nursing,  imaging, therapy, and other healthcare positions to hospitals and
     healthcare  providers.  By supplying traveling nurses and allied healthcare
     professionals on both temporary and direct hire assignments, Soliant Health
     delivers  comprehensive  healthcare staffing services to leading facilities
     across the United States.

     Diversified  Search provides  senior-level  executive and board of director
     search  services  to  clients   ranging  from  small,   private  firms  and
     not-for-profits  to large publicly held corporations in the United States.

The Company's  business  staffing  solutions are provided for varying periods of
time to companies or other organizations  (including  government  agencies) that
have a need for such  personnel,  but are unable  to, or choose  not to,  engage
certain personnel as their own employees.  Examples of client needs for staffing
solutions include the need for specialized or  highly-skilled  personnel for the
completion  of a  specific  project  or  subproject,  substitution  for  regular
employees during vacation or sick leave, and staffing of high turnover positions
or seasonal peaks.

The division has a variable  cost  business  model  whereby  revenue and cost of
revenue are primarily recognized and incurred on a time-and-materials basis. The
majority of the billable consultants are compensated on an hourly basis only for
the hours  which are  billed  its  client.  Approximately  5% of the  division's
revenue in 2003 was generated from permanent placement fees. Permanent placement
fees are generated when a client directly hires a skilled consultant.

In 2003,  the Company  acquired  the legal  staffing  businesses  of LawPros and
LawCorps.  Purchase  consideration  for these  two  acquisitions  totaled  $16.0
million  in cash,  of which  $15.3  million  was paid at  closing.  LawPros  and
Lawcorps  generated  $10.1  million  of revenue in 2003.  In 2002,  the  Company
acquired a health care staffing business, Elite Medical (subsequently re-branded
as Soliant Health). Purchase consideration totaled $15.9 million, which was paid
in a mixture of cash and stock.  Soliant  Health's revenue was $19.4 million and
$9.1 million in 2003 and 2002, respectively.

In December  2003,  the Company sold certain  operating  assets and  transferred
certain operating  liabilities of its outplacement  unit,  Manchester,  for $8.0
million  in  cash  while  retaining  the  working  capital  of the  business  of
approximately $2.0 million. This decision to sell Manchester was in keeping with
the Company's  long-term  strategy of focusing on the its core  businesses.  The
initial after-tax loss on the sale was $20.7 million.  Manchester's 2003 revenue
was $21.0 million.  As a result of the sale of Manchester and in accordance with
GAAP,  the  Company's   Consolidated   Financial   Statements  and  Management's
Discussion and Analysis of Financial  Condition and Results of Operations report
the results of  operations  of Manchester  as  discontinued  operations  for all
periods presented.


IT Services division

The IT services  division  includes  the Modis and Beeline  units.  The division
represented  approximately  47% of MPS's revenue and 40% of its gross profit for
2003.  Approximately  63% of the division's  revenue was generated in the United
States,  with the remainder generated  internationally,  primarily in the United
Kingdom.

Modis is one of the world's largest providers of Information Technology Resource
Management  (ITRM) services and solutions.  ITRM is defined as deploying skilled
consultants to meet an  organization's  information  technology  goals using the
optimal  mix of  internal  staff,  outside  consulting  resources,  and  project
outsourcing. Today, Modis delivers world-class ITRM solutions to more than 1,000
clients in a wide variety of industries  through its network of approximately 65
offices in the United States, United Kingdom, Canada and continental Europe.

The value-added  solutions falling under the umbrella of ITRM include IT project
support  and  staffing,   recruitment  of  full-time  positions,   project-based
solutions,  supplier management solutions, and on-site recruiting support in the
areas  of  application   development,   systems   integration,   and  enterprise
application integration.

Modis has a variable cost business model whereby revenue and cost of revenue are
primarily generated on a time-and-materials  basis. The majority of the billable
consultants  are  compensated  on an hourly  basis only for the hours  which are
billed its client. Less than 1% of the Modis' revenue in 2003 was generated from
permanent  placement fees.

Beeline provides a software-based  human capital management services solution to
principally  Fortune 1000 clients.  Beeline offers a wide range of human capital
solutions  that automate the  acquisition  and  management of both full-time and
contingent  workers.  Beeline  offerings  include Beeline for Contingent  Labor,
Beeline for Managed Services,  Beeline for Performance  Appraisals,  Beeline for
Direct Hire,  and Beeline for RFPs.  Companies and government  agencies  enhance
execution with these solutions by improving efficiency,  visibility, discipline,
and  communication.  Beeline has  operations  in both the United  States and the
United Kingdom.

Beeline  maintains a  full-time  staff to support  its  operations  and seeks to
collect a service charge based upon the usage of this service.  To implement its
service,  Beeline  incurs  considerable  start up costs and time.  Subsequent to
implementation,  minimal  cost  and  resources  are  required  for the  usage of
Beeline's services.


IT Solutions division

The IT solutions division is comprised solely of Idea Integration ('Idea').  The
division  represented  approximately  6% of MPS's  revenue  and 9% of its  gross
profit for 2003.  All of the  division's  revenue  was  generated  in the United
States.

Idea is an e-business  consulting  and systems  integration  solutions  provider
serving Fortune 1000 companies, government, and middle-market clients, through a
combination of local,  regional,  and national  practice  groups located in nine
domestic  markets.  Specializing  in Web  design  and  development,  information
management  solutions,  wireless workflow  applications,  portal solutions,  and
enterprise resource  management,  Idea strives to deliver  high-return  business
applications for its clients.

Idea has a fixed cost business model utilizing  salaried  consultants to deliver
solutions  primarily under  time-and-materials  contracts and to a lesser extent
under fixed-fee contracts.


                                   Competition

MPS's ability to compete  successfully  for clients  depends on its  reputation,
pricing and quality of service provided,  its understanding of clients' specific
job  requirements,  and the ability to provide  qualified  personnel in a timely
manner.  Certain  of  the  Company's  contracts  are  awarded  on the  basis  of
competitive  proposals which can be periodically re-bid by the client. While MPS
has been successful in obtaining both short and long-term contracts in the past,
there  can  be  no  assurance  that  existing   contracts  will  be  renewed  on
satisfactory  terms or that additional or replacement  contracts will be awarded
to the Company.

The principal  competitors of the professional  services division include Robert
Half International  Inc.,  Resources  Connection,  Inc.,  Spherion  Corporation,
Wallace Law Registry,  Ajilon  Consulting  (a wholly owned  subsidiary of Adecco
SA), Michael Page  International,  Robert Walters PLC, Cross Country Healthcare,
Inc., and CDI Corporation.

The principal  competitors  of the IT services  division  include  Keane,  Inc.,
Computer Horizons Corp., Comsys Information  Technology  Services,  Inc., CIBER,
Inc., and Ajilon Consulting.

The  principal   competitors  of  the  IT  solutions  division  include  Sapient
Corporation,  Cognizant Technology  Solutions  Corporation,  Answerthink,  Inc.,
Accenture  Ltd.,  Cap Gemini  Ernst & Young,  and to an extent,  the  consulting
division of IBM. In addition, in seeking engagements the division often competes
against the  internal  management  information  services and IT  departments  of
clients and potential clients.


                                 Growth Strategy

The Company's growth strategy is focused on increasing overall revenue and gross
profits primarily through its core services  offerings  relating to professional
services, IT services, and IT solutions and, to a lesser extent,  expansion into
new  specialties.  The Company looks to achieve this focus through a combination
of both internal growth and  acquisitions.  In addition,  this focus is aided by
the  shedding of non-core  businesses,  as  illustrated  by the 2003 sale of the
Company's outplacement unit,  Manchester.  The decision of growing internally as
opposed  to an  acquisition  will be based on the  perceived  length  of time to
penetrate a market  compared to its cost,  as well as  analyzing  the  potential
return on invested capital for a potential acquisition.

The Company feels it has positioned  itself for an upturn in the economy through
the consolidation of back office activities and the continued development of its
strategic  management  systems.  Coming out of an economic  downturn,  employers
historically  have turned to  contingent  labor first  before  hiring fixed cost
employees. As demand for the Company's services improves, the Company is looking
to further  diversify  its business mix through a combination  of  maintaining a
leadership  position in both IT services  and IT  solutions,  while  growing the
professional  services segment.  Supported by favorable workforce  demographics,
the Company  looks to grow the  professional  services  segment  revenue in both
amount and overall  percentage  contribution  through a  broadening  of existing
service  lines and  through  strategic  acquisitions  primarily  in the areas of
accounting and finance, legal and health care.

The key elements of the Company's  internal growth strategy  include  increasing
penetration  of  existing  markets  and  customer  segments,  expanding  current
specialties into new and contiguous  geographic markets,  concentrating on skill
areas that value high levels of service, and identifying and adding new practice
areas. As one of the largest global providers of business services,  the Company
looks to expand on this market  footprint.  Further,  the Company can strengthen
its  relationships  with  clients,  consultants  and  employees by enhancing the
knowledge and skills of its consultants  and employees.  While the Company looks
to strengthen its relationships with clients, it does not look to concentrate on
any one specific  client.  For  example,  there were no customers to which sales
represented over 5% of the Company's consolidated revenue for 2003.


                                    Employees

On March 1, 2004, the Company  employed  approximately  12,800  consultants  and
approximately  1,900  corporate  employees  on  a  full-time  equivalent  basis.
Approximately 275 of the employees work at corporate headquarters.

As described below, in most  jurisdictions,  the Company, as the employer of the
consultants  or as otherwise  required by  applicable  law, is  responsible  for
employment   administration.   This   administration   includes   collection  of
withholding taxes, employer  contributions for social security or its equivalent
outside the United States,  unemployment tax, workers' compensation and fidelity
and  liability  insurance,  and  other  governmental   requirements  imposed  on
employers.  Full-time employees are covered by life and disability insurance and
receive health insurance and other benefits.


                             Government Regulations

Outside of the United  States and  Canada,  the  staffing  services  industry is
closely  regulated.  These regulations  differ among countries but generally may
regulate:  (i) the relationship between the Company and its temporary employees;
(ii) registration,  licensing,  record keeping, and reporting requirements;  and
(iii) types of  operations  permitted.  Regulation  within the United States and
Canada has not materially impact the Company's operations.

In many countries,  including the United States and the United Kingdom, staffing
services firms are considered the legal  employers of the temporary  consultants
while the consultant is on assignment  with a company  client.  Therefore,  laws
regulating  the  employer/employee  relationship,  such  as tax  withholding  or
reporting,  social  security or  retirement,  anti-discrimination,  and workers'
compensation,  govern the Company. In other countries,  staffing services firms,
while not the direct legal employer of the consultant, are still responsible for
collecting taxes and social security deductions and transmitting such amounts to
the taxing authorities.


                              Intellectual Property

The Company seeks to protect its intellectual property through copyright,  trade
secret and trademark law and through  contractual  non-disclosure  restrictions.
The Company's  services often involve the  development of work and materials for
specific client  engagements,  the ownership of which is frequently  assigned to
the client. The Company does at times, and when appropriate, negotiate to retain
the  ownership  or  continued  use of  development  tools or know how created or
generated by the Company for a client in the delivery of its services, which the
Company may then license to other clients.


                                   Seasonality

The Company's  quarterly operating results are affected by the number of billing
days in the quarter and the seasonality of its customers' businesses. Demand for
the Company's services has historically been lower during the calendar year-end,
as a  result  of  holidays,  through  February  of the  following  year,  as the
Company's customers approve annual budgets.  Extreme weather conditions may also
affect demand in the early part of the year as certain of the  Company's  client
facilities  are located in geographic  areas subject to closure or reduced hours
due to inclement weather.


ITEM 2. PROPERTIES

The  Company  owns  no  material   real   property.   It  leases  its  corporate
headquarters,  as well as almost all of its branch  offices.  The branch  office
leases generally run for three to five-year terms. The Company believes that its
facilities  are  generally  adequate  for its  needs  and  does  not  anticipate
difficulty  replacing  such  facilities or locating  additional  facilities,  if
needed.  For  additional  information  on lease  commitments,  see Note 6 to the
Company's Consolidated  Financial Statements.  For additional information on the
Company's  charge for exit costs  associated with the abandonment of excess real
estate obligations for certain vacant office space, see Note 17 of the Company's
Consolidated Financial Statements.


ITEM 3. LEGAL PROCEEDINGS

The  Company is a party to a number of  lawsuits  and claims  arising out of the
ordinary  conduct of its business.  In the opinion of  management,  based on the
advice of in-house and external legal  counsel,  the lawsuits and claims pending
are not likely to have a material  adverse effect on the Company,  its financial
position, its results of operations, or its cash flows.

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

No  matters  were  submitted  to a vote of  security  holders  during the fourth
quarter of 2003.



                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

                           PRICE RANGE OF COMMON STOCK

The  Company's  Common  Stock is traded  on the NYSE  (NYSE  symbol - MPS).  The
following  table sets forth the high and low sale prices of MPS's Common  Stock,
as reported by the NYSE, during the two years ended December 31, 2003:
<TABLE>
<CAPTION>
                                                             2003                                 2002
                                                  -----------------------------      ------------------------------
                                                   High                 Low               High                 Low
                                                  -----------------------------      ------------------------------
<S>                                               <C>                <C>              <C>                  <C>
Period:
         First Quarter.....................       $ 6.24              $ 4.75             $ 8.94              $ 6.45

         Second Quarter....................         7.58                5.20               9.80                7.00

         Third Quarter.....................        10.10                6.83               8.25                4.35

         Fourth Quarter....................        10.65                8.55               6.65                4.35

</TABLE>
See the factors set forth below in 'FACTORS  WHICH MAY IMPACT FUTURE RESULTS AND
FINANCIAL  CONDITION' under  'MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF  OPERATIONS,'  for factors that may impact the price of
the Company's  Common Stock.  Fluctuations  and  volatility in the financial and
equity markets, in general, and in the Company's industry sector, in particular,
affect the price of the Company's Common Stock.

As of March 1,  2004,  there were  approximately  912  holders of record of the
Company's Common Stock.

No cash dividend or other cash distribution with respect to the Company's Common
Stock has ever been paid by the Company. The Company currently intends to retain
any earnings to provide for the operation and expansion of its business and does
not  anticipate  paying  any  cash  dividends  in the  foreseeable  future.

The Company's  Board of Directors had  authorized  the repurchase of up to $65.0
million of the Company's  Common  Stock.  Beginning in the third quarter of 2002
through the second quarter of 2003, 1.6 million shares at a cost of $9.1 million
have been repurchased under this authorization. There has been no activity under
this authorization since the second quarter of 2003.


<PAGE>
ITEM 6.  SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
                                                                         Years Ended
                                          ---------------------------------------------------------------------------------
                                                  Dec. 31,        Dec. 31,        Dec. 31,       Dec. 31,       Dec. 31,
(in thousands, except per share amounts)           2003            2002            2001           2000           1999
- -------------------------------------------------------------------------------------------------------------------------
<S>                                             <C>            <C>             <C>            <C>            <C>
Consolidated Statements of Operations data:
Revenue                                        $  1,096,030    $  1,119,156      $1,500,615   $  1,777,540    $ 1,895,093
Cost of revenue                                     808,890         834,318       1,105,781      1,269,760      1,395,945
                                          ---------------------------------------------------------------------------------
Gross profit                                        287,140         284,838         394,834        507,780        499,148
Operating expenses                                  251,623         255,929         342,918        388,338        312,729
Amortization of goodwill (1)                              -               -          37,312         35,937         30,618
Impairment of investment                                  -          16,165               -           (694)        (2,275)
Exit costs (recapture)                                 (284)          8,967               -              -              -
Asset write-down related to sale of
  discontinued operations                                 -               -               -         13,122         25,000
                                          ---------------------------------------------------------------------------------
Operating income                                     35,801           3,777          14,604         71,077        133,076
Other income (expense), net                             553          (3,947)         (9,199)       (21,621)        (7,794)
                                          ----------------------------------------------------------------------------------
Income (loss) from continuing operations
   before income taxes and cumulative
   effect of accounting change                       36,354            (170)          5,405         49,456        125,282
Provision (benefit) for income taxes                 14,519          13,832           3,102        (65,834)        47,571
                                          ---------------------------------------------------------------------------------
Income (loss) from continuing
    operations before cumulative
    effect of accounting change                      21,835         (14,002)          2,303        115,290         77,711
Discontinued operations: (2)
Income (loss) from discontinued
   operations, net of tax                            (2,395)          1,410           6,040          4,463          4,424
Gain (loss) on sale of discontinued
   operations, net of tax                           (20,675)              -               -              -         14,955
                                          ---------------------------------------------------------------------------------
Income (loss) before cumulative
   effect of accounting change                       (1,235)        (12,592)          8,343        119,753         97,090
Cumulative effect of accounting change,
   net of tax (1)                                         -        (553,712)              -              -              -
                                          ---------------------------------------------------------------------------------
Net income (loss)                              $     (1,235)   $   (566,304)     $    8,343   $    119,753     $   97,090
                                          =================================================================================
Basic income (loss) per common share:
   From continuing operations                  $       0.21    $      (0.14)     $     0.02   $       1.19     $     0.81
                                          =================================================================================
   From discontinued operations                $      (0.02)   $       0.01      $     0.06   $       0.05     $     0.05
                                          =================================================================================
   From sale of discontinued operations        $      (0.20)   $          -      $        -   $          -     $     0.16
                                          =================================================================================
   From accounting change                      $          -    $      (5.49)     $        -   $          -     $        -
                                          =================================================================================
Basic income (loss) per common share           $      (0.01)   $      (5.62)     $     0.09   $       1.24     $     1.01
                                          =================================================================================
Diluted income (loss) per common share:
   From continuing operations                  $       0.21    $      (0.14)     $     0.02   $       1.18      $    0.80
                                          =================================================================================
   From discontinued operations                $      (0.02)   $       0.01      $     0.06   $       0.05     $     0.05
                                          =================================================================================
   From sale of discontinued operations        $      (0.20)   $          -      $        -   $          -     $     0.15
                                          =================================================================================
   From accounting change                      $          -    $      (5.49)     $        -   $          -     $        -
                                          =================================================================================
Diluted income (loss) per common share         $      (0.01)   $      (5.62)     $     0.08   $       1.23     $     1.00
                                          =================================================================================

Basic average common shares
   outstanding                                      101,680          100,833         97,868         96,675         96,268
                                          =================================================================================
Diluted average common shares
   outstanding                                      104,518          100,833         98,178         97,539         97,110
                                          =================================================================================

<PAGE>

                                                                         December 31,
                                          ---------------------------------------------------------------------------------
(in thousands)                                      2003             2002           2001           2000           1999
---------------------------------------------------------------------------------------------------------------------------

Consolidated Balance Sheet data:
Working capital                                $     216,879     $    171,154   $  200,887     $    242,872   $   250,668
Total assets                                         893,151          892,974    1,533,863        1,645,414     1,581,049
Long term debt                                             -                -      101,000          194,000       238,615
Stockholders' equity                                 793,462          781,559    1,310,811        1,303,218     1,182,515

</TABLE>

(1)  Cumulative effect of accounting change relates to the Company's adoption of
     Statement of Financial  Accounting Standards ('SFAS') No. 142 'Goodwill and
     Other  Intangible   Assets,'  effective  January  1,  2002.  SFAS  No.  142
     discontinued the periodic amortization of goodwill.

(2)  For  discontinued  operations,  the  1999  gain  on  sale  related  to  the
     discontinued  Commercial  operations  and  Teleservices  division  sold  in
     September  1998.  The income (loss) from  discontinued  operations  for the
     periods  presented  above  and  the  2003  loss  on  sale  related  to  the
     discontinued outplacement unit, Manchester, sold in December 2003.

