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

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**FORM 10-Q**

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(Mark One)

**[X]       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
             SECURITIES EXCHANGE ACT OF 1934**

**For the Quarterly Period Ended June 30, 2000**

**OR**

**[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934**

**For the transition period from ________to _________**

**Commission file number 0-19872**

**WALKER INTERACTIVE SYSTEMS, INC.**
(Exact name of Registrant as specified in its Charter)



|**Delaware**                                                   | **95-2862954**                         
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

**303 Second StreetSan Francisco, California     94107**(Address of Principal Executive Offices including Zip Code)

**(415) 495-8811**(Registrant's Telephone Number, Including Area Code)







Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file reports), and (2) has been subject to such filing
requirements for the past 90 days.    YES [X]    NO [  ]

There were 14,617,722 Shares of $.001 Par Value Common Stock outstanding as of
                               August 4, 2000.







**WALKER INTERACTIVE SYSTEMS, INC.
      QUARTERLY REPORT ON FORM 10-Q FOR THE PERIOD ENDED JUNE 30, 2000
                                TABLE OF CONTENTS**



|**PART I.   FINANCIAL INFORMATION**                                                                                   | **Page No.**
|--------------------------------------------------------------------------------------------------------------------- | ------------
|                                                                                                                      |             
|Item 1.   Interim Consolidated Financial Statements
                  (unaudited):                                    |             
|                                                                                                                      |             
|Condensed Balance Sheets at June 30, 2000 and
     December 31, 1999                                                  | **          
|                                                                                                                      |             
|Condensed Statements of Operations for the
          
    three and six months ended June 30, 2000 and 1999           | **          
|                                                                                                                      |             
|Condensed Statements of Cash Flows for the
          
    six months ended June 30, 2000 and 1999                     | **          
|                                                                                                                      |             
|Notes to Financial Statements                                                                                         | **          
|                                                                                                                      |             
|Item 2.   Management's Discussion and Analysis of Financial
                      Condition and Results of Operations | **          
|                                                                                                                      |             
|Item 3.   Quantitative and Qualitative Disclosures About Market Risk                                                  | **          
|                                                                                                                      |             
|**PART II.  OTHER INFORMATION**                                                                                       |             
|                                                                                                                      |             
|Item 6.   Exhibits and Reports on Form 8-K                                                                            | **          
|                                                                                                                      |             
|**Signatures**                                                                                                        | **          

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**PART I -- FINANCIAL INFORMATION**

Item 1. Financial Statements

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**WALKER INTERACTIVE SYSTEMS, INC.

                          CONSOLIDATED BALANCE SHEETS**
(in thousands, except share amounts)

`June 30,     December 31,
                                                            2000           1999
                                                        ------------  ------------
                                                         (unaudited)
ASSETS                                                                            
Current assets:
   Cash and cash equivalents...........................      $6,781        $9,187
   Short-term investments..............................       5,705         6,642
   Accounts receivable, net of allowance for doubtful
     accounts of $1,422 - June 30, 2000 and $4,554 -
     December 31, 1999.................................      12,216        17,368
   Prepaid expenses....................................       2,968         2,471
   Other receivables...................................         391           812
                                                        ------------  ------------
       Total current assets............................      28,061        36,480
Long-term investments..................................       1,516         6,185
Property and equipment, net                                   2,860         4,169
Capitalized software, net of accumulated amortization
  of $50,425 - June 30, 2000 and $47,379 -
  December 31, 1999....................................      10,268        10,653
Other assets...........................................          95           463
                                                        ------------  ------------
Total assets...........................................     $42,800       $57,950
                                                        ============  ============

LIABILITIES AND STOCKHOLDERS' EQUITY                                              
Current liabilities:
   Accounts payable....................................      $3,627        $4,203
   Accrued liabilities.................................      10,757        12,788
   Deferred revenue....................................      12,648        17,168
                                                        ------------  ------------
       Total current liabilities.......................      27,032        34,159
Deferred revenue.......................................       1,694         1,697
Other long-term obligations............................       2,866         2,975
                                                        ------------  ------------
       Total liabilities...............................      31,592        38,831
                                                        ------------  ------------

Commitments and contingencies

Stockholders' equity
   Common stock, $.001 par value: 50,000,000 shares
    authorized; issued 14,616,241 shares - June 30,
    2000; 14,257,185 shares - December 31, 1999........          14            14
   Additional paid-in capital..........................      75,905        74,566
   Accumulated other comprehensive income..............         (40)           33
   Accumulated deficit.................................     (64,671)      (55,450)
   Treasury stock at cost (- shares - June 30,
    2000 and 26,091 shares - December 31, 1999)........           --          (44)
                                                        ------------  ------------
       Total stockholders' equity......................      11,208        19,119
                                                        ------------  ------------
Total liabilities and stockholders' equity.............     $42,800       $57,950
                                                        ============  ============`

See notes to consolidated financial statements

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**WALKER INTERACTIVE SYSTEMS, INC.

               CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)**
(in thousands, except per share amounts)

`Three Months Ended     Six Months Ended
                                             June 30,              June 30,
                                      --------------------- ---------------------
                                         2000       1999       2000       1999
                                      ---------- ---------- ---------- ----------
REVENUES:                                                                                 
  License............................    $1,468     $4,778     $2,294     $8,168
  Maintenance........................     6,783      8,038     14,395     15,947
  Consulting.........................     5,964     12,528     11,976     25,136
                                      ---------- ---------- ---------- ----------
     Total revenues..................    14,215     25,344     28,665     49,251

OPERATING EXPENSES:                                                                       
  Costs of revenues:
     Costs of licenses,
      maintenance and consulting.....     6,314     11,520     14,172     22,964
     Amortization of
      capitalized software...........     1,720      1,140      3,047      2,629
  Sales and marketing................     4,994      5,707      9,567     11,643
  Product development................     2,665      4,112      5,688      7,462
  General and administrative.........     2,467      3,696      5,792      7,297
  Impairment of capitalized
     software and associated goodwill.     --        9,003       --        9,003
  Restructuring charges...............     --        3,134       --        3,134
                                      ---------- ---------- ---------- ----------
     Total operating expenses........    18,160     38,312     38,266     64,132
                                      ---------- ---------- ---------- ----------
Operating loss.......................    (3,945)   (12,968)    (9,601)   (14,881)
     Interest income, net............       181        234        478        473
                                      ---------- ---------- ---------- ----------
Loss before income taxes.............    (3,764)   (12,734)    (9,123)   (14,408)
     Provision for income taxes......        50     13,137         98     12,501
                                      ---------- ---------- ---------- ----------

NET LOSS.............................    (3,814)   (25,871)    (9,221)   (26,909)         
                                      ========== ========== ========== ==========

BASIC NET LOSS PER SHARE.............    ($0.26)    ($1.85)    ($0.64)    ($1.92)         
                                      ========== ========== ========== ==========
Shares used to compute basic
     net loss per share..............    14,478     13,965     14,421     14,022
                                      ========== ========== ========== ==========

DILUTED NET LOSS PER SHARE...........    ($0.26)    ($1.85)    ($0.64)    ($1.92)         
                                      ========== ========== ========== ==========
Shares used to compute diluted
     net loss per share..............    14,478     13,965     14,421     14,022
                                      ========== ========== ========== ==========`

See notes to consolidated financial statements

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**WALKER INTERACTIVE SYSTEMS, INC.

               CONSOLIDATED STATEMENTS OF CASH FLOWS(UNAUDITED)**
(in thousands)

`Six Months Ended
                                                                June 30,
                                                        ------------------------
                                                             2000         1999
                                                        -----------  -----------
CASH FLOWS FROM OPERATING ACTIVITIES:                                           
     Net loss..........................................    ($9,221)    ($26,909)
     Adjustments to reconcile net loss to
       net cash provided by operating activities:
       Depreciation and amortization...................      4,085        4,325
       Change in allowance for doubtful accounts.......     (3,132)         159
       Deferred tax asset, net.........................         --       12,501
       Impairment of capitalized
       software and associated goodwill.................        --        9,003
     Changes in operating assets and liabilities:
       Accounts receivable.............................      8,705        1,428
       Prepaids and other assets.......................       (497)      (1,122)
       Accounts payable & accrued liabilities..........     (2,716)       1,589
       Deferred revenue................................     (4,523)       4,955
       Other...........................................        920           77
                                                        -----------  -----------
           Net cash (used)/provided  by operations.....     (6,379)       6,006
                                                        -----------  -----------

CASH FLOWS FROM FINANCING ACTIVITIES:                                           
     Proceeds from employee stock purchase plan
       issuances and stock options exercised...........      1,383          381
     Treasury stock acquired...........................         --         (906)
     Capital lease payments............................         --          (71)
                                                        -----------  -----------
           Net cash provided /(used) by financing
              activities...............................      1,383         (596)
                                                        -----------  -----------

CASH FLOWS FROM INVESTING ACTIVITIES:                                           
     Purchases of short- and long-term investments.....     (2,335)      (8,540)
     Maturities of short-term investments..............      2,500        2,625
     Sales of short-term investments...................      5,441        1,508
     Purchases of property and equipment...............       (373)      (1,192)
     Additions to capitalized software.................     (2,661)      (3,184)
     Other.............................................         18         (183)
                                                        -----------  -----------
           Net cash provided/(used) by investing
              activities...............................      2,590       (8,966)
                                                        -----------  -----------

NET DECREASE  IN CASH AND CASH EQUIVALENTS.............     (2,406)      (3,556)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD........      9,187       15,556
                                                        -----------  -----------
CASH AND CASH EQUIVALENTS - END OF PERIOD..............     $6,781      $12,000 
                                                        ===========  ===========
Supplemental disclosure:
    Cash paid for income taxes.........................       $118         $166`

See notes to consolidated financial statements

---

WALKER INTERACTIVE SYSTEMS, INC.



NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)



(Amounts in thousands except per share data)

1. SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted
accounting principles and include all adjustments (consisting only of normal recurring adjustments) which the Company considers
necessary for a fair presentation of the financial position, operating results and cash flows for those periods.  Results for the
interim periods are not necessarily indicative of the results for the entire year.  These condensed consolidated financial statements
and any notes thereto should be read in conjunction with the audited consolidated financial statements included in the Walker
Interactive Systems, Inc. Annual Report on Form 10-K for the year ended December 31, 1999.

