<PAGE>

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-QSB
      [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                  For the QUARTERLY PERIOD ended June 30, 2004
                                       OR
           [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

  FOR THE TRANSITION PERIOD FROM __________________ TO ________________________

                        Commission File Number: 000-29217

                             ACCESSPOINT CORPORATION
        ----------------------------------------------------------------
                 (Name of Small Business Issuer in its Charter)

               Nevada                                   95-4721385
----------------------------------------    ------------------------------------
   (State or Other Jurisdiction of          (I.R.S. Employer Identification No.)
    Incorporation or Organization)

    3030 S. VALLEY BLVD. SUITE 190
       LAS VEGAS, NEVADA, 89102                           89102
----------------------------------------    ------------------------------------
(Address of Principle Executive Offices)                (Zip Code)

                                 (702) 809 0206
          -------------------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

      Securities Registered Pursuant to Section 12(b) of the Exchange Act:
                                      None
      Securities Registered Pursuant to Section 12(g) of the Exchange Act:

                         Common Stock, $0.001 Par Value

The number of the Company's shares of Common Stock outstanding as of June
30, 2004 was 18,971,230.

Transitional Small Business Disclosure Format (check one):  Yes [   ]   No [ X ]



<PAGE>

                             Accesspoint Corporation
                          Form 10-QSB QUARTERLY Report
                    FOR THE FIRST QUARTER ENDED JUNE 30, 2004
                                TABLE OF CONTENTS

Forward-Looking Statements

PART I

Item 1.  Financial Statements                                                  3
Item 2.  Management's Discussion and Analysis or Plan of Operation            11
Item 3.  Controls and Procedures                                              12

PART II

Item 1.  Legal Proceedings                                                    12
Item 2.  Changes in Securities                                                14
Item 3.  Defaults Upon Senior Securities
Item 4.  Submission of Matters to a Vote of Security Holders                  14
Item 5.  Other Information                                                    14
Item 6.  Exhibits and Reports on Form 8-K                                     14

Signatures

                                        2



<PAGE>

                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

         This Form 10-QSB contains forward-looking statements about the
business, financial condition and prospects of the Company that reflect
assumptions made by management and management's beliefs based on information
currently available to it. We can give no assurance that the expectations
indicated by such forward-looking statements will be realized. If any of
management's assumptions should prove incorrect, or if any of the risks and
uncertainties underlying such expectations should materialize, the Company's
actual results may differ materially from those indicated by the forward-looking
statements.

         The key factors that are not within the Company's control and that may
have a direct bearing on operating results include, but are not limited to, the
acceptance by customers of the Company's products and services, the Company's
ability to develop new products and services cost-effectively, the ability of
the Company to raise capital in the future, the development by competitors of
products or services using improved or alternative technology, the retention of
key employees and general economic conditions.

         There may be other risks and circumstances that management is unable to
predict. When used in this Form 10-QSB, words such as, "believes," "expects,"
"intends," "plans," "anticipates" "estimates" and similar expressions are
intended to identify forward-looking statements, although there may be certain
forward-looking statements not accompanied by such expressions. All
forward-looking statements are intended to be covered by the safe harbor created
by Section 21E of the Securities Exchange Act of 1934.

                                     PART I
                              FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                             ACCESSPOINT CORPORATION
                        CONSOLIDATED FINANCIAL STATEMENTS
                                  JUNE 30, 2004

                                TABLE OF CONTENTS

Consolidated Balance Sheets                                                    4

Consolidated Statements of Operations                                          5

Consolidated Statements of Cash Flows                                          6

Notes to Consolidated Financial Statements                                  7-10

                                        3



<PAGE>
                             ACCESSPOINT CORPORATION
                           CONSOLIDATED BALANCE SHEETS

                                                     June 30,       December 31,
                                                       2004             2003
                                                   (unaudited)
                                                   -------------   -------------

                       ASSETS
                      -------
Current Assets
         Cash                                      $    115,195    $     28,393
         Accounts receivable, net of allowance
           for doubtful accounts $0 for
           June 30, 2004 and $80,000 for
           December 31, 2003, respectively              314,318         446,870
         Prepaid expenses                                    --          39,235
                                                   -------------   -------------
                  Total Current Assets                  429,513         514,498
                                                   -------------   -------------
Fixed Assets
         Furniture and equipment, net                    12,772          91,099
                                                   -------------   -------------
                  Total Fixed Assets                     12,772          91,099
                                                   -------------   -------------
Other Assets
         Deferred financing costs, net                  495,928         752,873
         Deposits                                       287,659         285,108
                                                   -------------   -------------
                  Total Other Assets                    783,587       1,037,981
                                                   -------------   -------------
         Total Assets                              $  1,225,872    $  1,643,578
                                                   =============   =============

