UNITED STATES
                       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
                                 MARCH 31, 2003
                           COMMISSION FILE NO. 1-16349
                                   -----------

                        INVESTORS CAPITAL HOLDINGS, LTD.
                    (Exact name of registrant in its charter)
                                  ------------

             MASSACHUSETTS
    (State or other jurisdiction of                 04-3284631
     incorporation or organization)      (IRS Employer Identification No.)

                                  230 Broadway
                         Lynnfield, Massachusetts 01940
                                 (781) 593-8565
    (Address, including zip code, and telephone number, including area code,
                  of Registrant's principal executive offices)
                                   ----------

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

           Title of each class        Name of each exchange on which registered
      Common Stock, $0.01 par value         The American Stock Exchange


           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                                      NONE
                                   -----------

                                (Title of class)

     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|_| No |X|

     The aggregate market value of the shares of the registrant's common equity
held by non-affiliates, computed by reference to the price at which the common
equity was last sold, as of the last business day of the registrant's most
recently completed second fiscal quarter, was $4,627,378.

     As of June 16, 2003, there were outstanding 5,717,380 shares of Common
Stock, $0.01 par value per share of the registrant.


                      Documents Incorporated by Reference

     Certain portions of the registrant's definitive proxy statement for the
     Annual Meeting of Stockholders to be held on August 12, 2003 are
     incorporated by reference in Items 11 through 13 of Part III, and Item 15
     of Part IV, of this Annual Report on Form 10-K.

<PAGE>

<TABLE>
<CAPTION>

                                    Contents
<S>                                                                                                                              <C>
Forward-Looking Statements...................................................................................................      1
PART I.......................................................................................................................      1
ITEM 1. Business.............................................................................................................      1
ITEM 2. Properties...........................................................................................................      7
ITEM 3. Legal Proceedings....................................................................................................      7
ITEM 4. Submission of Matters to a Vote of Security Holders..................................................................      7
PART II......................................................................................................................      8
ITEM 5. Market for Registrant's Common Equity and Related Stockholder Matters................................................      8
ITEM 6. Selected Financial Data..............................................................................................      8
ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations................................     10
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk..........................................................     16
ITEM 8. Financial Statements and Supplementary Data..........................................................................     17
ITEM 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure.................................     38
PART III.....................................................................................................................     38
ITEM 10. Directors and Executive Officers of the Registrant..................................................................     38
ITEM 11. Executive Compensation..............................................................................................     39
ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters......................     39
ITEM 13. Certain Relationships and Related Transactions......................................................................     39
ITEM 14. Controls and Procedures.............................................................................................     39
PART IV......................................................................................................................     40
ITEM 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K....................................................     40
</TABLE>



<PAGE>



                        INVESTORS CAPITAL HOLDINGS, LTD.
                           Forward-Looking Statements

     The statements, analyses, and other information contained herein relating
to trends in the operations and financial results of Investors Capital Holdings,
Ltd. (the "Company"), the markets for the Company's products, the future
development of the Company's business, and the contingencies and uncertainties
to which the Company may be subject, as well as other statements including words
such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "will,"
"should," "may," and other similar expressions, are "forward-looking statements"
under the Private Securities Litigation Reform Act of 1995. Such statements are
made based upon management's current expectations and beliefs concerning future
events and their effects on the Company. The Company's actual results may differ
materially from the results anticipated in these forward-looking statements.

     These forward-looking statements are subject to risks and uncertainties
including, but not limited to, the risks that (1) losses may be incurred if our
investment professionals fail to comply with regulatory requirements; (2) the
loss of either Theodore E. Charles or Timothy B. Murphy may adversely affect our
business and financial condition through the loss of significant business
contacts, which would have to be replaced; (3) customer fraud could harm our
earnings and profits by requiring us to expend time, money and incur actual
loss, exposing us to the potential for arbitration; (4) investment professional
and employee fraud and misconduct could harm our profits and earnings by causing
us to expend time, money and incur actual loss, with the latter exposing us to
the potential for litigation; (5) without implementation of adequate internal
controls, our ability to make money could be severely restricted by regulatory
sanctions being applied against our broker-dealer subsidiary, and could result
in us paying substantial fines and limit our ability to make money; (6)
involvement in material legal proceedings could have a significant impact on our
earnings and profits if we are found liable for such claims; (7) a change in our
clearing firm could result in the inability of our customers to transact
business in a timely manner due to delays and errors in the transfer of their
accounts, which, on a temporary basis, could affect our earnings and profits.

     Readers are also directed to other risks and uncertainties discussed, as
well as to further discussion of the risks described above, in other documents
filed by the Company with the United States Securities and Exchange Commission.
The Company specifically disclaims any obligation to update or revise any
forward- looking information, whether as a result of new information, future
developments, or otherwise.

<PAGE>


                                     PART I

ITEM 1. Business.

Overview

     Incorporated in July of 1995, Investors Capital Holdings, Ltd. ("ICH") is a
financial services holding company that operates primarily through its
subsidiaries in two segments of the financial services industry. These two
segments provide for the offering of (1) services related to corporate equity
and debt securities, U.S. Government securities, municipal securities, mutual
funds, variable annuities, variable life insurance, market information, internet
online trading and portfolio tracking and records management and (2) financial
planning services, investment advisory and asset management services and the
management of a retail mutual fund. Financial information pertaining to (" ICH")
for each of the three fiscal years ended March 31, 2003, 2002 and 2001 is
included in the selected financial data in Item 6 of this document.

Support to our Representatives

     Investors Capital Corporation. Investors Capital Corporation, an NASD
registered broker-dealer also registered with the Securities and Exchange
Commission is headquartered in Lynnfield, Massachusetts and is a wholly-owned
subsidiary of Investors Capital Holdings, Ltd. Doing business in all 50 states,
Puerto Rico and the District of Columbia, Investors Capital Corporation makes
available multiple investment products, and provides support, technology and
back-office service to its network of approximately 958 registered
representatives. Our representatives sell investment products that are
securities under federal and state law. Accordingly, they are required to, and
are registered as, representatives with our broker-dealer subsidiary. Similar
registrations may be required by these persons as investment adviser
representatives under federal and state law. Our in-house training program for
these representatives emphasizes the long-range aspects of financial planning
and investment products. We believe that through the continuing education we
provide to our registered representatives, our clients can become better
informed, and therefore, better serviced. This entity generated approximately
93% of Investors Capital Holdings' total revenues for the fiscal year ended
March 31, 2003.

     We seek to recruit primarily experienced, productive registered
representatives by offering them an attractive commission payout and the
independence of owning and operating their own offices. Generally, each such
office pays substantially, if not all, of the costs associated with its
establishment and operation. We provide technical, regulatory, supervisory,
compliance and other support services to our independent investment
professionals. This allows expansion of our operations with relative minimal
capital outlay by our firm. Continuing to add experienced, productive registered
representatives is an integral part of our growth strategy.

     The commission payouts to our registered representatives are negotiable and
currently average approximately 85% of the gross dealer concession generated
from the sale of securities. Pursuant to the terms of our agreement with our
registered representatives, and as permitted by current NASD rules, we provide
our representatives, or their named beneficiaries, with continuing commissions
on pre-existing business in the event of their retiring from the securities
industry or death. Also, in this agreement, each of our representatives grants
to us the right to offset against commissions any losses we sustain as a result
of their actions, omissions and errors. Our agreement with our representatives
is terminable by either party with 15 days prior written notice, and does not
contain either a confidentiality or non-compete provision.

     Our products and services provided to our representatives include:

     Technology Resources: Utilizing the latest in technology, our
     representatives are able to perform the following activities on-line:

             Opening of new accounts;

             Monitoring of existing accounts;

             Trading;

             Locating and exploring approved products;

             Downloading client data; and

             Researching reports or inquiries on companies, securities and
             other pertinent financial topics.


                                       1
<PAGE>


     Product Choices: Allowing our representatives to choose from a wide variety
     of investment products sponsored by well-respected and financially sound
     companies is critical to our registered representatives' success as well as
     ours. We follow a selective process in determining approved products to be
     offered to clients by our representatives. In addition, we continuously
     monitor the product list as deemed necessary.

     Marketing: Producing compliance and NASD-approved marketing materials to be
     used by our representatives enhances their professional stature in the
     public's eye. The marketing resources produced by Investors Capital
     Corporation include:

             Corporate and product brochures;

             Technology resources;

             Client letters;

             Seminars; and

             Advertising and public relations.

Focus. Our focus is on representatives who offer their clients assistance in
attaining their long-range financial goals. Utilizing primarily experienced
representatives, our client list is widely diversified in terms of goals,
financial resources and geography. During the fiscal year ended March 31, 2003,
the average revenue per registered representative was $33,300 as compared to
$23,700 for our fiscal year ended March 31, 2002. Additionally, on March 31,
2003, we had a total of 958 representatives in our national network, as compared
to 1,103 for the same period last year.

Supervision. Our broker-dealer subsidiary's compliance staff includes
individuals with significant industry experience. Six of these individuals,
including two experienced compliance attorneys, are located in the home office.
The remaining compliance individuals, most of whom have significant industry
experience, termed Offices of Supervisory Jurisdiction by the NASD, are field
supervisors situated across the country and are charged with compliance
responsibilities for a defined group of registered representatives. By
positioning these compliance individuals in the field, we are able to more
closely scrutinize and monitor the activities of our representatives thereby
ensuring, as much as possible, their compliance with the requisite rules and
regulations. Such a field supervisor is assigned to each new registered
representative affiliated with our broker-dealer subsidiary. Our in-house
computer systems and programs further assist us in compliance matters.

     As compliance is an area for which representatives seek and value
assistance to keep abreast of, and in step with, the latest industry
regulations, our compliance department provides, among other things:

             Advertising and sales literature review;

             Field inspections followed up with written findings and
             recommendations;

             Weekly faxes and monthly conference calls on selected compliance
             topics;

             Assistance with customer complaints and regulatory inquiries;

             Workshops and in-house publications on various compliance matters;
             and

             Regional and national meetings.

Clearing. We utilize the services of another broker-dealer to clear our
transactions. Our clearing agreement is on a fee-for-service basis. Our clearing
firm processes most of the securities transactions for our account and the
accounts of our clients. Services of our clearing firm include billing and
credit extension, control and receipt and custody and delivery of securities,
for which we pay a transaction charge. We rely on the operational capacity and
the ability of our clearing firm for the orderly processing of transactions. In
addition, by engaging the processing services of a clearing firm, certain
capital reserve requirements and other complex regulatory requirements imposed
by federal and state securities laws are not applicable to us.


                                       2
<PAGE>





Broker-Dealer Revenue. Revenue generated from our broker-dealer subsidiary's
activities can be broken into the following percentages for a three-year
comparative review for fiscal years ended March 31:
<TABLE>
<CAPTION>
                                                                                                2003         2002            2001
                                                                                                ----         ----            ----
 <S>                                                                                             <C>           <C>             <C>
Commissions from the sale of mutual funds and unit investment trusts:                           25%           34%            34%
Commissions from the sale of variable annuities and variable life insurance:                    49%           48%            50%
Commissions from the sale of individual stocks and bonds:                                       13%           9%             10%
Commissions from the sale of direct participation programs:                                      5%           1%              1%
Other miscellaneous commission and fee income:                                                   8%           8%              5%
</TABLE>


Investment Advisory Services

     Eastern Point Advisors, Inc. Our investment adviser subsidiary provides
investment advisory and asset management services directly to the investing
public through its managed asset programs. These programs involve managed
portfolios of load and no-load mutual funds, variable and fixed annuities and/or
individual securities, and are provided to the public through approximately 295
investment adviser representatives . As of March 31, 2003, we had approximately
$116 million under management in these managed asset programs with average
weekly contributions of new money in excess of $1 million since January of 2000.
The maximum annual fee charged for these services is 2.75%, which is paid by the
customer in quarterly installments. Eastern Point Advisors contributes
approximately 7% of Investors Capital Holdings' total revenues.
<TABLE>
<CAPTION>

   Eastern Point Advisors, Inc. Plan                     Market Value
   ---------------------------------                     ------------
<S>                                                       <C>
Aetna Life Insurance and Annuity Co.                    $  1,626,725
American Skandia Annuity Company                          10,960,062
Conseco Variable Annuity                                  10,699,511
ING Variable Annuity                                       8,384,420
Jackson National Life Insurance Co.                        4,025,347
Lincoln Benefit Life Insurance Co.                           831,385
Manulife                                                     314,799
Mass Mutual                                                1,366,879
Midland National                                             756,675
Nationwide Life Insurance Co.                                418,709
Pershing Securities Managed Asset Plan                    64,868,636
Resources Trust                                            1,601,508
Security Benefit Life                                         57,006
SEI Trust Company                                          9,440,688
US Allianz                                                   341,487
US Allianz Fixed                                             442,398
                                                             -------

     Total Assets Under Management:                     $116,136,235
                                                        ============
</TABLE>

     In addition, our investment adviser subsidiary is the investment adviser to
our retail mutual fund, the Eastern Point Advisors Twenty Fund. Until recently,
this mutual fund was marketed to the public solely by registered representatives
of Investors Capital Corporation. Recently, our investment adviser subsidiary
has begun making its portfolios available to other broker-dealers. We have
signed selling agreements to make our managed asset programs available to
registered representatives of certain other broker-dealers, as well as to allow
our mutual fund to be marketed by investment professionals affiliated with
certain selected broker-dealers in addition to Investors Capital Corporation.
These wholesaling activities increase the exposure of both the managed asset
programs and the mutual fund.

     As of March 31, 2003, Eastern Point Advisors had approximately $5.9 million
under management in this mutual fund. The annual fee charged by Eastern Point
Advisors to the fund for its services is 1.50%, which is paid monthly.

     As of March 31, 2003 we had approximately 295 investment adviser
representatives registered with the various state securities departments. These
investment adviser representatives are typically registered representatives of
our wholly-owned brokerage subsidiary. Licensing requirements for these
investment adviser representatives are dictated by the state in which they
conduct business. As such, prior to their clients utilizing our investment
advisory services, each investment adviser representative must satisfy the
requisite state licensing requirements which are typically the NASD Series 6 or
7 securities license coupled with a Series 65 or 66 license.


                                       3
<PAGE>

Asset Allocation Strategy. Eastern Point Advisor's asset allocation strategy,
utilized by approximately 2,535 investors as of March 31, 2003, is based on the
principle that, by investing in a combination of asset classes, we may reduce
risk while seeking to provide enhanced returns. Thus, by combining asset classes
that typically do not move in tandem, the volatility of the customer's
investment portfolio may be lowered while, at the same time, provide the
opportunity for possible increased long-term returns. In implementing this asset
allocation strategy for each individual: customer, we utilize the following
three steps:

         Based upon a customer's ascertained tolerance for risk, investment
         goals, age, time horizon, investment experience and financial and
         personal situation, determined through the use of detailed
         questionnaires completed during personal interviews, we will recommend
         an overall investment allocation consisting of a suggested percentage
         of stocks, bonds and cash.

         Should the customer agree with the recommended overall investment
         allocation, we will then select what we believe to be the appropriate
         investment vehicles for the particular customer from the universe of
         mutual funds, variable annuities and individual securities.

         Following implementation of the recommended portfolio, our investment
         adviser subsidiary monitors the performance of the portfolio,
         communicates the model's performance to the client at least quarterly
         and makes any necessary changes based upon performance, changes in a
         customer's financial situation, goals or risk tolerance or any other
         factor relevant to the composition of the customer's portfolio.

