================================================================================
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-Q/A
                                Amendment No. 1


                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2003
                          COMMISSION FILE NO. 001-31256

                                   CLARK, INC.
             (Exact name of Registrant as specified in its charter)

              DELAWARE                                   52-2103926
      (State of Incorporation)              (I.R.S. Employer Identification No.)

    102 SOUTH WYNSTONE PARK DRIVE
      NORTH BARRINGTON, ILLINOIS                           60010
(Address of principal executive offices)                 (Zip code)

                  Registrant's telephone number: (847) 304-5800



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 whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes X_ No ___

         As of August 1, 2003, the registrant had outstanding 18,408,605 shares
of common stock.


<PAGE>


                                  CLARK, INC.
                        QUARTERLY REPORT ON FORM 10-Q/A
                      FOR THE QUARTER ENDED JUNE 30, 2003

                                EXPLANATORY NOTE

         The purpose of this Form 10-Q/A ("Form 10-Q/A") is to amend Item 2 of
Part I of the Quarterly Report on Form 10-Q of Clark, Inc. for the quarter ended
June 30, 2003 (the "Form 10-Q"), to reflect certain Executive Benefits Practice
renewal revenue data, which was inadvertantly omitted from the first table under
the heading "Liquidity and Capital Resources--Estimated Future Gross Renewal
Revenue" contained in Management's Discussion and Analysis of Financial
Condition and Results of Operations. There have been no additional changes to
any other section of Item 2 of Part I of the Form 10-Q.

This amendment does not reflect events occurring after the original filing of
the Form 10-Q on August 14, 2003, or modify or update those disclosures
as presented in the Form 10-Q, except to reflect the amendment described above.

                                       2
<PAGE>

                           FORWARD-LOOKING STATEMENTS

This Form 10-Q/A may contain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Such statements are identified by
words such as "anticipate," "believe," "estimate," "expect," "intend,"
"predict," "project," and similar expressions, as they relate to us or our
management. When we make forward-looking statements, we are basing them on our
management's beliefs and assumptions, using information currently available to
us. These forward-looking statements are subject to risks, uncertainties and
assumptions, including but not limited to, risks, uncertainties and assumptions
related to the following:

          o    changes in tax legislation;
          o    federal and state regulations;
          o    general economic conditions;
          o    competitive factors and pricing pressures;
          o    our dependence on key consultants and services of key personnel;
          o    our dependence on persistency of existing business;
          o    our ability to achieve our earnings projections;
          o    risks associated with acquisitions;
          o    significant intangible assets;
          o    our dependence on a select group of insurance companies; and
          o    our dependence on information processing systems and risk of
               errors or omissions.

If one or more of these or other risks or uncertainties materialize, or if our
underlying assumptions prove to be incorrect, actual results may vary materially
from those anticipated. Any forward-looking statements you read in this Form
10-Q/A or the documents incorporated herein by reference reflect our current
views with respect to future events and are subject to these and other risks,
uncertainties and assumptions relating to our operations, results of operations,
growth strategy and liquidity. You should specifically consider the factors
identified in our Form 10-K for the year ended December 31, 2002, included under
the caption "Risk Factors," which could cause actual results to differ
materially from those indicated by the forward-looking statements. In light of
the foregoing risks and uncertainties, you should not unduly rely on such
forward-looking statements when deciding whether to buy, sell or hold any of our
securities. We disclaim any intent or obligation to update or alter any of the
forward-looking statements whether in response to new information, unforeseen
events, changed circumstances or otherwise.

                                       3

<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS (Tables shown in thousands of dollars, except share and
        per share amounts)

         The following discussion and analysis of our financial condition and
results of operations should be read in conjunction with our financial
statements, the notes thereto and other information appearing elsewhere in the
Form 10-Q as amended hereby.

BUSINESS

The condensed consolidated financial statements reflect the accounts of Clark,
Inc. (formerly Clark/Bardes, Inc.) ("Clark") and its wholly owned subsidiaries.
Through our six operating segments, Executive Benefits Practice, Banking
Practice, Healthcare Group, Human Capital Practice, Pearl Meyer & Partners, and
Federal Policy Group, we design, market and administer compensation and benefit
programs for companies supplementing and securing employee benefits and provide
executive compensation and related consulting services to U.S. corporations,
banks and healthcare organizations. We assist our clients in using customized
life insurance products to finance their long-term benefit liabilities. In
addition, we own Clark Securities, Inc. (formerly Clark/Bardes Financial
Services, Inc.), a registered broker-dealer through which we sell all our
securities products and receive a commission.