                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------
Current Liabilities
         Accounts payable                               863,491         939,851
         Accrued payroll taxes and penalties             17,371       1,328,138
         Accrued liabilities                            475,855         504,014
         Merchant loss reserve                            2,778           2,778
         Lines of credit                              1,364,699       1,373,049
         Capitalized leases                             547,574         577,638
         Notes payable                                  165,000         415,000
         Financing obligations                          617,251              --
         Related party payables                         321,428              --
                                                   -------------   -------------
         Total Current Liabilities                    4,375,447       5,140,468

         Total Liabilities                            4,375,447       5,140,468
                                                   -------------   -------------
Stockholders' Equity
         Preferred Stock, $.001 par value,
         5,000,000 shares authorized, 1,055,600
         shares issued and outstanding at
         June 30, 2004 and December 31, 2003,
         respectively                                     1,056           1,056

         Common stock, $.001 par value,
         25,000,000 shares authorized, 18,971,230
         issued and outstanding at June 30, 2004
         and December 31, 2003, respectively             18,971          18,971

         Additional paid in capital                  15,119,197      15,119,197
         Accumulated (deficit)                      (18,288,799)    (18,636,114)
                                                   -------------   -------------
         Total Stockholders' (Deficit)               (3,149,575)     (3,496,890)
                                                   -------------   -------------
         Total Liabilities and
         Stockholders' Equity                      $  1,225,872    $  1,643,578
                                                   =============   =============

                   Refer to notes to the financial statements

                                        4



<PAGE>
<TABLE>
<CAPTION>
                                                 ACCESSPOINT CORPORATION
                                          CONSOLIDATED STATEMENTS OF OPERATIONS
                                                       (UNAUDITED)

                                         For the six           For the six         For the three        For the three
                                         months ended          months ended        months ended         months ended
                                         June 30, 2004         June 30, 2003       June 30, 2004        June 30, 2003
                                        ----------------     ----------------     ----------------     ----------------

<S>                                     <C>                  <C>                  <C>                  <C>
Sales, net                              $     4,963,226      $     6,780,179      $     2,287,447      $     3,389,904
Cost of sales                                 4,233,652            5,147,265            2,222,091            2,530,974
                                        ----------------     ----------------     ----------------     ----------------
Gross profit                                    729,574            1,632,914               65,356              858,930

 Selling expenses                                 6,541                4,624                  580                   --
 General and administrative
   expenses                                     881,857            1,509,205              529,850              697,824
                                        ----------------     ----------------     ----------------     ----------------
Income (loss) from operations                  (158,824)             119,085             (465,074)             161,106

Other (Income) Expense
 Sale of book of business                       (85,000)                  --              (85,000)                  --
 Forgiveness of debt                           (754,884)                  --             (318,852)                  --
 Interest income                                (22,546)              (2,496)             (14,997)                (553)
 Other income                                    (1,007)                  --               (1,007)                  --
 Penalties                                       29,337                5,310                1,734                3,169
 Amortization of deferred
   financing costs                              256,946              256,945              128,473              128,472
 Lawsuit settlement                               2,000                   --                2,000                   --
 Interest expense                                69,015               94,347                7,120               44,368
                                        ----------------     ----------------     ----------------     ----------------
Total Other (Income) Expense                   (506,139)             354,106             (280,529)             175,456
                                        ----------------     ----------------     ----------------     ----------------

Income (loss) before income
   taxes                                        347,315             (235,021)            (184,545)             (14,350)
 Provision for income taxes                          --                   --                   --                   --
                                        ----------------     ----------------     ----------------     ----------------
Net income (loss)                       $       347,315      $      (235,021)     $      (184,545)     $       (14,350)
                                        ================     ================     ================     ================

Net income (loss) per share-
   Basic and Diluted                    $          0.02      $         (0.01)     $         (0.01)     $         (0.00)
                                        ================     ================     ================     ================
Weighted average number of shares-
   Basic and Diluted                         18,971,230           24,163,965           18,971,230           24,163,965
                                        ================     ================     ================     ================

                                       Refer to notes to the financial statements

                                                           5
</TABLE>



<PAGE>

                             ACCESSPOINT CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)