Fee-Based Compensation Structure. As required by the Investment Advisers Act of
1940, compensation is based on an annual fee calculated as a percentage of total
assets under management rather than a transaction-based commission or
performance fee.

Insurance Operations

     ICC Insurance Agency, Inc., our wholly-owned insurance agency subsidiary,
facilitates the sale by our registered representatives of variable life
insurance and variable annuities. In certain states, in order to transact
variable life and annuity business, a separately licensed insurance entity is
required. This is the role filled by ICC Insurance Agency. This entity is
properly licensed in all states in which such licensing is required. One hundred
percent of all funds realized by this entity flow through as revenue to our
broker-dealer subsidiary.

Mutual Fund

     The Eastern Point Advisors Twenty Fund. The Eastern Point Advisors Twenty
Fund, formally known as the Investors Capital Twenty Fund, is our
growth-oriented mutual fund, which became available for sale on October 19,
1999. We created this mutual fund to complement our existing product lines with
the rationale that our mutual fund would provide investors with a convenient way
to meet their financial goals and, at the same time, provide new sales
opportunities for representatives of our broker-dealer subsidiary.

     The Eastern Point Advisors Twenty Fund invests in a portfolio of common
stocks believed to offer capital appreciation potential. As such, the Fund may
be more suitable for those investors who seek capital appreciation and are
willing to accept a significant degree of volatility and risk.

     The Eastern Point Advisors Twenty Fund utilizes a non-diversified portfolio
of 20 to 30 common stocks of companies of any size, regardless of industry or
sector, which may include smaller emerging companies. As of March 31, 2003, the
Eastern Point Advisors Twenty Fund had assets of $5,909,265.

     Class A Shares of the Eastern Point Advisors Twenty Fund carry a maximum
one-time, up-front sales charge to the investor of 5.75%. This sales charge
decreases as the dollar amount of the investor's investment increases. Class C
Shares have no such up-front sales charge but, in addition to annual management
fees, carry a 1.00% per year annual fee.

Our Strategy

Key elements to achieve our corporate objectives include:

Increase brand awareness. We plan to increase our brand recognition to attract
new clients. We are implementing a comprehensive marketing plan to attract more
clients and experienced representatives, build market awareness, educate the
investing public and develop brand name recognition and loyalty. We intend to
accomplish this strategy through direct marketing, advertising through our
marketing department, use of our web site, a public relations program, live
seminars, print advertising and television air time. In addition, we have
committed to opening company-operated offices in selected strategic geographic
locations across the country. In this regard, we have already opened investment
centers in Topsfield, Massachusetts and Pittsburgh, Pennsylvania, and are in the
planning stage of opening centers in California and Florida.

Expand client relationships. We intend to expand our relationships with
representatives and investors by increasing our sales and marketing efforts. We
plan to target sophisticated and experienced investors and financial
institutions of all sizes, including professional money managers and registered
investment advisers. Because these participants typically execute more trades
per year than traditional retail investors and expect lower commissions,
real-time access to information and quick order execution, the market for their
business is currently underserviced. We believe that we can profitably fill this
market niche.



                                       4
<PAGE>

Provide value-added services to our clients. We will continue to provide our
clients with access to a pool of well-trained representatives, access to
up-to-date market and other financial information and direct access to our trade
desk that is online with various stock exchanges and institutional buyers and
sellers. We will also continue to provide trading before and after traditional
market hours to our clients.

Create technologically innovative solutions to satisfy clients' needs. We
intend to continue our active efforts in pursuing additional technologies to
service the rapidly evolving financial services industry. Specifically, we are
developing our web site to enable our clients to trade equity securities more
efficiently via the internet, monitor the history and current status of their
accounts at any time on-line and access all types of financial and other
information to enhance their situations. Also, we have developed personalized
Internet web sites for our representatives. These personalized sites provide the
clients of our representatives, through the use of passwords and firewalls, a
secure and private interface directly to our proprietary web site. This allows
these clients to do market research, buy and sell securities on-line, monitor
their accounts and utilize financial calculators.

Build and expand our corporate presence. We intend to expand our branch office
locations to strategically situated metropolitan locations throughout the United
States. We have expanded in Massachusetts and Pennsylvania, and intend to expand
in California and Florida. We also continue to explore strategic alliances,
acquisitions and other opportunities to provide our clients with the best
possible services and products.

Expand our product and service offering through strategic relationships. We
will continue to actively pursue alliances with various companies to increase
trading volume, capitalize on cross-selling opportunities, create additional
markets for our asset management programs and mutual fund sales, take advantage
of emerging market trends and create operational efficiencies and further
enhance our name recognition. We have no present agreements, plans, arrangements
or understandings regarding any acquisitions and have not identified any
specific criteria that such acquisitions must meet.

Competition

     Our competitors vary in size, scope and breadth of services offered. We
encounter direct competition from numerous other brokerage firms that have
electronic brokerage services and full research capabilities. We also encounter
competition from established, full-commission brokerage firms, as well as
insurance companies with securities brokerage subsidiaries, financial
institutions, mutual fund sponsors and others who utilize financial planning
representatives paying their own office costs and expenses. Competitors
utilizing similar representatives include Linsco Private Ledger and Commonwealth
Financial, and various insurance companies with securities brokerage
subsidiaries.

     Also, as demand for discounted brokerage services increases, our market is
becoming more competitive. In particular, we anticipate that competition for
electronic brokerage services will intensify as investor demand for such
services increases. We also recognize and intend to capitalize on the fact that
when investing large amounts of money, investors typically prefer personal
attention from an experienced industry professional rather than inexpensive
internet access to trading.

     Some of our competitors have significantly greater financial, technical,
marketing and other resources, and certain of our competitors also offer a wider
range of services and financial products and have greater name recognition and
more extensive client bases. These competitors may be able to respond more
quickly to new or changing opportunities, technologies, and client requirements,
and may be able to undertake more extensive promotional activities, offer more
attractive terms to clients and adopt more aggressive pricing policies.
Moreover, current and potential competitors have established, or may establish,
cooperative relationships among themselves or with third parties or may
consolidate to enhance their services and products.

     We believe that our ability to compete depends upon many factors both
within and outside our control, including:

     Our ability to attract and retain a network of investment professionals;

     The effectiveness, ease of use, performance and features of our technology
     and services;

     Client perceptions of the effectiveness of our services and technology;

     The price and quality of our services;


                                       5
<PAGE>

     Our ability to service our clients effectively and efficiently;

     The timing and acceptance of our new products and services and enhancements
     to existing products and services developed by us or our competitors; and

     Our reputation in the financial services industry.

Mutual Funds. Mutual funds are continuously being introduced to the investing
public. These funds are being offered by new, as well as existing, mutual fund
companies. Many of our mutual fund competitors have greater financial,
technical, marketing and distribution resources. We believe that we can become
competitive through our sales force and through selling agreements with other
broker-dealers.

How We Are Regulated

Broker-Dealer Regulation. The securities industry is subject to extensive
regulation under both federal and state law. The SEC is the federal agency
responsible for administering the federal securities laws. In general,
broker-dealers are required to register with the SEC under the Securities
Exchange Act of 1934, as amended. Our wholly-owned subsidiary, Investors Capital
Corporation is a broker-dealer registered with the SEC. Under the Securities
Exchange Act of 1934, every registered broker-dealer that does business with the
public is required to be a member of and is subject to the rules of the NASD.

     The NASD has established conduct rules for all securities transactions
among broker-dealers and private investors, trading rules for the
over-the-counter markets and operational rules for its member firms. The NASD
conducts examinations of member firms, investigates possible violations of the
federal securities laws and its own rules and conducts disciplinary proceedings
involving member firms and associated individuals. The NASD administers
qualification testing for all securities principals and registered
representatives for its own account and on behalf of the state securities
authorities. We are also subject to regulation under state law. We are currently
registered as a broker-dealer in all 50 states, Puerto Rico and the District of
Columbia.

     The SEC and other regulatory bodies in the United States have rules with
respect to net capital requirements that affect our broker-dealer subsidiary.
These rules are designed to ensure that broker-dealers maintain adequate
regulatory capital in relation to their liabilities, types of securities
business conducted and the size of their customer business. These rules have the
effect of requiring that a substantial portion of a broker-dealer's assets be
kept in cash or highly liquid investments. Failure to maintain the required net
capital may subject a firm to suspension or revocation of its registration with
the SEC and suspension and expulsion by the NASD and other regulatory bodies,
and ultimately may require its liquidation. The rules could restrict
underwriting, trading activities, our ability to withdraw capital, pay
dividends, pay interest on and repay the principal of any debt, among other
matters, that could be affected.

Registered Investment Adviser Regulation. The Investment Advisers Act of 1940
regulates the registration of and the compensation that may be charged by an SEC
registered investment adviser. Investment advisers are subject to the same
oversight by the SEC and the various states as are broker-dealers. Investment
advisers are required to register with the SEC, except those that are only
required to register with the appropriate state regulatory agency, are required
to periodically file reports and are subject to periodic or special
examinations. Rules promulgated under the Advisers Act govern advertisements by
investment advisers and the custody or possession of funds or securities of a
client. Most states require registration by investment advisers unless an
exemption is available and impose annual registration fees. Some states also
impose minimum capital requirements. There can be no assurance that compliance
with existing and future requirements and legislation will not be costly and
time consuming or otherwise adversely impact our business in this area.

     As a registered investment adviser under the Investment Advisers Act of
1940, our wholly-owned subsidiary, Eastern Point Advisors, is subject to
regulations which cover various aspects of its business, including compensation
arrangements. Under the Advisers Act, every investment advisory agreement with
clients must expressly provide that such contract may not be assigned by the
adviser without the consent of the client. Under the Investment Company Act of
1940, every investment adviser's agreement with a registered investment company
must provide for the agreement's automatic termination in the event it is
assigned. Under both the Advisers Act and the Investment Company Act, an
investment advisory agreement is deemed to have been assigned when there is a
direct or indirect transfer of the Agreement, including a direct assignment or a
transfer of a "controlling block" of the adviser's voting securities or, under
certain circumstances, upon the transfer of a "controlling block" of the voting
securities of its parent corporation. A transaction is not, however, an
assignment under the Advisers Act or the Investment Company Act if it does not
result in a change of actual control or management of the investment adviser.
Any assignment of Eastern Point Advisors' investment advisory agreements would
require, as to any registered investment company client, the approval of a
majority of its shareholders, and as to other advisory clients, the consent of
such clients to such assignments.


                                       6
<PAGE>




Regulations Applicable to the Use of the Internet. Due to the increasing
popularity and use of the internet and other online services, various regulatory
authorities are considering laws and/or regulations with respect to the internet
or other online services covering issues such as user privacy, pricing, content
copyrights and quality of services. In addition, the growth and development of
the market for online commerce may prompt more stringent consumer protection
laws that may impose additional burdens on those companies conducting business
online.

     Also, the recent increase in the number of complaints by online traders
could lead to more stringent regulations of online trading firms and their
practices by the SEC, NASD and other regulatory agencies. The applicability to
the internet and other online services of existing laws in various jurisdictions
governing issues such as property ownership, sales and other taxes and personal
privacy is also uncertain and may take years to resolve. Finally, as our
services are available over the internet in multiple states, and as we have
numerous clients residing in these states, these jurisdictions may claim that we
are required to qualify to do business as a foreign corporation in each such
state. While Investors Capital Corporation is currently registered as a
broker-dealer in all 50 states, Puerto Rico and the District of Columbia, we are
qualified to do business as a foreign corporation in only a few states. Failure
by our company to qualify as a broker-dealer in other jurisdictions or as an
out-of-state or "foreign" corporation in a jurisdiction where it is required to
do so could subject us to taxes and penalties for the failure to qualify. Our
business could be harmed by any new legislation or regulation, the application
of laws and regulations from jurisdictions whose laws do not currently apply to
our business or the applications of existing laws and regulations to the
internet and other online services.

Employees

     As of March 31, 2003, we had 46 full-time employees, the majority of which
are located at our principal office in Lynnfield, Massachusetts. No employee is
covered by a collective bargaining agreement or is represented by a labor union.
We consider our employee relations to be excellent. We also enter into
independent contractor arrangements with other individuals on an as-needed basis
to assist with programming and developing proprietary technologies.


ITEM 2. Properties.

     Our principal executive offices are located in a 7,600 square foot facility
at 230 Broadway, Lynnfield, Massachusetts. This facility is comprised of several
office condominiums owned by different entities, which lease the office space to
the Company. A portion of the space which is leased to the Company, including
Investors Capital Corporation and Eastern Point Advisors, is owned by Arlsburg
Trust, the trustee of which is the principal stockholder of Holdings, and
Investors Realty, LLC, the principal member of whom is the principal stockholder
of Holdings. The remainder is leased from an unrelated entity. The combined
current annual rent was $182,723 and is comparable to current market rates for
similar space in our geographic area. The leases expire in March 2005. In
addition, the Company leases office space from the Arlsburg Trust for its
investment center located in Topsfield, Massachusetts. Rent expense for the
investment center was $36,000 for the year ended March 31, 2003.

ITEM 3. Legal Proceedings.

     The Company operates in a highly litigious and regulated business and, as
such, is a defendant or codefendant in various lawsuits and arbitrations
incidental to its securities business. The Company is vigorously contesting the
allegations of the complaints in these cases and believes that there are
meritorious defenses in each. Counsel is unable to respond concerning the
likelihood of an outcome, whether favorable or unfavorable, because of inherent
uncertainties routine in these matters. Currently, there are a total of thirteen
lawsuits and/or arbitrations filed against the Company. For the majority of
claims, the Company's errors and omissions (E&O) policy limits the maximum
exposure in any one case to $75,000, and in certain of these cases, the Company
has the contractual right to seek indemnity from related parties. As such,
Management, in consultation with counsel, believes that resolution of all such
litigation is not expected to have a material adverse effect on the consolidated
financial results of the Company.

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

     No matter was submitted to a vote of security holders of Investors Capital
Holdings, Ltd. during the fourth quarter of the fiscal year covered by this
report.


                                       7
<PAGE>



                                     PART II

ITEM 5. Market for Registrant's Common Equity and Related Stockholder Matters.

     Investors Capital Holdings' common stock began trading on The American
Stock Exchange (AMEX) under the symbol "ICH" on February 8, 2001. Prior to such
date, there was no established public trading market for the common stock. As of
June 16, 2003, exclusive of shares held in street name, there were approximately
62 stockholders of record and 5,717,380 shares outstanding.

     The following table presents the high and low closing prices for the common
stock of Investors Capital Holding, Ltd. on the AMEX for the period indicated.
<TABLE>
<CAPTION>


                                                                                               High       Low
                                                                                               ----       ---
<S>                                                                                             <C>       <C>
Fiscal 2003
For the period from April 1, 2002 through June 30, 2002.................................      $2.35     $1.75
For the period from July 1, 2002 through September 30, 2002.............................      $2.00     $1.75
For the period from October 1, 2002 through December 31, 2002...........................      $2.40     $1.70
For the period from January 1, 2003 through March 31, 2003..............................      $2.05     $1.63

Fiscal 2002
For the period from April 1, 2001 through June 30, 2001.................................      $6.00     $3.11
For the period from July 1, 2001 through September 30, 2001.............................      $3.75     $2.20
For the period from October 1, 2001 through December 31, 2001...........................      $3.49     $2.50
For the period from January 1, 2002 through March 31, 2002..............................      $2.99     $2.00

Fiscal 2001
For the period from February 8, 2001 through March 31, 2001.............................      $8.00     $5.55
</TABLE>


     Investors Capital Holdings, Ltd. did not pay dividends for the year ended
March 31, 2003. Future dividend decisions will be based on, and affected by, a
number of factors, including the operating results and financial requirements of
the Company and the impact of regulatory restrictions. See Regulation and
Management's Discussion and Analysis--Liquidity and Capital Resources, included
elsewhere in this Form 10-K.