On June 9, 2003, the Company, Clark/Bardes, Inc., changed its name to Clark,
Inc. On April 24, 2003, the Company's operating entity, Clark/Bardes Consulting,
Inc., changed its name to Clark Consulting, Inc.

As discussed in Note 17 in the notes to the condensed consolidated financial
statements, the Company has restated its financial statements for the three and
six month periods ended June 30, 2002. This management discussion and analysis
gives effect to this restatement.

General economic conditions and market factors, such as changes in interest
rates and stock prices, can affect our commission and fee income and the extent
to which clients keep their policies inforce year after year. Equity returns and
interest rates can have a significant effect on the sale and profitability of
many employee benefit programs whether they are financed by life insurance or
other financial instruments. For example, if interest rates increase, competing
products could become attractive to potential purchasers of the programs we
market. Further, a prolonged decrease in stock prices can have a significant
effect on the sale and profitability of our clients' programs that are linked to
stock market indices.

                                       4
<PAGE>


CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires us to make estimates
and assumptions that affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. The Securities and Exchange Commission ("SEC") has defined a
company's critical accounting policies as those that are most important to the
portrayal of its financial condition and the results of operations, and which
require us to make difficult and subjective judgments, often as a result of the
need to make estimates of matters that are inherently uncertain. Based on this
definition, we have identified the following critical accounting policies and
judgments. Although we believe that our estimates and assumptions are
reasonable, they are based upon information available when they are made. Actual
results may differ significantly from these estimates under different
assumptions and conditions.

REVENUE SOURCES AND RECOGNITION

Our operating segments derive their revenue primarily from:

     o    commissions paid by the insurance companies issuing the policies
          underlying our benefit programs;
     o    program design and administrative service fees paid by our clients;
     o    executive compensation and benefit consulting fees; and
     o    fees for legislative liaison and related advisory services.

Our commission revenue is normally long term and recurring, is typically paid
annually and usually extends for a period of ten years or more after the sale.
Commissions paid by insurance companies vary by policy and by program and
typically represent a percentage of the premium or the cash surrender value of
the insurance policies underlying the program.

First Year Commission Revenue and Related Fees. First year commission revenue
and related fees are derived from two principal sources:  (a) the commission we
earn when the client first purchases the policies, which revenue is recognized
at the time the application is substantially completed, the client is
contractually committed to purchase the insurance policies and the premiums are
paid by the client, to the insurance company; and (b) fees for the services
related to the enrollment and initial administration of the benefit programs and
underlying policies.

         Our first year commission revenue is frequently subject to chargeback,
         which means that insurance companies retain the right to recover
         commissions in the event policies prematurely terminate. The chargeback
         schedules differ by product and usually apply to first year commission
         only. A typical chargeback schedule, based on a percent of first year
         commission and the year in which the termination occurs, is as follows:

                              Year 1                               100%
                              Year 2 and 3                         50%
                              Year 4                               25%
                              Year 5 and beyond                    0%

         While the commission revenue is subject to chargeback, our experience
         has indicated that less than 1% of revenue recognized has ever been
         refunded to insurance companies pursuant to such chargeback provisions.
         Given the homogenous nature of such cases and historical information
         about chargebacks, we believe we are able to accurately estimate the
         revenue earned. We currently maintain a chargeback allowance, which is
         monitored on a quarterly basis for adequacy.

Renewal Commission Revenue and Related Fees. Renewal commission revenue is the
commission we earn on the policies underlying the benefit programs we have sold
in prior years continuing inforce. Renewal revenue is recognized on the date
that the renewal premium is due or paid to the insurance company depending on
the type of policy.

                                       5

<PAGE>

Consulting fee revenue. Consulting fee revenue consists of fees of Human Capital
Practice, Pearl Meyer and Federal Policy Group for the services we perform in
advising our clients on their executive compensation programs and related
consulting services, retirement, benefit, actuarial, pension savings plan design
and management, people strategy, compensation surveys, institutional registered
investment advisory services and fees from legislative and regulatory policy
matters. These fees are generally based on a rate per hour arrangement and are
earned when the service is rendered. Some of our consulting clients pay a
retainer at the beginning of a project. These revenues are recognized ratably
over the term of the engagement. Consulting revenue generated by the Executive
Benefits Practice, Banking Practice and Healthcare Group are included as first
year revenue in the accompanying condensed consolidated income statement.