1. EARNINGS PER SHARE

The Company calculates basic earnings per share ("EPS") and diluted EPS in accordance with Statement of Financial
Accounting Standards ("SFAS") No. 128, "Earnings per Share".  Basic EPS is computed by dividing net income (loss) by the
weighted average number of common shares outstanding for that period. Diluted EPS takes into account the effect of dilutive
instruments, such as stock options, and uses the average share price for the period in determining the number of common stock
equivalents that are to be added to the weighted average number of shares outstanding.  Common stock equivalents are excluded from
the diluted loss per share calculation because the effect would be antidilutive.

1. COMPREHENSIVE INCOME/(LOSS)
2. IMPAIRMENT AND RESTRUCTURING CHARGES
3. DIVESTITURES
4. RECENT ACCOUNTING PROUNCEMENTS

In December 1999, the Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 101, "Revenue
Recognition in Financial Statements" (SAB 101). This summarizes certain areas of the Staff's views in applying generally
accepted accounting principles to revenue recognition in financial statements. The effective date has been delayed until no later
than the fourth quarter of fiscal years beginning after December 31, 1999. The Company believes that implementation of SAB 101 will
not have a material adverse effect on the results of operations for fiscal 2000.



WALKER INTERACTIVE SYSTEMS, INC.



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



The following discussion of results of operations and financial condition of the Company should be read in conjunction with
the Company's financial statements and notes thereto included elsewhere in this Form 10-Q.  The report on this Form 10-Q contains
forward-looking statements, including statements related to industry trends and demand for mainframe products, expected resolution of
legal proceedings, cash commitments, working capital requirements, and possible expansion in international markets.  Discussions
containing such forward-looking statements may be found in the material set forth under "Management's Discussion and Analysis of
Financial Condition and Results of Operations", generally and specifically therein under the captions  "Liquidity and
Capital Resources," and "Additional Risk Factors". Actual events or results may differ materially from those discussed
herein.  The Company disclaims any obligation to update these forward-looking statements as a result of subsequent events.  The risk
factors on pages 12 through 16, among others, should be considered in evaluating the Company's prospects and future financial
performance.

Walker designs its software products specifically for the Internet architecture and e-business B2B models and believes that its
architecture is among the most scalable and adaptable available for enterprise-level business software.  The Company's strategy is to
offer enterprise financial, operational and analytical e-business solutions to a variety of industries. Walker's e-business solutions
support and enhance enterprise-wide financial, operational and analytic processes, including procurement, revenue management,
financial management and insight, business planning, budgeting, forecasting, and financial consolidation. The Company's software
products utilize the Microsoft Windows operating systems on the desktop, NT, UNIX and OS/390 operating systems on the server and
industry-leading On Line Analytical Processing (OLAP), Relational Database Management Systems (RDBMS) including IBM's DB2, Hyperion
Solutions Essbase,  Microsoft SQL/Server and Oracle Express.

The Company divested its IMMPOWER product line in April 2000 and has a letter of intent to divest its Aptos product  line with
closure scheduled for the third quarter. The Company has also commenced the development and market testing of a knowledge management
analytical applications project.

RESULTS OF OPERATIONS

Quarters ended June 30, 2000 and June 30, 1999

REVENUES.

Total revenues for the three months ended June 30, 2000 were $14.2 million, a decrease of $11.1 million, or 43.9%, as compared to
the three months ended June 30, 1999.

License revenues for the three months ended June 30, 2000 were $1.5 million, a decrease of $3.3 million, or 68.8%, as compared to
the three months ended June 30, 1999. The license revenue decrease reflects the Company's longer sales cycle resulting from its
transition to e-business.  License revenues were also negatively impacted by reduced activity in the IMMPOWER and Aptos product
lines. The Company sold the Immpower division in April 2000 (see Note 5 - Divestiture) and is in the process of negotiating a sale of
the Aptos division.  No license revenues for these two product lines were recorded in the three months ended June 30, 2000, compared
with $0.7 million for the same quarter in the previous year.

Maintenance revenues for the three months ended June 30, 2000 were $6.8 million, a decrease of $1.2 million, or 15.0%, as compared
to the three months ended June 30, 1999.  The decrease was mainly in a legacy product line, as more maintenance contracts lapsed than
were replaced by new contracts.  In addition, $0.5 million of IMMPOWER maintenance revenues were recorded in the three months ended
June 30, 1999, compared to only $0.1 million in the three months ended June 30, 2000.

Consulting revenues for the three months ended June 30, 2000 were $6.0 million, a decrease of $6.6 million, or 52.4%, as compared
to the three months ended June 30, 1999. The revenue decrease reflects a decline in Year 2000 consulting projects and non-core
consulting projects of $4.2 million, comparing the three months ended June 30, 2000 with the same period in the previous year. The
Company believes the decrease in consulting revenues is also partly attributable to a reduction in implementation engagements as a
consequence of the decreased license revenues.

COSTS OF LICENSES, MAINTENANCE AND CONSULTING.

Costs of licenses, maintenance and consulting were $6.3 million for the three months ended June 30, 2000, representing 44% of
total revenues, and $11.5 million for the three months ended June 30, 1999, representing 45% of total revenues.

The costs of licenses as a percentage of license revenues decreased in the three months ended June 30, 2000 as compared to the
three months ended June 30, 1999. The decrease results from a smaller proportion of license revenues generated from the Company's
products that utilize technology licensed from third parties.

The cost of maintenance, as a percentage of related revenue, was relatively unchanged in the three months ended June 30, 2000
as compared to the three months ended June 30, 1999.