<PAGE>
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
             RESULTS OF OPERATIONS

MPS (the 'Company') is a leading global provider of business  services with over
170 offices  throughout  the United  States,  Canada,  the United  Kingdom,  and
continental  Europe. MPS delivers a mix of consulting,  solutions,  and staffing
services in  disciplines  such as IT services,  finance and  accounting,  legal,
engineering,  IT solutions,  health care,  executive  search,  and human capital
automation.

The  following  detailed  analysis  of  operations  contains  certain  financial
information on a 'constant  currency' basis.  Such constant  currency  financial
data is not a U.S. generally accepted  accounting  principles ('GAAP') financial
measure.  Constant currency removes from financial data the impact of changes in
exchange  rates  between the U.S.  dollar and the  functional  currencies of the
Company's foreign subsidiaries, by translating the current period financial data
into U.S. dollars using the same foreign currency  exchange rates that were used
to translate the financial data for the previous  period.  The Company  believes
presenting  certain results on a constant  currency basis is useful to investors
because it allows a more meaningful comparison of the performance of its foreign
operations from period to period.  Additionally,  certain internal reporting and
compensation  targets  are based on  constant  currency  financial  data for the
Company's  various foreign  subsidiaries.  However,  constant  currency measures
should not be considered in isolation or as an alternative to financial measures
that reflect  current period  exchange  rates,  or to other  financial  measures
calculated and presented in accordance with GAAP.

The  following  detailed  analysis  of  operations  also  presents  the  revenue
generated by the Company's  professional  services division in the United States
excluding  the effect of  acquisitions.  Such  financial  data that excludes the
effect of acquisitions  is not a GAAP financial  measure.  The Company  believes
presenting  some  results  excluding  the  effects of  businesses  we acquire is
helpful to investors  because it permits a comparison of the  performance of its
core internal operations from period to period.  Additionally,  certain internal
reporting and compensation  targets are based on core internal  operations.  The
effect of  acquisitions  are  excluded  for the first 12  months  following  the
acquisition  date.  Subsequent  to  this,  acquisitions  are  considered  to  be
integrated.   Again  however,   such  measures  should  be  considered  only  in
conjunction  with  the  correlative  measures  that  include  the  results  from
acquisitions, as calculated and presented in accordance with GAAP.

The following  detailed  analysis of operations also contains certain  financial
information  excluding  the effect of a $25.1  million  charge for an investment
impairment  and exit costs in 2002,  along with a $284,000  recapture  for these
exit  costs in 2003.  The 2002  charge of $25.1  million  was  comprised  of the
following: (1) The Company elected not to participate in a recapitalization of a
minority  investment  originally  made in 1996.  This  election  resulted in the
investment being impaired.  As a result, the Company wrote off the investment in
its entirety  resulting in a $16.2 million charge;  (2) The Company  recorded an
$9.0 million  charge for exit costs  associated  with the  abandonment of excess
real  estate  obligations  for  certain  vacant  office  space.  This charge was
recorded in accordance with SFAS No. 146,  'Accounting for Costs Associated with
Exit or  Disposal.' In 2003,  the Company  recaptured  $284,000  relating to the
settlement of abandoned real estate.  See Note 17 to the Company's  Consolidated
Financial  Statements  for further  discussion.  We believe  presenting  certain
financial  information  excluding  the  effect  of  the  aforementioned  charges
(recapture)  provides a more  meaningful  comparison  of changes  from period to
period.  Again  however,  you should  consider such measures only in conjunction
with  the  correlative  measures  that  include  the  charges  (recapture),   as
calculated and presented in accordance with GAAP.

In December  2003,  the Company sold certain  operating  assets and  transferred
certain operating  liabilities of its outplacement  unit,  Manchester,  for $8.0
million  in  cash  while  retaining  the  working  capital  of the  business  of
approximately $2.0 million. This decision to sell Manchester was in keeping with
the Company's  long-term  strategy of focusing on the its core  businesses.  The
initial after-tax loss on the sale was $20.7 million. As a result of the sale of
Manchester  and in accordance  with GAAP, the Company's  Consolidated  Financial
Statements and Management's  Discussion and Analysis of Financial  Condition and
Results  of  Operations  report the  results  of  operations  of  Manchester  as
discontinued  operations  for all periods  presented.  Manchester's  revenue was
$21.0  million,  $35.8  million,  and  $47.9  million,  in 2003,  2002 and 2001,
respectively. Manchester's income (loss) before taxes was a $(3.7) million, $2.2
million, and $9.7, for 2003, 2002 and 2001, respectively.

The following detailed analysis of operations should be read in conjunction with
the 2003 Financial  Statements and related notes included elsewhere in this Form
10-K.

                       2003 COMPARED TO 2002

Consolidated Results

Revenue.  Revenue decreased $23.2 million,  or 2.1%, to $1,096.0 million in 2003
from  $1,119.2  million in 2002.  The  decrease  was due to a reduction  in 2003
revenue in both the  Company's IT Services  and IT Solutions  divisions of 11.1%
and 16.9%, respectively.  This decrease was offset by a 2003 revenue increase of
11.9% in the Company's professional services division.

Approximately  36% of the Company's 2003 revenue was generated  internationally,
primarily in the United Kingdom.  The Company's  revenue is therefore subject to
changes in foreign currency  exchange rates. The weakening of the U.S. dollar in
2003 had a slight impact on revenue,  as revenue,  on a constant  currency basis
decreased 4.8%, as compared to the decrease of 2.1% above.

In 2002, the Company acquired a health care staffing business,  and in 2003, the
Company acquired two legal staffing businesses  (together,  the 'acquisitions').
The Company's  health care staffing  business,  which was acquired in July 2002,
contributed  $19.4  million  and $9.1  million  in  revenue  for 2003 and  2002,
respectively.  The Company's  acquisition  of two legal  staffing  businesses in
February and August of 2003 (together,  the 'legal  acquisitions'),  contributed
$10.1  million in revenue  for 2003.  See Note 3 to the  Company's  Consolidated
Financial Statements for a discussion of the acquisitions.

Gross profit. Gross profit increased $2.3 million, or 0.8%, to $287.1 million in
2003 from $284.8 million in 2002.  However,  on a constant currency basis, gross
profit decreased $2.5 million, or 0.8%, in 2003. Gross margin increased to 26.2%
in 2003,  from 25.5% in 2002.  The higher  margin is due  primarily  to a higher
concentration of revenue being generated from the professional services division
for 2003.

Operating expenses.  Total operating expenses decreased $29.8 million, or 10.6%,
to $251.3  million  in 2003,  from  $281.1  million in 2002.  Included  in total
operating  expenses  for  2002  was a $25.1  million  charge  for an  investment
impairment and exit costs.  Included in total operating  expenses for 2003 was a
$284,000 recapture for these exit costs.  Excluding these aforementioned charges
(recapture), total operating expenses decreased $4.3 million, or 1.7%, to $251.6
million  in 2003,  from  $255.9  million  in 2002.  The  Company's  general  and
administrative  ('G&A')  expenses,  which are  included in  operating  expenses,
decreased $1.1 million,  or 0.5%, to $234.6 million in 2003, from $235.7 million
in 2002. G&A expenses on a constant  currency basis  decreased $6.6 million,  or
2.8%, in 2003. The decrease in G&A expenses was  attributable to the elimination
of duplicative  corporate  infrastructure  responsibilities  and the decrease in
revenue  for 2003.  The  decrease  in revenue  primarily  reduces  the  variable
component of compensation for the Company's employees.

Operating  income.  Operating income increased $32.0 million to $35.8 million in
2003,  from $3.8  million in 2002.  Results  for 2002 and 2003  included a $25.1
million  charge for an  investment  impairment  and exit  costs,  and a $284,000
recapture for these exit costs,  respectively.  Operating income as a percentage
of  revenue  increased  to 3.3% in 2003,  from 0.3% in 2002.  The  charge for an
investment  impairment  and exit costs in 2002 and the exit costs  recapture  in
2003,  had a 2.3%  and 0.1%  impact,  respectively,  on  operating  income  as a
percentage of revenue.

Other income (expense),  net. Other expense,  net consists primarily of interest
expense  related to  borrowings  under the Company's  credit  facility and notes
issued in  connection  with  acquisitions,  net of  interest  income  related to
investment income from (1) certain investments owned by the Company and (2) cash
on hand.  Interest expense decreased $4.7 million,  or 83.9%, to $0.9 million in
2003, from $5.6 million in 2002. The decrease in interest  expense is related to
the lack of borrowings under the Company's credit facility during 2003. Interest
expense was offset by $1.5 million and $1.7 million of interest and other income
in 2003 and 2002, respectively.

Income taxes. The Company recognized an income tax provision of $14.5 million in
2003,  compared  to a  provision  of  $13.8  million  in 2002.  Included  in the
provision  for 2002 is an $8.7  million  charge  for an agreed  upon  adjustment
related to an audit by the Internal Revenue Service of prior years' tax returns.
See  Note 7 to the  Company's  Consolidated  Financial  Statements  for  further
discussion.  This  charge  net of the tax  benefit on the  previously  mentioned
investment  impairment  and exit  costs in 2002  increased  the 2002  income tax
provision by $3.5 million.  The remaining decrease in the level of the Company's
income tax provision as a percentage of pre-tax income is due to the lower level
of non-deductible expenses for 2003.

Income from continuing operations before cumulative effect of accounting change.
As  a  result  of  the  foregoing,  income  from  continuing  operations  before
cumulative effect of accounting change increased $35.8 million, to $21.8 million
in 2003, from a $14.0 million loss in 2002.


Segment Results

Professional Services division

Revenue in the professional services division increased $54.8 million, or 11.9%,
to $514.1 million in 2003,  from $459.3 million in 2002. On a constant  currency
basis, revenue increased 8.4%. Acquisitions contributed $19.6 million in revenue
for 2003.

Of the division's revenue,  approximately 61% was generated in the United States
in both 2002 and 2003.  The  remainder  was  generated  in the  United  Kingdom.
Excluding the contribution  from  acquisitions,  revenue generated in the United
States increased 5.2% for 2003. On a constant currency basis,  revenue increased
2.6% for revenue generated in the United Kingdom.

Excluding the  contribution  from  acquisitions  and the  favorable  impact from
changes in foreign currency  exchange rates, all of the professional  division's
operating  units,  as listed below,  increased  revenue in 2003 from 2002.  This
increase in revenue was  attributable  to the increased  demand for the services
provided by the division.  Revenue  contribution from the professional  services
division's operating units for 2003 and 2002 are as follows:
<TABLE>
<CAPTION>

                                            2003            2002
------------------------------------------------------------------
<S>                                        <C>            <C>
Accounting and finance                      44.5%           46.0%
Engineering                                 34.9            37.6
Legal                                       15.3            12.8
Health care                                  3.8             2.0
Executive search                             1.5             1.6
</TABLE>

Gross profit for the professional  services division increased $13.3 million, or
9.9%, to $147.4  million in 2003 from $134.1  million in 2002.  The gross margin
decreased to 28.7% in 2003,  from 29.2% in 2002. The decrease in gross margin is
primarily attributable to the lower level of direct hire and permanent placement
fees, which generate a higher margin. As a percentage of revenue, the division's
direct hire and permanent  placement  fees decreased to 4.8% of revenue in 2003,
from 5.4% in 2002. Gross margin for the division's  staffing  services  remained
stable from 2002 to 2003.

The professional  services  division's G&A expenses  increased $9.6 million,  or
9.1%, to $115.6 million in 2003, from $106.0 million in 2002. As a percentage of
revenue,  the division's G&A expenses  decreased to 22.5% in 2003, from 23.1% in
2002. The increase in the  division's G&A expenses is associated  primarily with
the  increase in revenue for 2003,  and to a lesser  extent,  from the impact of
changes in foreign currency exchange rates.

Operating income for the professional  services division increased $4.8 million,
or 21.9%, to $26.7 million in 2003, from $21.9 million in 2002.


IT Services division

Revenue in the IT services division decreased $63.6 million, or 11.1%, to $511.7
million in 2003,  from $575.3  million in 2002.  On a constant  currency  basis,
revenue  decreased 13.7%. The decrease was attributable to the diminished demand
for IT services.  The division's customers continued to experience a constrained
ability to spend on IT initiatives due to uncertainties relating to the economy.

Of the division's revenue, approximately 63% and 65% was generated in the United
States  in  2003  and  2002,   respectively.   The   remainder   was   generated
internationally,  primarily  in the United  Kingdom.  Revenue  generated  in the
United States  decreased 15.0% in 2003. On a constant  currency  basis,  revenue
decreased 11.0% for revenue generated internationally.

Gross profit for the IT services  division  decreased $7.6 million,  or 6.2%, to
$114.7  million in 2003 from $122.3 million in 2002.  However,  the gross margin
increased  to 22.4% in 2003,  from 21.3% 2002.  The  increase in gross margin is
attributable  to the  division's  domestic  operations  where the  gross  margin
increased to 26.9% in 2003, from 24.4% in 2002. In 2002, the division's domestic
operations  experienced  a decrease  in bill rates and a shift in the mix of its
services,  which  exceeded  the related  decrease in pay rates of its  primarily
hourly  employees.   The  division was  able  to  more  effectively  manage  the
differential  in the bill and pay rates  throughout  2003,  which resulted in an
increase in gross margin from 2002. For revenue generated  internationally,  the
gross margin decreased to 15.0% in 2003, from 15.4% in 2002,  primarily due to a
shift in the mix of services provided internationally.

The IT services  division's  G&A expenses  decreased  $2.5 million,  or 2.5%, to
$99.5 million in 2003,  from $102.0 million in 2002. As a percentage of revenue,
the division's G&A expenses  increased to 19.4% in 2003, from 17.7% in 2002. The
decrease  in the  division's  G&A  expenses  is  primarily  associated  with the
decrease in revenue for 2003.

Operating income for the IT services division decreased $4.3 million,  or 40.6%,
to $6.3 million in 2003, from $10.6 million in 2002.


IT Solutions division

Revenue in the IT solutions division decreased $14.3 million, or 16.9%, to $70.2
million in 2003,  from  $84.5  million in 2002.  Weak  demand for IT  consulting
solutions was  intensified by the  uncertainties  relating to the economy.  As a
result,  management refined its focus by deciding to exit certain  non-strategic
markets  throughout  2002,  the last of which  occurred  in August  2002.  These
markets,  while generating  revenue,  were not producing positive income or cash
flow from  operations.  Revenue  generated  from these  closed  markets was $4.3
million for 2002.

Gross profit for the IT solutions division decreased $3.3 million,  or 11.6%, to
$25.1  million in 2003 from $28.4  million in 2002.  However,  the gross  margin
increased  to 35.7% in 2003,  from 33.6% in 2002.  This  increase  was driven by
higher  utilization  of the  Company's  salaried  consultants.  This  division's
business model,  unlike the Company's other divisions,  uses primarily  salaried
consultants  to meet customer  demand.  To reflect lower  customer  demand,  the
division significantly reduced billable headcount during 2002.

The IT solutions  division's G&A expenses  decreased $8.2 million,  or 29.6%, to
$19.5  million in 2003,  from $27.7 million in 2002. As a percentage of revenue,
the division's G&A expenses  decreased to 27.8% in 2003, from 32.8% in 2002. The
decrease in the division's  G&A expenses was primarily  related to reductions in
its work force throughout 2002.

Operating income for the IT solutions division  increased $6.1 million,  to $2.5
million in 2003, from a $3.6 million loss in 2002.



                       2002 COMPARED TO 2001

Consolidated Results

Revenue. Revenue decreased $381.4 million, or 25.4%, to $1,119.2 million in 2002
from  $1,500.6  million in 2001.  The  decrease  was due to a reduction  in 2002
revenue for all three divisions,  whereby revenue  decreased  18.1%,  25.4%, and
49.9%,  in the  Company's  professional  services,  IT Services and IT Solutions
divisions, respectively.

Approximately  34% of the Company's 2002 revenue was generated  internationally,
primarily in the United Kingdom.  The Company's  revenue is therefore subject to
changes in foreign currency  exchange rates. The weakening of the U.S. dollar in
2002 had a slight impact on revenue,  as revenue,  on a constant  currency basis
decreased 26.4%, as compared to the decrease of 25.4% above.  Constant  currency
removes the impact on revenue  from changes in exchange  rates  between the U.S.
dollar and the functional currencies of its foreign subsidiaries.

Included in the results for 2001 was $20.7 million in revenue from the Company's
scientific  operating  unit which was sold in December 2001.  Additionally,  the
Company acquired a health care staffing  business in July 2002 which contributed
$9.1  million  in revenue  for 2002.

Gross profit. Gross profit decreased $110.0 million, or 27.9%, to $284.8 million
in 2002 from $394.8  million in 2001.  Gross margin  decreased to 25.5% in 2002,
from 26.3% in 2001.  The lower  margin is due  primarily  to changes in business
mix, and a decrease in direct hire and permanent  placement fees, which generate
a higher margin.

Operating expenses.  Total operating expenses decreased $99.1 million, or 26.1%,
to $281.1  million in 2002,  from  $380.2  million in 2001.  There are two items
which should be separately  identified to provide a more meaningful  analysis of
the change in operating expenses.  Included in total operating expenses for 2002
was a $25.1 million charge for an investment impairment and exit costs. Included
in total operating expenses for 2001 was $37.3 million of goodwill amortization.
Excluding these  aforementioned  costs, total operating expenses decreased $87.0
million,  or 25.4%,  to $255.9 million in 2002, from $342.9 million in 2001. The
Company's G&A expenses  decreased $86.2 million,  or 26.8%, to $235.7 million in
2002, from $321.9 million in 2001. The decrease in G&A expenses was attributable
to (i) a decrease in revenue for 2002, (ii) cost reduction initiatives that were
implemented  in 2001 and throughout  2002 across MPS's  divisions in response to
the lower revenue  levels and (iii) the  elimination  of  duplicative  corporate
infrastructure  responsibilities.  The decrease in revenue primarily reduces the
variable component of compensation for the Company's  employees.  Certain of the
cost  reduction  initiatives  include the  reduction of the  Company's  salaried
workforce,  and  the  realignment  of  compensation  levels  for  the  Company's
employees.

In  accordance  with SFAS No.  142,  the  Company  did not record  any  goodwill
amortization  in  2002.  See  Note 5 to  the  Company's  Consolidated  Financial
Statements for further discussion.

Operating  income.  Operating income decreased $10.8 million,  or 74.0%, to $3.8
million in 2002, from $14.6 million in 2001.  Results for 2001 and 2002 included
$37.3  million  of  goodwill  amortization,  and a $25.1  million  charge for an
investment  impairment  and exit  costs,  respectively.  Operating  income  as a
percentage  of revenue  decreased to 0.3% in 2002,  from 1.0% in 2001.  Goodwill
amortization in 2001 and the charge for an investment  impairment and exit costs
in 2002, had a 2.5% and 2.3% negative impact, respectively,  on operating income
as a percentage revenue.

Other income (expense),  net. Other expense,  net consists primarily of interest
expense related to borrowings  under the Company's  credit  facilities and notes
issued in  connection  with  acquisitions,  net of  interest  income  related to
investment income from (1) certain investments owned by the Company and (2) cash
on hand.  Interest expense decreased $5.0 million,  or 47.2%, to $5.6 million in
2002, from $10.6 million in 2001. The decrease in interest expense is related to
the lower level of borrowings  under the Company's  credit facility during 2002.
Interest  expense was offset by $1.7  million and $1.4  million of interest  and
other income in 2002 and 2001, respectively.