                                                        Six Months Ended
                                                        -----------------
                                                    June 30,         June 30,
                                                     2004               2003
                                                 ------------      ------------
CASH FLOWS FROM OPERATING ACTIVITIES
         Net income (loss)                        $  347,315       $  (235,021)

Adjustments to reconcile net income (loss) to net
cash used or provided by operating activities:
         Amortization                                256,946           256,945
         Depreciation                                 38,072           104,283
         (Increase) decrease in receivables          132,552           (76,906)
         Decrease in other current assets                 --            40,803
         Increase in clearing account                 (2,551)               --
         Decrease in prepaid expenses                 39,235             1,488
         Decrease in accounts payable and
            accrued expenses                        (104,517)         (164,294)
         Decrease in accrued payroll taxes        (1,310,767)          (74,100)
         Increase in merchants loss reserve               --            13,163
         Increase in accrued liabilities                  --            91,467
                                                 ------------      ------------
         Total adjustments                          (951,030)          192,849
                                                 ------------      ------------
         Net cash provided by (used) in
          operations                                (603,715)          (42,172)
                                                 ------------      ------------
CASH FLOW FROM INVESTING ACTIVITIES
         Disposition of fixed assets                  40,252                --
                                                 -----------       -----------
         Net cash provided by investing
         activities                                   40,252                --
                                                 -----------       -----------
CASH FLOWS FROM FINANCING ACTIVITIES
         Loans from related parties                  321,428                --
         Proceeds from financing obligations         617,251                --
         Payments on capital leases                  (30,064)           (5,000)
         Increase in (payments) on
         line of credit                               (8,350)           36,658
         Decrease in notes payable                  (250,000)               --
                                                 ------------      ------------
         Net cash provided (used in)
         financing activities                        650,265           31,658
                                                 ------------      ------------
         Net change in cash                           86,802           (10,514)
                                                 ------------      ------------
         Cash at beginning of period                  28,393            35,961
                                                 ------------      ------------
         Cash at end of period                   $   115,195       $    25,447
                                                 ============      ============

                   Refer to notes to the financial statements

                                        6



<PAGE>

                             ACCESSPOINT CORPORATION
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                 FOR THE SIX MONTHS ENDED JUNE 30, 2004 AND 2003

NOTE A - NATURE OF OPERATIONS
         --------------------

         Accesspoint Corporation (subsequently referred to as "Accesspoint", the
         "Company" or "We") was incorporated as Accesspoint Corporation in
         Nevada in 1995 and is a provider of card- and web-based payment
         processing services to small businesses throughout the United States.
         The Company enables merchants to accept credit cards as payment for
         their products and services by providing card authorization, data
         capture, settlement, risk management, fraud detection and chargeback
         services. Our services also include transaction organization and
         retrieval, ongoing merchant assistance and support in connection with
         disputes with cardholders. We market and sell our services primarily
         through independent sales organizations ("ISOs") and registered sales
         agents ("RSAs").

         Our payment processing services enable merchants to process both
         traditional swipe transactions, as well as card-not-present
         transactions. A card-not-present transaction occurs whenever a customer
         does not physically present a payment card at the point-of-sale and may
         occur over the Internet or by mail, fax or telephone. Our processing
         services include evaluation and acceptance of card numbers, detection
         of fraudulent transactions, receipt and settlement of funds and service
         and support. By outsourcing some of these services to third parties,
         including the evaluation and acceptance of card numbers and receipt and
         settlement of funds, we maintain an efficient operating structure,
         which allows us to easily expand our operations without significantly
         increasing our fixed costs. We believe our experience and knowledge in
         providing payment processing services to merchants of all sizes gives
         us the ability to effectively identify, evaluate and manage the payment
         processing needs and risks that are unique to businesses of varying
         levels.

         We market and sell our services primarily through our relationships
         with ISOs and RSAs. ISOs and RSAs act as a non-employee, external sales
         force in communities throughout the United States. By providing the
         same high level of service and support to our ISOs and RSAs as we do to
         our merchants, we maintain our access to an experienced sales force
         sales professionals who market our services, with minimal direct
         investment in sales infrastructure and management. After an agent
         refers a merchant to us and we execute a processing agreement with that
         merchant, we pay the referring ISO or RSAs a percentage of the revenues
         generated by that merchant. Although our relationships with agents are
         mutually non-exclusive, we believe that our understanding of the unique
         payment processing needs of merchants of all sizes enables us to
         develop compelling incentives for agents to continue to refer newly
         identified merchants to us.