The costs of consulting, as a percentage of related revenue, decreased slightly in the three months ended June 30, 2000 as
compared to the three months ended June 30, 1999.The decrease is primarily attributable to lower unrecovered travel costs in
the three months ended June 30, 2000.

SALES AND MARKETING.

Sales and marketing costs for the three months ended June 30, 2000 were $5.0 million, a decrease of $0.7 million, or 12.3%, as
compared to the three months ended June 30, 1999.  This decrease is largely attributable to lower employee costs incurred in the
three months ended June 30, 2000 compared to the equivalent period in fiscal 1999, partially offset by spending on a knowledge
management analytical applications project.  As a percentage of total revenues, sales and marketing expenses were 35.1% and 22.5% in
the three months ended June 30, 2000 and 1999, respectively.  Sales and marketing expenses increased as a percentage of revenue
because of the decrease in revenues in the three months ended June 30, 2000 as compared to the same period in the previous year.

PRODUCT DEVELOPMENT.

Product development related expenses, excluding amortization of capitalized software, were as follows:

`Three Months Ended
                                             June 30,
                                      -------------------
                                         2000      1999
                                      --------- ---------
Product development expenditures.....   $4,210    $5,386
Less:
   Additions to capitalized software.   (1,555)   (1,274)
                                      --------- ---------
Product development expense..........   $2,655    $4,112
                                      ========= =========`



Net product development expense decreased $1.4 million, or 35.1%, in the three months ended June 30, 2000 as compared to the three
months ended June 30, 1999 and were 18.7% and 16.2% of total revenues in the second quarters of 2000 and 1999, respectively.
Decreased employee costs in the three months ended June 30, 2000 were partially offset by spending on a knowledge management
analytical applications project. Additions to capitalized software increased $0.3 million, or 22.1%, in the second quarter of fiscal
2000 as compared to the second quarter of fiscal 1999 and were 36.8% and 23.7% of product development expenditures, respectively. The
increase in software costs capitalized in the three months ended June 30, 2000 is primarily attributable to product development
resources being allocated to both analytics and e-business products that were released at the end of the second quarter.





AMORTIZATION OF CAPITALIZED SOFTWARE.

Capitalized software amortization in the three months ended June 30, 2000 was $1.7 million, an increase of $0.6 million, or 50.8%,
as compared to the three months ended June 30, 1999. The increase in the second quarter of fiscal 2000 was due to additional
amortization associated with the Company's ongoing practice of reevaluating the lives of capitalized software products, as well as
higher amortization resulting from recent product releases.

GENERAL AND ADMINISTRATIVE.

General and administrative expenses in the three months ended June 30, 2000 were $2.5 million, a decrease of $1.2 million, or
33.3%, as compared to the three months ended June 30, 1999. As a percentage of total revenues, general and administrative expenses
were 17.3% and 14.6% in the three months ended June 30, 2000 and 1999, respectively.  The absolute decrease in the three months ended
June 30, 2000 is due to a decrease of $0.3 million in bad debt expense, and also to lower costs for compensation, facilities and
outside contractors mainly resulting from the Company's restructuring actions during the second half of 1999. General and
administrative expenses increased as a percentage of revenue because of the decrease in revenues in the three months ended June 30,
2000 as compared to the same period in the previous year.

INCOME TAX EXPENSE (BENEFIT).

In the three months ended June 30, 2000, the Company provided $50,000 for state income taxes that could not be offset against net
operating loss carryforwards. In the three months ended June 30, 1999, the Company recorded a valuation allowance of $13.1 million to
fully reserve its deferred tax assets due to a change in strategic direction and the timing of expiration of certain tax credits.



Six months ended June 30, 2000 and June 30, 1999



REVENUES.

Total revenues for the six months ended June 30, 2000 were $28.7 million, a decrease of $20.6 million, or 41.8%, as compared to
the six months ended June 30, 1999.

License revenues for the six months ended June 30, 2000 were $2.3 million, a decrease of $5.9 million, or 71.9%, as compared to
the six months ended June 30, 1999. The license revenue decrease mainly reflects the Company's longer sales cycle resulting from its
transition to e-business.  License revenues were also negatively impacted by reduced activity in the IMMPOWER and Aptos product
lines, which the Company is divesting.  License revenues for these two product lines totaled $0.1 million for the six months ended
June 30, 2000, compared with $2.7 million for the first half of fiscal 1999.

Maintenance revenues for the six months ended June 30, 2000 were $14.4 million, a decrease of $1.6 million, or 9.7%, as compared
to the six months ended June 30, 1999.  The decrease was mainly in a legacy product line, as more maintenance contracts lapsed than
were replaced by new contracts.  In addition, $1.1 million of IMMPOWER maintenance revenues were recorded in the six months ended
June 30, 1999, compared to  $0.6 million in the six months ended June 30, 2000.

Consulting revenues for the six months ended June 30, 2000 were $12.0 million, a decrease of $13.2 million, or 52.4%, as compared
to the six months ended June 30, 1999. The revenue decrease mainly reflects a decline in Year 2000 consulting projects and non-core
consulting projects of $7.3 million, comparing the six months ended June 30, 2000 with the same period in the previous year. The
Company believes the decrease in consulting revenues is also partly attributable to a reduction in implementation engagements as a
consequence of the decreased license revenues.

COSTS OF LICENSES, MAINTENANCE AND CONSULTING.