Administrative service fee revenue. Administrative service fee revenue consists
of fees we charge our clients for the administration of their benefit programs
and are earned when services are rendered. These revenues are included as
renewal commissions and related fees revenue in the accompanying condensed
consolidated income statement.

During the fourth quarter of 2002, we completed an analysis of the services
provided and timing thereof under our administrative service agreements at our
Executive Benefits Practice. As a result of this analysis, we determined that
because of changes in the timing of the services being provided, revenue under
these agreements should have been recognized on a straight-line basis during
2002 and restated our financial statements accordingly. Historically, these fees
were recognized 75% in the renewal month and 25% ratably over the remainder of
the annual service agreement.

We record revenue on a gross basis when we are the primary obligor in the
arrangement or when we bear the credit risk in the arrangement. We record
revenue on a net basis when another party is the primary obligor in the
arrangement or when another party bears the credit risk.

In accordance with Emerging Issues Task Force ("EITF") Issue No. 01-14, Income
Statement Characterization of Reimbursements Received for "Out-of-Pocket"
Expenses Incurred, reimbursements received for out-of-pocket expenses incurred
are characterized as revenues and are shown as a separate component of total
revenue. Similarly, related reimbursable expenses are also shown separately
within operating expenses. EITF Issue No. 01-14 was effective as of January 1,
2002.

Success fee arrangements. In our Human Capital Practice and Federal Policy
Group, we are involved in certain client engagements under which we receive a
success fee upon meeting certain objectives. We recognize revenue on these
engagements only when we have verifiable information that the objectives have
been met even if the services were performed in prior periods.

INTANGIBLE ASSETS

We have intangible assets representing the excess of the costs of acquired
businesses over the fair values of the tangible net assets associated with an
acquisition. Intangible assets consist of the net present value of estimated
future cash flows from policies inforce at the acquisition date, non-compete
agreements with the former owners of acquired businesses and assets, other
identifiable intangibles and goodwill. Non-compete agreements are amortized over
the period of the agreements and other identifiable intangibles are amortized
over their useful lives.

The net present value of inforce revenue is typically amortized between 20 and
30 years (the expected average policy duration). The determination of the
amortization schedule involves making certain assumptions related to
persistency, expenses, and discount rates that are used in the calculation of
the carrying value of inforce revenue. If any of these assumptions change or
actual experience differs materially from the assumptions used, it could affect
the carrying value of the inforce revenue.

We are required to assess potential impairments of long-lived assets in
accordance with Statement of Financial Accounting Standards ("SFAS") No. 144,
Accounting for the Impairment or Disposal of Long-Lived Assets, if events or
changes in circumstances indicate that the carrying amount of an asset may not
be recoverable.

                                       6

<PAGE>

In assessing the recoverability of goodwill and the net present value of future
cash flows from policies inforce, we must make assumptions regarding estimated
future cash flows and other factors to determine the fair value of the
respective assets. If these estimates and related assumptions change in the
future, we may be required to record impairment charges not previously recorded.
As of January 1, 2002, amortization of goodwill ceased and is tested annually,
in the fourth quarter, for impairment or whenever changes in circumstances
indicate impairment might exist.

EMPLOYEE COMPENSATION

We account for stock-based compensation to employees using the intrinsic value
method prescribed in Accounting Principles Board ("APB") Opinion No. 25,
Accounting for Stock Issued to Employees. Under APB Opinion No. 25, compensation
cost for stock options is measured as the excess, if any, of the quoted market
price of our stock at the date of grant over the amount an employee must pay to
acquire the stock. Generally, common stock options issued to employees do not
result in compensation expense because the exercise price of the option equals
the market price of the underlying stock on the date of grant. However,
compensation expense may be incurred for options issued to employees if the
options are contingent upon meeting certain performance criteria.