                                        7



<PAGE>

                             ACCESSPOINT CORPORATION
       NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
                 FOR THE SIX MONTHS ENDED JUNE 30, 2004 AND 2003

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         ------------------------------------------

         Unaudited Interim Financial Information
         ---------------------------------------

         The accompanying financial statements have been prepared by Accesspoint
         Corporation, ("Accesspoint", the "Company" or "We") pursuant to the
         rules and regulations of the Securities and Exchange Commission (the
         "SEC") Form 10-QSB and Item 310 of regulation S-B, and generally
         accepted accounting principles for interim financial reporting. These
         financial statements are unaudited and, in the opinion of management,
         include all adjustments (consisting of normal recurring adjustments and
         accruals) necessary for a fair presentation of the balance sheets,
         operations results, and cash flows for the periods presented. Operating
         results for the six months ended June 30, 2004 are not necessarily
         indicative of the results that may be expected for the year ending
         December 31, 2004, or any future period, due to seasonal and other
         factors. Certain information and footnote disclosures normally included
         in financial statements prepared in accordance with generally accepted
         accounting policies have been omitted in accordance with the rules and
         regulations of the SEC. These financial statements should be read in
         conjunction with the audited consolidated financial statements and
         accompanying notes, included in the Company's Annual Report for the
         year ended December 31, 2003. In July 2004, the Company dissolved
         Processing Source International Inc. (PSI), its wholly owned
         subsidiary. This had no effect on the income for any of the periods
         presented.

         Revenues, expenses, assets and liabilities can vary during each quarter
         of the year. Therefore, the results and trends in these interim
         financial statements may not be the same as those for the full year.

NOTE C - GOING CONCERN
         -------------

         The accompanying financial statements, which have been prepared in
         conformity with accounting principles generally accepted in the United
         States of America, contemplates the continuation of the Company as a
         going concern. However, the Company has sustained significant recurring
         operating losses, has limited capital resources, and is involved in
         several pending lawsuits raising significant doubts as to the Company's
         ability to continue as a going concern. Continuation of the Company as
         a going concern is contingent upon the ability of the company to expand
         its operations, generate increased revenues, secure additional sources
         of financing and sell a portion of the merchant portfolio. However,
         there is no assurance that the Company will realize the necessary
         capital expansion. The consolidated financial statements do not include
         any adjustments that might result from the outcome of this uncertainty.

NOTE D - LITIGATION AND CONTINGENCIES
         ----------------------------

         The Company is subject to various claims and legal proceedings covering
         a wide range of matters that arise in the ordinary course of its
         business activities. Listed below are only those matters considered to
         be material to the Company by management and its counsel.

         CITICORP - During 2001 the Company vacated office facilities it had
         leased under an operating lease agreement in Chicago, Illinois. The
         lessor subsequently filed suit against the Company for the remaining
         amount of unpaid rent and other various expenses. A judgment was filed
         against the Company in the amount of $95,000. As of June 30, 2004 the
         Company has accrued for the liability in full on its Balance Sheet. No
         payments have been made.

         BENTLEY PROMISSORY NOTES - Various family trusts related to James W.
         Bentley, a former Director of the Company, have filed three related
         actions seeking to collect in excess of $500,000 in promissory notes
         allegedly due. The Company believes these claims were settled by the
         June 26, 2002 Settlement and in any event, believes the sums due are
         substantially less than claimed. The Company continues to fight these
         actions vigorously. These cases have been consolidated with the case of
         Bentley v. Barber, et al (see below) and are scheduled to go to trial
         beginning on January 3, 2005. The parties are negotiating a global
         settlement of all of the consolidated cases

                                        8



<PAGE>

                             ACCESSPOINT CORPORATION
       NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
                 FOR THE SIX MONTHS ENDED JUNE 30, 2004 AND 2003

NOTE D - LITIGATION AND CONTINGENCIES (CONTINUED)
         ----------------------------------------

         MERCHANTSWAREHOUSE.COM - This is a claim against PSI for breach of an
         independent sales agent agreement. The claim is disputed. The matter
         was submitted to arbitration and was heard by the arbitrator. The
         arbitrator made an interim award of $296,720 and denied the Company's
         counterclaim. The Company is directed to pay the agent residuals
         according to the terms of the Company's agreement with the agent. The
         Company has made all payments to the agent since the date of the award.
         On November 7, 2003, Merchantswarehouse.com obtained a judgment
         consistant with the arbitrator's award. The Company is presently
         assessing the advisability of an appeal. The amount of the award has
         been accrued.