Income taxes. The Company recognized an income tax provision of $13.8 million in
2002, compared to a provision of $3.1 million in 2001. Included in the provision
for 2002 is an $8.7  million  charge  recognized  for an agree  upon  adjustment
related to an audit by the Internal Revenue Service of prior years' tax returns.
This  charge  net of the tax  benefit  on the  previously  mentioned  investment
impairment  and exit costs in 2002  increased  the 2002 income tax  provision by
$3.5 million.  The remaining  decrease in the level of the Company's  income tax
provision  as  a  percentage   of  pre-tax   income  is  primarily  due  to  the
discontinuance  of  goodwill  amortization  required  by SFAS No.  142. In 2001,
non-deductible  goodwill  amortization on certain  acquisitions had an increased
effect on the Company's effective tax rate.

Income from continuing operations before cumulative effect of accounting change.
As  a  result  of  the  foregoing,  income  from  continuing  operations  before
cumulative  effect of accounting  change  decreased  $16.3  million,  to a $14.0
million loss in 2002,  from $2.3 million of income in 2001.

Segment Results

Professional Services division

Revenue in the  professional  services  division  decreased  $101.7 million,  or
18.1%,  to $459.3  million in 2002,  from $561.0  million in 2001. On a constant
currency basis,  revenue  decreased  19.4%. The decrease was attributable to the
diminished demand for staffing services and workforce  solutions provided by the
division.

Of the division's revenue, approximately 61% and 66% was generated in the United
States in 2002 and 2001, respectively. The remainder was generated in the United
Kingdom.  Included  in revenue  for 2001 was $20.7  million of revenue  from the
Company's  scientific operating unit which was sold in 2001. Included in revenue
for 2002 was $9.1 million of revenue from the Company's mid-year  acquisition of
a health  care  staffing  business.  On an  organic  basis,  excluding  both the
divestiture  and  the  acquisition,  revenue  generated  in  the  United  States
decreased 21.5% for 2002. On a local currency basis, revenue decreased 11.8% for
revenue in the United Kingdom.

Gross profit for the professional  services division decreased $37.7 million, or
21.9%,  to $134.1  million in 2002 from $171.8 million in 2001. The gross margin
decreased to 29.2% in 2002,  from 30.6% in 2001. The decrease in gross margin is
primarily  attributable to a decrease in bill rates for the services provided by
the  division  and,  to a lesser  extent,  the lower  level of  direct  hire and
permanent  placement  fees,  which generate a higher margin.  As a percentage of
revenue,  the division's  direct hire and permanent  placement fees decreased to
5.4% of revenue in 2002, from 6.9% in 2001.

The professional  services  division's G&A expenses decreased $19.8 million,  or
15.7%,  to $106.0 million in 2002,  from $125.8 million in 2001. As a percentage
of revenue,  the division's G&A expenses  increased to 23.1% in 2002, from 22.4%
in 2001.  The decrease in the  division's  G&A expenses is  associated  with the
decrease in revenue for 2002, and cost reduction initiatives  implemented within
the division in 2001 and throughout 2002.

Operating income for the professional  services division decreased $8.2 million,
or 27.2%,  to $21.9  million  in 2002,  from  $30.1  million  in 2001.  Goodwill
amortization had a $10.5 million negative impact on operating income for 2001.


IT Services division

Revenue in the IT services  division  decreased  $195.5  million,  or 25.4%,  to
$575.3  million in 2002,  from $770.8  million in 2001.  On a constant  currency
basis,  excluding the effects of exchange rates,  revenue  decreased  26.4%. The
decrease  was  attributable  to  the  diminished  demand  for IT  services.  The
division's  customers  continued to experience a constrained ability to spend on
IT initiatives due to uncertainties relating to the economy.

Of the division's revenue, approximately 65% and 71% was generated in the United
States  in  2002  and  2001,   respectively.   The   remainder   was   generated
internationally,  primarily  in the United  Kingdom.  Revenue  generated  in the
United  States  decreased  30.8% in 2002.  On a local  currency  basis,  revenue
decreased 15.7% for revenue generated internationally.

Gross profit for the IT services division decreased $46.0 million,  or 27.3%, to
$122.3 million in 2002 from $168.3  million in 2001. The gross margin  decreased
to 21.3% in 2002,  from 21.8% 2001. The decrease in gross margin is attributable
to the division's international  operations,  where it experienced a decrease in
bill rates,  which exceeded the related  decrease in pay rates of the division's
primarily hourly employees,  along with a shift in the mix of its services.  For
revenue generated internationally,  the gross margin decreased to 15.4% in 2002,
from 16.6 % in 2001.  For  revenue  generated  in the United  States,  the gross
margin increased to 24.4% in 2002, from 24.0% in 2001.

The IT services  division's G&A expenses  decreased $22.6 million,  or 18.1%, to
$102.0 million in 2002, from $124.6 million in 2001. As a percentage of revenue,
the division's G&A expenses  increased to 17.7% in 2002, from 16.2% in 2001. The
decrease in the  division's  G&A  expenses is  associated  with the  decrease in
revenue for 2002, and cost reduction initiatives implemented within the division
in 2001 and throughout 2002.

Operating income for the IT services division decreased $2.8 million,  or 20.9%,
to $10.6 million in 2002, from $13.4 million in 2001. Goodwill  amortization had
a $19.4 million negative impact on operating income for 2001.


IT Solutions division

Revenue in the IT solutions division decreased $84.3 million, or 49.9%, to $84.5
million in 2002,  from $168.8  million in 2001.  Weak  demand for IT  consulting
solutions was  intensified by the  uncertainties  relating to the economy.  As a
result,  management refined its focus by deciding to exit certain  non-strategic
markets.  These markets,  while generating revenue,  were not producing positive
income or cash flow from operations.

Gross profit for the IT solutions division decreased $26.3 million, or 48.1%, to
$28.4  million in 2002 from $54.7  million in 2001.  However,  the gross  margin
increased  to 33.6% in 2002,  from 32.4% in 2001.  This  increase  was driven by
higher  utilization  of the  Company's  salaried  consultants.  This  division's
business model,  unlike the Company's other divisions,  uses primarily  salaried
consultants  to meet customer  demand.  To reflect lower  customer  demand,  the
division significantly reduced billable headcount from 2001 to 2002.

The IT solutions  division's G&A expenses decreased $43.9 million,  or 61.3%, to
$27.7  million in 2002,  from $71.6 million in 2001. As a percentage of revenue,
the division's G&A expenses  decreased to 32.8% in 2002, from 42.4% in 2001. The
decrease in the division's  G&A expenses was primarily  related to reductions in
its work force that started in 2001 and continued through 2002.

The operating loss for the IT solutions division  decreased $25.3 million,  to a
$3.6  million  loss  in  2002,  from a $28.9  million  loss  in  2001.  Goodwill
amortization had a $7.4 million negative impact on operating income for 2001.


LIQUIDITY AND CAPITAL RESOURCES

The Company's  historical capital  requirements have principally been related to
the acquisition of businesses,  working capital needs and capital  expenditures.
These  requirements  have  been  met  through  a  combination  of bank  debt and
internally  generated  funds.  The  Company's  operating  cash flows and working
capital requirements are affected  significantly by the timing of payroll and by
the  receipt of payment  from the  customer.  Generally,  the  Company  pays its
consultants weekly or semi-monthly,  and receives payments from customers within
30 to 90 days from the date of invoice.

The  Company  had working  capital of $216.9  million  and $171.2  million as of
December  31,  2003  and  2002,  respectively.  The  Company  had  cash and cash
equivalents  of $124.8  million and $66.9  million as of  December  31, 2003 and
2002, respectively.

For the years ended December 31, 2003,  2002,  and 2001,  the Company  generated
$70.3 million,  $111.5 million, and $173.9 million of cash flow from operations,
respectively. The reduction in cash flow from operations, from 2002 to 2003, was
primarily due to the  normalizing of receivables  collection.  In 2001 and 2002,
the main elements of the Company's  back office  integration  and  consolidation
efforts were being  completed.  These efforts led to improvements in receivables
collection for 2001 and 2002. The reduction in cash flow from  operations,  from
2001 to 2002,  was primarily  due to a reduced level of earnings in 2002,  which
was somewhat offset by this improvement in receivables collection.

For the year ended December 31, 2003, the Company used $22.7 million of cash for
investing  activities,  of which $15.9 million,  net of cash acquired,  was used
primarily  for the legal  acquisitions,  and $6.8  million  was used for capital
expenditures.  For the year ended  December  31,  2002,  the Company  used $12.7
million of cash for investing  activities,  of which $6.7  million,  net of cash
acquired,  was used for the purchase of the Company's health care business,  and
$6.0 million was used for capital expenditures.  For the year ended December 31,
2001, the Company used $14.8 million of cash for investing activities, primarily
for capital expenditures.

For the year ended December 31, 2003, the Company generated $2.7 million of cash
from  financing  activities,  primarily  from  $10.9  million  of  stock  option
exercises,  net of $7.6 million used for the purchase of treasury stock. For the
year ended  December  31,  2002,  the  Company  used  $86.5  million of cash for
financing  activities,  of which $101.4 was used for repayments on the Company's
credit facility and $16.9 million was generated from stock option exercises. The
Company also used $1.4 million for the purchase of treasury  stock in 2002.  For
the year ended  December 31, 2001,  the Company used $116.6  million of cash for
financing  activities.  This amount primarily  represented net repayments on the
Company's credit facility and on notes issued in connection with the acquisition
of certain  companies.  These repayments were mainly funded from cash flows from
operations.

The Company's  Board of Directors has  authorized  the repurchase of up to $65.0
million of the Company's  Common  Stock.  Beginning in the third quarter of 2002
through the second quarter of 2003, 1.6 million shares at a cost of $9.1 million
have been repurchased under this authorization. There has been no activity under
this authorization since the second quarter of 2003.

The Company  anticipates that capital  expenditures for furniture and equipment,
including  improvements  to its  management  information  and operating  systems
during the next twelve months will be approximately $8 million.

While there can be no assurance in this regard,  the Company believes that funds
provided by operations,  available  borrowings  under the credit  facility,  and
current  amounts of cash will be sufficient  to meet its  presently  anticipated
needs for working  capital,  capital  expenditures and acquisitions for at least
the next 12 months.

<PAGE>

Indebtedness, Contractual Obligations, and Commercial Commitments of the Company

The following are contractual cash obligations and other commercial  commitments
of the Company at December 31, 2003:
<TABLE>
<CAPTION>
                                                                       Payments Due by Period
                                           ------------------------------------------------------------------------------
                                                             Less than          1 - 3           4 - 5           After 5
                                             Total             1 Year           Years           Years            Years
Contractual Cash Obligations
(in thousands)
<S>                                         <c>             <c>               <c>             <c>             <c>
Operating leases                            $  52,810        $  14,462        $  24,346        $   9,387       $   4,615
Other                                             891              891                -                -               -
                                           ------------------------------------------------------------------------------
Total Contractual Cash Obligations          $  53,701        $  15,353       $   24,346       $    9,387      $    4,615
                                           ==============================================================================



                                                            Amount of Commitment Expiration per Period
                                           ------------------------------------------------------------------------------
                                                             Less than          1 - 3           4 - 5           After 5
                                             Total             1 Year           Years           Years            Years

Standby letters of credit                   $   2,753        $   2,753        $       -        $       -       $       -
                                           ------------------------------------------------------------------------------
Total Commercial Commitments                $   2,753        $   2,753        $       -        $       -       $       -
                                           ==============================================================================

</TABLE>

The Company had a revolving  credit  facility that expired in October 2003, with
no borrowings outstanding.  In the fourth quarter of 2003, the Company closed on
a $150  million  revolving  credit  facility  syndicated  to a group of  leading
financial  institutions.  The credit  facility  contains  certain  financial and
non-financial   covenants  relating  to  the  Company's  operations,   including
maintaining certain financial ratios.  Repayment,  if applicable,  of the credit
facility is guaranteed by substantially of the subsidiaries of the Company.  The
facility  expires in November 2006. As of March 1, 2004, there are no borrowings
outstanding under this facility,  other than the $2.8 million of standby letters
of credit.




<PAGE>
CRITICAL ACCOUNTING POLICIES

The Company  prepares its financial  statements in  conformity  with  accounting
principles  generally accepted in the United States of America.  Associated with
this,  the Company  believes  the  following  are its most  critical  accounting
policies in that they are the most  important to the  portrayal of the Company's
financial  condition  and  results  and  require  management's  most  difficult,
subjective or complex judgments.

Revenue Recognition

The  Company  recognizes  substantially  all  revenue at the time  services  are
provided  and is  recorded on a time and  materials  basis.  In most cases,  the
consultant is the  Company's  employee and all costs of employing the worker are
the responsibility of the Company and are included in cost of revenue.  Revenues
generated when the Company  permanently  places an individual  with a client are
recorded at the time of placement  less a reserve for  employees not expected to
meet the probationary period.

In addition  and to a lesser  extent,  the Company is involved in fixed price or
lump-sum  engagements.  The services  rendered by the Company under the relevant
contracts  generally  require  performance  spanning  more  than one  accounting
period.   The  Company  recognizes  revenue  for  these  engagements  under  the
proportional performance accounting model.


Goodwill

In connection  with SFAS No. 142,  'Goodwill and Other  Intangible  Assets,' the
Company is required to perform goodwill  impairment  reviews, at least annually,
utilizing  a  fair-value  approach.   Additionally,  SFAS  No.  142  required  a
transitional goodwill impairment review upon adoption.

The  Company  adopted  SFAS No. 142 as of January 1, 2002.  In  connection,  the
Company engaged an independent  valuation consultant to assist with the required
transitional  goodwill impairment review. As of December 31, 2001, the Company's
Consolidated  Balance  Sheet  reflected  goodwill  of  $1,166.0  million.  After
performing the required  transitional  goodwill  impairment  tests,  the Company
recognized  a loss of $553.7  million,  net of an income  tax  benefit of $113.0
million,  and recorded the loss (net of the related tax benefit) as a cumulative
effect  of an  accounting  change in the  Company's  Consolidated  Statement  of
Operations for 2002. The Company performed  additional  valuation testing during
the fourth  quarter  of 2002 and 2003 (the  Company's  designated  timing of the
annual  impairment  test  under  SFAS No.  142) and did not  incur  any  further
impairment.  The  Company  plans to perform its next  annual  impairment  review
during the fourth  quarter of 2004. An impairment  review prior to the Company's
next scheduled annual review may be required if certain events occur,  including
lower than forecasted  earnings levels for various reporting units. In addition,
changes to other assumptions could significantly impact our estimate of the fair
value of our reporting units. Such a change may result in a goodwill  impairment
charge,  which could have a significant  impact on the reportable  segments that
include the related  reporting  units and the Company's  Consolidated  Financial
Statements.

As part of the Company's goodwill impairment reviews,  fair value was calculated
using an equally  blended  value of a discounted  cash flow  analysis and market
comparables.  In contrast to SFAS 142, the prior  accounting  standard (SFAS No.
121) required the use of  undiscounted  cash flow  estimates  over the remaining
useful life of the  goodwill  and other  long-lived  assets as a step 1 test for
possible  impairment.  Under SFAS No. 121, the concept of  recoverability of the
goodwill  over  the  useful  life of the  asset  was  the  underlying  test  for
impairment  as opposed  to fair  value  under  SFAS No.  142.  This  fundamental
difference in the underlying methodologies of testing for impairment of goodwill
in SFAS No. 121 and SFAS No. 142 caused the Company to attribute  the  resulting
impairment from the initial  valuation  completed on January 1, 2002 to a change
in accounting principle upon the adoption of SFAS No. 142. Projected cash flows,
used for both SFAS No. 121 and No. 142 testing,  considered the effects from the
then downturn in the Company's business.

As mentioned  above,  the Company used an equally  blended value of a discounted
cash flow analysis and market  comparables  to arrive at fair value for SFAS No.
142. For the discounted  cash flow analysis,  significant  assumptions  included
expected  future revenue growth rates,  reporting unit profit  margins,  working
capital  levels and a discount rate. The revenue growth rates and reporting unit
profit margins are based, in part, on the Company's  expectation of an improving
economic  environment.  Market  comparables  included a comparison of the market
ratios and performance  fundamentals from comparable companies. The use of these
measurement  criteria  is  consistent  with  the  underlying  concepts  used  in
determining  the fair  value of a company  or  reportable  unit under the market
approach.  The market  ratios the Company used refer to the multiples of revenue
and earnings of comparable  companies and the performance  fundamentals refer to
the  consideration  of the effects of the differences in the operating  metrics,
ie. growth rates,  operating  margins,  gross margins,  etc. on the value of the
company  versus  the  comparable   companies.   See  Note  5  to  the  Company's
Consolidated Financial Statements for further discussion.


Allowance for Doubtful Accounts

The Company regularly  monitors and assesses its risk of not collecting  amounts
owed to it by its customers.  This evaluation is based upon a variety of factors
including:  an  analysis  of amounts  current  and past due along with  relevant
history and facts  particular  to the  customer.  Based upon the results of this
analysis,  the Company records an allowance for uncollectible  accounts for this
risk.  This analysis  requires the Company to make  significant  estimates,  and
changes  in facts and  circumstances  could  result in  material  changes in the
allowance for doubtful accounts.


Income Taxes

The  provision  for income taxes is based on income  before taxes as reported in
the  Company's  Consolidated  Statements  of  Income.  Deferred  tax  assets and
liabilities  are recognized for the expected  future tax  consequences of events
that have been included in the financial  statements or tax returns.  Under this
method,  deferred  tax  assets  and  liabilities  are  determined  based  on the
differences  between the financial  statement carrying amounts and the tax basis
of assets  and  liabilities  using  enacted  tax rates in effect for the year in
which the  differences  are  expected to reverse.  An  assessment  is made as to
whether or not a valuation  allowance is required to offset deferred tax assets.
This assessment includes anticipating future income.

Significant  management  judgment  is required  in  determining   the  Company's
provision  for  income  taxes,  deferred  tax  assets  and  liabilities  and any
valuation  allowance  recorded  against the  Company's  net deferred tax assets.
Management  evaluates  all  available  evidence to determine  whether it is more
likely than not that some portion or all of the deferred  income tax assets will
not be realized.  The establishment and amount of a valuation allowance requires
significant  estimates  and judgment  and can  materially  affect the  Company's
results of operations.  The company's effective tax rate may vary from period to
period  based,  for  example,  on changes in estimated  taxable  income or loss,
changes to the  valuation  allowance,  changes to federal,  state or foreign tax
laws,  deductibility  of certain  costs and  expenses by  jurisdiction  and as a
result of acquisitions.

The Company has a net deferred tax asset as of both  December 31, 2003 and 2002,
primarily  due to  the  impairment  loss  recorded  as a  change  in  accounting
principle  associated with the Company's  adoption of SFAS No. 142 in 2002. This
impairment reduced the financial  statement  carrying amount of goodwill,  which
resulted in the tax basis of tax  deductible  goodwill  being  greater  than the
financial  statement  carrying  amount.  The  Company's  tax  basis  in its  tax
deductible  goodwill  will be  deducted  in the  Company's  income tax  returns,
generating $420.0 million of future tax deductions over the next 15 years.

MPS is subject to periodic  review by federal,  state,  foreign and local taxing
authorities in the ordinary course of business. During 2001, MPS was notified by
the Internal Revenue Service that certain prior year income tax returns would be
examined.  As part of this examination,  the net tax benefit  associated with an
investment in a subsidiary  that MPS recognized in 2000 of $86.3 million is also
being  reviewed.  In 2002,  the company  recorded an $8.7 million  charge for an
agreed upon  adjustment  related to its audit of prior years' tax returns.  This
Internal Revenue Service examination will be finalized once it has been reviewed
by the Joint Committee on Taxation. For a further discussion,  see Note 7 to the
Consolidated Financial Statements.