SFAS No. 123, Accounting for Stock-Based Compensation, established accounting
and disclosure requirements using a fair value based method of accounting for
stock-based employee compensation plans. We have elected to remain on the
current method of accounting as described above for employees and directors.
However, we account for stock options granted to non-employees under the
provisions of SFAS No. 123.

The pro forma information regarding net income and earnings per share required
by SFAS No. 123 has been determined as if we accounted for our stock based
compensation plans under the fair value method. The fair value of each option
grant was estimated at the date of grant using the Black-Scholes option pricing
model with the following weighted average assumptions used for grants in 2003
and 2002, respectively:

                                                                JUNE 30,
                                                          2003            2002
                                                          ----            ----
     Dividend yield...............................        None            None
     Volatility...................................        64.8%           64.2%
     Risk-free interest rates.....................         5.2%            5.4%
     Expected life (years)........................           5               6

Had compensation cost for our stock-based compensation plans been determined in
accordance with SFAS No. 123, as amended by SFAS No. 148, Accounting for
Stock-Based Compensation - Transition and Disclosure - An Amendment of FASB
Statement No. 123, our net income and earnings per share would have been reduced
to the pro forma amounts indicated below:

<TABLE>
<CAPTION>
                                                      THREE MONTHS ENDED   SIX MONTHS ENDED
                                                           JUNE 30,            JUNE 30,
                                                      ---------------------------------------
                                                        2003      2002      2003      2002
                                                      --------- --------- --------- ---------
     <S>                                              <C>       <C>       <C>       <C>

     NET INCOME
     As reported...................................    $1,992   $1,330    $5,573    $5,758
     Add: stock-based employee compensation
     expense included in reported net income, net
     of related tax effect.........................         -      340       206       340
     Deduct: stock option compensation expense, net
     of tax........................................      (197)    (873)     (615)   (1,406)
                                                       ------     ----    ------    ------
     Pro forma.....................................    $1,795     $797    $5,164    $4,692
                                                       ======     ====    ======    ======

     BASIC EARNINGS PER COMMON SHARE
     As reported...................................     $0.11    $0.08     $0.31     $0.34
     Pro forma.....................................      0.10     0.05      0.28      0.28

</TABLE>

                                        7
<PAGE>
<TABLE>
<CAPTION>

     <S>                                              <C>       <C>       <C>       <C>
     DILUTED EARNINGS PER COMMON SHARE
     As reported...................................     $0.11    $0.08     $0.30     $0.33
     Pro forma.....................................      0.10     0.05      0.28      0.27
</TABLE>

OVERVIEW OF RESULT OF OPERATIONS

Total revenues for the three months ended June 30, 2003 was $77.3 million, an
increase of 40.8% from revenues of $54.9 million in the second quarter of 2002.
Second quarter 2003 operating income was $8.5 million, as compared to $2.5
million from the comparable 2002 period. The Company reported net income for the
second quarter 2003 of $2.0 million, or $0.11 per diluted share, compared to
reported net income of $1.3 million, or $0.08 per diluted share, for the same
period last year.

For the six months ended June 30, 2003, total revenue was $161.9 million, an
increase of 33.9% from revenues of $120.9 million for the first six months of
2002. Operating income was $20.3 million, an 82.6% increase from operating
income of $11.1 million in the comparable period of 2002. Net income for the six
months ended June 30, 2003 was $5.6 million or $0.30 per diluted share compared
to $5.8 million or $0.33 per diluted share for the six months ended June 30,
2002.

RESULTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                THREE MONTHS ENDED JUNE 30,               SIX MONTHS ENDED JUNE 30,
                                                ---------------------------               -------------------------
                                                2003          2002       % CHANGE       2003           2002       % CHANGE
                                                ----          ----       --------       ----           ----       --------
<S>                                            <C>            <C>        <C>            <C>            <C>        <C>
REVENUE
   First year commissions and related
     fees                                      $29,961        $26,281      14.0%        $57,522        $51,059      12.7%
   Renewal commissions and related fees         34,763         18,376      89.2%         77,071         53,251      44.7%
   Consulting fees                              11,066          8,911      24.2%         24,322         13,942      74.5%
   Reimbursable expenses                         1,468          1,322      11.0%          2,981          2,672      11.6%
                                          ------------- -------------- ---------- -------------- -------------- ----------
            Total                               77,258         54,890      40.8%        161,896        120,924      33.9%