ITEM 6. Selected Financial Data.

     The following table sets forth certain selected historical consolidated
financial data. The selected income statement data for each of the years in the
three year period ended March 31, 2003 and balance sheet data as of March 31,
2003 and 2002 have been derived from our audited consolidated financial
statements and related notes, included elsewhere in this Form 10-K and should be
read in conjunction with those financial statements and Management's Discussion
and Analysis of Financial Condition and Results of Operations, also included
elsewhere in this Form 10-K. The following selected income statement data for
the years ended March 31, 2000 and 1999 and balance sheet data as of March 31,
2001, 2000 and 1999 have been derived from our audited consolidated financial
statements not included herein. The following selected consolidated financial
data has been prepared in accordance with GAAP.
<TABLE>
<CAPTION>

                                                                       For the Year Ended March 31,
                                                   2003             2002          2001               2000              1999
                                                 --------         --------      --------           --------          --------
<S>                                                <C>              <C>           <C>                <C>               <C>
Income Statement Data:
Commission and advisory fee income...........  $34,289,460       $28,880,521     $29,806,144        $23,892,296       $15,724,649
Net income (loss)............................     $115,891            $4,137     $  (104,306)           $90,325          $107,255
Net income (loss) per share, basic...........         $.02             $0.00     $     (0.02)              $.02              $.02
Net income (loss) per share, diluted.........         $.02             $0.00     $     (0.02)              $.02              $.02

Weighted average common shares
   outstanding, basic........................    5,717,380         5,717,931       4,789,007          4,609,491         4,573,296
Weighted average common shares
   outstanding, diluted .....................    5,790,060         5,818,695       4,789,007          4,782,491         4,746,296

Cash dividends declared per share............  $      -          $     -         $     -           $     -          $       -
</TABLE>


                                       8
<PAGE>

<TABLE>
<CAPTION>


                                                                      As of March 31,
                                                    2003           2002             2001           2000              1999
                                                  --------       --------         --------       --------          --------
<S>                                               <C>             <C>                <C>             <C>            <C>
Balance Sheet Data:

Total assets........................            $10,642,940     $10,114,532      $10,612,301     $4,100,065        $2,863,542

Shareholders' equity................            $ 8,248,640     $ 8,057,066      $ 8,122,573     $1,846,713        $1,497,123
Shares outstanding..................              5,717,380       5,717,380        5,708,311      4,645,311         4,573,671


Equity per share at end of period...                  $1.44           $1.41            $1.42           $.40              $.33
</TABLE>



                                       9
<PAGE>

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

     Management's discussion and analysis reviews our consolidated financial
condition as of March 31, 2003 and 2002, the consolidated results of operations
for the years ended March 31, 2003, 2002 and 2001 and, where appropriate,
factors that may affect future financial performance. The discussion should be
read in conjunction with the consolidated financial statements and related
notes, included elsewhere in the Form 10-K.

Forward-Looking Statements

     The statements, analyses, and other information contained herein relating
to trends in the operations and financial results of Investors Capital Holdings,
Ltd. (the "Company"), the markets for the Company's products, the future
development of the Company's business, and the contingencies and uncertainties
to which the Company may be subject, as well as other statements including words
such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "will,"
"should," "may," and other similar expressions, are "forward-looking statements"
under the Private Securities Litigation Reform Act of 1995. Such statements are
made based upon management's current expectations and beliefs concerning future
events and their effects on the Company. The Company's actual results may differ
materially from the results anticipated in these forward-looking statements.

     These forward-looking statements are subject to risks and uncertainties
including, but not limited to, the risks that (1) losses may be incurred if our
investment professionals fail to comply with regulatory requirements; (2) the
loss of either Theodore E. Charles or Timothy B. Murphy may adversely affect our
business and financial condition through the loss of significant business
contacts, which would have to be replaced; (3) customer fraud could harm our
earnings and profits by requiring us to expend time, money and incur actual
loss, exposing us to the potential for arbitration; (4) investment professional
and employee fraud and misconduct could harm our profits and earnings by causing
us to expend time, money and incur actual loss, with the latter exposing us to
the potential for litigation; (5) without implementation of adequate internal
controls, our ability to make money could be severely restricted by regulatory
sanctions being applied against our broker-dealer subsidiary, and could result
in us paying substantial fines and limit our ability to make money; (6)
involvement in material legal proceedings could have a significant impact on our
earnings and profits if we are found liable for such claims; (7) a change in our
clearing firm could result in the inability of our customers to transact
business in a timely manner due to delays and errors in the transfer of their
accounts, which, on a temporary basis, could affect our earnings and profits.

     Readers are also directed to other risks and uncertainties discussed, as
well as to further discussion of the risks described above, in other documents
filed by the Company with the United States Securities and Exchange Commission.
The Company specifically disclaims any obligation to update or revise any
forward- looking information, whether as a result of new information, future
developments, or otherwise.

Overview

     We are a financial services holding company that, through our subsidiaries,
provides investment advisory, insurance, financial planning and related
services. We operate in a highly regulated and competitive industry, that is
influenced by numerous external factors such as economic conditions, marketplace
liquidity and volatility, monetary policy, global and national political events,
regulatory developments, competition and investor preferences. Our revenues and
net earnings may be either enhanced or diminished from period to period by any
one of or by a multiple of these external factors. In addition, the passage of
the Graham-Leach-Bliley Act in November of 1999 repealed depression-era laws
that separated commercial, investment banking and insurance activities. Such
repeal may result in the intensification of the environment in which we compete
by increasing the number of companies doing business in the financial services
arena.

Critical Accounting Policies

     The consolidated financial statements are prepared in accordance with
generally accepted accounting principles generally accepted in the United
States. The Company believes that of its significant accounting policies, those
described below involve a high degree of judgment and complexity. These critical
accounting policies require estimates and assumptions that affect the amounts of
assets, liabilities, revenues and expenses reported in the consolidated
financial statements. Due to their nature, estimates involve judgment based upon
available information. Actual results or amounts could differ from estimates and
the difference could have a material effect on the consolidated financial
statements. Therefore, understanding these policies is important in
understanding the reported results of operations and the financial position of
the Company.


                                       10
<PAGE>

Valuation of Securities and Other Assets

     Substantially all financial instruments are reflected in the consolidated
financial statements at fair value or amounts that approximate fair value, these
include: cash, cash equivalents, and securities purchased under agreements to
resell; deposits with clearing organizations; securities owned; and securities
sold but not yet purchased. Unrealized gains and losses related to these
financial instruments are reflected in net earnings or other comprehensive
income in accordance with FASB 115, depending on the underlying purpose of the
instrument. Where available, the Company uses prices from independent sources
such as listed market prices, or broker or dealer price quotations. Fair values
for certain derivative contracts are derived from pricing models that consider
current market and contractual prices for the underlying financial instruments
or commodities, as well as time value and yield curve or volatility factors
underlying the positions. In addition, even where the value of a security is
derived from an independent market price or broker or dealer quote, certain
assumptions may be required to determine the fair value. For instance, the
Company generally assumes that the size of positions in securities that the
Company holds would not be large enough to affect the quoted price of the
securities if the Company were to sell them, and that any such sale would happen
in an orderly manner. However, these assumptions may be incorrect and the actual
value realized upon disposition could be different from the current carrying
value.

Reserves

     The Company records reserves related to legal proceedings in "accrued
expenses". The determination of these reserve amounts requires significant
judgment on the part of management. Management considers many factors including,
but not limited to: the amount of the claim; the amount of the loss in the
client's account; the basis and validity of the claim; the possibility of
wrongdoing on the part of an employee of the Company; previous results in
similar cases; and legal precedents and case law. Each legal proceeding is
reviewed with counsel in each accounting period and the reserve is adjusted as
deemed appropriate by management. Any change in the reserve amount is recorded
in the consolidated financial statements and is recognized as a charge/credit to
earnings in that period. The assumptions of management in determining the
estimates of reserves may be incorrect and the actual disposition of a legal
proceeding could be greater or less than the reserve amount.

Results of Operations

Fiscal Year Ended March 31, 2003 Compared with Fiscal Year Ended March 31, 2002

     Consolidated operating income of $311,978 for the year ended March 31, 2003
increased by $464,183, or 305.0%, as compared to the consolidated operating loss
of $152,205 for the year ended March 31, 2002. This increase in consolidated
operating income, after the elimination of all inter-segment revenues and
expenses, was attributable to a $646,451 increase in operating income provided
by Investors Capital Corporation (ICC) and a $10,099 increase in operating
income from Investors Capital Holdings, Ltd. (ICH), on a stand alone basis.
Offsetting these increases was a decrease of $192,367 in operating income
provided by Eastern Point Advisors, Inc. (EPA). The $646,451 increase in
operating income provided by ICC was attributable to an increase of $488,642 in
the combined gross margin on our mutual fund /variable annuity and brokerage
business, a $255,306 increase in fee income and a $238,989 decrease in legal
settlements. These increases in operating income were offset by a $292,944
increase in gross salaries. The remaining variance of $43,542 was the result of
miscellaneous items. The $192,367 decrease in operating income provided by EPA
was attributable to a $127,280 decrease in the gross margin, a $60,575 increase
in fee income and an increase of $144,855 in gross salaries. The remaining
variance of $19,193 resulted from miscellaneous items.

     Consolidated commissions and advisory fee income of $34,289,460 for the
year ended March 31, 2003 increased by $5,408,939, or 18.7%, as compared to
consolidated commissions and advisory fee income of $28,880,521 for the year
ended March 31, 2002. This increase in gross revenues, after the elimination of
all inter-segment revenues and expenses, was attributable to a $5,784,417
increase in gross revenues provided by ICC, which was offset by a decline of
$375,478 in advisory fee income provided by EPA. The increase of $5,784,417 in
gross revenues provided by ICC was driven by increases of $3,830,713 from mutual
fund/variable annuity commissions, $902,507 from commissions generated from
stock trades, $677,583 from underwriting fees, $198,331 from E&O insurance and
$188,728 from 12b-1 commissions. The remaining $13,445 decrease was the result
of miscellaneous items. The $375,478 decrease in advisory fee income provided by
EPA was mainly the result of market conditions and a decision to terminate
certain selling agreements that were not favorable to the Company.

     Consolidated commissions and advisory fee expense of $28,040,831 for the
year ended March 31, 2003 increased by $4,731,695, or 20.3%, as compared to
consolidated commissions and advisory fee expense of $23,309,136 for the year
ended March 31, 2002. This increase, after the elimination of all inter-segment
revenues and expenses, was attributable to a $5,040,467 increase in commission
expense incurred by ICC and a $308,772 decrease in advisory fee expense incurred
by EPA. The increase of $5,040,467 in commission expense incurred by ICC was the
result of the overall increase in gross commissions from the sale of mutual
funds/variable annuities. The decrease of $308,772 generated by EPA was the
result of the decline in advisory fee income.


                                       11
<PAGE>

     Consolidated administrative expenses of $5,440,681 for the year ended March
31, 2003 increased by $282,391, or 5.5%, as compared to consolidated
administrative expenses of $5,158,290 for the year ended March 31, 2002. This
increase, after the elimination of all inter-segment revenues and expenses, was
attributable to a $125,345 increase in administrative expenses incurred by ICC,
a $115,099 increase incurred by EPA and a $41,947 increase in administrative
expenses incurred by ICH. The increase of $125,345 in administrative expenses
incurred by ICC was mainly driven by a $292,944 increase in gross salaries,
which was offset by a decrease of $238,989 in legal settlements. The remaining
$71,390 variance was the result of miscellaneous items. The increase of $115,099
in administrative expenses incurred by EPA was mainly driven by an increase of
$144,855 in gross salaries. The remaining $29,756 variance was attributable to
miscellaneous items.

     Consolidated selling expenses of $495,970 for the year ended March 31, 2003
decreased by $69,330, or 12.3%, as compared to consolidated selling expenses of
$565,300 for the year ended March 31, 2002. This decrease, after the elimination
of all inter-segment revenues and expenses, was attributable to a $52,046
decline in selling expenses generated by ICH, a $27,846 decrease in selling
expenses incurred by ICC and a $10,562 increase in selling expenses incurred by
EPA. The decrease of $52,046 was due to a reclassification of expenses to the
"administrative" category.

     Consolidated net other expense of $14,296 for the year ended March 31, 2003
increased by $295,887, or 105.0%, as compared to consolidated net other income
of $281,591 for the year ended March 31, 2002. The increase was mainly
attributable to a $250,000 charge to earnings as a result of a fine imposed by
the National Association of Securities Dealers (NASD).

     Consolidated income taxes of $181,791 for the year ended March 31, 2003
increased by $56,542, or 45.1%, as compared to consolidated income taxes of
$125,249 for the year ended March 31, 2002. This increase in income tax expense
was attributable to the increased profitability of the Company.

     Consolidated net income of $115,891 for the year ended March 31, 2003
increased by $111,754, or over 100.0%, as compared to consolidated net income of
$4,137 for the year ended March 31, 2002. This $111,754 increase in net
earnings, after the elimination of all inter-segment revenues and expenses, was
attributable to a $259,925 increase in net income provided by ICC. Offsetting
this increase was a $98,848 decrease in net income generated by EPA and a
$49,323 decrease in net income provided by ICH. The $259,925 increase in net
income provided by ICC was attributable to the $255,306 increase in fee income
as well at the increase in gross margins. The $98,848 decrease in net income
from EPA was attributable to the increase in salary expense. The $49,323
decrease in net income provided by ICH was attributable to gains and losses on
investments.

Fiscal Year Ended March 31, 2002 Compared with Fiscal Year Ended March 31, 2001

     Consolidated operating loss of $152,205 for the year ended March 31, 2002
decreased by $16,305, or 9.7%, as compared to the consolidated operating loss of
$168,510 for the year ended March 31, 2001. This decrease in consolidated
operating loss, after the elimination of all inter-segment revenues and
expenses, was attributable to a $253,503 increase in operating income provided
by Investors Capital Corporation (ICC) and a $121,522 increase in operating
income provided by Eastern Point Advisors (EPA). Offsetting these increases was
a decrease of $358,720 in operating income provided by Investors Capital
Holdings, Ltd (ICH), on a stand-alone basis. The $253,503 increase in operating
income provided by ICC was attributable to an increase of $151,876 in income
earned from promotional events throughout the year as well as a $116,279
increase in fees charged for an insurance policy. The remaining $14,652 decrease
was the result of miscellaneous items. The $121,522 increase in operating income
provided by EPA was mainly attributable to a $94,476 decrease in expenses
associated with the discontinuation of the Investors Capital Internet and
Technology Fund. The remaining $27,046 increase resulted from a general
reduction in various expenses as part of an effort to streamline our operations.
The $358,720 decrease in operating income provided by ICH was attributable to an
increase of $130,388 in legal and accounting, a $100,000 increase associated
with the amortization of the Company's subsidiary, ICC Insurance Agency, an
increase of $61,445 in printing costs and a $59,328 increase in investor and
public relations costs. The remaining $7,559 decrease was comprised of
miscellaneous items.