         CIT COMMUNICATIONS CO. ("CIT") - CIT, an equipment lessor, claims that
         we defaulted on an equipment lease. A request for entry of default was
         submitted on 7/8/04. It is expected that a default judgment against the
         Company will be entered soon. The total amount of any potential
         judgment for the value of the equipment has been accrued.

         FOLEY HOAG - This is a claim against PSI by a Boston law firm which
         worked on the MerchantWarehouse.com case for fees it says remain
         unpaid. The firm is seeking $48,000 in principal, plus interest, fees
         and costs. The firm has advised the Company that it has filed suit in
         Massachusetts, but the Company has yet to be served.

         GLOBAL ATTORNEYS NETWORK CO. - This is an action filed on behalf of an
         equipment lessor on a defaulted lease. In April 2003 the matter was
         settled for $16,900. This amount has been accrued. No payments have
         been made.

         FOSTER TEPPER - This is an action recently brought by a former attorney
         for the Company for approximately $63,000 in legal fees, which are
         allegedly due and payable. The Company has accrued $37,000 for this
         matter. Trial is scheduled to start August 30, 2004

         ACCESS HOLDINGS LIMITED PARTNERSHIP - This is a lawsuit brought on
         behalf of two holders of Company stock who claim the Company has
         violated a prior settlement agreement and that they are therefore
         entitled to the return of approximately 4.1 million shares of Company
         stock, which they had previously surrendered to the Company per that
         agreement. The Company denies both that it has breached the prior
         settlement agreement and that the plaintiffs are entitled to the relief
         they seek. Plaintiffs are not seeking monetary damages from the
         Company, though they are seeking court costs and attorney fees. This
         case has been consolidated with the case of Bentley v. Barber, et al
         (see below) and is scheduled for trial beginning on Ja  nuary3,2005.
         The parties are negotiating a global settlement of all of the
         consolidated cases.

                                        9



<PAGE>

                             ACCESSPOINT CORPORATION
       NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
                 FOR THE SIX MONTHS ENDED JUNE 31, 2004 AND 2003

NOTE D - LITIGATION AND CONTINGENCIES (CONTINUED)
         ----------------------------------------

         BENTLEY V. WILLIAM R. BARBER, ET AL. - On March 22, 2002, James Bentley
         ("Plaintiff"), a shareholder of the Company, filed a shareholder
         derivative lawsuit against the Company and several individual
         defendants for breach of contract, breach of fiduciary duty,
         misappropriation of trade secret, recovery of personal property,
         imposition of a constructive trust, unfair competition in violation of
         Business and Profession Code Section 17200, conversion, unfair business
         practices, and usurpation of corporate opportunity. On several
         occasions, Plaintiff also sought provisional remedies with the Court,
         including multiple applications for preliminary injunction and the
         appointment of a receiver. To date, none of Plaintiff's requests for
         provisional relief have been granted. The parties are currently in
         negotiations to settle this claim and the other cases with which the
         Bentley case had been consolidated, including the Access Holdings
         matter and the Bentley Promissory Notes case, discussed above. In light
         of these negotiations, a stay of proceedings is in effect until August
         27, 2004. Trial is currently scheduled for January 3, 2005. The Company
         has recorded no liability for the potential of an adverse outcome of
         the action.

NOTE E - PAYROLL TAXES
         -------------

         The IRS had made formal demand of amounts due and unpaid for the period
         of January 1 - December 31, 2000, including interest and penalties,
         from the Company, and had appropriately filed tax liens against all
         assets of the Company. The Company filed requests for an "Offer in
         Compromise" for all amounts owed by the Company and its subsidiaries.
         During the six months ended June 30, 2004 the Company made a settlement
         with the IRS for claims against the Company and its prior subsidiary
         Processing Source International and recorded a forgiveness of debt of
         $754,883 (See Note F-Related Party Transactions).

NOTE F - RELATED PARTY TRANSACTIONS
         --------------------------

         The Company has entered into a number of relationships that fit the
         definition provided by Statement of Financial Accounting Standards No.
         57, "Related Party Disclosures". An entity that can control or
         significantly influence the management or operating policies of another
         entity to the extent one of the entities may be prevented from pursuing
         its own interests. As of June 30, 2004, the following related party
         relationships existed between the Company, its shareholders, officers
         and directors:

         MBS, majority owned by William R. Barber, Secretary of the Company and
         currently a Director of the Company, is also an agent of the Company
         and sells the Company's products and services through its own network
         of subagents and sales personnel.