OPERATING EXPENSE
    Commission and fee                          21,716         16,183      34.2%         46,822         40,237      16.4%
    % of revenue                                  28.1%          29.5%                     28.9%          33.3%
    General and administrative                  41,861         32,832      27.5%         82,897         62,958      31.7%
    % of revenue                                  54.2%          59.8%                     51.2%          52.1%
    Reimbursable expenses                        1,468          1,322      11.0%          2,981          2,672      11.6%
    Amortization                                 5,197          2,097     147.8%         10,375          3,928     164.1%
    Settlement of litigation                    (1,500)             -                    (1,500)             -
                                          ------------- -------------- ---------- -------------- -------------- ----------
Operating income                                 8,516          2,456     246.7%         20,321         11,129      82.6%
     % of revenue                                 11.0%          4.5%                      12.6%          9.2%
Other income                                        94             65      44.6%            181            134      35.1%
Interest income                                     52             90    (42.2%)            152            178    (14.6%)
Interest expense                                (6,164)          (458)                  (12,167)          (840)
                                          ------------- -------------- ---------- -------------- -------------- ----------
Income before taxes                              2,498          2,153      16.0%          8,487         10,601    (19.9%)
Income taxes                                      (506)          (823)   (38.5%)         (2,914)        (4,320)   (32.5%)
                                          ------------- -------------- ---------- -------------- -------------- ----------
Net income, before cumulative effect of          1,992          1,330      49.8%          5,573          6,281    (11.3%)
    change in accounting, net of tax
Cumulative effect of change in
     accounting principle                            -              -                         -           (523)
                                          ------------- -------------- ---------- -------------- -------------- ----------
Net Income                                      $1,992         $1,330      49.8%         $5,573         $5,758     (3.2%)
                                          ============= ============== ========== ============== ============== ==========


Per common share - diluted
     Net income                                  $0.11          $0.08                     $0.30          $0.33
     Weighted average shares                18,509,674     17,336,783                18,555,033     17,250,826

</TABLE>


                                       8
<PAGE>


Quarter ended June 30, 2003 compared to quarter ended June 30, 2002

Revenue. Total revenue for the second quarter ended June 30, 2003 was $77.3
million, an increase of 40.8% from revenues of $54.9 million in second quarter
2002. First year commissions and consulting fees during second quarter 2003 were
$41.0 million compared to $35.2 million in the second quarter of 2002. The
Banking Practice, which increased total revenue by $23.8 million over the prior
period, benefited significantly (approximately $12.5 million) from the November
2002 acquisition of Long, Miller & Associates, LLC ("LongMiller") and a strong
community bank market. The Banking Practice experienced a $1.3 million
chargeback during the three months ended June 30, 2003 of which approximately
$750 thousand will be recovered from its consultants. The Executive Benefits
Practice, as predicted, continues to underperform compared to the three months
ended June 30, 2002 due to the weak economic environment.

Commission and fee expense. Commission and fee expense for the three months
ended June 30, 2003 was $21.7 million or 28.1% of total revenue compared to
$16.2 million or 29.5% of total revenue in second quarter 2002. The percentage
paid in commission expense declined primarily due to an increasing number of
employee consultants who have a lower commission rate than independent
consultants and the increase in consulting fee revenue from the three months
ended June 30, 2002. With the acquisition of Federal Policy Group and the
formation of our Human Capital Practice, we continue to expand our fee-based
revenue (an increase of 24.2% over the three months ended June 30, 2002), which
should continue to favorably affect commission expense as a percentage of total
revenue.

General and administrative expense. General and administrative expense for the
three months ended June 30, 2003 was $41.9 million or 54.2% of total revenue
compared to $32.8 million or 59.8% of total revenue for the three months ended
June 30, 2002. General and administrative expenses increased for the three
months ended June 30, 2003 from that of the prior year as a result of the 2002
acquisitions, such as LongMiller and the hiring of Andersen Human Capital
Practice partners and employees, included for the entire quarter of 2003.
General and administrative expense for the three months ended June 30, 2003
included approximately $800 thousand relating to the corporate re-branding
effort and $300 thousand of severance expense at Human Capital Practice.

Settlement of litigation - During the three months ended June 30, 2003, we
received $1.5 million from the favorable settlement of a lawsuit.