     Consolidated commissions and advisory fee income of $28,880,521 for the
year ended March 31, 2002 decreased by $925,623, or 3.1%, as compared to
consolidated commissions and advisory fee income of $29,806,144 for the year
ended March 31, 2001. This decrease in gross revenues, after the elimination of
all inter-segment revenues and expenses, was attributable to a $777,309 decrease
in revenues provided by ICC, a $139,470 decrease in advisory fee income provided
by EPA and an $8,844 decrease in other income provided by ICH. The decrease of
$777,309 in gross revenues provided by ICC was mainly driven by a decrease of
$480,184 in one-time commissions earned from the initial public offering which
occurred last year. The remaining $297,125 decrease was attributable to an
overall decline in commissions earned from the sale of mutual fund and variable
annuity products as the market under-performed compared to the previous year.
The $139,470 decrease in advisory fee income provided by EPA was mainly the
result of market conditions and a decision to terminate certain selling
agreements that were not favorable to the Company.


                                       12
<PAGE>

     Consolidated commissions and advisory fee expense of $23,309,136 for the
year ended March 31, 2002 decreased by $1,252,532, or 5.1%, as compared to
consolidated commissions and advisory fee expense of $24,561,668 for the year
ended March 31, 2001. This decrease, after the elimination of all inter-segment
revenues and expenses, was attributable to a $1,171,215 decrease in commission
expense incurred by ICC and an $81,317 decrease in advisory fee expense incurred
by EPA. The decrease of $1,171,215 in commission expense incurred by ICC was the
result of the decrease in one-time commissions earned from the sale of mutual
funds and variable annuity products as well as the decrease in commissions
earned from the initial public offering in the previous year. As the commissions
earned on these revenues decrease, the payout associated with these revenues
decreases proportionately.

     Consolidated administrative expenses of $5,158,290 for the year ended March
31, 2002 increased by $680,084, or 15.2%, as compared to consolidated
administrative expenses of $4,478,206 for the year ended March 31, 2001. This
increase, after the elimination of all inter-segment revenues and expenses, was
attributable to a $529,890 increase in administrative expenses incurred by ICC
and a $312,576 increase in administrative expenses incurred by ICH. Offsetting
these increases was a decrease of $162,382 in administrative expenses incurred
by EPA. The increase of $529,890 in administrative expenses incurred by ICC was
mainly driven by a $438,024 increase in legal expense related to the settlement
of various NASD arbitrations. The remaining $91,866 increase was driven by an
overall increase in payroll and payroll related expenses. The increase of
$312,576 in administrative expenses incurred by ICH was driven by an increase of
$130,388 in legal and accounting expense, a $100,000 increase associated with
the amortization of the Company's subsidiary, ICC Insurance Agency, and a
$61,445 increase in printing costs. The remaining $20,743 increase was
attributable to miscellaneous items. The decrease of $162,382 in administrative
expenses incurred by EPA was driven by a $94,476 decrease in expenses associated
with the discontinuation of the Investors Capital Internet and Technology Fund
as well as a $69,744 decrease in printing expense. The offsetting increase of
$1,838 was due to miscellaneous items.

     Consolidated selling expenses of $565,300 for the year ended March 31, 2002
decreased by $369,480, or 39.5%, as compared to consolidated selling expenses of
$934,780 for the year ended March 31, 2001. This decrease, after the elimination
of all inter-segment revenues and expenses, was attributable to a $389,487
decrease in selling expenses incurred by ICC and a $17,293 decrease in selling
expenses incurred by EPA. Offsetting these decreases was a $37,300 increase in
selling expenses incurred by ICH. The decrease of $389,487 in selling expenses
incurred by ICC was driven by a decrease of $172,847 in advertising costs and a
$151,876 increase in income earned from promotional events throughout the year.
The remaining $64,764 decrease was the result of various cost cutting measures
put in place throughout the year.

     Consolidated income taxes of $125,249 for the year ended March 31, 2002
increased by $111,249, or 794.6%, as compared to consolidated income taxes of
$14,000 for the year ended March 31, 2001. This increase in income tax expense
was mainly attributable to an increase in permanent differences in which certain
expenses are deductible for book purposes but not deductible for tax purposes.

     Consolidated net income of $4,137 for the year ended March 31, 2002
increased by $108,443, or 104.0%, as compared to consolidated net loss of
$104,306 for the year ended March 31, 2001. This $108,443 increase in net
earnings, after the elimination of all inter-segment revenues and expenses, was
attributable to a $239,116 increase in net income provided by ICC and a $103,696
increase in net income provided by EPA. Offsetting these increases was an
increase in net loss of $234,369 provided by ICH. The $239,116 increase in net
income provided by ICC was attributable to an increase of $151,876 in income
earned from promotional events throughout the year as well as an increase of
$116,279 in fees charged for an insurance policy. The offsetting decrease of
$29,039 was due to miscellaneous items. The $103,696 increase in net income
provided by EPA was attributable to a $94,476 decrease in expenses associated
with the discontinuation of the Investors Capital Internet and Technology Fund
as well as a $69,744 decrease in printing expense. The offsetting decrease of
$60,524 was attributable to a lower gross margin resulting from unfavorable
market conditions and the termination of certain selling agreements. The
$234,369 increase in net loss provided by ICH was attributable to an increase of
$130,388 in legal and accounting expense, a $100,000 increase associated with
the amortization of the Company's subsidiary, ICC Insurance Agency, a $70,635
increase in income tax expense, a $61,445 increase in printing costs and a
$59,328 increase in investor and public relations costs. Offsetting these
increased costs was an increase in interest income of $170,335 resulting from
availability of IPO proceeds for an entire year. The remaining $17,092 was the
result of miscellaneous items.

Liquidity and Capital Resources

     We believe that return on equity primarily is based on the use of capital
in an efficient manner. Historically, we have financed our operations primarily
through private equity and internally generated cash flow and not by incurring
debt.

     As of March 31, 2003, cash and cash equivalents totaled $7,088,659 as
compared to $6,337,445 as of March 31, 2002. Working capital as of March 31,
2003 was $7,702,618 as compared to $7,276,218 as of March 31, 2002. Our ratio of
current assets to current liabilities was 4.42 to 1 as of March 31, 2003 as
compared to 4.53 to 1 as of March 31, 2002.

     As of March 31, 2003, our net capital ratio for the broker-dealer was 1.98
to 1 as compared to 1.74 to 1 for our fiscal year ended March 31, 2002. The SEC
requires that we maintain a net capital of $100,000 and a ratio of aggregate
indebtedness to net capital not to exceed 15 to 1. This SEC requirement is also
referred to as the "net capital ratio" or the "net capital rule." Indebtedness
generally includes all money owed by a company, and net capital includes cash
and assets that are easily converted into cash. SEC rules also prohibit "equity
capital," which, under the net capital rule, includes the subordinated loans
from being withdrawn or cash dividends from being paid if our net capital ratio
would exceed 10 to 1 if we would have less than our minimum required net
capital. As of March 31, 2003, we had net capital of $1,214,481 as compared to
net capital of $1,136,646 as of March 31, 2002. This resulted in excess net
capital of $1,053,988 and $1,004,696, respectively, for the applicable years.


                                       13
<PAGE>

     Net cash provided by operating activities was $798,354 for the year ended
March 31, 2003 as compared to net cash used in operating activities of $15,651
and $325,681 for the years ended March 31, 2002 and 2001, respectively. The
$814,005 increase in 2003 compared to 2002 resulted primarily from an increase
in commissions received and an increase in liabilities. The $310,030 increase in
2002 as compared to 2001 was primarily the result of a decrease in commissions
payable. This decrease in commissions payable resulted from the automation of
the commission payment system in the previous year, which pays commissions on a
timelier basis.

     Net cash used in investing activities was $30,225, $420,405 and $139,592
for the years ended March 31, 2003, 2002 and 2001, respectively. The decrease in
cash used of $390,180 in 2003 compared to 2002 resulted from a decline in
spending on fixed assets and an increase in cash from the collection of loans
receivable from registered representatives. The increase in cash used of
$280,813 in 2002 compared to 2001 was the result of granting loans to our
registered representatives during the current year in addition to an increase in
the purchase of fixed assets needed to enhance our infrastructure.

     Net cash used in financing activities was $16,915 for 2003 and $406,839 for
2002. Net cash provided by financing activities was $6,801,010 for 2001. The
$389,924 decrease in cash used in 2003 as compared to 2002 resulted primarily
from not having to finance our E&O policy in 2003 as had been done in previous
years. The $7,207,849 increase resulted from our Company's initial public
offering on February 8, 2001.

Risk Management

     Risks are an inherent part of the Company's business and activities.
Management of these risks is critical to the Company's financial strength and
profitability and requires communication, judgment and knowledge of financial
trends and the economy as a whole. Senior management takes an active role in the
risk management process. The principal risks involved in the Company's business
activities are market, operational, regulatory and legal.

Market Risk

     Market risk is the risk attributable to common macroeconomic factors such
as gross domestic product, employment, inflation, interest rates, budget
deficits and Sentiment. Consumer and producer sentiment is critical to our
business. The level of consumer confidence determines their willingness to
spend, especially in the financial markets. It is this willingness to spend in
the financial markets that is key to our business. A shift in spending in this
area could negatively impact us. However, senior management is constantly
monitoring these economic trends in order to enhance our product line to offset
any potential negative impact.

Operational Risk

     Operational risk refers to the risk of loss resulting from the Company's
operations, including, but not limited to, improper or unauthorized execution
processing of transactions, deficiencies in the Company's technology or
financial or financial operating systems and inadequacies or breaches in the
Company's control processes. Managing these risks is critical, especially in a
rapidly changing environment with increasing transaction volume. Failure to
manage these risks could result in financial loss to the Company. To mitigate
these risks, the Company had developed specific policies and procedures designed
to identify and manage operational risk. These policies and procedures are
reviewed and updated on a continuing basis to ensure that this risk is
minimized.

Regulatory and Legal Risk

     Regulatory and legal risk include non-compliance with applicable legal and
regulatory requirements and the risk of a large number of customer claims that
could result in adverse judgments against the Company. The Company is subject to
extensive regulation in all jurisdictions in which it operates. In this regard,
the Company has instituted comprehensive procedures to address issues such as
regulatory capital requirements, sales and trading practices, use of and
safekeeping of customer funds, credit granting, collection activities,
money-laundering and record keeping.


                                       14
<PAGE>


Effect of Recently Issued Accounting Pronouncements

Please refer to Note 2 "Accounting Policies" of the notes to the consolidated
financial statements contained herein.

Effects of Inflation

     Investors Capital Holdings' assets are primarily liquid in nature and are
not significantly affected by inflation. Management believes that the
replacement cost of property and equipment will not materially affect operating
results. However, the rate of inflation affects our expenses, including employee
compensation and benefits, communications and occupancy, which may not be
readily recoverable through charges for services provided.


                                       15
<PAGE>

ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk.

     The information required by this item is contained in "Managements's
Discussion and Analysis of Financial Condition and Results of Operations" under
the caption "Market Risk" of this Form 10-K.







                                       16
<PAGE>



ITEM 8. Financial Statements and Supplementary Data.

To the Board of Directors and Stockholders of
Investors Capital Holdings, Ltd. and Subsidiaries
Lynnfield, Massachusetts

                          INDEPENDENT AUDITORS' REPORT

     We have audited the accompanying consolidated balance sheets of Investors
Capital Holdings, Ltd. and Subsidiaries as of March 31, 2003 and 2002, and the
related consolidated statements of operations, changes in stockholders' equity
and cash flows for each of the years in the two-year period ended March 31, 2003
and 2002. These consolidated financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits. The consolidated
statement of operations, changes in stockholders' equity and cash flows of
Investors Capital Holdings, Ltd. and Subsidiaries for the year ending March 31,
2001 were audited by other auditors whose report dated May 29, 2001 expressed an
unqualified opinion on those statements.

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

     In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position of
Investors Capital Holdings, Ltd. and Subsidiaries as of March 31, 2003 and 2002,
and the consolidated results of their operations and their cash flows for each
of the years in the two-year period ended March 31, 2003 and 2002, in conformity
with accounting principles generally accepted in the United States of America.



                                           /s/SHATSWELL, MacLEOD & COMPANY, P.C.
West Peabody, Massachusetts                   SHATSWELL, MacLEOD & COMPANY, P.C.
May 15, 2003







                                       17
<PAGE>

<TABLE>
<CAPTION>


                                     INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                                     -------------------------------------------------
                                              CONSOLIDATED BALANCE SHEETS
                                              ---------------------------
                                               March 31, 2003 and 2002
                                               -----------------------


                                                                                         2003              2002
                                                                                   ----------------  ----------------
<S>                                                                                 <C>                <C>
ASSETS
Cash and cash equivalents                                                            $  7,088,659    $    6,337,445
Investments in available-for-sale securities                                               42,195            56,291
Marketable securities, at market value                                                    132,471             2,364
Securities not readily marketable, at estimated fair value                                 47,500            10,000
Investment in unconsolidated affiliate                                                     64,495            89,697
Deposits with clearing organization, restricted                                           175,000           175,000
Accounts receivable                                                                     1,946,565         2,101,200
Loans receivable from registered representatives                                           95,389           199,996
Receivables from officers                                                                 104,088           136,078
Prepaid expenses                                                                          195,702           193,682
Deferred income tax asset, net                                                                 --            31,930
Property and equipment, net                                                               525,174           531,296
Income taxes receivable                                                                    60,113                --
Other assets                                                                              165,589           249,553
                                                                                   --------------    --------------
           Total assets                                                               $10,642,940       $10,114,532
                                                                                      ===========    ==============

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
   Notes payable                                                                   $       62,101    $       79,016
   NASD settlement payable                                                                250,000                --
   Commissions payable                                                                  1,130,539         1,136,676
   Accounts payable                                                                       438,572           379,320
   Accrued expenses                                                                       377,783           303,816
   Deferred income tax liability, net                                                      28,032                --
   Securities sold, not yet purchased, at market value                                    107,273             9,530
   Income taxes payable                                                                        --           149,108
                                                                                    -------------    --------------
           Total liabilities                                                            2,394,300         2,057,466
                                                                                    -------------    --------------
Stockholders' equity:
   Common stock, $.01 par value, authorized 10,000,000 shares; issued 5,721,265
     shares at March 31, 2003 and 2002; outstanding 5,717,380 shares at
     March 31, 2003 and 2002                                                               57,213            57,213
   Additional paid-in capital                                                           8,169,292         8,135,347
   Retained earnings (accumulated deficit)                                                 54,257           (61,634)
   Treasury stock, at cost (3,885 shares at March 31, 2003 and 2002)                      (30,135)          (30,135)
   Accumulated other comprehensive loss                                                    (1,987)          (43,725)
                                                                                    -------------    --------------
           Total stockholders' equity                                                   8,248,640         8,057,066
                                                                                    -------------     -------------
           Total liabilities and stockholders' equity                              $   10,642,940    $   10,114,532
                                                                                    =============    ==============

                  The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>


                                       18
<PAGE>
<TABLE>
<CAPTION>


                               INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                               -------------------------------------------------
                                    CONSOLIDATED STATEMENTS OF OPERATIONS
                                    -------------------------------------
                                   Years Ended March 31, 2003, 2002 and 2001
                                   -----------------------------------------


                                                                      2003             2002              2001
                                                                ---------------- ----------------  ----------------
<S>                                                                 <C>              <C>               <C>
Commission and advisory fee income                                  $ 34,289,460  $    28,880,521    $   29,806,144
Cost of commission and advisory fees                                  28,040,831       23,309,136        24,561,668
                                                                    ------------  ---------------    --------------
           Gross profit                                                6,248,629        5,571,385         5,244,476
                                                                    ------------  ---------------    --------------
Selling and administrative expenses:
   Administrative                                                      5,440,681        5,158,290         4,478,206
   Selling                                                               495,970          565,300           934,780
                                                                    ------------  ---------------    --------------
           Total selling and administrative expenses                   5,936,651        5,723,590         5,412,986
                                                                    ------------  ---------------    --------------
           Operating income (loss)                                       311,978         (152,205)         (168,510)
                                                                    ------------  ----------------   ---------------
Other income (expense):
   Interest income                                                       311,068          268,228           138,596
   Interest expense                                                      (14,117)         (30,982)          (21,576)
   Other (expense) income                                               (311,247)          44,345           (38,816)
                                                                    ------------  ---------------    --------------
           Net other (expense) income                                    (14,296)         281,591            78,204
                                                                    ------------  ----------------   -------------
Income (loss) before taxes                                               297,682          129,386           (90,306)
Provision for income taxes                                               181,791          125,249            14,000
                                                                    ------------  ---------------    --------------
           Net income (loss)                                        $    115,891  $         4,137    $     (104,306)
                                                                    ============  ===============    ==============

Earnings (loss) per common share
   Basic and diluted earnings (loss) per common share:
           Net income (loss)                                        $       0.02  $         0.00     $        (0.02)
                                                                    ============  ==============     ===============

Share data:
   Weighted average shares used in basic earnings (loss) per
     common share calculations                                         5,717,380        5,717,931         4,789,007
Plus:  Incremental shares from assumed conversion of stock options        72,680          100,764         --
                                                                    ------------  ---------------    --------------
   Weighted average shares used in diluted earnings (loss) per
     common share calculations                                         5,790,060        5,818,695         4,789,007
                                                                    ============  ===============    ==============


           The accompanying notes are an integral part of these consolidated financial statements.