Exit Costs

In 2001 and 2002, the Company  experienced a material decrease in demand for its
domestic operations. To reflect this decreased demand, the Company made attempts
to realign its real estate capacity needs and thus vacate and reorganize certain
office space.

In 2002,  management  determined  that the Company  would not be able to utilize
this vacated office space.  This  determination  eliminated the economic benefit
associated with the vacated office space. As a result, the Company recorded $9.0
million of contract  termination  costs in 2002,  mainly due to, costs that will
continue to be incurred  under the lease contract for its remaining term without
economic  benefit to the  Company.  These  termination  costs were  recorded  in
accordance  with SFAS No. 146,  "Accounting  for Costs  Associated  with Exit or
Disposal Activities," which requires that a liability for a cost associated with
an exit or disposal activity be recognized, at fair value, when the liability is
incurred  rather  than at the time an entity  commits  to a plan.  In 2003,  the
Company  recaptured  $284,000 of these costs  relating to the  settlement of the
abandoned space. While the Company looks to settle excess lease obligations, the
current  economic  environment  has made it difficult  for the Company to either
settle or find acceptable subleasing opportunities.  The average remaining lease
term for the lease  obligations  included herein is approximately 1.5 years. See
Note  17  to  the  Company's   Consolidated  Financial  Statements  for  further
discussion.

For the Company's discontinued Manchester operations,  the Company recorded $0.7
million  of  contract  termination  costs  in 2002.  As a result  of the sale of
Manchester,  the  Company  recorded  an  additional  $0.7  million  of  contract
termination  costs in 2003,  which is included in 'Loss on  Disposition,  net of
tax' on the Company's Consolidated  Statement of Operations.  See Note 18 to the
Company's Consolidated Financial Statements for further discussion.


Impairment on Tangible Assets

The Company  reviews its  long-lived  assets and  identifiable  intangibles  for
impairment  whenever  events  or  changes  in  circumstances  indicate  that the
carrying  amount of the asset may not be  recoverable.  In performing the review
for  recoverability,  the Company  estimates  the future cash flows  expected to
result from the use of the asset and its eventual disposition. If the sum of the
expected future cash flows  (undiscounted  and without interest charges) is less
than the  carrying  amount  of the  asset,  an  impairment  loss is  recognized.
Otherwise,  an impairment loss is not  recognized.  Measurement of an impairment
loss for long-lived  assets and identifiable  intangibles  would be based on the
fair value of the asset.


RECENT ACCOUNTING PRONOUNCEMENTS

During January 2003, the FASB issued  Interpretation  No. 46,  'Consolidation of
Variable  Interest  Entities,' which clarifies the  consolidation and disclosure
requirements  related to variable  interests in a variable  interest  entity.  A
variable  interest  entity is an entity for which  control is  achieved  through
means  other  than  voting  rights.   The   consolidation   provisions  of  this
Interpretation,  as revised,  are effective  immediately  for interests  created
after  January 31, 2003 and are  effective  on December  31, 2003 for  interests
created before February 1, 2003. This  Interpretation will not have an impact on
the Company's Consolidated Financial Statements as it does not have any variable
interest entities that require consolidation.

During April 2003, the FASB issued SFAS No. 149,  'Amendment of Statement 133 on
Derivative  Instruments  and Hedging  Activities,'  which  amends and  clarifies
financial  accounting  and reporting  for certain  derivative  instruments.  The
adoption of this statement did not have an impact on the Company's  Consolidated
Financial  Statements,  as it is not currently a party to  derivative  financial
instruments addressed by this standard.

During May 2003, the FASB issued SFAS No. 150, 'Accounting for Certain Financial
Instruments  with   Characteristics  of  both  Liabilities  and  Equity,'  which
establishes   standards  for  the  classification  and  measurement  of  certain
financial  instruments with  characteristics of both liabilities and equity. The
adoption of this statement did not have an impact on the Company's  Consolidated
Financial  Statements,  as it is not  currently  a  party  to  such  instruments
addressed by this standard.

During  December  2003, the FASB revised SFAS No. 132,  'Employers'  Disclosures
about  Pensions  and  Other  Postretirement  Benefits,'  to  require  additional
disclosures about the assets, obligations,  cash flows, and net periodic benefit
cost of defined benefit  pension plans and other defined benefit  postretirement
plans.  The adoption of this  statement  did not have an impact on the Company's
Consolidated  Financial  Statements,  as the  Company  does not  offer a defined
benefit  pension plan or other defined benefit  postretirement  plans within the
scope of the revised SFAS No. 132.


Item 7A. Quantitative And Qualitative Disclosures About Market Risk

The  following  assessment  of the  Company's  market  risks  does  not  include
uncertainties  that  are  either  nonfinancial  or   nonquantifiable,   such  as
political, economic, tax and credit risks.

Interest  rates.  The Company's  exposure to market risk for changes in interest
rates  relates  primarily to the  Company's  debt  obligations  under its credit
facility and to the Company's investments.

The  Company's  investment  portfolio  consists  of cash  and  cash  equivalents
including  deposits in banks,  government  securities,  money market funds,  and
short-term  investments with maturities,  when acquired, of 90 days or less. The
Company is adverse to principal loss and seeks to preserve its invested funds by
placing these funds with high credit  quality  issuers.  The Company  constantly
evaluates  its  invested  funds to respond  appropriately  to a reduction in the
credit rating of any investment issuer or guarantor.

Foreign currency  exchange rates.  Foreign currency exchange rate changes impact
translations of foreign denominated assets and liabilities into U.S. dollars and
future  earnings  and cash  flows from  transactions  denominated  in  different
currencies. The Company generated approximately 36% of its consolidated revenues
for 2003 from international operations, approximately 97% of which were from the
United  Kingdom.  The British pound  sterling to U.S.  dollar  exchange rate has
increased  approximately  11% in 2003, from 1.61 at December 31, 2002 to 1.78 at
December 31, 2003. The Company  prepared  sensitivity  analyses to determine the
adverse impact of hypothetical  changes in the British pound sterling,  relative
to the U.S.  Dollar,  on the  Company's  results of  operations  and cash flows.
However,  the  analysis  did not include the  potential  impact on sales  levels
resulting from a change in the British pound sterling. An additional 10% adverse
movement  in the  exchange  rate  would  have had an  immaterial  impact  on the
Company's cash flows and financial  position for 2003. While fluctuations in the
British  pound  sterling  have not  historically  had a  material  impact on the
Company's  consolidated  results  of  operations,  the lower  level of  earnings
resulting  from a decrease in demand for the services  provided by the Company's
domestic operations have increased the impact of exchange rate fluctuations.  As
of December 31, 2003,  the Company did not hold and has not  previously  entered
into any foreign currency derivative instruments.

<PAGE>
FACTORS WHICH MAY IMPACT FUTURE RESULTS AND FINANCIAL CONDITION

Demand For The  Company's  Services Is Impacted By The  Economic  Climate In The
Industries And Markets The Company Serves. This Economic Climate Is Difficult To
Predict, With Downturns Weakening Demand.

     MPS's  revenues  are  affected  by the level of  business  activity  of its
customers,  which is driven by the level of economic  activity in the industries
and  markets  we  serve.  While we have  experienced  a recent  uptick in demand
related to the current  economic  environment,  a downturn or  deterioration  in
global economic or political  conditions could  significantly  hurt our revenues
and results of operations.

     We cannot  predict when the economic  climate will  significantly  improve.
Although we are seeing an slight improvement in the economic climate,  we cannot
predict to what extent the demand for our services will improve.  Even though we
have a somewhat  variable  cost base,  further  declines in revenue  will have a
material adverse impact on our results.

     The current economic climate may also encourage  customer  downsizings,  or
consolidations  through  mergers and otherwise of our major customers or between
our major customers with non-customers.  These may result in redundant functions
or  services  and a resulting  reduction  in demand by those  customers  for our
services.  Also,  spending for outsourced  business  services may be put on hold
until the consolidations are completed.

     Economic  considerations  may also  encourage our customers to  consolidate
their  vendor  lists in an attempt to achieve  cost and expense  savings,  which
increases competitive pressure as described below.


Our Market Is Highly  Competitive,  Which Puts Pressure On The Profit Margins Of
Our Services.

     Our  industry is  intensely  competitive  and highly  fragmented,  with few
barriers to entry by potential competitors. MPS faces significant competition in
the industries and markets it serves,  and will face significant  competition in
any geographic market that it may enter. In each market in which we operate,  we
compete for both  clients and  qualified  candidates  with other firms  offering
similar services.  Competition creates an aggressive pricing environment,  which
puts pressure on profit margins.

     We have  increasingly  competed  against service  providers  offering their
services from remote  locations,  particularly  from offshore  locations such as
India. The substantially  lower cost of the labor pool in these remote locations
puts significant  pricing pressure on our service offerings when we compete with
them. While we believe that our service delivery model provides a superior level
of service than many of these offshore based competitors,  the increased pricing
pressure  from  these  providers  may  have a  material  adverse  impact  on our
profitability.

     The  effects  of   competition   may  be   intensified  by  our  customers'
consolidation of their vendor lists. As customers have consolidated their number
of vendors, often in an attempt to secure cost or expense savings in the face of
difficult economic conditions,  competition to be an approved vendor has greatly
intensified.  If we fail to  remain  on these  consolidated  vendor  lists,  our
results of operations  will suffer  accordingly.  Competing to remain on, or get
on, these  vendor  lists could  obligate us to offer our services at prices that
offer  lower  margins,  and  less  profit,  than we might  otherwise  be able to
achieve.


Our Business  Depends On Key  Personnel,  Including  Executive  Officers,  Local
Managers And Field  Personnel;  Our Failure To Retain  Existing Key Personnel Or
Attract New People Will Reduce Business And Revenues.

     MPS's  operations  depend on the  continued  efforts  of our  officers  and
executive  management.  The  loss  of key  officers  and  members  of  executive
management may cause a significant disruption to our business.

     We also depend on the  performance  and  productivity of our local managers
and field  personnel.  Our  ability  to  attract  and  retain  new  business  is
significantly  affected  by  local  relationships  and the  quality  of  service
rendered.  The loss of key  managers  and field  personnel  may also  jeopardize
existing client  relationships with businesses that continue to use our services
based upon past  relationships  with local  managers  and field  personnel.  Our
revenues would decline in that event.


The Inability To Comply With Existing Government Regulation Along With Increased
Regulation Of The Workplace Could Adversely Effect The Company.

     The Company's business is subject to regulation or licensing in many states
and in  certain  foreign  countries.  While  the  Company  has  had no  material
difficulty  complying with  regulations  in the past,  there can be no assurance
that the Company  will be able to continue to obtain all  necessary  licenses or
approvals  or that the cost of  compliance  will not prove to be  material.  Any
inability  of the  Company to comply with  government  regulation  or  licensing
requirements could materially  adversely effect the Company.  Additionally,  the
Company's  temporary  services  business  entails  employing  individuals  on  a
temporary basis and placing such individuals in clients'  workplaces.  Increased
government regulation of the workplace or of the employer-employee  relationship
could materially adversely effect the Company.


The  Company  Is  Exposed  To  Employment-Related  Claims  and  Costs  And Other
Litigation  That  Could  Materially  Adversely  Effect The  Company's  Business,
Financial Condition, And Results Of Operations.

     The Company's temporary services business entails employing  individuals on
a temporary  basis and placing  such  individuals  in clients'  workplaces.  The
Company's  ability to control  the  workplace  environment  is  limited.  As the
employer of record of its  temporary  employees,  the  Company  incurs a risk of
liability to its temporary  employees for various  workplace  events,  including
claims  of  physical   injury,   discrimination,   harassment,   or  retroactive
entitlement to employee benefits. The Company also incurs a risk of liability to
its clients resulting from allegations of errors,  omissions,  misappropriation,
or theft of property or  information  by its  temporary  employees.  The Company
maintains insurance with respect to many of such claims.  While such claims have
not historically  had a material adverse effect on the Company,  there can be no
assurance  that the Company  will  continue to be able to obtain  insurance at a
cost that does not have a material  adverse effect upon the Company or that such
claims  (whether by reason of the Company not having  insurance  or by reason of
such claims being outside the scope of the Company's  insurance) will not have a
material adverse effect upon the Company.


Adjustments  During  Periodic Tax Audits May Increase Our Tax Liability And Hurt
Our Results Of Operations.

     MPS is subject to periodic  review by federal,  foreign,  state,  and local
taxing  authorities  in the ordinary  course of business.  During 2001,  MPS was
notified by the Internal  Revenue  Service  that  certain  prior year income tax
returns  will be  examined.  As part of this  examination,  the net tax  benefit
associated  with an  investment in a subsidiary  that MPS  recognized in 2000 of
$86.3  million is also being  reviewed.  In 2002,  the company  recorded an $8.7
million  charge  for an agreed  upon  adjustment  related  to its audit of prior
years'  tax  returns.  While  MPS  has not  received  notice  of any  additional
adjustments  relating to its audit of prior years' tax returns, we cannot assure
you that the IRS will not propose additional adjustments. Additional adjustments
may affect our financial condition.


The Price Of Our Common Stock May Fluctuate  Significantly,  Which May Result In
Losses For Investors.

     The  market  price for our  common  stock has been and may  continue  to be
volatile. For example, during the period from January 1, 2003 until December 31,
2003,  the closing  price of the common  stock as reported on the New York Stock
Exchange  ranged  from a high of $10.62 to a low of $4.85.  Our stock  price can
fluctuate as a result of a variety of factors,  including  factors  listed above
and others, many of which are beyond our control. These factors include:

     -    actual or anticipated variations in quarterly operating results;
     -    announcement of new services by us or our competitors;
     -    announcements relating to strategic relationships or acquisitions;
     -    changes in  financial  estimates  or other  statements  by  securities
          analysts;
     -    valuation  fluctuations  which  may  cause a  negative  impact  to our
          operating  results as it relates to Statement of Financial  Accounting
          Standards No. 142; and
     -    changes in general economic conditions.

     Because of this  volatility,  we may fail to meet the  expectations  of our
shareholders or of securities  analysts,  and our stock price could decline as a
result.

<PAGE>

ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

(a)  Consolidated  Financial Statements:  The following  consolidated  financial
     statements are included in this Annual Report on Form 10-K:

<TABLE>
<CAPTION>


<S>     <c>
        Report of Independent Certified Public Accountants
        Consolidated Balance Sheets at December 31, 2003 and 2002
        Consolidated Statements of Operations for the years ended
           December 31, 2003, 2002, and 2001
        Consolidated Statements of Stockholders' Equity for the
           years ended December 31, 2003, 2002, and 2001
        Consolidated Statements of Cash Flows for the years ended
           December 31, 2003, 2002, and 2001
        Notes to Consolidated Financial Statements


</TABLE>


<PAGE>

               Report of Independent Certified Public Accountants

To the Board of Directors and Stockholders of
MPS Group, Inc.


In our opinion,  the  accompanying  consolidated  balance sheets and the related
consolidated  statements of operations,  of  stockholders'  equity,  and of cash
flows present fairly, in all material  respects,  the financial  position of MPS
Group,  Inc. and its  subsidiaries  (the Company) at December 31, 2003 and 2002,
and the results of their  operations  and their cash flows for each of the three
years in the period ended  December  31, 2003,  in  conformity  with  accounting
principles  generally accepted in the United States of America.  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 of these  statements  in  accordance  with
auditing  standards  generally  accepted in the United States of America,  which
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,  assessing the  accounting  principles
used and  significant  estimates made by management,  and evaluating the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

As discussed in Note 5 to the  Consolidated  Financial  Statements,  the Company
changed  its  method  of  accounting  for  goodwill  upon  the  adoption  of the
accounting  guidance of  Statement of Financial  Accounting  Standards  No. 142,
"Goodwill and Other Intangible Assets," effective January 1, 2002.


PricewaterhouseCoopers LLP
Jacksonville, Florida
March 12, 2004


<PAGE>
MPS Group, Inc. and Subsidiaries
Consolidated Balance Sheets


<TABLE>
<CAPTION>
                                                                                      December 31,      December 31,
(dollar amounts in thousands except share amounts)                                       2003               2002
-----------------------------------------------------------------------------------------------------------------------
<S>                                                                                  <C>            <C>
ASSETS
Current assets:
   Cash and cash equivalents                                                          $   124,830      $     66,934
   Accounts receivable, net of allowance of $12,899 and $16,919                           159,359           180,120
   Prepaid expenses                                                                         6,417             4,703
   Deferred income taxes                                                                    2,200             3,386
   Other                                                                                   10,662            11,632
                                                                                     ----------------------------------
      Total current assets                                                                303,468           266,775
Furniture, equipment, and leasehold improvements, net                                      29,488            36,505
Goodwill, net                                                                             486,630           474,484
Deferred income taxes                                                                      62,464            67,562
Other assets, net                                                                          11,101            10,437
Net assets of discontinued operations                                                           -            37,211
                                                                                   ----------------------------------
    Total assets                                                                      $   893,151      $    892,974
                                                                                     ==================================

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable and accrued expenses                                                   32,601            46,606
   Accrued payroll and related taxes                                                       37,848            34,104
   Income taxes payable                                                                    16,140            14,911
                                                                                     ----------------------------------
      Total current liabilities                                                            86,589            95,621
Other                                                                                      13,100            15,794
                                                                                     ----------------------------------
     Total liabilities                                                                     99,689           111,415
                                                                                     ----------------------------------
Commitments and contingencies (Notes 3, 4, 6, and 7)

Stockholders' equity:
   Preferred stock, $.01 par value; 10,000,000 shares authorized;
      no shares issued                                                                          -                 -
   Common stock, $.01 par value; 400,000,000 shares authorized;
      104,576,204 and 102,531,491 shares issued, respectively                               1,046             1,025
   Additional contributed capital                                                         634,492           622,079
   Retained earnings                                                                      162,546           163,781
   Accumulated other comprehensive income                                                   6,933                66
   Deferred stock compensation                                                             (2,495)           (3,958)
   Treasury stock, at cost (1,613,400 shares in 2003 and 290,400
     shares in 2002)                                                                       (9,060)           (1,434)
                                                                                     ----------------------------------
     Total stockholders' equity                                                           793,462           781,559
                                                                                     ----------------------------------
     Total liabilities and stockholders' equity                                       $   893,151      $    892,974
                                                                                     ==================================
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>
MPS Group, Inc. and Subsidiaries
Consolidated Statements of Operations