         During the six months ended June 30, 2004, the Company settled
         outstanding IRS claims against the Company and its prior subsidiary
         Processing Source International in the amount of approximately
         $1,311,000. The funds necessary to settle the claims were obtained in
         April when the Company concluded a funding agreement with MBS that
         called for the sale and exchange of certain e-commerce accounts in
         exchange for $382,118. The agreement for the sale of e-commerce
         accounts for $382,118 allows the Company to repurchase the assets with
         stock equal in value to the purchase price at the Company's discretion
         within the first twelve months. The sale has been recorded as a
         financing obligation on the financial statements at June 30, 2004.

         During the six months ended June 30, 2004, the Company sold
         miscellaneous merchant accounts to MBS in exchange for $15,133. The
         sale agreement allows the Company to repurchase the assets at a 20%
         price premium. This sale has been recorded as a financing obligation on
         the financial statements at June 30, 2004.

         The company has entered into several merchant portfolio sales
         agreements with unrelated third parties for a total sales price of
         $305,000, in which MBS is the seller acting as the legal agent for the
         Company. These agreements allow the buyers to sell back the portfolios
         for a price equal to the sales price less all prior residual payments
         received from the portfolios for up to twelve months after the purchase
         date. Additionally, any increase in the volume and residual growth of
         the portfolios would serve as cause for price negotiations above the
         original sales price. As of June 30, 2004, agreements totaling $85,000
         have passed the twelve month period without being repurchased and,
         therefore, have been recorded as a sale of a book of business. The
         remaining agreements have been recorded as financing obligations in the
         financial statements at June 30, 2004.




         As of April 1, 2004 the Company completed an agreement with 2C
         Processor USA, LLC (2CP) to manage its business for the period April 1,
         2004 through April 1, 2005 at a fee of $65,000 per month. In addition,
         any net profits of 2CP will be assigned to the Company in exchange
         for stock. For the six months ended June 30, 2004 there had been no
         assignable profits.

                                       10



<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

         The following discussion and analysis should be read in conjunction
with the financial statements and related notes contained elsewhere in this
document. The discussion contained herein relates to the financial statements,
which have been prepared in accordance with GAAP.

THE DISCUSSION IN THIS SECTION AND OTHER PARTS OF THIS REGISTRATION STATEMENT
CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS SUCH AS STATEMENTS OF THE COMPANY'S
PLANS, OBJECTIVES, EXPECTATIONS AND INTENTIONS. THESE STATEMENTS INVOLVE RISKS
AND UNCERTAINTIES. THEY ARE MADE AS OF THE DATE OF THIS REPORT, AND THE COMPANY
ASSUMES NO OBLIGATION TO UPDATE THEM.

RESULTS OF OPERATIONS
----------------------

     The six months ended June 30, 2004 compared with the six months ended
June 30, 2003.

         Revenues for the six months ended June 30, 2004 decreased to $4,963,226
from $6,780,179 for the six months ended June 30, 2003. The decrease of
$1,817,000 27% is due primarily to the decreased revenues associated with credit
card processing which resulted in an overall decrease in sales and the sale of
certain e-commerce accounts and related billing software and host server.

         Cost of sales for the six months ended June 30, 2004 decreased to
$4,233,652 from $5,147,265 for the six months ended June 30, 2003. The decrease
of $913,000 18%, resulted primarily from lower sales volume off-set by increased
processing fees.

         Selling and marketing expenses for the six months ended June 30, 2004
$6,541 remained about the same as the $4,624 for the six months ended June 30,
2003. The Company has held selling and marketing expenses down due to it being
known in the market place.

         General and administrative expenses for the six months ended June 30,
2004 decreased to $881,857 from $1,509,205 for the six months ended June 30,
2003. The decrease of $627,000 41%, resulted primarily from a decrease of
salaries and wages, occupancy costs, Chase clearing and other operating
efficiencies realized through the consolidation of two offices into one and the
outsourcing of jobs to contractors.

         Interest expense, net, for the six months ended June 30, 2004 was
$46,469, as compared to $91,851 for the six months ended June 30, 2003. The
decrease resulted primarily from the Company's continued reduction of debt.