</TABLE>



                                       19
<PAGE>

<TABLE>
<CAPTION>


                                      INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                                      -------------------------------------------------
                                CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                                ----------------------------------------------------------
                                       Years Ended March 31, 2003, 2002 and 2001
                                       ------------------------------------------

                                                                      Retained                        Accumulated
                                  Common Stock           Additional   Earnings                        Other
                             --------------------        Paid-in      (Accumulated    Treasury        Comprehensive
                                Shares    Amount         Capital      Deficit)        Stock           Income (Loss)        Total
                             --------------------     ------------  --------------   ----------      ---------------   -----------
<S>                          <C>          <C>         <C>            <C>              <C>             <C>                <C>
Balance, March 31, 2000       4,645,311    $31,628     $1,744,602    $  38,535        $    --          $    31,948       $1,846,713
Additional capital            1,063,000     10,630      6,407,158                                                         6,417,788
Comprehensive loss:
   Net loss                                                           (104,306)
   Net unrealized losses                                                                                   (37,622)
     Comprehensive loss                                                                                                   (141,928)
                              ---------    -------     ----------   -----------       ----------        -----------     -----------
Balance, March 31, 2001       5,708,311     42,258      8,151,760      (65,771)            --               (5,674)       8,122,573
Costs related to initial
   public offering                                         (1,458)                                                           (1,458)
Common stock adjustment          12,954     14,955        (14,955)                                                               --

Purchases of treasury stock                                                              (30,135)                           (30,135)
Comprehensive loss:
   Net income                                                            4,137
   Net unrealized losses                                                                                   (38,051)
     Comprehensive loss                                                                                                     (33,914)
                              ---------    -------     ----------   -----------       ----------        -----------     -----------
Balance, March 31, 2002       5,721,265     57,213      8,135,347      (61,634)          (30,135)          (43,725)       8,057,066
Stock-based compensation                                   33,945                                                            33,945
Comprehensive income:
   Net income                                                          115,891
   Net unrealized gains                                                                                     41,738
     Comprehensive income                                                                                                   157,629
                              ---------    -------     ----------   ----------          ---------       ----------       ----------
Balance, March 31, 2003       5,721,265    $57,213     $8,169,292    $  54,257          $(30,135)      $   (1,987)       $8,248,640
                              =========    =======     ==========    =========           ========       ==========        =========

Reclassification disclosure:

Net unrealized gains on available-for-sale securities for the year ended March
31, 2003 were $14,906. Such amount has been adjusted to $41,738 to reflect a
reclassification of the loss of $55,834 on the sale of a security, with no tax
effect. Net unrealized losses on available-for-sale securities for the year
ended March 31, 2002 were $37,426. Such amount has been adjusted to $38,051 to
reflect a reclassification of the gain of $656 on the sale of a security, with
no tax effect.

For net unrealized gains (losses) on available-for-sale securities, no
reclassification adjustment was necessary and there was no income tax effect for
the year ended March 31, 2001 because there were no sales of such securities in
that year.

Accumulated other comprehensive loss as of March 31, 2003, 2002 and 2001
consists of net unrealized holding losses on available-for-sale securities, net
of taxes.

The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>


                                       20
<PAGE>
<TABLE>
<CAPTION>



                                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                                -------------------------------------------------
                                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                      -------------------------------------
                                    Years Ended March 31, 2003, 2002 and 2001
                                    -----------------------------------------

                                                                      2003             2002              2001
                                                                ---------------- ----------------  ----------------
<S>                                                                    <C>             <C>               <C>
Cash flows from operating activities:
   Net income (loss)                                                 $   115,891      $     4,137       $  (104,306)
   Adjustments to reconcile net income (loss) to net cash provided
     by (used in) operating activities:
       Depreciation and amortization                                     140,954          133,932            79,382
       Change in deferred taxes                                           59,962          (44,930)            6,000
       Unrealized loss on investments                                         --               --            65,644
       Loss on securities positions, net                                  48,334               --                --
       Gain on sale of available-for-sale security                            --             (656)               --
       Change in marketable securities                                  (130,107)          13,405                --
       Realized loss (gain) on investment in unconsolidated affiliates    25,202          (14,241)               --
       Decrease (increase) in accounts receivable                        154,635          (91,948)         (193,134)
       Decrease (increase) in prepaid expenses, receivables from
         officers and other assets                                        83,934          (27,509)            4,628
       (Increase) decrease in prepaid income taxes                       (60,113)          88,123            50,862
       (Decrease) increase in taxes payable                             (149,108)         149,108                --
       Increase (decrease) in accounts payable and other liabilities     156,995         (250,941)           93,192
       Increase (decrease) in accrued expenses                            73,967           54,242            (5,819)
       (Decrease) increase in commissions payable                         (6,137)           3,575          (322,130)
       Stock-based compensation                                           33,945               --                --
       NASD settlement payable                                           250,000               --                --
       Other                                                                  --          (31,948)               --
                                                                      ----------       ----------         ---------

   Net cash provided by (used in) operating activities                   798,354          (15,651)         (325,681)
                                                                      ----------       ----------         ---------

Cash flows from investing activities:
   Purchases of property and equipment                                  (134,832)        (225,639)         (121,220)
   Purchase of securities                                                     --               --           (18,372)
   Proceeds from sale of available-for-sale security                          --            5,230                --
   Decrease (increase) in loans
    receivable from registered representatives                           104,607         (199,996)               --
                                                                      ----------       ----------         ---------

   Net cash used in investing activities                                 (30,225)        (420,405)         (139,592)
                                                                      ----------       ----------         ---------

Cash flows from financing activities:
   Proceeds from the issuance of common stock                                --                --           10,630
   Additional paid-in capital                                                --                --        6,407,158
   Costs related to initial public offering                                  --            (1,458)              --
   Purchases of treasury stock                                               --           (30,135)              --
   Proceeds from notes payable                                               --           773,668           558,225
   Payments on notes payable                                             (16,915)      (1,148,914)         (175,003)
                                                                      ----------       ----------         ---------

   Net cash (used in) provided by financing activities                   (16,915)        (406,839)        6,801,010
                                                                      ----------       ----------         ---------

Net increase (decrease) in cash and cash equivalents                     751,214         (842,895)        6,335,737
Cash and cash equivalents at beginning of year                         6,337,445        7,180,340           844,603
                                                                      ----------       ----------         ---------
Cash and cash equivalents at end of year                              $7,088,659       $6,337,445        $7,180,340
                                                                      ==========       ==========        ==========
</TABLE>



                                       21
<PAGE>

<TABLE>
<CAPTION>
                                     INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                                     -------------------------------------------------
                                         CONSOLIDATED STATEMENTS OF CASH FLOWS
                                         -------------------------------------
                                                      (Continued)
                                                      -----------
                                       Years Ended March 31, 2003, 2002 and 2001
                                       -----------------------------------------

                                                                        2003              2002              2001
                                                                   -------------      -----------         ---------
<S>                                                                     <C>             <C>                <C>
Supplemental disclosures:
   Interest paid                                                     $    14,117         $ 30,982           $21,576
   Income taxes paid (received)                                          331,050          (67,052)           72,200
   Noncash activity:
     Transfer from receivables from
      officers to securities not readily marketable                       30,000               --                --


           The accompanying notes are an integral part of these consolidated financial statements.


</TABLE>




                                       22
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------


NOTE 1 - NATURE OF OPERATIONS
-----------------------------

Investors Capital Holdings, Ltd., (the Company) (ICH) and its wholly-owned
subsidiaries, Investors Capital Corporation (ICC), Eastern Point Advisors, Inc.
(EPA) and ICC Insurance Agency, Inc. are engaged throughout the United States in
the financial services industry as general securities brokers and asset
managers. ICC is a registered broker-dealer under the Securities Exchange Act of
1934. EPA is a Federally Regulated Advisor subject to the Securities and
Exchange Commission under the Investment Adviser's Act of 1940.

NOTE 2 - ACCOUNTING POLICIES
----------------------------

The significant accounting policies of the Company are summarized below to
assist the reader in better understanding the consolidated financial statements
and other data contained herein.

         USE OF ESTIMATES:

         The preparation of financial statements in conformity with accounting
         principles generally accepted in the United States of America requires
         management to make estimates and assumptions that affect the reported
         amounts of assets and liabilities as of the date of the financial
         statements and the reported amounts of revenues and expenses during the
         reporting period. Actual results could differ from those estimates.

         PRINCIPLES OF CONSOLIDATION:

         The consolidated financial statements include the accounts of the
         Company and its wholly-owned subsidiaries, ICC, EPA and ICC Insurance
         Agency, Inc. All significant inter-company items and transactions have
         been eliminated in the consolidation.

         REVENUE RECOGNITION:

         Securities transactions and related commission revenues and expenses
         are recorded on a settlement date basis. The Company earns an advisory
         fee based on a client's managed portfolio value on portfolios managed
         by EPA. These fees are recorded under the accrual method.

         CASH AND CASH EQUIVALENTS:

         For purposes of reporting cash flow, cash and cash equivalents includes
         cash in checking and savings accounts, cash at a clearing broker-dealer
         and short-term investments with original maturities of three months or
         less.

         FINANCIAL INSTRUMENTS:

         The financial instruments of the Company are reported in the
         consolidated balance sheets at market or fair values, or at carrying
         amounts that approximate fair values because of the short maturity of
         the instruments, except loans receivable. The fair values for loans
         receivable are estimated using discounted cash flow analyses, using
         interest rates currently being offered for loans with similar terms to
         borrowers of similar credit quality. As of March 31, 2003, the carrying
         amount and fair value of loans receivable from registered
         representatives were $95,389 and $95,389, respectively.



                                       23
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 2 - ACCOUNTING POLICIES (Continued)
---------------------------------------

         INVESTMENT SECURITIES:

         The Company classifies debt and equity securities into one of three
         categories: held-to-maturity, available-for-sale, or trading. These
         security classifications may be modified after acquisition only under
         certain specified conditions. In general, securities may be classified
         as held-to-maturity only if the Company has the positive intent and
         ability to hold them to maturity. Trading securities are defined as
         those bought and held principally for the purpose of selling them in
         the near term. All other securities must be classified as
         available-for-sale.

               --   Held-to-maturity securities are measured at amortized cost
                    in the consolidated balance sheets. Unrealized holding gains
                    and losses are not included in earnings, or in a separate
                    component of capital. They are merely disclosed in the notes
                    to the consolidated financial statements.

               --   Available-for-sale securities are carried at fair value on
                    the consolidated balance sheets. Unrealized holding gains
                    and losses are not included in earnings but are reported as
                    a net amount (less expected tax) in a separate component of
                    capital until realized.

               --   Trading securities are carried at fair value on the
                    consolidated balance sheets. Unrealized holding gains and
                    losses for trading securities are included in earnings.

         Declines in the fair value of available-for-sale and held-to-maturity
         securities below their cost that are deemed to be other than temporary
         are reflected in earnings as realized losses.

         Marketable securities are valued at market value, and securities not
         readily marketable are valued at fair value as determined by
         management.

         PREMISES AND EQUIPMENT:

         Furniture, equipment and leasehold improvements are stated at cost.
         Maintenance and repairs are charged to operations. Depreciation is
         provided utilizing the straight-line method over their useful lives,
         generally seven years.

         BUSINESS DEVELOPMENT:

         The Company expenses all promotional costs as incurred and advertising
         costs upon first exhibition of the advertisement. Substantially all
         business development costs relate to advertising. Business development
         expenses amounted to $253,146, $346,681 and $311,905 for the years
         ended March 31, 2003, 2002 and 2001, respectively.

         INCOME TAXES:

         The Company accounts for income taxes under the provisions of Statement
         of Financial Accounting Standards ("SFAS") No. 109, "Accounting for
         Income Taxes." Under the asset and liability approach, deferred taxes
         are determined based on the difference between the financial statement
         and tax basis of assets and liabilities using enacted tax rates in
         effect in the years in which the differences are expected to reverse.



                                       24
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 2 - ACCOUNTING POLICIES (Continued)
---------------------------------------

         STOCK BASED COMPENSATION:

         At March 31, 2003, the Company has three stock-based compensation plans
         which are described more fully in Note 15. The Company accounts for
         transactions with employees under those plans under the recognition and
         measurement principles of APB Opinion No. 25, Accounting for Stock
         Issued to Employees, and related Interpretations. No stock-based
         employee compensation cost has been recognized for employee
         transactions related to its fixed stock option plans. Transactions with
         nonemployees, in which goods or services are the consideration received
         for the issuance of equity instruments are accounted for based on the
         fair value of the consideration received or the fair value of the
         equity instruments issued, whichever is more reliably measured, in
         accordance with SFAS No. 123, "Accounting for Stock-Based
         Compensation." The following table illustrates the effect on net income
         and earnings per share if the Company had applied the fair value
         recognition provisions of SFAS No. 123 to stock-based transactions with
         employees.
<TABLE>
<CAPTION>


                                                                                  For the Years Ended March 31,
                                                                              -------------------------------------
                                                                                2003          2002         2001
                                                                            -----------     --------   ------------
        <S>                                                                    <C>            <C>          <C>
         Net income (loss), as reported                                        $115,891      $ 4,137      $(104,306)
         Deduct:  Total stock-based employee compensation expense
           determined under fair value based method for all awards,
           net of related tax effects                                           (13,458)      (9,233)        (7,121)
                                                                                -------      -------      ---------
         Pro forma net income (loss)                                           $102,433      $(5,096)     $(111,427)
                                                                               ========      =======      =========

         Earnings (loss) per share:
           Basic - as reported                                                    $0.02        $0.00        $(0.02)
           Basic - pro forma                                                      $0.02        $0.00        $(0.02)
           Diluted - as reported                                                  $0.02        $0.00        $(0.02)
           Diluted - pro forma                                                    $0.02        $0.00        $(0.02)
</TABLE>

         SEGMENT REPORTING:

         The Company makes disclosures about products and services, geographic
         areas, and major customers in accordance with SFAS No. 131,
         "Disclosures about Segments of an Enterprise and Related Information."