<TABLE>
<CAPTION>
                                                                               Years Ended December 31,
                                                                      ------------------------------------------
(dollar amounts in thousands except per share amounts)                      2003          2002            2001
------------------------------------------------------------------------------------------------------------------
<S>                                                                   <C>            <C>            <C>
Revenue                                                               $  1,096,030   $  1,119,156   $  1,500,615
Cost of revenue                                                            808,890        834,318      1,105,781
                                                                      ------------------------------------------
   Gross profit                                                            287,140        284,838        394,834
                                                                      ------------------------------------------
Operating expenses:
   General and administrative                                              234,614        235,673        321,939
   Depreciation and intangibles amortization                                17,009         20,256         20,979
   Amortization of goodwill                                                      -              -         37,312
   Exit costs (recapture)                                                     (284)         8,967              -
   Impairment of investment                                                      -         16,165              -
                                                                       ------------------------------------------
      Total operating expenses                                             251,339        281,061        380,230
                                                                      ------------------------------------------
Operating income                                                            35,801          3,777         14,604
Other income (expense), net                                                    553         (3,947)        (9,199)
                                                                      ------------------------------------------
Income (loss) from continuing operations before income taxes
   and cumulative effect of accounting change                               36,354           (170)         5,405
Provision (benefit) for income taxes                                        14,519         13,832          3,102
                                                                      ------------------------------------------
Income (loss) from continuing operations before
   cumulative effect of accounting change                                   21,835        (14,002)         2,303
Discontinued operations (Note 18):
   Income (loss) from discontinued operations (net of income taxes
      of $(1,289), $759, and $3,702, respectively)                          (2,395)         1,410          6,040
   Loss on disposition of discontinued operations (net of a
      $11,133 income tax benefit)                                          (20,675)             -              -
                                                                       ------------------------------------------
Income (loss) from operations before cumulative effect of
   accounting change                                                        (1,235)        12,592          8,343
Cumulative effect of accounting change (net of a $112,953
   income tax benefit)                                                           -       (553,712)             -
                                                                      ------------------------------------------
Net income (loss)                                                     $     (1,235)  $   (566,304)  $      8,343
                                                                      ==========================================

Basic net income (loss) per common share:
  Income (loss) from continuing operations before cumulative
     effect of accounting change                                      $       0.21   $      (0.14)  $       0.02
  Income (loss) from discontinued operations, net of tax                     (0.02)          0.01           0.06
  Loss on disposition of discontinued operations, net of tax                 (0.20)             -              -
  Cumulative effect of accounting change, net of tax                             -          (5.49)             -
                                                                      ------------------------------------------
Basic net income (loss) per common share                              $      (0.01)  $      (5.62)  $       0.09
                                                                      ==========================================
Average common shares outstanding, basic                                   101,680        100,833         97,868
                                                                      ==========================================

Diluted net income (loss) per common share:
  Income (loss) from continuing operations before cumulative
     effect of accounting change                                      $       0.21   $      (0.14)  $       0.02
  Income (loss) from discontinued operations, net of tax                     (0.02)          0.01           0.06
  Loss on disposition of discontinued operations, net of tax                 (0.20)             -              -
  Cumulative effect of accounting change, net of tax                             -          (5.49)             -
                                                                      ------------------------------------------
Diluted net income (loss) per common share                            $      (0.01)  $      (5.62)  $       0.08
                                                                      ==========================================
Average common shares outstanding, diluted                                 104,518        100,833         98,178
                                                                      ==========================================

</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>
MPS Group, Inc. and Subsidiaries
Consolidated Statements of Stockholders' Equity

<TABLE>
<CAPTION>
                                                                                      Accumulated
                                                                                        Other
                                                   Common       Additional           Comprehensive   Deferred
(dollar amounts in thousands                        Stock      Contributed  Retained    Income        Stock      Treasury
except share amounts)                          Shares   Amount   Capital    Earnings    (Loss)     Compensation   Stock     Total
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                       <C>          <C>      <C>        <C>          <C>         <C>        <C>      <C>

Balance, December 31, 2000                 96,796,217   $  968  $587,854   $ 721,742    $ (6,945)   $  (401)   $     -   $1,303,218
Comprehensive income:
   Net income                                       -        -         -       8,343           -          -          -
   Foreign currency translation                     -        -         -           -      (9,132)         -          -
   Foreign currency translation, tax benefit        -        -         -           -       8,185          -          -
   Derivative instruments, net of
      related tax benefit                           -        -         -           -      (1,508)         -          -
Total comprehensive income                          -        -         -           -           -          -          -        5,888
Exercise of stock options and related
   tax benefit                                150,566        1       373           -           -          -          -          374
Issuance of restricted stock                1,360,000       14     5,834           -           -     (5,848)         -            -
Vesting of restricted stock                         -        -         -           -           -      1,331          -        1,331
                                          -----------------------------------------------------------------------------------------
Balance, December 31, 2001                 98,306,783      983   594,061     730,085      (9,400)    (4,918)         -    1,310,811
Comprehensive loss:
   Net loss                                         -        -         -    (566,304)          -          -          -
   Foreign currency translation                     -        -         -           -       7,958          -          -
   Derivative instruments, net of
      related tax benefit                           -        -         -           -       1,508          -          -
Total comprehensive loss                            -        -         -           -           -          -          -     (556,838)
Issuance of common stock related to
   business combinations                    1,149,679       11     8,714           -           -          -          -        8,725
Exercise of stock options and related
   tax benefit                              2,871,696       29    18,023           -           -          -          -       18,052
Purchase of treasury stock                          -        -         -           -           -          -     (1,434)      (1,434)
Issuance of restricted stock                  203,333        2     1,281           -           -     (1,283)         -            -
Vesting of restricted stock                         -        -         -           -           -      2,243          -        2,243
                                          -----------------------------------------------------------------------------------------
Balance, December 31, 2002                102,531,491    1,025   622,079     163,781          66     (3,958)    (1,434)     781,559
Comprehensive loss:
   Net loss                                         -        -         -      (1,235)          -          -          -
   Foreign currency translation                     -        -         -           -       6,867          -          -
Total comprehensive loss                            -        -         -           -           -          -          -        5,632
Exercise of stock options and related
   tax benefit                              2,044,713       21    12,413           -           -          -          -       12,434
Purchase of treasury stock                          -        -         -           -           -          -     (7,626)      (7,626)
Vesting of restricted stock                         -        -         -           -           -      1,463          -        1,463
                                          -----------------------------------------------------------------------------------------
Balance, December 31, 2003                104,576,204   $1,046  $634,492   $ 162,546    $  6,933    $(2,495)   $(9,060)  $  793,462
                                          =========================================================================================

</TABLE>


See accompanying notes to consolidated financial statements.


<PAGE>
MPS Group, Inc. and Subsidiaries
Consolidated Statements of Cash Flows


<TABLE>
<CAPTION>
                                                                             Years Ended December 31,
                                                                    ------------------------------------------
(dollar amounts in thousands)                                            2003          2002           2001
--------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>             <C>            <C>
Cash flows from operating activities:
   Income (loss) from continuing operations before cumulative
    effect of accounting change                                     $   21,835      $ (14,002)    $     2,303
   Adjustments to income (loss) from continuing operations before
    cumulative effect of accounting change to net cash provided
    by operating activities:
       Exit costs (recapture)                                             (284)         8,967               -
       Impairment of investment                                              -         16,165               -
       Deferred income taxes                                            17,417         29,172           3,522
       Deferred compensation                                             1,465          2,243           1,331
       Depreciation and identified intangibles amortization             17,009         20,256          20,979
       Amortization of goodwill                                              -              -          37,313
       Changes in assets and liabilities, net of acquisitions:
         Accounts receivable                                            31,235         49,868         110,862
         Prepaid expenses and other assets                              (1,712)        (1,969)          3,350
         Accounts payable and accrued expenses                         (15,974)         5,876          (1,351)
         Accrued payroll and related taxes                               2,204         (4,690)         (2,084)
         Other, net                                                     (2,857)          (373)         (2,294)
                                                                    -----------------------------------------
           Net cash provided by operating activities                    70,338        111,513         173,931
                                                                    -----------------------------------------
Cash flows from investing activities:
   Purchase of furniture, equipment, and leasehold
     improvements, net of disposals                                     (6,880)        (6,016)        (14,287)
   Purchase of businesses, including additional earn-outs on
     acquisitions, net of cash acquired                                (15,864)        (6,739)           (509)
                                                                    -----------------------------------------
           Net cash used in investing activities                       (22,744)       (12,755)        (14,796)
                                                                    -----------------------------------------
Cash flows from financing activities:
   Repurchases of common stock                                          (7,626)        (1,434)              -
   Discount realized on employee stock purchase plan                      (389)          (494)              -
   Proceeds from stock options exercised                                10,867         16,881             373
   Borrowings on indebtedness                                                -              -           2,000
   Repayments on indebtedness                                             (163)      (101,423)       (118,962)
                                                                    -----------------------------------------
           Net cash provided by (used in) financing activities           2,689        (86,470)       (116,589)
                                                                    -----------------------------------------
Effect of exchange rate changes on cash and cash equivalents             4,714          1,541          (7,484)
                                                                    -----------------------------------------
Net increase in cash and cash equivalents                               54,997         13,829          35,062

Net cash provided by discontinued operations                             2,899          3,897           9,133

Cash and cash equivalents, beginning of year                            66,934         49,208           5,013
                                                                    -----------------------------------------
Cash and cash equivalents, end of year                              $  124,830     $   66,934      $   49,208
                                                                    =========================================
</TABLE>


See accompanying notes to consolidated financial statements.

<PAGE>




<TABLE>
<CAPTION>
                                                                               Years Ended December 31,
(dollar amounts in thousands except for per share amounts)                 2003           2002           2001
------------------------------------------------------------------------------------------------------------------
<S>                                                                   <C>            <C>            <C>
SUPPLEMENTAL CASH FLOW INFORMATION
   Interest paid                                                      $     1,234    $      4,534   $     12,711
   Income taxes (refunded) paid                                            (3,838)          6,214         13,873


COMPONENTS OF CASH PROVIDED BY DISCONTINUED OPERATIONS
   Cash (used in) provided by operating activities                    $    (4,987)   $      4,368   $      9,660
   Cash provided by (used in) investing activities                          7,886            (471)          (527)
                                                                       -----------    ------------   ------------
     Net cash provided by discontinued operations                     $     2,899    $      3,897   $      9,133
                                                                       ===========    ============   ============




NON-CASH INVESTING AND FINANCING ACTIVITIES

     The Company completed two acquisitions in 2003 and one acquisition in 2002.
There  were no  acquisitions  in 2001.  In  connection  with  the  acquisitions,
liabilities were assumed as follows:

                                                                                        Years Ended December 31,
                                                                                          2003           2002
------------------------------------------------------------------------------------------------------------------


   Fair value of assets acquired                                                     $    18,839    $      7,367
   Cash paid                                                                             (16,322)         (7,000)
                                                                                       ----------     -----------
   Liabilities assumed                                                               $     2,517    $        367
                                                                                       ==========     ===========





</TABLE>

<PAGE>
1. DESCRIPTION OF BUSINESS

     MPS  Group,  Inc.  ('MPS'  or  the  'Company')  (New  York  Stock  Exchange
symbol:MPS)  is a leading  global  provider of business  services  with over 170
offices  throughout  the  United  States,   Canada,  the  United  Kingdom,   and
continental  Europe. MPS delivers a mix of consulting,  solutions,  and staffing
services in the disciplines such as IT services, finance and accounting,  legal,
engineering,  IT solutions,  health care,  executive  search,  and human capital
automation.

     MPS consists of three divisions: the professional services division; the IT
services division; and the IT solutions division.


2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Consolidation

     The consolidated  financial  statements include the accounts of the Company
and its wholly owned subsidiaries.  All material intercompany  transactions have
been eliminated in the accompanying consolidated financial statements.

Cash and Cash Equivalents

     Cash and cash equivalents include deposits in banks, government securities,
money market funds, and short-term  investments with maturities,  when acquired,
of 90 days or less.

Furniture, Equipment, and Leasehold Improvements

     Furniture,  equipment, and leasehold improvements are recorded at cost less
accumulated  depreciation  and  amortization.   Depreciation  of  furniture  and
equipment is computed using the  straight-line  method over the estimated useful
lives of the assets.  The Company has developed a proprietary  software  package
which allows the Company to implement imaging,  time capture, and data-warehouse
reporting.  The  costs  associated  with  the  development  of this  proprietary
software package have been capitalized, and are being amortized over a five-year
period. See Note 14 to the Consolidated Financial Statements.

     The Company adopted Statements of Financial  Accounting  Standards ('SFAS')
No. 144, 'Accounting for the Impairment or Disposal of Long-Lived Assets,' as of
January 1, 2002. The Company evaluates the  recoverability of its carrying value
of property and equipment  whenever events or changes in circumstances  indicate
that the carrying amount may not be recoverable.  Carrying value write-downs and
gains and losses on  disposition  of property  and  equipment  are  reflected in
'Income from operations.'

Goodwill and Other Identifiable Intangible Assets

     In July 2001, the Financial Accounting Standards Board ('FASB') issued SFAS
No.  142,  'Goodwill  and Other  Intangible  Assets,'  which was  required to be
adopted for fiscal  2002.  SFAS No. 142  established  accounting  and  reporting
standards  for  goodwill  and   intangible   assets   resulting   from  business
combinations.  In  connection  with SFAS No.  142,  the  Company is  required to
perform goodwill impairment  reviews, at least annually,  utilizing a fair-value
approach. Additionally, SFAS No. 142 required a transitional goodwill impairment
review upon adoption.

     The  Company  adopted  SFAS No. 142 as of January  1, 2002.  In  connection
therewith,  the Company  engaged an independent  valuation  consultant to assist
with the required  transitional  goodwill  impairment review. As of December 31,
2001, the Company's  Consolidated  Balance Sheet reflected  goodwill of $1,166.0
million.  After performing the required  transitional goodwill impairment tests,
the Company recognized a loss of $553.7 million, net of an income tax benefit of
$113.0  million,  and  recorded  the loss (net of the related tax  benefit) as a
cumulative  effect  of  an  accounting  change  in  the  Company's  Consolidated
Statement of Operations for 2002.  The Company  performed  additional  valuation
testing  during the fourth  quarter of 2002 and 2003 (the  Company's  designated
timing of the annual  impairment  test under SFAS No. 142) and did not incur any
further  impairment.  The Company  plans to perform  its next annual  impairment
review  during the fourth  quarter of 2004.  An  impairment  review prior to the
Company's next scheduled  annual review may be required if certain events occur,
including lower than forecasted  earnings levels for various reporting units. In
addition,  changes to other assumptions could significantly  impact our estimate
of the fair value of our reporting units. Such a change may result in a goodwill
impairment  charge,  which  could have a  significant  impact on the  reportable
segments that include the related reporting units and the Company's Consolidated
Financial Statements.

     As part of the  Company's  goodwill  impairment  reviews,  fair  value  was
calculated using an equally blended value of a discounted cash flow analysis and
market comparables. In contrast to SFAS 142, the prior accounting standard (SFAS
No. 121) required the use of undiscounted cash flow estimates over the remaining
useful life of the  goodwill  and other  long-lived  assets as a step 1 test for
possible  impairment.  Under SFAS No. 121, the concept of  recoverability of the
goodwill  over  the  useful  life of the  asset  was  the  underlying  test  for
impairment  as opposed  to fair  value  under  SFAS No.  142.  This  fundamental
difference in the underlying methodologies of testing for impairment of goodwill
in SFAS No. 121 and SFAS No. 142 caused the Company to attribute  the  resulting
impairment from the initial  valuation  completed on January 1, 2002 to a change
in accounting principle upon the adoption of SFAS No. 142. Projected cash flows,
used for both SFAS No. 121 and No. 142 testing,  considered the effects from the
then downturn in the Company's business.

     As  mentioned  above,  the  Company  used an  equally  blended  value  of a
discounted cash flow analysis and market comparables to arrive at fair value for
SFAS No. 142. For the  discounted  cash flow analysis,  significant  assumptions
included  expected  future revenue growth rates,  reporting unit profit margins,
working  capital  levels and a  discount  rate.  The  revenue  growth  rates and
reporting unit profit margins are based,  in part, on the Company's  expectation
of an improving economic  environment.  Market comparables included a comparison
of the market ratios and performance fundamentals from comparable companies. The
use of these  measurement  criteria is consistent  with the underlying  concepts
used in  determining  the fair value of a company or  reportable  unit under the
market  approach.  The market  ratios the Company used refer to the multiples of
revenue and earnings of comparable  companies and the  performance  fundamentals
refer to the  consideration  of the effects of the  differences in the operating
metrics, ie. growth rates,  operating margins,  gross margins, etc. on the value
of the company  versus the  comparable  companies.  See Note 5 to the  Company's
Consolidated Financial Statements for further discussion.

     In 2002 and 2003, the Company acquired a health care staffing  business and
two legal staffing businesses,  respectively. These acquisition were recorded in
accordance with the provisions of SFAS No. 141 'Business Combinations'. See Note
3 and Note 5 to the Consolidated Financial Statements for further discussion.

Revenue Recognition

     The Company  recognizes  substantially all revenue at the time services are
provided  and is  recorded on a time and  materials  basis.  In most cases,  the
consultant is the  Company's  employee and all costs of employing the worker are
the responsibility of the Company and are included in cost of revenue.  Revenues
generated when the Company  permanently  places an individual  with a client are
recorded at the time of placement  less a reserve for  employees not expected to
meet the probationary period.

     In addition and to a lesser extent,  the Company is involved in fixed price
or lump-sum engagements. The services rendered by the Company under the relevant
contracts  generally  require  performance  spanning  more  than one  accounting
period.   The  Company  recognizes  revenue  for  these  engagements  under  the
proportional performance accounting model.

Foreign Operations

     The financial  position and  operating  results of foreign  operations  are
consolidated  using  the  local  currency  as  the  functional  currency.  These
operating  results  are  considered  to  be  permanently   invested  in  foreign
operations.  Local currency assets and liabilities are translated at the rate of
exchange to the U.S.  dollar on the balance sheet date,  and the local  currency
revenues and expenses are  translated  at average  rates of exchange to the U.S.
dollar during the period.

Stock-Based Compensation

     During  December  2002,  the FASB,  issued  SFAS No. 148,  'Accounting  for
Stock-Based  Compensation  -  Transition  and  Disclosure,'  which  provides for
alternative methods of transition for a voluntary change to the fair-value-based
method of accounting for  stock-based  compensation.  In addition,  SFAS No. 148
amends the disclosure  requirements of SFAS No. 123, 'Accounting for Stock-Based
Compensation,'  to require more prominent  disclosure in both annual and interim
financial  statements  about the method of accounting for  stock-based  employee
compensation and the effect of the method used on reported results.