Costs of licenses, maintenance and consulting were $14.2 million for the six months ended June 30, 2000, representing 49% of total
revenues, and $23.0 million for the six months ended June 30, 1999, representing 47% of total revenues.

The costs of licenses as a percentage of license revenues increased in the six months ended June 30, 2000 as compared to the six
months ended June 30, 1999. The increase results from a larger proportion of license revenues generated from the Company's products
that utilize technology licensed from third parties.

The cost of maintenance, as a percentage of related revenue, was relatively unchanged in the six months ended June 30, 2000 as
compared to the six months ended June 30, 1999.

The costs of consulting, as a percentage of related revenue, increased in the six months ended June 30, 2000 as compared
to the six months ended June 30, 1999, mainly because of the decrease in consulting revenues in the six months ended June 30, 2000 as
compared to the same period in the previous year.

SALES AND MARKETING.

Sales and marketing costs for the six months ended June 30, 2000 were $9.6 million, a decrease of $2.1 million, or 17.8%, as
compared to the six months ended June 30, 1999.  This decrease is largely attributable to lower staff costs incurred in the six
months ended June 30, 2000 compared to the equivalent period in fiscal 1999, partially offset by spending on a knowledge management
analytical applications project.  As a percentage of total revenues, sales and marketing expenses were 33.3% and 23.6% in the six
months ended June 30, 2000 and 1999, respectively.  Sales and marketing expenses increased as a percentage of revenue because of the
decrease in revenues in the six months ended June 30, 2000 as compared to the same period in the previous year. The Company
anticipates that sales and marketing expenses to further promote the Company and its e-business and other offerings will increase in
2000.

PRODUCT DEVELOPMENT.

Product development related expenses, excluding amortization of capitalized software, were as follows:

`Six Months Ended
                                             June 30,
                                      -------------------
                                         2000      1999
                                       --------- ---------
Product development expenditures.....   $8,349   $10,646
Less:
   Additions to capitalized software.   (2,661)   (3,184)
                                       --------- ---------
Product development expense..........   $5,688    $7,462
                                      ========= =========`



Net product development expense decreased $1.8 million, or 23.8%, in the six months ended June 30, 2000 as compared to the six
months ended June 30, 1999 and were 19.8% and 15.1% of total revenues in the first six months of 2000 and 1999, respectively.
Decreased employee costs in the six months ended June 30, 2000 were partially offset by spending on a knowledge management analytical
applications project. Additions to capitalized software decreased $0.5 million, or 15.1%, in the first half of fiscal 2000 as
compared to the same period of fiscal 1999 and were 31.9% and 29.6% of product development expenditures, respectively. The decrease
in software costs capitalized in the six months ended June 30, 2000 is primarily attributable to product development resources being
allocated to projects that did not meet capitalization criteria, mainly during the first quarter, offset by the capitalized costs of
the analytics and e-business products that were released at the end of the second quarter.



AMORTIZATION OF CAPITALIZED SOFTWARE.

Capitalized software amortization in the six months ended June 30, 2000 was $3.0 million, an increase of $0.4 million, or 15.9%,
as compared to the six months ended June 30, 1999. The increase in the first six months of fiscal 2000 is due to additional
amortization associated with the Company's ongoing practice of reevaluating the lives of capitalized software products, as well as
higher amortization resulting from recent product releases.

GENERAL AND ADMINISTRATIVE.

General and administrative expenses in the six months ended June 30, 2000 were $5.8 million, a decrease of $1.5 million, or 20.6%,
as compared to the six months ended June 30, 1999. As a percentage of total revenues, general and administrative expenses were 20.2%
and 14.8% in the six months ended June 30, 2000 and 1999, respectively.  The absolute decrease in the six months ended June 30, 2000
is mainly attributable to lower bad debt expense and reduced staff costs. General and administrative expenses increased as a
percentage of revenue because of the decrease in revenues in the six months ended June 30, 2000 as compared to the same period in the
previous year.

INCOME TAX EXPENSE (BENEFIT).

In the six months ended June 30, 2000, the Company provided $98,000 for state income taxes that could not be offset against net
operating loss carryforwards. In the six months ended June 30, 1999, the Company recorded a valuation allowance of $13.1 million to
fully reserve its deferred tax assets due to a change in strategic direction and the timing of expiration of certain tax credits,
resulting in a net tax provision of $12.5 million.



LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2000, the Company's principal sources of liquidity included cash, cash equivalents and short- and long-term
investments aggregating $14.0 million. The Company believes that its existing cash balances, together with other sources of
liquidity, including cash flows from operating activities and amounts available under the existing $6.0 million line of credit (all
of which was available at June 30, 2000), will satisfy the Company's currently anticipated working capital and capital expenditure
requirements for at least the next twelve months.

The Company's operating activities used cash of $6.4 million in the six months ended June 2000 and provided $6.0 million in the
first half of fiscal 1999. Cash flows from operating activities for the six months ended June 30, 2000 primarily reflected a net loss
of $9.2 million; increases in depreciation and amortization of $4.1 million; decreases in accounts receivable provisions of $3.1
million; decreases in accounts receivable of $8.7 million; decreases in accounts payable of $2.7 million; decreases in deferred
revenue of $4.5 million; and decreases in other assets of $0.9 million. A sigificant portion of these fluctuations is due to the fact
that, following its divestiture, the IMMPOWER division is no longer included in the Company's balance sheet. The fluctuation in other
assets is wholly due to this. Cash flows from operating activities for the six months ended June 30, 1999 primarily reflected a net
loss of $26.9 million; increases in depreciation and amortization of $4.3 million; a write-down of capitalized software and goodwill
totaling $9.0 million; decreases in accounts receivable of $1.4 million; decreases in accounts payable of $1.1 million; a decrease in
the deferred tax asset of $12.5 million; and increases in deferred revenue of $5.0 million.