         RECENT ACCOUNTING PRONOUNCEMENTS:

         In June 2001, the FASB issued SFAS No. 141, "Business Combinations."
         This Statement addresses financial accounting and reporting for
         business combinations and supercedes Accounting Principles Board
         ("APB") Opinion No. 16, "Business Combinations," and SFAS No. 38,
         "Accounting for Preacquisition Contingencies of Purchased Enterprises."
         Under Opinion 16, business combinations were accounted for using one of
         two methods, the pooling-of-interests method or the purchase method.
         All business combinations in the scope of SFAS No. 141 are to be
         accounted for using one method - the purchase method. The provisions of
         SFAS No. 141 apply to all business combinations initiated after June
         30, 2001 and to all business combinations accounted for using the
         purchase method for which the date of acquisition is July 1, 2001, or
         later.



                                       25
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 2 - ACCOUNTING POLICIES (Continued)
---------------------------------------

         RECENT ACCOUNTING PRONOUNCEMENTS: (Continued)

         The adoption of SFAS No. 141 had no immediate effect on the Company's
         financial statements since it had no pending business combinations as
         of June 30, 2001 or as of the date of the issuance of these
         consolidated financial statements. If the Company consummates business
         combinations in the future, any such combinations that would have been
         accounted for by the pooling-of-interests method under Opinion 16 will
         be accounted for under the purchase method and the difference in
         accounting could have a substantial impact on the Company's
         consolidated financial statements.

         In June 2001, the FASB issued SFAS No. 142, "Goodwill and Other
         Intangible Assets." This Statement addresses financial accounting and
         reporting for acquired goodwill and other intangible assets and
         supercedes APB Opinion No. 17, "Intangible Assets." The initial
         recognition and measurement provisions of SFAS No. 142 apply to
         intangible assets which are defined as assets (not including financial
         assets) that lack physical substance. The term "intangible assets" is
         used in SFAS No. 142 to refer to intangible assets other than goodwill.
         The accounting for a recognized intangible asset is based on its useful
         life. An intangible asset with a finite useful life is amortized; an
         intangible asset with an indefinite useful life is not amortized. An
         intangible asset that is subject to amortization shall be reviewed for
         impairment in accordance with SFAS No. 144, "Accounting for the
         Impairment or Disposal of Long-Lived Assets."

         SFAS No. 142 provides that goodwill shall not be amortized. Goodwill is
         defined as the excess of the cost of an acquired entity over the net of
         the amounts assigned to assets acquired and liabilities assumed. SFAS
         No. 142 further provides that goodwill shall be tested for impairment
         at a level of reporting referred to as a reporting unit. Impairment is
         the condition that exists when the carrying amount of goodwill exceeds
         its implied fair value.

         SFAS No. 142 was effective as follows:

              All of the provisions of SFAS No. 142 were applied in fiscal years
              beginning after December 15, 2001, to all goodwill and intangible
              assets recognized in the Company's statement of financial position
              at the beginning of that fiscal year, regardless of when those
              previously recognized assets were initially recognized.

         The adoption of SFAS No. 142 did not have a material impact on the
         consolidated financial statements.

         In August 2001, the FASB issued SFAS No. 144 "Accounting for the
         Impairment or Disposal of Long-Lived Assets." SFAS No. 144 addresses
         financial accounting and reporting for the impairment or disposal of
         long-lived assets. SFAS No. 144 supercedes SFAS No. 121 "Accounting for
         the Impairment of Long-Lived Assets and for Long-Lived Assets to Be
         Disposed Of," but retains the basic recognition and measurement model
         for assets held for use and held for sale. The provisions of SFAS No.
         144 are required to be adopted starting with fiscal years beginning
         after December 15, 2001. This Statement did not have a material impact
         on the Company's consolidated financial statements.

         In June 2002, the FASB issued SFAS No. 146 "Accounting for Costs
         Associated with Exit or Disposal Activities." This Statement requires
         that a liability for a cost associated with an exit or disposal
         activity be recognized and measured initially at fair value only when
         the liability is incurred. SFAS No. 146 is effective for exit or
         disposal activities that are initiated after December 31, 2002. This
         Statement did not have a material impact on the Company's consolidated
         financial statements.



                                       26
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 2 - ACCOUNTING POLICIES (Continued)
---------------------------------------

         RECLASSIFICATIONS:

          Certain amounts from the prior years have been reclassified for
          consistency with the current year's presentation.

NOTE 3 - NET CAPITAL
--------------------

ICC is subject to the Securities and Exchange Commission's regulations and
operating guidelines, which require ICC to maintain a specified amount of net
capital, as defined, and a ratio of aggregate indebtedness to net capital, as
defined, not exceeding 15 to 1.

ICC's net capital as computed under 15c3-1 was $1,214,481 at March 31, 2003
which resulted in excess net capital of the required net capital of $160,493 in
the amount of $1,053,988. The ratio of aggregate indebtedness to capital at
March 31, 2003 was 1.98 to 1. ICC's net capital as computed under 15c3-1 was
$1,136,646 at March 31, 2002 which resulted in excess net capital of the
required net capital of $131,950 in the amount of $1,004,696. The ratio of
aggregate indebtedness to capital at March 31, 2002 was 1.74 to 1.

NOTE 4 - SECURITIES OWNED AND SOLD, NOT YET PURCHASED
-----------------------------------------------------

Securities owned and sold, not yet purchased, consist of available-for-sale
securities and investment securities at market values.

The carrying amount and fair value of investments in available-for-sale
securities are as follows:

<TABLE>
<CAPTION>

                                                                             Losses In
                                                                             Accumulated
                                                                             Other
                                                            Amortized        Comprehensive
                                                            Cost             Income               Fair Value
March 31, 2003                                              ---------        -------------       ------------
<S>                                                         <C>                <C>               <C>
   Equity securities                                        $  44,182         $  1,987            $42,195
                                                            =========         ========            =======

March 31, 2002
   Equity securities                                         $100,016         $ 43,725            $56,291
                                                             ========          =======            =======

The carrying amount of investment securities at market values are as follows:

                                                                              Sold, Not Yet
March 31, 2003                                               Owned            Purchased
                                                            ---------         ----------
   Corporate bond                                           $  49,066         $       --
   Unit investment trust                                           --             28,587
   Equity securities                                           83,405             78,686
                                                           ----------         ----------
                                                             $132,471           $107,273
                                                             ========           ========

March 31, 2002
   Equity securities                                       $    2,364         $    9,530
                                                           ==========         ==========
</TABLE>


                                       27
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 4 - SECURITIES OWNED AND SOLD, NOT YET PURCHASED (Continued)
----------------------------------------------------------------

The securities owned are securities owned temporarily by the Company for the
convenience of customers of the Company.

Securities not readily marketable include investment securities (a) for which
there is no market on a securities exchange or no independent publicly quoted
market, (b) that cannot be publicly offered or sold unless registration has been
effected under the Securities Act of 1933, or (c) that cannot be offered or sold
because of other arrangements, restrictions, or conditions applicable to the
securities or to the Company.

These securities at estimated fair values consist of the following:

March 31, 2003
   Equity securities                                    $47,500
                                                        =======

March 31, 2002
   Equity securities                                    $10,000
                                                        =======

NOTE 5 - INVESTMENT IN UNCONSOLIDATED AFFILIATE
-----------------------------------------------

As of March 31, 2003 and 2002, the Company had an investment totaling $64,495
and $89,697, respectively in an unconsolidated affiliate. As of March 31, 2001,
the investment holdings consisted of Eastern Point Advisors Twenty Fund and
Investors Capital Internet and Technology Fund. During the year ended March 31,
2002, the Company sold its investment in Investors Capital Internet and
Technology Fund and the fund was liquidated as described in Note 20. These
investments were accounted for under the equity method of accounting for
investments because the Company had the ability to exercise significant
influence over the funds.

An investor using the equity method initially records an investment at cost.
Subsequently, the carrying amount of the investment is increased to reflect the
investor's share of income of the investee and is reduced to reflect the
investor's share of losses of the investee or dividends received from the
investee. The investor's share of the income or losses of the investee is
included in the investor's net income as the investee reports them. Adjustments
similar to those made in preparing consolidated financial statements, such as
elimination of intercompany gains and losses, also are applicable to the equity
method.

As of March 31, 2003, the Company held a 1.1% ownership in the Eastern Point
Advisors Twenty Fund which had a market value of $64,495.

NOTE 6 - TRANSACTIONS WITH RELATED PARTIES
------------------------------------------

The Company leases office space from the Arlsburg Trust, the trustee of whom is
the principal stockholder of the Company and Investors Realty, LLC, the
principal member of whom is the principal stockholder of the Company. Rent
expense for these leases amounted to $175,799, $175,799 and $163,019 for the
years ending March 31, 2003, 2002 and 2001, respectively.



                                       28
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 6 - TRANSACTIONS WITH RELATED PARTIES (Continued)
------------------------------------------------------

One of the members of the Board of Directors is also a registered representative
and he earned commission income from the Company in the years ending March 31,
2003, 2002 and 2001 of $186,418, $66,828 and $0, respectively.

Loans Receivable From Registered Representatives - These loans consist of
promissory notes, which bear interest at the rate of 3.94% per annum, and are
payable within 18 or 24 months of the date of the note, in weekly installments.
The notes are secured by various pledges of brokerage accounts and/or personal
assets of the registered representatives. As of March 31, 2003 these loans
amounted to $95,389 and $18,141 of these loans are to a registered
representative who is also a Director of the Company.

The Company is owed money from senior executives. As of March 31, 2003 and 2002
the balances owed amounted to $104,088 and $136,078, respectively.

Investors Marketing Services, Inc. is jointly owned by the Company's principal
stockholder, Theodore E. Charles and his spouse, Janice M. Charles. This entity
performs a fulfillment function for subsidiaries of the Company by preparing,
collating and mailing registration kits to registered representatives, and
creates graphics and other art work for various marketing materials produced for
these subsidiaries. It also prepares the assembly, shipping and postage of
literature pertaining to the subsidiaries. For the years ended March 31, 2003,
2002 and 2001, the cost paid for these services was $60,130, $62,982 and
$221,091, respectively.

Included in accounts receivable at March 31, 2003 is $200,226 due to EPA from
the Eastern Point Advisors 20 Fund (the "Fund"). As compensation for its
services EPA receives, on a monthly basis, an investment advisory fee calculated
at the annual rate of 1.5% of the Fund's average daily net assets. EPA has
voluntarily agreed to waive its advisory fees or reimburse other Fund expenses
so that the Fund's annual operating expenses will not exceed 5.00% for Class A
shares and 5.75% for Class C shares, of the average daily net assets of the
respective class. The waiver may be terminated by EPA at any time. EPA has three
years to recoup any expenses it pays for on behalf of the Fund, or the
receivable relating to that year will have to be written off by EPA. A summary
of outstanding amounts for waived fees since the inception of the Fund, and the
related Fund year are as follows as of March 31, 2003:
<TABLE>
<CAPTION>

                                               Reimbursable Fund
                   Amount                      Year End                           Expiration Date
                  --------                  -----------------------             ---------------------
                   <S>                           <C>                             <C>
                 $  54,929                        2000                          September 30, 2003
                    13,090                        2001                          September 30, 2004
                    73,893                        2002                          September 30, 2005
                    58,314                        2003                          September 30, 2006
                 ---------
                  $200,226
                  ========
</TABLE>

The amount outstanding for the 2000 Reimbursable Fund Year End of $54,929,
consists of $109,858 of waived fees less $54,929 that the Company has reserved
for as uncollectible. Management of the Company feels, based upon a reduction in
future estimated administrative costs associated with a change in the Fund's
administrator under a service agreement effective May 1, 2002, that the entire
receivable from the Fund will be recovered by EPA.



                                       29
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 7 - PROPERTY AND EQUIPMENT, NET
------------------------------------

Property and equipment consisted of the following at March 31:
<TABLE>
<CAPTION>

                                                                                          2003              2002
                                                                                      -----------       -----------
<S>                                                                                     <C>                <C>
Equipment                                                                                $543,042          $483,786
Furniture and fixtures                                                                    234,626           179,110
Leasehold improvements                                                                    198,868           178,808
                                                                                        ---------         ---------
                                                                                          976,536           841,704
Accumulated depreciation and amortization                                                (451,362)         (310,408)
                                                                                        ---------         ---------
         Property and equipment, net                                                     $525,174          $531,296
                                                                                         ========          ========
</TABLE>

NOTE 8 - NOTES PAYABLE
----------------------

At March 31, 2003 and 2002 notes payable consisted of debt to finance insurance
premiums. The annual rate of interest on the outstanding loan at March 31, 2003
was 6% and the loan matures on November 8, 2003.

NOTE 9 - NATIONAL ASSOCIATION OF SECURITIES DEALERS SETTLEMENT
--------------------------------------------------------------

Subsequent to a National Association of Securities Dealers (NASD) examination,
NASD, on April 9, 2003, accepted a Letter of Acceptance, Waiver and Consent
("AWC") submitted by the Company, in which the Company agreed to be censured and
fined $250,000. Without admitting or denying the alleged violations, the Company
agreed to the findings by NASD that certain supervisory deficiencies existed
between January 2000 and July 2002. The acceptance of the AWC concludes the
matter. As a result, the Company recorded a $250,000 liability and related
expense for the NASD fine in its financial statements for the year ending March
31, 2003.

NOTE 10 - INCOME TAXES
----------------------

The components of income taxes are as follows for the years ended March 31:
<TABLE>
<CAPTION>

                                                                         2003            2002               2001
                                                                     -----------      -----------        ----------
<S>                                                                     <C>             <C>               <C>
Current tax expense (benefit):
   Federal                                                             $  71,420         $125,095          $(21,000)
   State                                                                  50,409           45,084            18,000
                                                                      ----------       ----------         ---------
                                                                         121,829          170,179            (3,000)
                                                                       ---------        ---------        ----------

Deferred tax expense (benefit):
   Federal                                                                45,373          (42,400)           14,000
   State                                                                  10,469           (2,530)            3,000
   Increase in valuation allowance                                         4,120          --                --
                                                                     -----------   --------------    --------------
                                                                          59,962          (44,930)           17,000
                                                                      ----------        ---------         ---------
     Total income taxes                                                 $181,791         $125,249          $ 14,000
                                                                        ========         ========          ========
</TABLE>

Deferred income taxes are the result of timing differences between book and
taxable income and consist primarily of net operating loss carryforwards,
unrealized gains, mutual fund start up costs and differences between
depreciation expense for financial statement purposes versus tax return
purposes.