         Other (Income) Expense, net of interest income and expense was
($552,608) for the six months ended June 30, 2004, as compared to $262,255 for
the six months ended June 30, 2003. The increase in income of $814,863 resulted
primarily from the forgiveness of debt income $754,884 and the sale of a book of
business occurring in the first six months of June 30, 2004, as compared to the
six months ended June 30, 2003.

         Net income for the six months ended June 30, 2004 was $347,315, as
compared to a loss of ($235,021) for the six months ended June 30, 2003. The
difference, a gain of $582,336 is due to the forgiveness of debt, the sale of a
book of business and reduction of general and administrative expenses due to
increased efficiency in operations, off-set by lower gross profit.

                                       11



<PAGE>

LIQUIDITY AND CAPITAL RESOURCES
--------------------------------

         The Company had cash of $115,195 at June 30, 2004, as compared to cash
of $28,393 at December 31, 2003.

         The Company had negative working capital at June 30, 2004. We believe
that cash generated from operations will not be sufficient to fund the current
and anticipated cash requirements. During the six months ended June 30, 2004 the
Company sold off a book of business (e-commerce accounts and related billing
software and host server) in order to pay down IRS claims against it and its
previously held subsidiary Processing Source International, Inc. The Company is
continuing its effors to settle accounts with other creditors.

ITEM 3.  CONTROLS AND PROCEDURES

         Our President and Treasurer/Chief Financial Officer (the "Certifying
Officer") is responsible for establishing and maintaining disclosure controls
and procedures and internal controls and procedures for financial reporting for
the Company. The Certifying Officer has designed such disclosure controls and
procedures and internal controls and procedures for financial reporting to
ensure that material information is made known to him, particularly during the
period in which this report was prepared. The Certifying Officer has evaluated
the effectiveness of the Company's disclosure controls and procedures and
internal controls and procedures for financial reporting as of March 31, 2004
and believes that the Company's disclosure controls and procedures and internal
controls and procedures for financial reporting are effective based on the
required evaluation. There have been no significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of their evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.

                                     PART II
                                OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         The Company is subject to various claims and legal proceedings covering
         a wide range of matters that arise in the ordinary course of its
         business activities. Listed below are only those matters considered to
         be material to the Company by management and its counsel.

         CITICORP - During 2001 the Company vacated office facilities it had
         leased under an operating lease agreement in Chicago, Illinois. The
         lessor subsequently filed suit against the Company for the remaining
         amount of unpaid rent and other various expenses. A judgment was filed
         against the Company in the amount of $95,000. As of June 30, 2004 the
         Company has accrued for the liability in full on its Balance Sheet. No
         payments have been made.

         BENTLEY PROMISSORY NOTES - Various family trusts related to James W.
         Bentley, a former Director of the Company, have filed three related
         actions seeking to collect in excess of $500,000 in promissory notes
         allegedly due. The Company believes these claims were settled by the
         June 26, 2002 Settlement and in any event, believes the sums due are
         substantially less than claimed. The Company continues to fight these
         actions vigorously. These cases have been consolidated with the case of
         Bentley v. Barber, et al (see below) and are scheduled to go to trial
         beginning on January        3,2005.Thepartiesarenegotiatingaglobal
         settlement of all of the consolidated cases.

                                       12



<PAGE>

         MERCHANTSWAREHOUSE.COM - This is a claim against PSI for breach of an
         independent sales agent agreement. The claim is disputed. The matter
         was submitted to arbitration and was heard by the arbitrator. The
         arbitrator made an interim award of $296,720 and denied the Company's
         counterclaim. The Company is directed to pay the agent residuals
         according to the terms of the Company's agreement with the agent. The
         Company has made all payments to the agent since the date of the award.
         On November 7, 2003, Merchantswarehouse.com obtained a judgment
         consistent with the arbitrator's award. The Company is presently
         assessing the advisability of an appeal. The amount of the award has
         been accrued.

         CIT COMMUNICATIONS CO. ("CIT") - CIT, an equipment lessor, claims that
         we defaulted on an equipment lease. A request for entry of default was
         submitted on 7/8/04. It is expected that a default judgment against the
         Company will be entered soon. The total amount of any potential
         judgment for the value of the equipment has been accrued.

         FOLEY HOAG - This is a claim against PSI by a Boston law firm which
         worked on the MerchantWarehouse.com case for fees it says remain
         unpaid. The firm is seeking $48,000 in principal, plus interest, fees
         and costs. The firm has advised the Company that it has filed suit in
         Massachusetts, but the Company has yet to be served.