     The Company  accounts for its  employee and director  stock option plans in
accordance with APB Opinion No. 25,  'Accounting for Stock Issued to Employees,'
and related  Interpretations.  The  Company  measures  compensation  expense for
employee and director  stock  options as the  aggregate  difference  between the
market value of its common stock and exercise  prices of the options on the date
that both the  number of shares  the  grantee is  entitled  to  receive  and the
exercise prices are known. Compensation expense associated with restricted stock
grants is equal to the  market  value of the  shares on the date of grant and is
recorded pro rata over the required  holding period.  If the Company had elected
to  recognize  compensation  cost for all  outstanding  options  granted  by the
Company,  by applying the fair value  recognition  provisions of SFAS No. 148 to
stock-based  employee  compensation,  net (loss) income and (loss)  earnings per
share would have been reduced to the pro forma amounts indicated below.
<PAGE>
<TABLE>
<CAPTION>
(dollar amounts in thousands except per share amounts)                              2003            2002           2001
--------------------------------------------------------------------------------------------------------------------------
<S>                                                                           <C>            <C>            <C>
Net income (loss)
   As reported                                                                $     (1,235)  $   (566,304)  $      8,343
     Total stock-based employee compensation expense determined
     under fair value based method for all awards, net of
     related tax effects                                                            (4,796)        (4,451)       (11,037)
                                                                                 -----------------------------------------
   Pro forma                                                                  $     (6,031)  $   (570,755)  $     (2,694)
                                                                                 =========================================

Basic net income (loss) per common share
   As reported                                                                $      (0.01)  $      (5.62)  $       0.09
   Pro forma                                                                  $      (0.06)  $      (5.66)  $      (0.03)
Diluted net income (loss) per common share
   As reported                                                                $      (0.01)  $      (5.62)  $       0.08
   Pro forma                                                                  $      (0.06)  $      (5.66)  $      (0.03)
</TABLE>

     The weighted  average fair values of options granted during 2003, 2002, and
2001 were $5.44,  $3.99,  and $2.68 per share,  respectively.  The fair value of
each option  grant is  estimated  on the date of grant  using the Black  Scholes
option-pricing model with the following assumptions:
<TABLE>
<CAPTION>

                                                                                   2003            2002           2001
--------------------------------------------------------------------------------------------------------------------------
<S>                                                                           <C>            <C>            <C>
Expected dividend yield                                                                  -              -              -
Expected stock price volatility                                                        .70            .77            .42
Risk-free interest rate                                                               3.78           3.78           4.88
Expected life of options (years)                                                      5.00           5.00           7.87
</TABLE>


Derivative Instruments and Hedging Activities

     The Company  accounts for derivative  instruments  in accordance  with SFAS
Nos. 133, 137, and 138 related to  "Accounting  for Derivative  Instruments  and
Hedging Activities" ('SFAS No. 133, as amended'). The Company's adoption of SFAS
No. 133, as amended, in the first quarter of 2001 did not have an initial impact
on the  Company as the Company did not hold any  derivatives  prior to 2001.  In
2001,  the Company  entered into  interest  rate swap  agreements  to manage and
reduce the risk inherent in interest rate fluctuations. The Company entered into
these  agreements to convert certain  floating rate debt  outstanding  under the
Company's  credit  facility  into fixed  rate debt by fixing  the base rate,  as
defined by the credit facility.  These  derivatives were classified as cash flow
hedges as  interest  rate swap  agreements  are  considered  hedges of  specific
borrowings.  Differences  received under the swap  agreements were recognized as
adjustments to interest expense. Accordingly, changes in the fair value of these
hedges were recorded in 'Accumulated  other  comprehensive  loss' on the balance
sheet.  As of  December  31,  2003 and 2002,  there were no  interest  rate swap
agreements outstanding.

     Derivative instruments are recorded on the balance sheet as either an asset
or liability  measured at their fair value. If the derivative is designated as a
fair value  hedge,  the changes in the fair value of the  derivative  and of the
hedged item  attributable to the hedged risk are recognized in earnings.  If the
derivative  is designated  as a cash flow hedge,  the effective  portions of the
changes in the fair value of the  derivative  are  recorded  as a  component  of
'Accumulated   other   comprehensive   income  (loss)'  and  recognized  in  the
'Consolidated  statements of operations' when the hedged item affects  earnings.
Ineffective  portions of changes in the fair value of hedges are  recognized  in
earnings.

     Hedging interest rate exposure  through the use of swaps were  specifically
contemplated to manage risk in keeping with management  policy. The Company does
not   utilize   derivatives   for   speculative   purposes.   These  swaps  were
transaction-specific  so that a specific debt instrument  determined the amount,
maturity and specifics of each swap.

Income Taxes

     The  provision for income taxes is based on income before taxes as reported
in the accompanying  Consolidated Statements of Operations.  Deferred tax assets
and  liabilities  are recognized  for the expected  future tax  consequences  of
events that have been included in the financial statements or tax returns. Under
this method,  deferred tax assets and  liabilities  are determined  based on the
differences  between the financial  statement carrying amounts and the tax basis
of assets  and  liabilities  using  enacted  tax rates in effect for the year in
which the  differences  are  expected to reverse.  An  assessment  is made as to
whether or not a valuation  allowance is required to offset deferred tax assets.
This assessment includes anticipating future taxable income.

     The Company is subject to periodic  review by federal,  state,  foreign and
local taxing  authorities in the ordinary  course of business.  During 2001, the
Company was notified by the  Internal  Revenue  Service that certain  prior year
income tax returns would be examined.  As part of this examination,  the Company
recorded a tax  provision of $8.7 million in 2002 for an agreed upon  adjustment
with the Internal Revenue Service.  For a further discussion,  see Note 7 to the
Consolidated Financial Statements.

Net Income (Loss) per Common Share

     The  consolidated  financial  statements  include 'basic' and 'diluted' per
share  information.  Basic per share  information  is calculated by dividing net
income by the weighted average number of shares  outstanding.  Diluted per share
information  is calculated by also  considering  the impact of potential  common
stock on both net income and the weighted average number of shares  outstanding.
The  weighted  average  number of shares  used in the basic  earnings  per share
computations were 101.7 million,  100.8 million,  and 97.9 million in 2003, 2002
and 2001,  respectively.  The only  difference in the  computation  of basic and
diluted earnings per share is the inclusion of 2.8 million and 310,000 potential
common  shares  in 2003  and  2001,  respectively.  As the  Company  was in loss
position for 2002 from continuing operations, before the cumulative effect of an
accounting  change,  the potential common shares for 2002 were excluded from the
calculation  of  diluted  earnings  per share as the  shares  would  have had an
anti-dilutive effect. See Note 10 to the Consolidated Financial Statements.

Excess Real Estate Obligations

     The Company  recorded a $9.0 million  charge in 2002, of which $284,000 was
recaptured  in  2003,   relating  to  its  abandonment  of  excess  real  estate
obligations  for  certain  vacant  office  space.

     For the Company's discontinued Manchester operations,  the Company recorded
$732,000  of  contract  termination  costs in 2002.  As a result  of the sale of
Manchester,  the Company recorded an additional $705,000 of contract termination
costs in 2003,  which is  included in 'Loss on  Disposition,  net of tax' on the
Company's Consolidated Statement of Operations.

     These charges  (recapture) were recorded in  accordance  with SFAS No. 146,
"Accounting  for Costs  Associated  with  Exit or  Disposal  Activities,"  which
requires  that a  liability  for a cost  associated  with an  exit  or  disposal
activity be  recognized,  at fair value,  when the liability is incurred  rather
than at the time an  entity  commits  to a plan.  See Note 17 and Note 18 to the
Consolidated Financial Statements for further discussion.

Discontinued Operations

     In December 2003, the Company sold certain operating assets and transferred
certain operating  liabilities of its outplacement  unit,  Manchester,  for $8.0
million  in  cash  while  retaining  the  working  capital  of the  business  of
approximately  $2.0 million.  The initial  after-tax  loss on the sale was $20.7
million.  The Company  recorded the disposition in accordance with SFAS no. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets." See Note 18 to
the Consolidated Financial Statements for further discussion.

Impairment of Investment

     The Company had a minority  investment in a privately held company that was
recorded as a non-current asset. The asset was carried at its original cost plus
accrued  interest.  The investment  was  originally  made in 1996 and was set to
mature in 2004. In 2002,  this  privately  held company  recapitalized  at terms
which diluted the value of the Company's investment.  The Company elected not to
participate in the  recapitalization,  which  resulted in the  investment  being
impaired.  As a result,  the Company  wrote off the  investment  in its entirety
recognizing a $16.2 million charge in 2002.

     The process of  assessing  whether a  particular  equity  investment's  net
realizable value is less than its carrying cost requires a significant amount of
judgment.  The Company  periodically  monitors an investment  for  impairment by
considering,  among other things,  the investee's cash position,  projected cash
flows,  financing  needs,  liquidation  preference,  most recent  valuation data
(including  the  duration and extent to which the fair value is less than cost),
the current  investing  environment,  competition  and the Company's  intent and
ability to hold the investment.

Pervasiveness of Estimates

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect  the  reported  amount of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements and the reported amounts of revenue and expenses during the reporting
period.  Although  management  believes  these  estimates  and  assumptions  are
adequate, actual results may differ from the estimates and assumptions used.

Reclassifications

     Certain  amounts have been  reclassified in 2001 and 2002 to conform to the
2003 presentation.


3. BUSINESS COMBINATIONS

     In February and August of 2003,  the Company  acquired  the legal  staffing
businesses of LawPros and LawCorps, respectively. Purchase consideration totaled
$16.0 million in cash, of which $15.3 million was at closing.  In July 2002, the
Company acquired a health care staffing  business,  Elite Medical  (subsequently
re-branded as Soliant  Health).  Purchase  consideration  totaled $15.9 million,
$7.2 million in cash,  and 1.1 million shares of MPS Common Stock valued at $8.7
million. The Company did not make any acquisitions in 2001.

     The Company,  in the past,  has been  obligated  under certain  acquisition
agreements to make earn-out payments to former  stockholders of certain acquired
companies,   accounted  for  under  the  purchase  method  of  accounting,  upon
attainment of certain  earnings targets of the acquired  companies.  The Company
recorded  these payments as goodwill in accordance  with EITF 95-8,  'Accounting
for Contingent  Consideration Paid to the Shareholders of an Acquired Enterprise
in a Purchase  Business  Combination'.  The  Company  has not made any  material
earn-out payments in 2001, 2002 or 2003.


4.  INDEBTEDNESS

Indebtedness at December 31, 2003 and 2002 consisted of the following:
<TABLE>
<CAPTION>
(dollar amounts in thousands)                                                              2003            2002
----------------------------------------------------------------------------------------------------------------
<S>                                                                                  <C>            <C>
Notes payable to former stockholders of acquired companies
   (interest ranging from 2.5% to 7.0%)                                              $       891    $        334
                                                                                     ---------------------------
                                                                                             891             334
Current portion of notes payable                                                             891             334
                                                                                     ---------------------------
Long-term portion of notes payable                                                   $         -    $          -
                                                                                     ===========================
</TABLE>

     The notes  payable  are  included  in the line item  'Accounts  payable and
accrued expenses' on the Consolidated Balance Sheet

     The Company had a revolving  credit  facility that expired in October 2003,
with no  borrowings  outstanding.  In the fourth  quarter of 2003,  the  Company
closed on a $150 million  revolving  credit  facility  syndicated  to a group of
leading financial  institutions.  The credit facility contains certain financial
and  non-financial  covenants  relating to the Company's  operations,  including
maintaining certain financial ratios.  Repayment,  if applicable,  of the credit
facility is guaranteed by substantially of the subsidiaries of the Company.  The
facility  expires in November 2006. The Company  incurred certain costs directly
related to obtaining  the credit  facility in the amount of  approximately  $1.0
million. These costs have been capitalized and are being amortized over the life
of the credit facility, and are included in the line item 'Other assets, net' on
the Consolidated Balance Sheet. As of December 31, 2003, there are no borrowings
outstanding under this facility.


5. GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS

     The Company adopted SFAS No. 142 effective  January 1, 2002. The changes in
the carrying amount of goodwill for 2003 and 2002, are as follows:

<TABLE>
<CAPTION>
                                               Professional            IT                 IT
(dollar amounts in thousands)                    Services           Services          Solutions           Total
-------------------------------------------------------------------------------------------------------------------
<S>                                            <C>                <C>                <C>                <C>
Balance as of December 31, 2001                $  312,952         $  592,037         $  260,972         $1,165,961
  Impairment losses from change in
    accounting principle                          (87,969)          (338,449)          (240,247)          (666,665)
  2002 acquisition                                 12,500                  -                  -             12,500
                                               -----------        -----------        -----------        -----------
Balance as of December 31, 2002                $  237,483         $  253,588         $   20,725         $  511,796
  2003 acquisitions                                12,146                  -                  -             12,146
  Reduction of goodwill as a result of
    the disposition of Manchester                 (37,312)                 -                  -            (37,312)
                                               -----------        -----------        -----------        -----------
Balance as of December 31, 2003                $  212,317         $  253,588         $   20,725         $  486,630
                                               ===========        ===========        ===========        ===========
</TABLE>
<PAGE>
     The Company allocated the purchase price of acquisitions in accordance with
SFAS No. 141 "Business  Combinations."  At December 31, 2003 and 2002, there was
$1.6 million and $466,000,  respectively,  of identifiable  intangible assets on
the Company's Consolidated Balance Sheets relating to the Company's acquisitions
in 2002 and 2003.  Identifiable  intangible  assets  relate to both the existing
value of the target's customer  relationships at the date of the acquisition and
trade names, if applicable.  See Note 3 to the Company's  Consolidated Financial
Statements for further discussion of the Company's acquisitions.

     The following table provides comparative  disclosure of adjusted net income
excluding goodwill  amortization  expense,  net of income taxes, for the periods
presented:
<TABLE>
<CAPTION>
                                                                               Years Ended December 31,
                                                                   -------------------------------------------------
(dollar amounts in thousands except per share amounts)                  2003              2002               2001
--------------------------------------------------------------------------------------------------------------------
<S>                                                                <C>              <C>                 <C>
Income (loss) from continuing operations before
  cumulative effect of accounting change, as reported              $    21,835       $   (14,002)       $     2,303
Goodwill amortization, net of tax                                            -                 -             26,237
                                                                   ------------      ------------       ------------
Income (loss) from continuing operations before
  cumulative effect of accounting change, as adjusted                   21,835           (14,002)            28,540
Income (loss) from discontinued operations, net of tax                  (2,395)            1,410              6,040
Loss on disposition of discontinued operations, net of tax             (20,675)                -                  -
Cumulative effect of accounting change, net of tax                           -          (553,712)                 -
                                                                   ------------      ------------       ------------
Net income (loss), as adjusted                                     $    (1,235)      $  (566,304)       $    34,580
                                                                   ============      ============       ============

Basic income (loss) per common share:
  Income (loss) from continuing operations before
    cumulative effect of accounting change, as reported            $      0.21       $     (0.14)       $      0.02
  Goodwill amortization, net of tax                                          -                 -               0.27
                                                                   ------------      ------------       ------------
  Income (loss) from continuing operations before
    cumulative effect of accounting change, as adjusted                   0.21             (0.14)              0.29
  Income (loss) from discontinued operations, net of tax                 (0.02)             0.01               0.06
  Loss on disposition of discontinued operations, net of tax             (0.20)                -                  -
  Cumulative effect of accounting change, net of tax                         -             (5.49)                 -
                                                                   ------------      ------------       ------------
Basic net income (loss) per common share, as adjusted              $     (0.01)      $     (5.62)       $      0.35
                                                                   ============      ============       ============
Diluted income (loss) per common share:
  Income (loss) from continuing operations before
    cumulative effect of accounting change, as reported            $      0.21       $     (0.14)       $      0.02
  Goodwill amortization, net of tax                                          -                 -               0.27
                                                                   ------------      ------------       ------------
  Income (loss) from continuing operations before
    cumulative effect of accounting change, as adjusted                   0.21             (0.14)              0.29
  Income (loss) from discontinued operations, net of tax                 (0.02)             0.01               0.06
  Loss on disposition of discontinued operations, net of tax             (0.20)                -                  -
  Cumulative effect of accounting change, net of tax                         -             (5.49)                 -
                                                                   ------------      ------------       ------------
Diluted net income (loss) per common share, as adjusted            $     (0.01)      $     (5.62)       $      0.35
                                                                   ============      ============       ============
</TABLE>

6. COMMITMENTS AND CONTINGENCIES

Leases

     The Company  leases  office  space under  various  noncancelable  operating
leases.  The following is a schedule of future minimum lease payments with terms
in excess of one year (dollar amounts in thousands):
<TABLE>
<CAPTION>
Year
-------------------------------------------------------------------------------------------------------
<S>                                                                                            <C>
2004                                                                                           $ 14,462
2005                                                                                             10,960
2006                                                                                              7,269
2007                                                                                              6,117
2008                                                                                              5,151
Thereafter                                                                                        8,851
                                                                                               --------
                                                                                               $ 52,810
                                                                                               ========
</TABLE>
     Total  rent  expense  for 2003,  2002,  and 2001 was $23.4  million,  $25.4
million,  and  $23.9  million,  respectively.  See  Note 17 to the  Consolidated
Financial  Statements for discussion of a charge for exit costs that the Company
recorded in 2002.
<PAGE>
Litigation

     The  Company is a party to a number of lawsuits  and claims  arising out of
the ordinary conduct of its business. In the opinion of management, based on the
advice of in-house and external legal  counsel,  the lawsuits and claims pending
are not likely to have a material  adverse effect on the Company,  its financial
position, its results of operations, or its cash flows.


7. INCOME TAXES

     A comparative  analysis of the  provision for income taxes from  continuing
operations, before cumulative effect of accounting change, is as follows (dollar
amounts in thousands):
<TABLE>
<CAPTION>

                              2003         2002         2001
--------------------------------------------------------------
<S>                       <C>        <C>            <C>
Current:
   Federal                $   7,050  $  (20,605)    $  (5,652)
   State                        611       1,557         1,365
   Foreign                      574       3,708         3,867
                          ------------------------------------
                              8,235     (15,340)         (420)
                          ------------------------------------
Deferred:
   Federal                    6,267      32,042        11,573
   State                        114      (1,428)        3,080
   Foreign                      (97)     (1,442)      (11,131)
                          ------------------------------------
                              6,284      29,172         3,522
                          ------------------------------------
                          $  14,519  $   13,832     $   3,102
                          ====================================
</TABLE>
     The  difference  between  the  actual  income  tax  provision  and  the tax
provision  computed by applying the statutory  federal income tax rate to income
from  continuing  operations  before  provision for income taxes and  cumulative
effect of accounting  change is attributable to the following (dollar amounts in
thousands except percentage amounts):
<TABLE>
<CAPTION>
                                                                  2003                  2002                  2001
                                                         -------------------------------------------------------------------
                                                          AMOUNT   PERCENTAGE    AMOUNT   PERCENTAGE     AMOUNT  PERCENTAGE
----------------------------------------------------------------------------------------------------------------------------
<S>                                                      <C>           <C>      <C>           <C>      <C>          <C>
Tax computed using the federal statutory rate             $   12,724    35.0%   $     (60)   (35.0)%   $   1,892     35.0%
State income taxes, net of federal income tax effect             725     2.0          129     76.0         4,445     82.2
Non-deductible goodwill                                            -       -            -        -         3,187     59.0
Foreign tax credit carryforward                                    -       -          (49)   (29.0)          525      9.7
Investment in subsidiary                                           -       -        8,660  5,094.0             -        -
Reorganization of subsidiary                                       -       -            -        -        (7,909)  (146.3)
Capital loss carryforward                                          -       -        3,661  2,153.5             -        -
Other permanent differences                                    1,070     2.9        1,491    877.0           962     17.8
                                                         -------------------------------------------------------------------
                                                          $   14,519    39.9%   $  13,832  8,136.5%   $    3,102     57.4%
                                                         ===================================================================
</TABLE>
<PAGE>
     The components of the deferred tax assets and  liabilities  recorded in the
Consolidated balance sheets are as follows:

<TABLE>
<CAPTION>

(dollar amounts in thousands)                                                             2003            2002
------------------------------------------------------------------------------------------------------------------
<S>                                                                                  <C>            <C>
Gross deferred tax assets:
   Self-insurance reserves                                                           $   1,394     $      1,669
   Allowance for doubtful accounts receivable                                            2,704            3,781
   Foreign tax credit carryforward                                                      19,507           21,611
   Net operating loss carryforward                                                      24,905            7,342
   Capital loss carryforward                                                             3,661            3,661
   Leases                                                                                1,630            3,395
   Amortization of goodwill                                                             41,321           57,265
   Other                                                                                 5,002            4,950
                                                                                     ---------------------------
    Total gross deferred tax assets                                                    100,124          103,674
                                                                                     ---------------------------
    Valuation allowance                                                                (27,171)         (25,050)
                                                                                     ---------------------------
      Total gross deferred tax assets, net of valuation allowance                       72,953           78,624
                                                                                     ---------------------------

Gross deferred tax liabilities:
   Other                                                                                (8,289)          (7,676)
                                                                                     ---------------------------
      Total gross deferred tax liabilities                                              (8,289)          (7,676)
                                                                                     ---------------------------
      Net deferred tax asset                                                         $  64,664     $     70,948
                                                                                     ===========================
</TABLE>

     Recognition of deferred tax assets is based on management's  belief that it
is  more  likely  than  not  that  the tax  benefit  associated  with  temporary
differences,  operating loss  carryforwards and tax credits will be utilized.  A
valuation  allowance is recorded  for those  deferred tax assets for which it is
more likely than not that realization will not occur.