                                       30
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 10 - INCOME TAXES (Continued)
----------------------------------

Net deferred tax assets (liabilities) within each tax jurisdiction consisted of
the following at:
<TABLE>
<CAPTION>

                                                                                       March 31, 2003
                                                                       --------------------------------------------
                                                                         Asset           Liability            Net
                                                                      ----------         ---------        -----------
<S>                                                                    <C>               <C>               <C>
Federal                                                                 $ 40,667           $44,461        $  (3,794)
State                                                                     12,556            10,190            2,366
Valuation allowance - realized losses on investments                     (26,604)               --          (26,604)
                                                                       ---------           -------         --------
   Total                                                                $ 26,619           $54,651         $(28,032)
                                                                        ========           =======         ========

                                                                                       March 31, 2002
                                                                       --------------------------------------------
                                                                         Asset           Liability          Net
                                                                       ---------         ---------        ---------
Federal                                                                 $ 57,411           $33,011         $ 24,400
State                                                                     17,725            10,195            7,530
                                                                       ---------          --------        ---------
     Total                                                              $ 75,136           $43,206         $ 31,930
                                                                        ========           =======         ========
</TABLE>

A reconciliation of the provision for income taxes with amounts determined by
applying the statutory federal income tax rate to income before income taxes.
<TABLE>
<CAPTION>

                                                                                   Year Ended March 31,
                                                                       ---------------------------------------------
                                                                         2003             2002               2001
                                                                       ---------        ---------         ---------
<S>                                                                   <C>                <C>               <C>
Tax at U.S. statutory rate                                              $101,212        $  43,992          $ (7,000)
State taxes, net of federal benefit                                       40,179           28,085            21,000
Unallowable expenses                                                      36,280           53,172                --
Change in valuation allowance                                              4,120               --                --
                                                                       ---------         --------           -------
   Provision for income taxes                                           $181,791         $125,249           $14,000
                                                                        ========         ========           =======
</TABLE>

NOTE 11 - SEGMENT INFORMATION
-----------------------------

The accounting policies of the segments are described in the summary of
significant accounting policies. The Company evaluates performance based on
profit and loss from operations after income taxes.

The Company accounts for intersegment services and transfers as if the services
or transfers were to third parties, that is, at current market prices.

The Company's reportable segments are strategic business units that offer
different services. They are managed separately because each business requires
different technology and marketing strategies.

The Company's reportable segments include support services by the parent company
ICH, investment services offered through ICC and asset management services
offered through EPA. The investment services segment includes securities,
insurance, financial planning and related services. ICH incurs expenses on
behalf of and to support ICC and EPA. ICC earns commissions as a broker for its
customers in the purchase and sale of securities on major exchanges. Asset
management services generates recurring annual revenue from fees received on the
management of customer accounts. EPA provides asset management and portfolio
design services to one mutual fund and a variety of investors.



                                       31
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 11 - SEGMENT INFORMATION (Continued)
-----------------------------------------

Segment data presented includes the allocation of all corporate overhead to each
segment. Intersegment revenues and expenses, and receivables and payables, are
eliminated between segments. Information concerning operations in the Company's
segments of business is as follows at or for the years ended March 31:
<TABLE>
<CAPTION>

                                                                      2003             2002              2001
                                                                ---------------- ----------------  ----------------
<S>                                                                  <C>                <C>             <C>
Non-interest revenues:
   ICC, investment services                                          $31,911,884      $26,127,467       $26,904,776
   EPA, asset management services                                      2,377,576        2,753,054         2,892,524
   ICH, support services                                                     --                --             8,844
                                                                     -----------      -----------       -----------
     Total                                                           $34,289,460      $28,880,521       $29,806,144
                                                                     ===========      ===========       ===========

Revenues from transactions with other operating segments:
   ICC                                                               $   625,969      $   532,677       $   344,260
   EPA                                                                   268,273          228,290           147,540
   Intersegment elimination                                             (894,242)        (760,967)         (491,800)
                                                                     -----------      -----------       -----------
     Total                                                           $         0      $         0       $         0
                                                                     ===========      ============      ============

Interest and dividend income:
   ICC                                                               $   159,787      $   103,977       $   132,283
   ICH                                                                   151,281          164,251             6,313
                                                                     -----------      -----------       -----------
     Total                                                           $   311,068      $   268,228       $   138,596
                                                                     ===========      ===========       ===========

Depreciation and amortization expense:
   ICC                                                               $   134,668      $   122,054       $    73,811
   EPA                                                                     6,286           11,878             5,571
                                                                     -----------      -----------       -----------
     Total                                                           $   140,954      $   133,932       $    79,382
                                                                     ===========      ===========       ===========

Income tax expense (benefit):
   ICC                                                               $   269,812      $   115,050       $    92,000
   EPA                                                                  (150,682)         (57,436)          (75,000)
   ICH                                                                    62,661           67,635            (3,000)
                                                                     -----------      -----------       -----------
     Total                                                           $   181,791      $   125,249       $    14,000
                                                                     ===========      ===========       ===========

Income (loss):
   ICC                                                               $   917,780      $   657,855       $   418,739
   EPA                                                                    43,455          142,303            38,607
   ICH                                                                  (845,344)        (796,021)         (561,652)
                                                                     -----------      -----------       -----------
     Total                                                           $   115,891      $     4,137       $  (104,306)
                                                                     ===========      ===========       ===========

Year-end total assets:
   ICC                                                               $ 4,651,859      $ 4,096,506       $ 2,422,255
   EPA                                                                   602,160          718,649           800,406
   ICH                                                                 5,388,921        5,299,377         7,389,640
                                                                     -----------      -----------       -----------
     Total                                                           $10,642,940      $10,114,532       $10,612,301
                                                                     ===========      ===========       ===========

</TABLE>



                                       32
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 12 - CONCENTRATIONS OF CREDIT RISK
---------------------------------------

The Company is engaged in various trading and brokerage activities whose
counterparties primarily include the general public. In the event counterparties
do not fulfill their obligations, the Company may be exposed to risk. The risk
of default depends on the credit worthiness of the counterparty or issuer of the
instrument. It is the Company's policy to review, as necessary, the credit
standings of each counterparty with which it conducts business.

At March 31, 2003, the carrying amount of the Company's cash and cash
equivalents, including a time deposit, was $7,088,659 and the bank statement
balance was $6,266,149. Of the bank statement balance, $100,000 was covered by
federal depository insurance and $6,166,149 was covered by the Depositors
Insurance Fund of Massachusetts. The Company's cash and cash equivalents as of
March 31, 2003 also include $1,157,101 at its clearing broker-dealer of which
$500,000 is fully insured by the Securities Investor Protection Corporation
(SIPC). At March 31, 2002, the carrying amount of the Company's cash and cash
equivalents, including a time deposit, was $6,337,445 and the bank statement
balance was $6,311,508. Of the bank statement balance, $263,073 was covered by
federal depository insurance and $6,048,435 was covered by the Depositors
Insurance Fund of Massachusetts. The Company's deposits at March 31, 2002 also
included $470,303 at its clearing broker-dealer that was fully insured by the
Securities Investor Protection Corporation (SIPC).

NOTE 13 - COMMITMENTS AND CONTINGENCIES
---------------------------------------

The Company is obligated under various lease agreements covering offices and
equipment. These agreements are considered to be operating leases. The terms
expire between fiscal year 2004 and 2007. Options to renew for additional terms
are included under the office lease agreements. The total minimum rental due in
future periods under these existing agreements is as follows as of March 31,
2003:
<TABLE>
<CAPTION>

                <S>                                                                    <C>
                  Year ending March 31, 2004                                             $226,130
                  Year ending March 31, 2005                                              201,292
                  Year ending March 31, 2006                                               25,493
                  Year ending March 31, 2007                                                  969
                                                                                         --------
                      Total minimum lease payments                                       $453,884
                                                                                         ========
</TABLE>

Certain leases contain provisions for escalation of minimum lease payments
contingent upon increases in real estate taxes. The total lease expense amounted
to $233,397 for fiscal year 2003, $227,993 for fiscal year 2002 and $213,882 for
fiscal year 2001.

NOTE 14 - LITIGATION
--------------------

The Company operates in a highly litigious and regulated business and as such is
a defendant or co-defendant in various lawsuits and arbitrations incidental to
its securities business. The Company is vigorously contesting the allegations of
the complaints in these cases and believes that there are meritorious defenses
in each. Counsel is unable to respond concerning the likelihood of an outcome,
whether favorable or unfavorable, because of inherent uncertainties routine in
these matters. Currently, there are a total of thirteen lawsuits and/or
arbitrations filed against the Company seeking a total of approximately $1.9
million. For the majority of claims, the Company's errors and omissions (E&O)
policy limits the maximum exposure in any one case to $75,000. In certain of
these cases the Company has the contractual right to seek indemnity from related
parties.


                                       33
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 15 - STOCK COMPENSATION PLANS
----------------------------------

As of September 1, 1994, the Company issued a stock option plan (the "1994
Plan") which provided for the granting of options to an officer of the Company
to purchase shares of the common stock of the Company. Following a three for two
stock split in 1997, a maximum of 150,000 shares of common stock could be issued
under the 1994 Plan. The number of options and grant date were determined at the
discretion of the Company's Board of Directors. Options outstanding under the
1994 Plan are exercisable and have no stated maturity.

As of October 1, 1997, the Board of Directors issued the 1996 Incentive Stock
Option Plan (the "1996 Plan"). Key employees, directors and the Company's
registered representatives are eligible to receive options and the aggregate
number of shares to be delivered under the 1996 Plan could not exceed 300,000
shares. Each grant of options, the number of options granted and the vesting
schedules of such options subject thereto were determined by the Board. The
stock options outstanding are fully vested after two years from grant date, are
exercisable for an additional three years after vesting and are forfeited 30
days after termination.

As of March 12, 2001, the Board of Directors issued the 2001 Equity Incentive
Plan (the "2001 Plan"). Key employees, directors and the Company's registered
representatives are eligible to receive options to purchase shares of the common
stock of the Company and the aggregate number of shares to be delivered under
the 2001 Plan shall not exceed 250,000 shares. Each grant of options, the number
of options granted and the vesting schedules of such options subject thereto
shall be determined by the Board. The stock options outstanding are fully vested
after two years from grant date, are exercisable for an additional three years
after vesting and are forfeited 30 days after termination.

A summary of the status of the Company's employee and Directors' fixed stock
options as of March 31, 2003, 2002 and 2001 and changes during the years ending
on those dates is presented below:
<TABLE>
<CAPTION>

                                                2003                        2002                        2001
                                   ----------------------------   ----------------------------   --------------------------
                                               Weighted-Average               Weighted-Average             Weighted-Average
Fixed Options                       Shares     Exercise Price      Shares     Exercise Price      Shares   Exercise Price
-------------                      -------- -------------------   --------    ----------------   -------   ----------------
<S>                                 <C>              <C>           <C>              <C>            <C>           <C>
Outstanding at beginning of year   218,731          $2.82         230,600          $3.08           168,000       $1.25
Granted                             10,000           1.91              --             --            62,600        8.00
Forfeited                          (21,022)          4.01         (11,869)          8.00                --          --
                                  --------                       --------                        ---------
Outstanding at end of year         207,709           2.65         218,731           2.82           230,600        3.08
                                   =======                        =======                        =========

Options exercisable at year-end    197,709                        168,000                          168,000
Weighted-average fair value of
   options granted during the year   $0.88                             --                            $0.91
</TABLE>

The fair value of options granted to employees in 2003, 2002 and 2001 is
estimated on the date of grant using the Black-Scholes option-pricing model
based on the following assumptions:
<TABLE>
<CAPTION>

                                                                           2003            2002            2001
                                                                         -------           ----          --------
<S>                                                                        <C>              <C>              <C>
Dividend yield                                                                0%             --               0%
Volatility                                                                   50%             --              21%
Risk-free interest rate                                                    2.78%             --            5.75%
Expected life in years                                                        5              --               5
</TABLE>


                                       34
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 15 - STOCK COMPENSATION PLANS (Continued)
----------------------------------------------

The following table summarizes information about employee and Directors' fixed
stock options outstanding as of March 31, 2003:
<TABLE>
<CAPTION>

                                  Options Outstanding                                       Options Exercisable
                    -------------------------------------------------------------   ------------------------------------
                    Number            Weighted-Average                              Number
Range of            Outstanding       Remaining               Weighted-Average      Exercisable       Weighted-Average
Exercise Prices     as of 3/31/03     Contractual Life        Exercise Price        as of 3/31/03     Exercise Price
---------------     -------------     --------------------   ---------------------  -------------    -------------------
      <S>                <C>               <C>                     <C>                  <C>                  <C>
     $1.00             150,000        No Stated Maturity           $1.00                150,000              $1.00
      8.00              47,709           2.38                       8.00                 47,709               8.00
      1.91              10,000           4.81                       1.91                     --
                      --------                                                         --------
                       207,709           2.80 (1)                   2.65                197,709               2.69
                       =======                                                          =======
</TABLE>

       (1) Includes only stock options with stated maturity.

A summary of the status of the Company's registered representatives' fixed stock
options as of March 31, 2003, 2002 and 2001 and changes during the years ending
on those dates is presented below:
<TABLE>
<CAPTION>

                                              2003                          2002                          2001
                                   ----------------------------   -----------------------------  ---------------------------
                                                Weighted-Average              Weighted-Average             Weighted-Average
Fixed Options                       Shares      Exercise Price     Shares     Exercise Price      Shares   Exercise Price
-------------                      -------- -------------------   --------    -----------------  -------  -------------
<S>                               <C>                <C>          <C>             <C>              <C>          <C>
Outstanding at beginning of year   232,196          $7.72         254,500          $7.91           5,000        $3.34
Granted                             86,483           2.00          10,000           3.90         249,500         8.00
Forfeited                          (22,657)          6.80         (32,304)          8.00              --           --
                                  --------                       --------                       --------
Outstanding at end of year         296,022           6.12         232,196           7.72         254,500         7.91
                                   =======                        =======                        =======

Options exercisable at year-end    200,197                          5,000                          5,000
</TABLE>


Stock-based compensation for grants to registered representatives amounted to
$33,945 and was calculated using the Black-Scholes option-pricing model as of
March 31, 2003. The fair value per share was $0.77, $0.31 and $0.08 for grants
during the years ending March 31, 2003, 2002 and 2001, respectively. The
following assumptions were applied at March 31, 2003 to grants for the years
ending March 31:
<TABLE>
<CAPTION>

                                                                        2003                 2002              2001
                                                                     ---------               ----              ----
<S>                                                                       <C>                <C>                <C>
Dividend yield                                                             0%                  0%                0%
Volatility                                                                53%                 53%               54%
Risk-free interest rate                                                 2.36%               1.93%             1.93%
Expected life in years                                                  4.25                3.15                3%
</TABLE>

The following table summarizes information about representatives' fixed stock
options outstanding as of March 31, 2003:
<TABLE>
<CAPTION>

                                 Options Outstanding                                       Options Exercisable
                    -----------------------------------------------------------      ------------------------------------
                        Number        Weighted-Average                               Number
   Range of          Outstanding         Remaining             Weighted-Average      Exercisable       Weighted-Average
Exercise Prices     as of 3/31/03     Contractual Life         Exercise Price        as of 3/31/03     Exercise Price
---------------     -------------     --------------------   ------------------      -------------    -------------------
      <S>               <C>                <C>                     <C>                  <C>                  <C>
     $8.00             200,197              2.50                   $8.00                200,197              $8.00
      3.90              10,000              3.17                    3.90                     --                 --
      2.00              85,825              4.25                    2.00                     --                 --
                      --------                                                         --------
                       296,022              3.03                    6.12                200,197               8.00
                       =======                                                          =======
</TABLE>



                                       35
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 16 - EARNINGS PER COMMON SHARE
-----------------------------------

Basic earnings per share represents income available to common stockholders
divided by the weighted-average number of common shares outstanding during the
period. Diluted earnings per share reflects additional common shares that would
have been outstanding if dilutive potential common shares had been issued, as
well as any adjustment to income that would result from the assumed issuance.
Potential common shares that may be issued by the Company relate solely to
outstanding stock options, and are determined using the treasury stock method.