Financing activities provided $1.4 million in cash during the six months ended June 2000, all of which comprised proceeds from the
issuance of stock under the Company's employee stock purchase plan and proceeds from stock options exercised, and used $0.6 million
in cash during the first six months of fiscal 1999. In the six months ended June 30, 1999, the Company received proceeds from the
issuance of stock under the Company's employee stock purchase plan and proceeds from stock options exercised totaling $0.4 million
and used cash in the amount of $0.9 million for the purpose of repurchasing Company stock.  All stock repurchases were made pursuant
to resolutions of the Company's Board of Directors in 1995 authorizing the repurchase of the Company's outstanding shares of common
stock, not to exceed a total cost of $17.5 million. Through June 30, 2000, the Company had acquired 1,059,500 shares of its common
stock at a cost of $11.1 million.  As of June 30, 2000, the Company had reissued all of the repurchased shares in connection with the
Company's employee stock purchase plan, one of its employee stock option plans and the acquisition of Revere.

Investing activities provided $2.6 million in cash during the six months ended June 30, 2000 and used $9.0 million in cash
during the six months ended June 30, 1999.  The major cash flows in the six months ended June 30, 2000 comprised net sales of
investments totaling $5.6 million, offset by additions to capitalized software of $2.7 million and fixed asset purchases of $0.4
million.  Cash flows from investing activities for the six months ended June 30, 1999 primarily reflected additions to capitalized
software of $3.2 million, fixed asset purchases of $1.2 million, and net outflows from investments totaling $4.4 million.



ADDITIONAL RISK FACTORS

The Company operates in a rapidly changing environment that involves numerous risks and uncertainties which could have
a material adverse effect on the Company.  The following discussion details some, but not all, of these risks and uncertainties.

FLUCTUATION IN OPERATING RESULTS.

The Company's operating results fluctuate as a result of a variety of factors including:

1. the execution of new license agreements;
2. the shipment of software products;
3. customer acceptance criteria for services performed;
4. completion of milestone or other significant development requirements pursuant to the Company's license agreements;
5. the financial terms of consulting agreements and the inclusion of fixed as opposed to variable pricing;
6. third-party royalty payments for licensed software;
7. the demand for the Company's products and services;
8. changes in the Company's product mix;
9. the development and launch of new products, and the life cycles of the Company's existing products;
10. research and development expenditures required to update and expand the Company's product portfolio and related third-party
consulting costs;
11. sales and marketing expenses generally related to the entry into new markets with new or existing products and maintenance of
market share in existing markets;
12. acquisitions and the integration and development of acquired entities or products;
13. competitive conditions in the industry and
14. general economic conditions.
15. As a result, the Company believes that period-to-period comparisons of its operating results are not necessarily meaningful and
should not be relied upon as indications of future performance.

The Company's quarterly operating results are particularly dependent on the number of license agreement bookings executed in each
quarter.  The amount of quarterly bookings has varied substantially from quarter to quarter due to a variety of reasons including:

1. a high proportion of license agreements are negotiated during the latter part of each quarter and may not be completed before the
quarter end;
2. the sales cycles for some of the Company's products are relatively long due to the Company's focus on "enterprise solutions" as
opposed to individual products, which adds complexity to the customer's selection, negotiation and approval process;
3. the amount related to each booking may vary significantly due to the need for different solutions for different customers;
4. procurement procedures may vary from customer to customer, which may affect the timing of the bookings;
5. the period for a customer to complete product evaluations and to complete any subsequent purchase approval may be delayed due to
resource limitations; and
6. economic, political and industrial conditions can adversely affect business opportunities without notice.

In addition, bookings that are executed during a particular quarter may not be recognized as revenue during such quarter because
such bookings may not have met the Company's revenue recognition criteria.  No assurance can be given that the Company will be able
to effect new bookings in accordance with historical results or management's expectations, and the inability of the Company to do so
could have a material adverse effect on the Company's operating results.

While the Company typically sells its software under a standard license agreement, license agreements associated with large
enterprise solutions often require the negotiation of terms and conditions that differ substantially from the Company's standard
license agreement terms.  The negotiation of these agreements may extend the sales cycle. The Company may not always obtain terms and
conditions that permit the recognition of revenue upon shipment of the licensed product or under the percentage of completion method
of contract accounting rules.  Accordingly, revenue may not be recognized after shipment of a product because specified milestones
have not been met or because applicable services have not been completed.

The Company has and expects to enter into fixed-price consulting agreements, particularly in response to increased competition in
the industry.  The Company has recognized lower profit margins on certain fixed-price service agreements when compared to variable
agreements. No assurance can be given that the Company will be able to conclude fixed-price agreements on terms that will allow the
Company to retain its historical operating margins.