     The Company's valuation allowance at December 31, 2003,  consisted of $14.7
million in foreign tax credit carryforwards, $8.8 million in state net operating
loss  carryforwards,  and $3.7  million  for a capital  loss  carryforward.  The
valuation allowance at December 31, 2002,  consisted of $14.0 million in foreign
tax  credit   carryforwards,   $7.3   million  in  state  net   operating   loss
carryforwards, and $3.7 million for a capital loss carryforward.

     The Company  generated a federal net operating  loss  carryforward  in 2003
resulting in a deferred tax asset of $16.1  million.  This federal net operating
loss carryforward will expire in 2024.

     The Company has a net deferred tax asset in 2002  resulting  primarily from
its tax basis in deductible goodwill being greater than the associated financial
statement carrying amount. The Company recognized an impairment loss recorded as
a change in accounting  principle associated with the Company's adoption of SFAS
No. 142. This  impairment  reduced the financial  statement  carrying  amount of
goodwill.  The  Company's  tax  basis  in its tax  deductible  goodwill  will be
deducted in the  Company's  income tax  returns,  generating  $420.0  million of
future tax deductions over the next 15 years.

     The Company is subject to periodic  review by federal,  foreign,  state and
local taxing  authorities in the ordinary  course of business.  During 2001, the
Company was notified by the  Internal  Revenue  Service that certain  prior year
income tax returns would be examined.  As part of this examination,  the Company
recorded a tax  provision of $8.7 million in 2002 for an agreed upon  adjustment
with the Internal  Revenue Service.  This Internal  Revenue Service  examination
will be finalized once it has been reviewed by the Joint Committee on Taxation.


8. EMPLOYEE BENEFITS

Profit Sharing Plans

     The Company has a qualified  contributory  401(k) profit sharing plan which
covers  all  full-time  employees  over  age  twenty-one  with  over  90 days of
employment and 375 hours of service. The Company made matching  contributions of
approximately $2.1 million and $7.1 million,  net of forfeitures,  to the profit
sharing plan for 2003 and 2001,  respectively.  During 2002,  management elected
not to match employee  deferrals.  When the Company reinstated the match for the
2003  plan  year,  it  redefined  the  terms to match at least  25% of  employee
contributions up to the first 5% of total eligible  compensation,  as defined in
the various profit sharing plans. For 2003, the Company matched 40%.

     The Company has assumed  many 401(k) plans of acquired  subsidiaries.  From
time to time,  the Company merges these plans into the Company's  plan.  Company
contributions  relating to these merged plans are included in the aforementioned
total.


<PAGE>
Deferred Compensation Plan

     The Company also has a  non-qualified  deferred  compensation  plan for its
highly compensated employees.  While the deferred compensation plan provides for
matching  contributions,  management elected not to match employee deferrals for
2003,  2002 and 2001.  The  Company  looks to invest the assets of the  deferred
compensation  plan  based  on  investment  allocations  of  the  employees.  The
liability to the  employees  for amounts  deferred is included in 'Other' in the
Liabilities section of the Consolidated Balance Sheet.

     Effective the  beginning of 2002,  the Company  purchased  insurance on the
lives of its highly compensated employees.  This company-owned life insurance is
utilized  to settle the  Company's  obligations  of deferred  compensation.  The
policies  are issued by Mutual of New York  ('MONY').  The Company has  directed
MONY to invest the assets  consistent  with the  investment  allocations  of the
employees.  The cash  surrender  value of the  company-owned  life  insurance is
included in 'Other assets, net' in the Consolidated Balance Sheet.


9. STOCKHOLDERS' EQUITY

Stock Repurchase Plan

     The Company's  Board of Directors had  authorized  the  repurchase of up to
$65.0 million of the Company's  Common Stock.  Beginning in the third quarter of
2002 through the second  quarter of 2003,  1.6 million  shares at a cost of $9.1
million  have  been  repurchased  under  this  authorization.  There has been no
activity under this authorization since the second quarter of 2003.

Incentive Employee Stock Plan

     The Company's  employee stock option plan (Employee  Plan) provides for the
granting  of options  for the  purchase  of the  Company's  common  stock to key
employees. The Employee Plan, among other things, requires the exercise price of
non-qualified stock options to not be less than 100% of the fair market value of
the stock on the date the option is  granted,  and  defines a director to comply
with Rule 16b-3 of the  Securities  Exchange  Act of 1934,  as amended  and with
Section 162(m) of the Internal  Revenue Code of 1986, as amended.  There were no
material amendments to the Employee Plan from 2001 to 2003.

     Additionally,  the  Company  assumed  the  stock  option  plans of some its
subsidiaries  upon acquisition in accordance with terms of the respective merger
agreements.  As of  December  31,  2003  and  2002,  the  assumed  plans  had an
immaterial number of options outstanding.

     In 2001, the Company  adopted the 2001 Voluntary Stock Option Exchange Plan
(the 'Option Exchange Plan') in an effort to improve the retention and incentive
aspects of the  Company's  Employee  Plan,  and to provide a mechanism to return
shares to the  Employee  Plan for  future  issuance.  The Option  Exchange  Plan
allowed  eligible option  holders,  as defined,  to voluntarily  cancel existing
options in exchange  for new options to be issued no earlier than six months and
one day following termination of existing options. The exercise price of the new
options was the market  price on the date of  re-issuance.  Vested  options that
were cancelled were re-granted on a one-for-one basis and were completely vested
upon  re-grant.  Unvested  options  that were  cancelled  were  re-granted  on a
one-for-two  basis and will vest in equal annual  installments over a three year
period from the date of re-grant.

     The Option Exchange Plan was approved by the Compensation Committee and the
non-employee members of the Board of Directors. The Company completed the Option
Exchange  Plan in the third  quarter of 2001 with the  re-grant  of 8.2  million
options.  The Company did not incur any compensation  charges in connection with
the Option Exchange Plan.


<PAGE>
Non-Employee Director Stock Plan

     The Company's  director stock option plan (Director  Plan) provided for the
granting  of  options  for  the  purchase  of  the  Company's  common  stock  to
non-employee directors. The Director Plan expired of its own term December 2003.
The Director Plan allowed each  non-employee  director to purchase 60,000 shares
at an exercise  price  equal to the fair  market  value at the date of the grant
upon  election to the Board.  In  addition,  the Director  Plan  provided for an
annual  issuance  of  non-qualified  options to purchase  20,000  shares to each
director,  upon reelection,  at an exercise price equal to the fair market value
at the date of grant.  The Board of Directors were also able to grant additional
options to non-employee  directors from time to time as the Board  determined in
its  discretion.  The  Committee  has not  issued  non-qualified  options  at an
exercise  price  less than 100% of the fair  market  value and,  therefore,  the
Company has not been  required to recognize  compensation  expense for its stock
option plans. The options become  exercisable  ratably over a three-year  period
and  expire  ten years  from the date of the grant.  However,  the  options  are
exercisable  for a maximum of three  years after the  individual  ceases to be a
director  and,  if the  director  ceases  to be a  director  within  one year of
appointment,  the options are  cancelled.  In 2003,  2002 and 2001,  the Company
granted  260,000,  180,000  and  490,000  options,  respectively,  at an average
exercise price of $7.82, $6.31 and $3.88, respectively.

     The following table summarizes the Company's Stock Option Plans:
<TABLE>
<CAPTION>
                                                                                                         Weighted
                                                                                       Range of          Average
                                                                         Shares     Exercise Prices   Exercise Price
---------------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>          <C>                  <C>
Balance, December 31, 2000                                             14,617,361   $ 1.25 - $33.38      $  13.83
   Granted                                                             12,389,156   $ 3.85 - $ 6.90      $   5.46
   Exercised                                                             (150,566)  $ 1.25 - $ 7.87      $   6.31
   Canceled                                                           (11,666,729)  $ 3.63 - $33.38      $  14.83
                                                                       ----------------------------------------------
Balance, December 31, 2001                                             15,189,222   $ 1.25 - $33.38      $   6.50
   Granted                                                              3,011,170   $ 5.24 - $ 8.45      $   5.44
   Exercised                                                           (2,871,696)  $ 2.85 - $ 9.65      $   8.18
   Canceled                                                              (955,513)  $ 3.63 - $17.38      $   7.98
                                                                       ----------------------------------------------
Balance, December 31, 2002                                             14,373,183   $ 1.25 - $33.38      $   6.12
   Granted                                                                429,000   $ 5.29 - $ 9.14      $   6.99
   Exercised                                                           (2,044,713)  $ 1.25 - $ 9.88      $   5.23
   Canceled                                                              (957,412)  $ 3.63 - $33.38      $   9.73
                                                                       ----------------------------------------------
Balance, December 31, 2003                                             11,800,058   $ 3.56 - $22.88      $   6.10
                                                                       ==============================================
</TABLE>

     The following table summarizes  information about stock options outstanding
at December 31, 2003:
<TABLE>
<CAPTION>
                                                         Outstanding                          Exercisable
                                           ------------------------------------------- -----------------------------
                                                                        Average                        Average
                                                          Average       Exercise                       Exercise
                                            Shares        Life (a)       Price           Shares         Price
--------------------------------------------------------------------------------------------------------------------
<S>                                        <C>            <C>           <C>            <C>           <C>
$  3.56 - $  3.85                           2,092,116     7.71          $  3.84        1,259,467     $  3.84
$  3.94 - $  5.24                           2,752,536     8.40             5.17        1,091,724        5.10
$  5.29 - $  6.64                           5,249,990     7.71             6.00        4,486,884        6.00
$  6.88 - $  8.13                             521,132     6.59             7.67          424,565        7.77
$  8.19 - $ 11.00                             588,110     7.07             9.24          330,800        9.44
$ 11.06 - $ 15.38                             470,374     4.89            13.00          414,014       13.02
$ 16.06 - $ 22.88                             125,800     4.65            20.39          116,200       20.70
                                           -------------------------------------------------------------------------
Total                                      11,800,058     7.64          $  6.10        8,123,654     $  6.35
                                           =========================================================================
</TABLE>
(a) Average contractual life remaining in years.
<PAGE>

     At year-end  2002,  options  with an average  exercise  price of $6.74 were
exercisable on 8.5 million  shares;  at year-end  2001,  options with an average
exercise price of $6.82 were exercisable on 9.6 million shares.

     During 2002 and 2001, the Company's  Board of Directors  issued  restricted
stock  grants of 100,000  and 200,000  shares,  respectively,  to the  Company's
President and Chief Executive Officer,  and grants of 103,333 shares and 200,000
shares to other  members of senior  management  in 2002 and 2001,  respectively.
Additionally,  in 2001,  the  Company's  Board of Directors  issued a restricted
stock grant of 960,000 shares to the Company's  Chairman of the Board,  which is
scheduled to vest on the fifth  anniversary  of issuance.  The Company  recorded
$1.3 million and $5.8 million in Stockholders' equity for deferred  compensation
in 2002 and 2001, respectively.  The Company recorded $1.5 million, $2.2 million
and $1.3 million of compensation  expense in 2003, 2002 and 2001,  respectively,
for the vesting of these  grants.  The deferred  compensation  is amortized on a
straight  line  basis  over the  vesting  period of the  grants.  There  were no
restricted stock grants for 2003.


10. NET INCOME PER COMMON SHARE

     The calculation of basic net (loss) income per common share and diluted net
(loss) income per common share is presented below:
<TABLE>
<CAPTION>
(dollar amounts in thousands except per share amounts)                   2003              2002               2001
----------------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>                <C>                <C>

Basic income (loss) per common share computation:
    Income (loss) from continuing operations before
      cumulative effect of accounting change                         $    21,835       $   (14,002)       $     2,303
    Income (loss) from discontinued operations, net of tax                (2,395)            1,410              6,040
    Loss on disposition of discontinued operations, net of tax           (20,675)                -                  -
    Cumulative effect of accounting change, net of tax                         -          (553,712)                 -
                                                                     ------------      ------------       ------------
  Net income (loss)                                                  $    (1,235)      $  (566,304)       $     8,343
                                                                     ============      ============       ============
  Basic average common shares outstanding                                101,680           100,833             97,868
                                                                     ============      ============       ============
  Basic income (loss) per common share:
    Income (loss) from continuing operations before
      cumulative effect of accounting change                         $      0.21       $     (0.14)       $      0.02
    Income (loss) from discontinued operations, net of tax                 (0.02)             0.01               0.06
    Loss on disposition of discontinued operations, net of tax             (0.20)                -                  -
    Cumulative effect of accounting change, net of tax                         -             (5.49)                 -
                                                                     ------------      ------------       ------------
Basic net income (loss) per common share                             $     (0.01)      $     (5.62)       $      0.09
                                                                     ============      ============       ============

Diluted income (loss) per common share computation:
    Income (loss) from continuing operations before
      cumulative effect of accounting change                         $    21,835       $   (14,002)       $     2,303
    Income (loss) from discontinued operations, net of tax                (2,395)            1,410              6,040
    Loss on disposition of discontinued operations, net of tax           (20,675)                -                  -
    Cumulative effect of accounting change, net of tax                         -          (553,712)                 -
                                                                     ------------      ------------       ------------
  Net income (loss)                                                  $    (1,235)      $  (566,304)       $     8,343
                                                                     ============      ============       ============

    Basic average common shares outstanding                              101,680           100,833             97,868
    Incremental shares from assumed exercise of stock options              2,838                 -                310
                                                                     ------------      ------------       ------------
  Diluted average common shares outstanding                              104,518           100,833             98,178
                                                                     ============      ============       ============
  Diluted income (loss) per common share:
    Income (loss) from continuing operations before
      cumulative effect of accounting change                         $      0.21       $     (0.14)       $      0.02
    Income (loss) from discontinued operations, net of tax                 (0.02)             0.01               0.06
    Loss on disposition of discontinued operations, net of tax             (0.20)                -                  -
    Cumulative effect of accounting change, net of tax                         -             (5.49)                 -
                                                                     ------------      ------------       ------------
Diluted net income (loss) per common share                           $     (0.01)      $     (5.62)       $      0.08
                                                                     ============      ============       ============

</TABLE>

     Options to purchase 1.6 million,  2.3  million,  and 7.8 million  shares of
common stock that were  outstanding  during 2003,  2002, and 2001  respectively,
were not  included  in the  computation  of  diluted  earnings  per share as the
exercise  prices of these options were greater than the average  market price of
the common shares.
<PAGE>
11. RELATED PARTY

     During 2001, the Company's President and Chief Executive Officer issued the
Company a promissory note for $1.5 million,  bearing interest at 4.7%. Under the
conditions  of the note, if  employment  terms were met over 2001 and 2002,  the
unpaid principal and accrued interest would be forgiven.  Accordingly,  $785,300
million of unpaid  principal  and accrued  interest was forgiven and recorded as
compensation expense in the Company's  Consolidated  Statements of Operations in
both 2002 and 2001.


12. CONCENTRATION OF CREDIT RISK

     The Company's  financial  instruments that are exposed to concentrations of
credit risk  consist  primarily  of cash and  accounts  receivable.  The Company
places its cash and cash  equivalents  with what management  believes to be high
credit quality  institutions.  At times such investments may be in excess of the
FDIC insurance limit. The Company routinely  assesses the financial  strength of
its  customers  and, as a  consequence,  believes  that its accounts  receivable
credit risk exposure is limited.


13. FAIR VALUE OF FINANCIAL INSTRUMENTS

     The carrying  amounts of cash and cash  equivalents,  accounts  receivable,
other assets, accounts payable and accrued expenses, and notes payable to former
target shareholders  approximate fair value due to the short-term  maturities of
these assets and  liabilities.  Borrowings  under the revolving  credit facility
have variable rates that reflect  currently  available  terms and conditions for
similar debt. The carrying amount of this debt is considered by management to be
a reasonable estimate of its fair value.


14. FURNITURE, EQUIPMENT, AND LEASEHOLD IMPROVEMENTS

     A summary of furniture,  equipment,  and leasehold improvements at December
31, 2003 and 2002 is as follows (dollar amounts in thousands):

<TABLE>
<CAPTION>
                                                   Estimated
                                                   Useful Life
                                                    in Years            2003              2002
                                                  -------------     -------------------------------

<S>                                                <C>               <C>             <C>
Furniture, equipment, and leasehold                  5 - 15 /
  improvements                                      lease term       $    87,476     $      86,824
Software                                                3                  8,437             8,115
Software development                                    5                 22,698            20,031
                                                                    -------------    --------------
                                                                         118,611           114,970
  Accumulated depreciation and amortization                               89,123            78,465
                                                                    -------------    --------------
Total furniture, equipment, and leasehold
  improvements, net                                                  $    29,488     $      36,505
                                                                    =============    ==============

</TABLE>

     Total  depreciation  and amortization  expense on furniture, equipment, and
leasehold  improvements was $16.1 million,  $19.8 million, and $21.0 million for
2003, 2002, and 2001, respectively.


<PAGE>
15. QUARTERLY FINANCIAL DATA (UNAUDITED)
<TABLE>
<CAPTION>
                                                       For the Three Months Ended                         For the
                                         ----------------------------------------------------------     Year Ended
(dollar amounts in thousands                  Mar. 31,        June 30,       Sept. 30,       Dec. 31,      Dec. 31,
 except per share amounts)                     2003            2003           2003            2003          2003
---------------------------------------------------------------------------------------------------   ---------------
<S>                                      <C>            <C>             <C>            <C>            <C>
Revenue                                   $   264,263   $    273,167    $    274,669   $    283,931   $  1,096,030
Gross profit                                   67,005         73,581          73,697         72,857        287,140
Income from continuing operations               2,933          6,463           7,166          5,273         21,835
Income (loss) from discontinued
  operations, net of tax                            5           (644)         (1,177)          (579)        (2,395)
Loss on disposition of discontinued
  operations, net of tax                            -              -               -        (20,675)       (20,675)
Net income (loss)                               2,938          5,819           5,989        (15,981)        (1,235)
  Basic income per common share
    from continuing operations                   0.03           0.06            0.07           0.05           0.21
  Basic income (loss) per common share
    from discontinued operations,
    net of tax                                   0.00          (0.01)          (0.01)         (0.01)         (0.02)
  Basic loss per common share from
    disposition, net of tax                         -              -               -          (0.20)         (0.20)
Basic net income (loss) per
  common share                                   0.03           0.05            0.06          (0.15)         (0.01)
  Diluted income per common share
    from continuing operations                   0.03           0.06            0.07           0.05           0.21
  Diluted income (loss) per common share
    from discontinued operations,
    net of tax                                   0.00          (0.01)          (0.01)         (0.01)         (0.02)
  Diluted loss per common share from
    disposition, net of tax                         -              -               -          (0.19)         (0.20)
Diluted net income (loss) per
  common share                                   0.03           0.05            0.06          (0.15)         (0.01)
</TABLE>
<TABLE>
<CAPTION>
                                                       For the Three Months Ended                         For the
                                         ----------------------------------------------------------     Year Ended
(dollar amounts in thousands                  Mar. 31,        June 30,       Sept. 30,       Dec. 31,      Dec. 31,
 except per share amounts)                     2002            2002           2002            2002          2002
---------------------------------------------------------------------------------------------------   ---------------
<S>                                      <C>            <C>             <C>            <C>            <C>
Revenue                                   $   285,059   $    279,867    $    281,825   $    272,405   $  1,119,156
Gross profit                                   70,340         70,644          72,550         71,304        284,838
Income (loss) from continuing
  operations before cumulative effect
  of accounting change                            377          4,115           5,285        (23,779)       (14,002)
Income (loss) from discontinued
  operations, net of tax                        1,569             61               5           (225)         1,410
Cumulative effect of accounting
  change, net of tax                         (553,712)             -               -              -       (553,712)
Net income (loss)                            (551,766)         4,176           5,290        (24,004)      (566,304)
  Basic income (loss) per common share
    from continuing operations                   0.00           0.04            0.05          (0.23)         (0.14)
  Basic income (loss) per common share
    from discontinued operations,
    net of tax                                   0.02           0.00            0.00          (0.00)          0.01
  Basic loss per common share from
    accounting change, net of tax               (5.62)             -               -              -          (5.49)
Basic net income (loss) per
  common share                                  (5.60)          0.04            0.05          (0.23)         (5.62)
  Diluted income (loss) per common share
    from continuing operations                   0.00           0.04            0.05          (0.23)         (0.14)
  Diluted income (loss) per common share
    from discontinued operations
    net of tax                                   0.02           0.00            0.00          (0.00)          0.01
  Diluted loss per common share from
    accounting change, net of tax               (5.37)             -               -              -          (5.49)
Diluted net income (loss) per
  common share                                  (5.35)          0.04            0.05          (0.23)         (5.62)
</TABLE>




16. SEGMENT REPORTING

     The Company discloses segment  information in accordance with SFAS No. 131,
'Disclosure  About  Segments of an Enterprise  and Related  Information,'  which
requires  companies to report selected segment  information on a quarterly basis
and to report certain entity-wide disclosures about products and services, major
customers,  and the  material  countries  in which the entity  holds  assets and
reports revenues.