         GLOBAL ATTORNEYS NETWORK CO. - This is an action filed on behalf of an
         equipment lessor on a defaulted lease. In April 2003 the matter was
         settled for $16,900. This amount has been accrued. No payments have
         been made.

         FOSTER TEPPER - This is an action recently brought by a former attorney
         for the Company for approximately $63,000 in legal fees, which are
         allegedly due and payable. The Company has accrued $37,000 for this
         matter. Trial is scheduled to start August 30, 2004

         ACCESS HOLDINGS LIMITED PARTNERSHIP - This is a lawsuit brought on
         behalf of two holders of Company stock who claim the Company has
         violated a prior settlement agreement and that they are therefore
         entitled to the return of approximately 4.1 million shares of Company
         stock, which they had previously surrendered, to the Company per that
         agreement. The Company denies both that it has breached the prior
         settlement agreement and that the plaintiffs are entitled to the relief
         they seek. Plaintiffs are not seeking monetary damages from the
         Company, though they are seeking court costs and attorney fees. This
         case has been consolidated with the case of Bentley v. Barber, et al
         (see below)and is scheduled for trial beginning on Jan   uary3,2005.The
         parties are negotiating a global settlement of all of the consolidated
         cases. .

         BENTLEY V. WILLIAM R. BARBER, ET AL. - On March 22, 2002, James Bentley
         ("Plaintiff"), a shareholder of the Company, filed a shareholder
         derivative lawsuit against the Company and several individual
         defendants for breach of contract, breach of fiduciary duty,
         misappropriation of trade secret, recovery of personal property,
         imposition of a constructive trust, unfair competition in violation of
         Business and Profession Code Section 17200, conversion, unfair business
         practices, and usurpation of corporate opportunity. On several
         occasions, Plaintiff also sought provisional remedies with the Court,
         including multiple applications for preliminary injunction and the
         appointment of a receiver. To date, none of Plaintiff's requests for
         provisional relief have been granted. The parties are currently in
         negotiations to settle this claim and the other cases with which the
         Bentley case had been consolidated, including the Access Holdings
         matter and the Bentley Promissory Notes case, discussed above. In light
         of these negotiations, a stay of proceedings is in effect until August
         27, 2004. Trial is currently scheduled for January 3, 2005. The Company
         has recorded no liability for the potential of an adverse outcome of
         the action.

                                       13



<PAGE>

ITEM 2.  CHANGES IN SECURITIES
     None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES
     None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matter was
         submitted to a vote of security holders, through the solicitation of
         proxies or otherwise, during the quarter ended June 30, 2004.

ITEM 5.  OTHER INFORMATION None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         a. Exhibit 31              CERTIFICATION OF CHIEF EXECUTIVE OFFICER
                                    AND CHIEF FINANCIAL OFFICER PURSUANT
                                    TO SECTION 302 OF THE SARBANES-OXLEY ACT

            Exhibit 32              CERTIFICATION OF CHIEF EXECUTIVE OFFICER
                                    AND CHIEF FINANCIAL OFFICER PURSUANT TO
                                    SECTION 906 OF THE SARBANES-OXLEY ACT

         b. Reports on 8-K during the quarter:

            1. Item 5 filed 4/8/04
            2. Item 5 filed 5/28/04

                                       14



<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.

Dated:  August 17, 2004                   ACCESSPOINT CORPORATION

                                          By  /S/ WILLIAM R. BARBER
                                              ------------------------------
                                              William R. Barber,
                                              Chief Executive Officer, Chief
                                              Officer and President

                                       15



<PAGE>

         Pursuant to the requirements of the Securities Act of 1934, this report
has been signed by the following persons in the capacities and on the dates
indicated:

<TABLE>
<CAPTION>

      Signature                             Title                               Date
-----------------------        -----------------------------------        ----------------
<S>                             <C>                                        <C>
/S/ GENE VALENTINE              Chairman of the Board of Directors         August 17, 2004
-----------------------
Gene Valentine

/S/ JOE BYERS                   Director                                   August 17, 2004
-----------------------
Joe Byers

/S/ MIKE SAVAGE                 Director                                   August 17, 2004
-----------------------
Mike Savage

/S/ WILLIAM R. BARBER           Director                                   August 17, 2004
-----------------------
William R. Barber

                                          16
</TABLE>