The Company has historically generated a majority of its consulting revenue from pre- and post-implementation services.  The
Company has provided services that include, but are not limited to, Year 2000 readiness engagements, best practice solution
engagements and other hardware and software solutions.  The Company intends to continue its pursuit of consulting engagements for
which the Company believes it is qualified. There can be no assurances that these engagements will result in profit margins equal to
or greater than those engagements that are specific to a customer's product implementation.  Also, there can be no assurances that
consulting revenue generated from non-implementation related projects will continue in the future.

Employee- and facility-related expenditures comprise a significant portion of the Company's operating costs and expenses, and are
therefore relatively fixed over the short term.  In addition, the Company's expense levels are based, in significant part, on the
Company's forecasted revenue.  If revenue levels fall below expectations, operating results are likely to be adversely affected.
There can be no assurance that the Company will be able to achieve profitability on a quarterly or annual basis in the future. Any of
the foregoing factors could cause the Company's future operating results to fall below the expectations of public securities market
analysts, which could have an adverse effect on the trading price of the Company's common stock.  See "Volatility of Stock Price."

RELIANCE ON THIRD PARTY TECHNOLOGY.

The Company generates revenue from internally developed software products, some of which utilize technology licensed from third
parties.  The Company expects to continue utilizing third party technology and may enter into agreements with additional business
partners.  If sales of software utilizing third party technology increase disproportionately, gross margins may be below historical
levels due to third party royalty obligations.  There can be no assurances that the third parties will renew existing agreements with
the Company or will not require financial conditions that are unfavorable to the Company.  In addition, there can be no assurances
that existing third party agreements will not be terminated.

INDUSTRY.

Certain software companies, including the Company, have experienced significant economic downturns as a result of technological
shifts and competitive pressures.  These downturns are characterized by decreased product demand, price erosion, work slowdowns and
layoffs.  The Company's operations may, in the future, experience substantial fluctuations from period to period because of such
industry patterns and general economic and political conditions that could affect the timing of orders from customers.  There can be
no assurance that such factors will not have a materially adverse effect on the Company's business, operating results or financial
condition.

INTERNATIONAL.

The Company will continue its presence in international markets by marketing its B2B e-business solutions for the enterprise in
additional countries.  Risks associated with such pursuits include, but are not limited to, the following: changing market demands,
economic and political conditions in foreign markets, foreign exchange fluctuations, longer collections cycles, difficulty in
managing a geographically dispersed organization and changes in international tax laws.  The downturn in the Asia Pacific business
climate had an adverse effect on some market opportunities. Operating results are likely to be adversely affected if the Company's
operations in international markets are not successful.

COMPETITION.

The business and financial applications software market for large complex organizations is intensely competitive.  The Company's
principal competitors with e-business solutions are SAP AG, Oracle Corporation and PeopleSoft, Inc. With the Horizon analytics suite
of products, the Company principally competes with Hyperion Solutions Corporation, Oracle Corporation and Comshare, Inc.

The Company also competes to a lesser extent with other independent software application vendors.  Some of the Company's current
and potential competitors have substantially greater financial, technical, marketing and sales resources than the Company.  Some of
these competitors also offer business application products not offered by the Company, primarily in the areas of human resources and
manufacturing.  However, Walker remains one of the few companies committed to providing and enhancing applications for the mainframe
environment.  Most of the competitors listed above compete with Walker by offering UNIX-based applications.

The Company encounters competition from a broader range of firms in the market for professional services.
Principal competitors include consulting firms Andersen Consulting and IBM Global Services, the consulting divisions of the major
accounting firms, which possess greater resources than the Company, and niche-consulting firms that specialize in the Company's
products and compete primarily on the basis of price of services provided.



The principal competitive factors in the market for business and financial applications software and services
include product functionality, flexibility, portability, integration, reliability, performance, product availability, speed of
implementation, quality of customer support and user documentation, vendor reputation, experience, financial stability, cost
effectiveness and price.  The Company believes that it competes favorably with respect to these factors.  There can be no assurance,
however, that the Company will be able to compete successfully in the future.



RAPID TECHNOLOGICAL CHANGE.

The software industry is characterized by rapid technological change.  The pace of change has accelerated due to advances in
mainframe and client/server technology and the growth in Internet, Intranet and extranet utilization.  The Company expects to
evaluate potential opportunities and may invest in those that are compatible with the Company's strategic direction.  However, there
can be no assurance that any such investments will be profitable.  The Company's products are also designed primarily for use with
certain mainframe and client/server systems.  The introduction of products embodying new technologies and the emergence of new
industry standards can render existing products obsolete.  Accordingly, the Company's future success depends in part upon its ability
to continue to enhance its current products and to develop and introduce new products that respond to evolving customer requirements
and keep pace with technological development and emerging industry standards, such as new operating systems, hardware platforms,
interfaces and third party applications software. There can be no assurances

1. that the Company will be successful in developing and marketing product enhancements or new products that
respond to technological change, changes in customer requirements or emerging industry standards;
2. that the Company will not experience difficulties that could delay or prevent the successful development,
introduction and marketing of such products and enhancements; or
3. that any new products or enhancements that it may introduce will achieve market acceptance.



PRODUCT DEVELOPMENT.