     The  Company  has three  reportable  segments:  professional  services,  IT
services,  and IT  solutions.  The Company's  reportable  segments are strategic
divisions  that offer  different  services  and are managed  separately  as each
division requires different resources and marketing strategies. The professional
services division provides expertise in a wide variety of disciplines  including
accounting and finance, law, engineering, health care, and executive search. The
IT services division offers value-added solutions such as IT project support and
staffing, recruitment of full-time positions,  project-based solutions, supplier
management solutions,  and on-site recruiting support. The IT solutions division
provides IT strategy consulting,  design and branding,  application development,
and integration.  The professional services division's results for 2003, include
the results of the Company's  health care staffing  unit,  which was acquired by
the Company in July 2002,  and the results  from the  acquisitions  of two legal
staffing  businesses,  which were  acquired in February and August of 2003.  The
Company  evaluates  segment  performance  based on revenues,  gross profit,  and
income before  provision for income taxes.  The Company does not allocate income
taxes, interest or unusual items to the segments.

     The accounting policies of the segments are consistent with those described
in the summary of significant accounting policies in Note 2 and all intersegment
sales and transfers are eliminated.

     No one customer  represents more than 5% of the Company's  overall revenue.
Therefore,  the Company  does not believe it has a material  reliance on any one
customer as the Company is able to provide services to numerous Fortune 1000 and
other leading businesses.

     The following table summarizes segment and geographic information:
<PAGE>
<TABLE>
<CAPTION>

(dollar amounts in thousands)                             2003              2002              2001
-----------------------------------------------------------------------------------------------------


                                                  <c>               <c>               <c>
Revenue
   Professional services                             $    514,100      $    459,343      $    560,976
   IT services                                            511,739           575,312           770,830
   IT solutions                                            70,191            84,501           168,809
                                                     ------------      ------------      ------------
         Total revenue                               $  1,096,030      $  1,119,156      $  1,500,615
                                                     ============      ============      ============

Gross profit
   Professional services                             $    147,365      $    134,113      $    171,786
   IT services                                            114,704           122,294           168,317
   IT solutions                                            25,071            28,431            54,731
                                                     ------------      ------------      ------------
         Total gross profit                          $    287,140      $    284,838      $    394,834
                                                     ============      ============      ============

Income (loss) from continuing operations before
 provision for income taxes and cumulative
 effect of accounting change
   Professional services                             $     26,708      $     21,919      $     40,588
   IT services                                              6,310            10,639            32,811
   IT solutions                                             2,499            (3,649)          (21,483)
                                                     ------------      ------------      ------------
                                                           35,517            28,909            51,916
   Amortization of goodwill                                     -                 -           (37,312)
   Recapture (charges) (a)                                    284           (25,132)                -
   Corporate other income (expense), net                      553            (3,947)           (9,199)
                                                     ------------      ------------      ------------
   Total income (loss) from continuing operations
    before provision for income taxes and
    cumulative effect of accounting change           $     36,354      $       (170)     $      5,405
                                                     ============      ============      ============


Geographic Areas
   Revenue
      United States                                  $    705,914      $    742,452      $  1,075,486
      U.K.                                                379,081           364,304           412,528
      Other                                                11,035            12,400            12,601
                                                     ------------      ------------      ------------
         Total revenue                               $  1,096,030      $  1,119,156      $  1,500,615
                                                     ============      ============      ============



                                                                          December 31,
                                                               -------------------------------
(dollar amounts in thousands)                                        2003              2002
----------------------------------------------------------------------------------------------

Assets
   Professional services                                        $    379,959      $    375,331
   IT services                                                       464,538           457,163
   IT solutions                                                       48,654            59,700
                                                                ------------      ------------
                                                                     893,151           892,194
      Corporate                                                            -               780
                                                                ------------      ------------
         Total assets                                           $    893,151      $    892,974
                                                                ============      ============
Geographic Areas
   Identifiable Assets
      United States                                             $    633,810      $    631,342
      U.K.                                                           250,640           254,169
      Other                                                            8,701             7,463
                                                                ------------      ------------
         Total assets                                           $    893,151      $    892,974
                                                                ============      ============
 </TABLE>

(a)  Charges  for  2002  include  (1)  $16.2  million   impairment  of  minority
     investment,  and (2) 9.0  million  exit  costs.  2003  includes  a $284,000
     recapture  relating to the settlement of abandoned  real estate  associated
     with the 2002 exit costs.
<PAGE>

17.   Excess Real Estate Obligations

     In 2001 and 2002, the Company experienced a material decrease in demand for
its domestic  operations.  To reflect this  decreased  demand,  the Company made
attempts to realign its real estate capacity needs by vacating and  reorganizing
certain office space.

     In 2002,  management  determined  that  the  Company  would  not be able to
utilize  this  vacated  office space and,  therefore,  notified  the  respective
lessors of their intentions.  This determination eliminated the economic benefit
associated  with the vacated office space. As a result,  the Company  recorded a
charge for contract  termination costs,  mainly due to, costs that will continue
to be incurred under the lease contract for its remaining term without  economic
benefit  to the  Company.  While  the  Company  looks  to  settle  excess  lease
obligations,  the current  economic  environment  has made it difficult  for the
Company  to  either  settle or find  acceptable  subleasing  opportunities.  The
average  remaining  lease  term for the  lease  obligations  included  herein is
approximately 1.5 years.

     The  following  table  summarizes  the  activity of the charge for contract
termination  costs from  origination  through  December  31, 2003 by  reportable
segment:
<TABLE>
<CAPTION>
                                               Professional            IT                 IT
(dollar amounts in thousands)                    Services           Services          Solutions           Total
-------------------------------------------------------------------------------------------------------------------
<S>                                            <C>                <C>                <C>                <C>
Balance as of December 31, 2002                $      431         $      675         $    7,861         $    8,967

Costs paid or otherwise settled
   during 2003                                       (223)              (431)            (3,620)            (4,274)

Amounts recaptured during 2003                        (39)              (229)               (16)              (284)
                                               -----------        -----------        -----------        -----------
Balance as of December 31, 2003                $      169                 15              4,225              4,409
                                               ===========        ===========        ===========        ===========
</TABLE>


18.   Discontinued Operations

     In December 2003, the Company sold certain operating assets and transferred
certain  operating  liabilities of its outplacement  unit,  Manchester.  Revenue
generated from Manchester was $21.0 million,  $35.8 million,  and $47.9 million,
in 2003,  2002 and 2001,  respectively.  Income  before taxes was a $3.7 million
loss,  $2.2 million of income,  and $9.7 million of income,  for 2003,  2002 and
2001,  respectively.  The major classes of assets and liabilities as of December
31, 2003 and 2002 are as follows,  with the  remaining net assets of $109,000 at
December 31, 2003 being  included in the line item 'Other' in the Current Assets
section of the Company's Consolidated Balance Sheet:

<TABLE>
<CAPTION>
                                                                          December 31,
                                                               -------------------------------
(dollar amounts in thousands)                                        2003              2002
----------------------------------------------------------------------------------------------

                                                            <c>               <c>
Assets
   Accounts receivable, net                                     $      3,071      $      5,390
   Goodwill                                                                -            37,312
   Other assets                                                          332             2,995
                                                                ------------      ------------
     Total assets                                                      3,403            45,697
                                                                ------------      ------------
Liabilities
   Accounts payable and accrued liabilities                            2,161             3,228
   Other liabilities                                                   1,133             5,258
                                                                ------------      ------------
     Total liabilities                                          $      3,294      $      8,486
                                                                ============      ============
</TABLE>

     Included in the 'Accounts payable and accrued  liabilities' line item above
are amounts for exit costs  associated  with abandoned real estate.  At December
31, 2003 and 2002,  there was $1.1 million and $732,000 of contract  termination
costs, respectively.


19.   Equity Investment

     The Company had a minority  investment in a privately held company that was
recorded as a non-current asset. The asset was carried at its original cost plus
accrued  interest.  The investment  was  originally  made in 1996 and was set to
mature in 2004. In 2002,  this  privately  held company  recapitalized  at terms
which diluted the value of the Company's investment.  The Company elected not to
participate in the  recapitalization,  which  resulted in the  investment  being
impaired.  As a result,  the Company  wrote off the  investment  in its entirety
recognizing a $16.2 million charge in 2002.

     The process of  assessing  whether a  particular  equity  investment's  net
realizable value is less than its carrying cost requires a significant amount of
judgment.  The Company  periodically  monitors the  investment for impairment by
considering,  among other things,  the investee's cash position,  projected cash
flows,  financing  needs,  liquidation  preference,  most recent  valuation data
(including  the  duration and extent to which the fair value is less than cost),
the current  investing  environment,  competition,  and the Company's intent and
ability to hold the investment.




ITEM 9A. CONTROLS AND PROCEDURES

     Our management,  including the Chief Executive  Officer and Chief Financial
Officer,   conducted  an  evaluation  of  the  effectiveness  of  the  Company's
disclosure controls and procedures (as defined in Exchange Act Rule 13(a)-15(e))
as of the end of the period covered by this Annual Report on Form 10-K. Based on
that  evaluation,  the  Chief  Executive  officer  and Chief  Financial  Officer
concluded that the Company's  disclosure  controls and procedures were effective
to provide reasonable  assurance that the objectives of disclosure  controls and
procedures are met.

     There have been no changes in the Company's internal control structure over
financial  reporting (as defined in Exchange Act Rule 13(a)-15(f)) that occurred
during the  Company's  last fiscal  quarter that has  materially  affected or is
reasonably  likely to  materially  affect the Company's  internal  controls over
financial reporting.

<PAGE>

                                    PART III

     Information  required by Part III with respect to Directors  and  Executive
Officers of the Registrant (Item 10), Executive Compensation (Item 11), Security
Ownership of Certain  Beneficial  Owners and Management and Related  Stockholder
Matters (Item 12), Certain  Relationships  and Related  Transactions  (Item 13),
Principal  Accountant  Fees and  Services  (Item  14),  and the Audit  Committee
Charter is to be included in the  Registrant's  Definitive Proxy Statement to be
filed pursuant to Regulation 14A (the 'Proxy Statement') not later than 120 days
after the end of the fiscal year covered by this report.  Such Proxy  Statement,
when filed, is incorporated herein by reference.




<PAGE>
                                     PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a) 1. Financial Statements.

     The following consolidated financial statements of the Company and its
subsidiaries are included in Item 8 of this report:

        Report of Independent Certified Public Accountants

        Consolidated Balance Sheets at December 31, 2003 and 2002

        Consolidated Statements of Operations for the years ended
           December 31, 2003, 2002, and 2001

        Consolidated Statements of Stockholders' Equity for the
           years ended December 31, 2003, 2002, and 2001

        Consolidated Statements of Cash Flows for the years ended
           December 31, 2003, 2002, and 2001

        Notes to Consolidated Financial Statements

(a) 2. Financial Statement Schedules.

     Financial  statement  schedules  required to be included in this report are
either shown in the financial statements and notes thereto included in Item 8 of
this report or have been omitted because they are not applicable.

(a) 3. Exhibits.

          See (c) below.

(b) Reports on Form 8-K.

          On October 28,  2003,  we furnished a Report on Items 7 and 12 of Form
     8-K pertaining to the issuance of a press release  announcing our financial
     results for the three and nine months ended  September 30, 2003.  This Form
     8-K is not deemed  incorporated  by reference  into any of our filings with
     the Securities and Exchange Commission.


<PAGE>
(c) Exhibits.

3.1     Amended and restated Articles of Incorporation. (9)

3.2     Amended and Restated Bylaws. (12)

4       Form of stock certificate (13)

10.1    Modis Professional Services, Inc. (now MPS Group, Inc.) 2001 Employee
        Stock Purchase Plan. (8) ^

10.2    AccuStaff Incorporated (now MPS Group, Inc.) amended and restated
        Non-Employee Director Stock Plan. (3)

10.3    Form of Non-Employee Director Stock Option Award Agreement, as
        amended. (5)

10.4    Profit Sharing Plan. (1) ^

10.5    Revolving Credit Agreement by and between the Company and The Its
        Material Domestic Subsidiaries and Wachovia Bank, National Association
        as Administration Agent and certain lenders named therein, dated
        November 21, 2003.

10.6    Modis Professional Services, Inc. (now MPS Group, Inc.) Amended
        and Restated Stock Option Plan. (7) ^

10.7    Form of Stock Option Agreement under Modis Professional
        Services, Inc. (now MPS Group, Inc.) amended and restated 1995
        Stock Option Plan. (7) ^

10.8    Chairman Employment Agreement with Derek E. Dewan. (6) ^

10.8(a) Restricted Stock Agreement with Derek E. Dewan. (6) ^

10.9    Amended and Restated Executive Employment Agreement with
        Timothy D. Payne. (6) ^

10.9(a) Restricted Stock Agreement with Timothy D. Payne. (10) ^

10.10   Amended and Restated Executive Employment Agreement with
        Robert P. Crouch. (6) ^

10.10(a)Restricted Stock Agreement with Robert P. Crouch. (10) ^

10.11   Modis Professional Services, Inc. (now MPS Group, Inc.) Executive
        Option Plan (2) ^

10.12   Senior Executive Annual Incentive Plan. (4) ^

10.13   Form of Director's Indemnification Agreement. (5)

10.14   Form of Officer's Indemnification Agreement. (5)

10.15   Form of Award Notification under the Modis Professional Services, Inc.
        (now MPS Group, Inc.) Senior Executive Annual Incentive Plan. (7 ^

10.16   Amended and Restated Executive Deferred Compensation Plan. (12) ^

10.17   Form of Executive Employment Agreement entered into by Gregory D.
        Holland, Tyra H. Tutor, and Richard L. White. (12) ^

21      Subsidiaries of the Registrant.

23      Consent of PricewaterhouseCoopers LLP.

24      Form of Power of Attorney (11).

31.1    Certification of Timothy D. Payne pursuant to Rule 13a-14a.

31.2    Certification of Robert P. Crouch pursuant to Rule 13a-14a.

32.1    Certification of Timothy D. Payne pursuant to 18 U.S.C. Section 1350.

32.2    Certification of Robert P. Crouch pursuant to 18 U.S.C. Section 1350.


^    This Exhibit is a management contract or compensatory plan or arrangement.


(1) Incorporated by reference to the Company's Registration on Form S-1 (No.
 33-78906).

(2) Incorporated by reference to the Company's Registration on Form S-8 (No.
 33-88329).

(3) Incorporated by reference to the Company's Quarterly Report on Form 10-Q
 filed August 16, 1999.

(4) Incorporated by reference to the Company's Quarterly Report on Form 10-Q
 filed November 15, 1999.

(5) Incorporated by reference to the Company's Annual Report on Form 10-K filed
 March 30, 2000.

(6) Incorporated by reference to the Company's Quarterly Report on Form 10-Q
 filed May 16, 2001.

(7) Incorporated by reference to the Company's Quarterly Report on Form 10-Q
 filed August 8, 2001.

(8)  Incorporated  by reference to the Company's  Quarterly  Report on Form 10-Q
filed May 14, 2002.

(9)  Incorporated by reference to the Company's Annual Report on Form 10-K filed
March 26, 2002.

(10)  Incorporated by reference to the Company's  Quarterly  Report on Form 10-Q
filed November 14, 2002.

(11) Incorporated by reference to the Company's Annual Report on Form 10-K filed
March 31, 2003.

(12)  Incorporated by reference to the Company's  Quarterly  Report on Form 10-Q
filed May 14, 2003.

(13) Incorporated by reference to the Company's  Registration  Statement on Form
S-3 (No. 333-106855) filed July 7, 2003.

EXHIBIT INDEX

10.5    Revolving Credit Agreement by and between the Company and The Its
        Material Domestic Subsidiaries and Wachovia Bank, National Association
        as Administration Agent and certain lenders named therein, dated
        November 21, 2003.

21      Subsidiaries of the Registrant.

23      Consent of PricewaterhouseCoopers LLP.

31.1    Certification of Timothy D. Payne pursuant to Rule 13a-14 and 15e-14.

31.2    Certification of Robert P. Crouch pursuant to Rule 13a-14 and 15e-14.

32.1    Certification of Timothy D. Payne pursuant to 18 U.S.C. Section 1350.

32.2    Certification of Robert P. Crouch pursuant to 18 U.S.C. Section 1350.

<PAGE>

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

MPS GROUP, INC.


By:  /s/ Timothy D. Payne
     Timothy D. Payne
     President and Chief Executive Officer

Date:  March 15, 2004

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

Signatures                          Title                             Date


/s/ Timothy D. Payne             President, Chief                March 15, 2004
Timothy D. Payne                 Executive Officer and
                                 Director


/s/ Robert P. Crouch             Senior Vice President, Chief    March 15, 2004
Robert P. Crouch                 Financial Officer, Treasurer,
                                 and Chief Accounting Officer


/s/ Derek E. Dewan *             Chairman of the Board           March 15, 2004
Derek E. Dewan


/s/ Michael D. Abney *           Director                        March 15, 2004
Michael D. Abney


                                 Director                        March 15, 2004
T. Wayne Davis


/s/ Arthur B. Laffer *           Director                        March 15, 2004
Arthur B. Laffer


                                 Director                        March 15, 2004
Richard D. Heckmann


/s/ William M. Isaac *           Director                        March 15, 2004
William M. Isaac


/s/ John R. Kennedy *            Director                        March 15, 2004
John R. Kennedy


/s/ Darla D. Moore *             Director                        March 15, 2004
Darla D. Moore


/s/ Peter J. Tanous *            Director                        March 15, 2004
Peter J. Tanous


/s/ Robert P. Crouch *By         Attorney-in-Fact                March 15, 2004
Robert P. Crouch