Options to purchase common stock totaling 353,731 and 277,927 at March 31, 2003
and 2002, respectively, were not included in the computation of diluted earnings
per share as their effect would have been antidilutive.

NOTE 17 - RETIREMENT PLAN
-------------------------

The Company has a 401(k) retirement plan that covers all employees with at least
three months of service. Employees employed on the plan's effective date did not
have to satisfy the service requirement. The Company's contribution was based on
matching 100% of the first 3% of salary deferral elected by each eligible
employee. Effective May 29, 2001 the Company's contribution was increased to
matching 100% of the first 6% of salary deferral, with matching dollars to be in
the form of the Company's common stock. The Company's contribution expense for
the years ended March 31, 2003, 2002 and 2001 was $88,804, $72,692 and $27,649,
respectively.

NOTE 18 - DEFERRED COMPENSATION PLAN
------------------------------------

On March 20, 2001, at a special meeting of the Board of Directors, the Board
adopted a non-qualified deferred compensation plan for the principal
stockholder, President and Chief Executive Officer, Theodore E. Charles
effective April 1, 2001. Under the terms of this plan, Mr. Charles will annually
defer $100,000 of his salary in return for the Company's unsecured promise to
pay him a retirement benefit upon his retirement on or after attaining age 60.
The amount of this retirement benefit will be determined solely by the
investment performance of the amount deferred by Mr. Charles and invested by the
Company. This retirement benefit will be paid to Mr. Charles, at his election,
either in a lump sum or in installments over a period of 10 years. Should Mr.
Charles die prior to reaching retirement, his designated beneficiary will
receive a pre-retirement death benefit calculated in exactly the same manner.
This non-qualified deferred compensation plan is one in which Mr. Charles is
electing to defer current salary. There are no additional corporate funds being
contributed to the plan. In the year ending March 31, 2003 Mr. Charles elected
to receive the entire deferred balance owed to him by the Company in a lump sum
and is no longer deferring his compensation.

NOTE 19 - EMPLOYMENT AGREEMENTS
-------------------------------

The Company entered into employment agreements with its President and Chief
Financial Officer. The employment agreements provide for continued payments of
specified compensation and benefits for specified periods. The employment
agreements also provide for severance benefits if the President or Chief
Financial Officer resign for just cause, as defined in the employment
agreements, just cause including a significant decrease by the Board of
Directors of their duty or authority. Severance benefits include, among other
things, 60 months base salary for the President and 36 months base salary for
the Chief Financial Officer.



                                       36
<PAGE>



                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES
                -------------------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                                   (Continued)
                                   -----------
                    Years Ended March 31, 2003, 2002 and 2001
                    -----------------------------------------

NOTE 20 - LIQUIDATION OF INVESTORS CAPITAL INTERNET AND TECHNOLOGY FUND
-----------------------------------------------------------------------

The Eastern Point Advisors (formerly Investors Capital) Funds' Board of Trustees
voted to liquidate the Investors Capital Internet and Technology Fund as of May
31, 2001. The Board determined that because of the small asset size of the Fund
and the costs involved, it was in the best interests of the shareholders to
cease operations. Sales of new shares were discontinued as of April 23, 2001.
Eastern Point Advisors is a Delaware Business Trust. Eastern Point Advisors,
Inc., a subsidiary of the Company, was the investment advisor to Investors
Capital Internet and Technology Fund.







                                       37
<PAGE>


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

         None.

                                    PART III

ITEM 10. Directors and Executive Officers of the Registrant.

     The following table presents information about each of our executive
officers and directors. All directors hold office until the next annual meeting
of stockholders or until successors have been duly elected and qualified. There
are no arrangements or understandings between any director and any other person
pursuant to which he or she was selected as a director.
<TABLE>
<CAPTION>


NAME                                   AGE POSITION(S) HELD                                                    DIRECTOR SINCE
<S>                                     <C>  <C>                                                               <C>
Theodore E. Charles..............       59 President, Chairman of the Board, Chief Executive Officer, and      July 1995
                                           Director
Timothy B. Murphy................       37 Executive Vice President, Treasurer, Chief Financial Officer, and   July 1995
                                           Director
C. David Weller..................       46 Vice President, General Counsel, and Assistant Secretary                   --
Janice M. Charles................       51 Secretary                                                                  --
David R. Smith...................       41 Director                                                            March 2000
Stephen Parker...................       69 Director                                                            March 2001
James F. Twaddell................       64 Director                                                            April 2001
C. Troy Shaver, Jr...............       56 Director                                                            December 2001
</TABLE>


     THEODORE E. CHARLES, founder of Holdings in July of 1995, serves as
chairman of the board, chief executive officer and president. Mr. Charles also
serves as the chief executive officer of Investors Capital Corporation and
Eastern Point Advisors. In addition, he is the founder and co-owner of two other
unconsolidated companies: Investors Marketing Services, Inc. in June of 1989 and
Eastern Point Distributors, LLC, in April of 1999.

     Mr. Charles received his Bachelors degree from Ithaca College, Ithaca, New
York in May of 1964. He also has graduate hours from the University of Hartford,
Hartford, Connecticut and St. Lawrence University, Canton, New York. Mr. Charles
was previously a life insurance agent with National Life of Vermont. He
currently holds various securities licenses, including the series 6, 63, 7 and
24. Mr. Charles is a member of the Financial Planning Association and has been
since 1985. He was formerly Chairman of the Shareholder Advisory Board of Life
USA Insurance Company and is a former member of the Board of Trustees of the
Museum Council, Museum of Fine Arts in Boston. Mr. Charles is married to Janice
M. Charles.

     TIMOTHY B. MURPHY is also a July 1995 founder of Holdings and currently
serves as treasurer, chief financial officer and a director. Since August of
1994, Mr. Murphy has also served as president of Investors Capital Corporation.
In addition, since January of 1995 Mr. Murphy has been president of Eastern
Point Advisors. He entered the securities industry in May of 1991 as an
operations manager, assisting brokers in the Boston regional office of Clayton
Securities. From February through August of 1994, he was a compliance officer of
Baybanks Brokerage in Burlington, Massachusetts and a vice president of G.R.
Stuart & Company, a brokerage firm located in Maynard, Massachusetts. Mr. Murphy
earned a Bachelor of Science degree in Finance from Babson College, Wellesley,
Massachusetts in May 1986. He holds various securities licenses, including the
series 4, 7, 24, 27, 53, 63 and 65. Mr. Murphy is a member of the New England
Securities Compliance Group and past member of the National Society of
Compliance Professionals.

     DAVID R. SMITH is a founding partner and Managing Director of Charter
Financial Publishing Network in Shrewsbury, New Jersey. Founded in March 2000,
CFPN publishes, markets and distributes information for the financial services
industry. He is co-founder of, and currently oversees sales, marketing and
circulation for FINANCIAL ADVISOR magazine, along with other newsletters, books
and investment charts distributed by CFPN. He was previously Senior Vice
President of Dow Jones Financial Publishing Corporation, where he served as
Publisher of DOW JONES INVESTMENT ADVISOR and Associate Publisher of DOW JONES
ASSET MANAGEMENT magazines since October of 1987. Mr. Smith attended Hobart
College in Geneva, New York from August of 1982 through January of 1983 and
graduated from Monmouth College in West Long Branch, New Jersey in June of 1985.



                                       38
<PAGE>



     STEPHEN PARKER was formerly a vice president of Allmerica Financial, a
Fortune 500 financial services firm located in Worcester, Massachusetts. He was
also president of Allmerica Investment Management Company (AIMCO), the
Registered Investment Advisory Company (RIA). Prior to joining Allmerica
Investments, Mr. Parker was chairman and chief executive officer of Freedom
Capital Management, a subsidiary of John Hancock, with $2.7 billion under
management including 12 mutual funds. Mr. Parker has held positions of president
and CEO of Interact Management, Inc., an affiliate of the Colonial Group; and
Moseley Securities, a regional brokerage firm. Mr. Parker has been a director of
the Securities Industry Association (SIA), has served on many committees, and
has all series of Securities Registrations. He is a graduate of Harvard
University, with a B.A. in Economics.

     JAMES F. TWADDELL was a member of the corporate finance team of Schneider
Securities, an active underwriter of small and medium sized companies. He is
also Chairman of the Trainer Wortham First Mutual Fund. Mr. Twaddell is the
former Chairman and Director of the National Investment Bankers Association
(NIBA). He is also a former member of the National Association of Securities
Dealers (NASD) Business District committee. Prior to entering the financial
services industry, Mr. Twaddell served in the foreign service office of the U.S.
State Department. He has served on the board of directors of numerous public
companies. He is a 1961 graduate of Brown University with a B.A. in American
Civilization.

     C. TROY SHAVER, JR. is the Vice Chairman of GoldK, Inc., a full-service
retirement company and a leading provider of online retirement plans. He is also
President and CEO of GoldK Investment Services, Inc., the division which enables
GoldK to offer a self-directed brokerage option in a 401(k) plan. Prior to
joining GoldK, Mr. Shaver was President of State Street Research Investment
Services Inc., President and CEO of John Hancock Funds, Inc. and Executive Vice
President and Director of Oppenheimer Management Corporation. He held similar
roles at State Street Research, Hancock and Oppenheimer dealing with mutual
funds and the development and restructuring of strategies for sales, marketing,
distribution and customer service. He is a 1969 graduate of Dartmouth College
with a B.A. in Geology.

ITEM 11. Executive Compensation.

         The information required by Item 11 is set forth in the Proxy
         Statement and is incorporated herein by reference.

ITEM 12. Security Ownership of Certain Beneficial Owners and Management and
         Related Stockholder Matters.

         The information required by Item 12 is set forth in the Proxy Statement
         and is incorporated herein by reference.

ITEM 13. Certain Relationships and Related Transactions.

         The information required by Item 13 is set forth in the Proxy Statement
         and is incorporated herein by reference.

ITEM 14. Controls and Procedures.

     Our Chief Executive Officer and Chief Financial Officer have concluded,
based on their evaluation within 90 days of the filing date of this report, that
our disclosure controls and procedures are effective for gathering, analyzing
and disclosing the information we are required to disclose in our reports filed
under the Securities Exchange Act of 1934. There have been no significant
changes in our internal controls or in other factors that could significantly
affect these controls subsequent to the date of the previously mentioned
evaluation.









                                       39
<PAGE>


                                     PART IV

ITEM 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.

         (a) Exhibits.
<TABLE>
<CAPTION>


     Exhibit
     Number                                                              Description
     --------                                                            -----------
        <S>                                                            <C>
        3.1 Articles of Organization, as amended.                        Incorporated by reference to the Company's registration
                                                                         statement on Form SB-2 File #333-43664.
        3.2 By-laws.                                                     Incorporated by reference to the Company's registration
                                                                         statement on Form SB-2 File #333-43664.
        4.1 Form of Stock Certificate of the Company.                    Incorporated by reference to the Company's registration
                                                                         statement on Form SB-2 File #333-43664.
        10.1 Employment agreement with Theodore E. Charles.              Incorporated by reference to the Company's registration
                                                                         statement on Form SB-2 File #333-43664.
        10.2 Employment agreement with Timothy B. Murphy.                Incorporated by reference to the Company's registration
                                                                         statement on Form SB-2 File #333-43664.
</TABLE>



     Any exhibit not included with this Form 10-K when furnished to any
shareholder of record will be furnished to such shareholder upon written request
and payment of up to $.25 per page plus postage. Such requests should be
directed to Investors Capital Holdings, LTD., 230 Broadway East, Lynnfield, MA
01940-2320.

(b) Reports on Form 8-K.

     There were no reports on Form 8-K required to be filed during the fourth
quarter of Fiscal 2003.

                                       40
<PAGE>



                                   SIGNATURES

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

                                               INVESTORS CAPITAL HOLDINGS, LTD.

                          By:                   /s/ Timothy B. Murphy
                                                ------------------------------
                                                Chief Financial Officer
                          Date:                 June 30, 2003

     Pursuant to the requirements of the Securities Exchange 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/ Theodore E. Charles                  Chairman, President, Chief Executive Officer and Director     June 30, 2003
---------------------------------------- (Principal Executive Officer)
Theodore E. Charles                      President and Director



/s/ Timothy B. Murphy                    Executive Vice President, Treasurer, Chief Financial          June 30, 2003
---------------------------------------- Officer and Director (Principal Financial and Accounting
Timothy B. Murphy                        Officer)


/s/ David R. Smith                       Director                                                      June 30, 2003
----------------------------------------
David R. Smith

/s/ Stephen Parker                       Director                                                      June 30, 2003
----------------------------------------
Stephen Parker

/s/ James F. Twaddell                    Director                                                      June 30, 2003
----------------------------------------
James F. Twaddell

/s/ C. Troy Shaver, Jr.                  Director                                                      June 30, 2003
----------------------------------------
C. Troy Shaver, Jr.

</TABLE>




                                       41
<PAGE>

                                  CERTIFICATION

I, Theodore E. Charles, certify that:

1.   I have reviewed this annual report on Form 10-K of Investors Capital
     Holdings, Ltd.;
2.   Based on my knowledge, this annual report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     this annual report;
3.   Based on my knowledge, the financial statements, and other financial
     information included in this annual report, fairly present in all material
     respects the financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this annual report;
4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
     a)   designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this annual report
          is being prepared;
     b)   evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual report (the "Evaluation Date"); and
     c)   presented in this annual report our conclusions about the
          effectiveness of the disclosure controls and procedures based on our
          evaluation as of the Evaluation Date;
5.   The registrant's other certifying officers and I have disclosed, based on
     our most recent evaluation, to the registrant's auditors and the audit
     committee of registrant's board of directors (or persons performing the
     equivalent functions):
     a)   all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and
     b)   any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and
6.   The registrant's other certifying officers and I have indicated in this
     annual report whether there were significant changes in internal controls
     or in other factors that could significantly affect internal controls
     subsequent to the date of our most recent evaluation, including any
     corrective actions with regard to significant deficiencies and material
     weaknesses.

Date: June 30, 2003

By: /s/ Theodore  E. Charles
---------------------------------------
Theodore E. Charles
Chairman, President and
 Chief Executive Officer and Director



                                       42
<PAGE>



                                  CERTIFICATION

I, Timothy B. Murphy, certify that:

1.   I have reviewed this annual report on Form 10-K of Investors Capital
     Holdings, Ltd.;
2.   Based on my knowledge, this annual report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     this annual report;
3.   Based on my knowledge, the financial statements, and other financial
     information included in this annual report, fairly present in all material
     respects the financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this annual report;
4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
     d)   designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this annual report
          is being prepared;
     e)   evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual report (the "Evaluation Date"); and
     f)   presented in this annual report our conclusions about the
          effectiveness of the disclosure controls and procedures based on our
          evaluation as of the Evaluation Date;
5.   The registrant's other certifying officers and I have disclosed, based on
     our most recent evaluation, to the registrant's auditors and the audit
     committee of registrant's board of directors (or persons performing the
     equivalent functions):
     c)   all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and
     d)   any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and
6.   The registrant's other certifying officers and I have indicated in this
     annual report whether there were significant changes in internal controls
     or in other factors that could significantly affect internal controls
     subsequent to the date of our most recent evaluation, including any
     corrective actions with regard to significant deficiencies and material
     weaknesses.

Date: June 30, 2003

By: /s/ Timothy B. Murphy
-------------------------------------
Timothy B. Murphy
Executive Vice President, Treasurer,
 Chief Financial Officer and Director




                                       43