The Company's continued success is dependent on its continued ability to introduce, develop and market new and enhanced versions
of its software products, although there can be no assurance that such ability can be maintained.  The Company plans to continue its
investment in product development in future periods.  However, there can be no assurance that revenues will be sufficient to support
the future product development that is required for the Company to be competitive.  Although the Company may be able to release new
products in addition to enhancements to existing products, there can be no assurance that the Company's new or upgraded products will
be accepted, will not be delayed or canceled, or will not contain errors or "bugs" that could affect the performance of the product
or cause damage to users' data.

PROPRIETARY RIGHTS.

The Company regards its products as proprietary.  Through its license agreements with customers and its internal security systems,
confidentiality procedures and employee agreements, the Company has taken steps to maintain the trade secrecy of its products.
However, there can be no assurances that misappropriation will not occur.  In addition, the laws of some countries do not protect the
Company's proprietary rights to the same extent as do the laws of the United States.  There can be no assurance that the
confidentiality of any proprietary information will provide any meaningful competitive advantage.  The Company has no patents
relating to its products.  The Company believes that, because of the rapid pace of technological change in the computer software
industry, that patents and copyrights are less significant than factors such as the knowledge, ability and experience of the
Company's employees, frequent product enhancements and the timeliness and quality of support services.  There can be no assurance
that the Company's current efforts to retain its products as proprietary will be adequate.

Although the Company believes that its products do not infringe upon the proprietary rights of third parties, there can be no
assurance that third parties will not assert infringement claims against the Company in the future with respect to current or future
products or that any such assertions will not require the Company to enter into royalty arrangements or result in costly litigation.

PRODUCT LIABILITY.

The Company's license agreements with its customers contain provisions designed to limit the Company's exposure to potential
product liability claims. It is possible, however, that the limitation of liability provisions contained in such license agreements
may not be enforced as a result of international, federal, state and local laws or ordinances or unfavorable judicial decisions. The
license and support of the Company's software for use in mission critical applications creates the risk of product liability claims
against the Company. Damage liability or injunctive relief resulting from such a claim could cause a materially adverse impact on the
Company's business, operating results and financial condition.

EMPLOYEES.

The Company believes that its continued success will depend in large part upon its ability to attract, train and retain highly
skilled technical, sales, marketing and managerial personnel.  The Company continues to hire a significant number of sales,
marketing, services and technical personnel. Because of the high level of demand, competition for such personnel is intense and the
Company sometimes experiences difficulty in locating candidates with appropriate qualifications or within desired geographic
locations.  Revenue growth is dependent on the Company's ability to attract, train, retain and productively manage such personnel.

ACQUISITION-RELATED RISKS.

The Company has acquired and may continue to acquire complimentary businesses, products or technology.  The process of integrating
an acquired company's business into the Company's operations may result in unforeseen operating difficulties and expenditures and may
require significant management attention that would otherwise be available for the ongoing development of the Company's business.
There can be no assurance that any anticipated benefits of an acquisition will be realized.  Future acquisitions by the Company could
result in potentially dilutive issuances of equity securities, the incurrence of debt and contingent liabilities and amortization
related to goodwill and other intangible assets, which could materially affect the Company's operating results and financial
condition.  Acquisitions involve numerous risks, including difficulties in the assimilation of operations, technologies and products
of the acquired company, risks associated with entering markets in which the Company has no or limited direct prior experience and
the potential loss of key employees of the acquired company.

VOLATILITY OF STOCK PRICE.

High technology companies, including the Company, frequently experience volatility in their common stock prices.  Factors such as
quarterly fluctuations in results of operations, announcements of technological innovations by the Company or its competitors or the
introduction of new products by the Company or its competitors and macroeconomic conditions in the computer hardware and software
industries generally may have a significant adverse impact on the market price of the Company's stock.  If revenues or earnings in
any quarter fail to meet the expectations of the investment community, there could be an immediate impact on the Company's stock
price.  In addition, the Company has issued shares and stock options which, if sold directly or exercised and sold on the open market
in large concentrations, could cause the Company's stock price to decline in the short term. Furthermore, the stock market has from
time to time experienced extreme price and volume fluctuations which have particularly affected the market price for many high
technology companies, in some cases unrelated to the operating performance of those companies.  These broad market
fluctuations may materially adversely affect the market price of the stock of the Company.

Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There were no material changes in the reported market risks since December 31, 1999.



PART II.  OTHER INFORMATION

Item 6.	EXHIBITS AND REPORTS ON FORM 8-K



1. Exhibits

10.27	Shareholder Rights Agreement dated June 1, 2000

27.1	Financial Data Schedule (electronic filing only)

1. Reports on Form 8-K

The Company filed a report on Form 8-K on June 6, 2000 pertaining to the Shareholder Rights Agreement dated June 1, 2000.

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**SIGNATURES**

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



| |                                 
| | --------------------------------
| | WALKER INTERACTIVE SYSTEMS, INC.

| |             
| | ------------
| | (Registrant)



| |     |                      
| | --- | ---------------------
| | By: | /s/ Stanley V. Vogler

| |                                             
| | --------------------------------------------
| |                                             
| | Stanley V. Vogler                           
| | Chief Financial Officer                     
| | (Principal Financial and Accounting Officer)

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**WALKER INTERACTIVE SYSTEMS, INC.**

**INDEX TO EXHIBITS**





|**Exhibit Number** | **Exhibit Title**                               
|------------------ | ------------------------------------------------
|10.27              | Shareholder Rights Agreement dated June 1, 2000.
|27.1               | Financial Data Schedule (electronic filing only)

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