Amortization. Amortization expense for the three months ended June 30, 2003 was
$5.2 million compared to $2.1 million in the prior year. We acquired
approximately $400 million of inforce revenue with our November 2002 acquisition
of LongMiller, which accounted for approximately $3.0 million of the
amortization expense in the second quarter of 2003.

Other income. In the second quarter of 2003 and 2002, we received rental income
of approximately $94 thousand and $65 thousand, respectively, from several
tenants.

Interest expense - net. Net interest expense for the three months ended June 30,
2003 was $6.1 million compared to $368 thousand in 2002. With the November 2002
acquisition of LongMiller, we borrowed approximately $87.5 million on our line
of credit and issued $305 million of non-recourse asset-backed notes. This
acquisition-related debt significantly increased our net interest expense from
the three months ended June 30, 2003 compared to the three months ended June 30,
2002.

Income taxes. Income taxes for the three months ended June 30, 2003 were $506
thousand at an effective tax rate of 20.3% compared to $823 thousand at an
effective tax rate of 38.2% for the three months ended June 30, 2002. The
effective tax rate for the three months ended June 30, 2003 reflects an
anticipated $509 thousand net state tax refund. The decrease in the effective
tax rate is primarily related to the trueup of the estimated 2002 state tax
liability.

Net Income. Net income for the three months ended June 30, 2003 was $2.0
million, or $0.11 per diluted common share versus net income of $1.3 million or
$0.08 per diluted share for the same period last year.

                                       9

<PAGE>

Six months ended June 30, 2003 compared to six months ended June 30, 2002

Revenue. Total revenues for the six months ended June 30, 2003 were $161.9
million, an increase of 33.9% from revenues of $120.9 million in the six months
ended June 30, 2002. The Banking Practice, which increased total revenue by
$42.3 million over the prior period, benefited significantly from the November
2002 acquisition of Long, Miller & Associates, LLC ("LongMiller") and a strong
community bank market. The Banking Practice experienced a $1.3 million
chargeback during the three months ended June 30, 2003 of which approximately
$750 thousand will be recovered from its consultants. Federal Policy Group
results were strong reflecting good overall demand for its services and includes
a $2.8 million success fee recorded and collected during the first quarter 2003.
However, the Executive Benefits Practice, as predicted, continued to
underperform and compared to the six months ended June 30, 2002 due to the weak
economic environment, which has slowed the benefit plan implementation process
with its corporate clients. Consulting fees as a percentage of total revenue
increased to 15.0% for the six months ended June 30, 2003 compared to 11.5% in
the six months ended June 30, 2002. This increase is primarily due to the
formation and growth of our Human Capital Practice through the addition of the
Arthur Andersen ("Andersen") partners and employees in May 2002 and the
acquisition of Federal Policy Group in February 2002.

Commission and fee expense. Commission and fee expense for the six months ended
June 30, 2003 was $46.8 million or 28.9% of total revenue compared to $40.2
million or 33.3% of total revenue for the six months ended June 30, 2002. The
percentage paid in commission expense declined primarily due to an increasing
number of employee consultants who have a lower commission rate than independent
consultants and the increase in consulting fee revenue from the six months ended
June 30, 2002. With the acquisition of Federal Policy Group and the formation of
our Human Capital Practice, we continue to expand our fee-based revenue (an
increase of 74.5% over the six months ended June 30, 2002), which should
continue to favorably affect commission expense as a percentage of revenue.

General and administrative expense. General and administrative expense for the
six months ended June 30, 2003 was $82.9 million or 51.2% of total revenue
compared to $63.0 million or 52.1% of total revenue for the six months ended
June 30, 2002. General and administrative expenses increased for the six months
ended June 30, 2003 from prior year as a result of the 2002 acquisitions, such
as LongMiller and Federal Policy Group and the hiring of Andersen Human Capital
Practice partners and employees, included for the entire six months of 2003.
General and administrative expense for the six months ended June 30, 2003
included approximately $2.2 million in charges, primarily related to severance
costs and lease terminations in our Executive Benefits Practice, Healthcare
Group and Human Capital Practice and approximately $800 thousand relating to the
corporate re-branding effort. A non-cash expense of $345 thousand was incurred
in the first quarter of 2003 related to stock compensation expense.

Amortization. Amortization expense for the six months ended June 30, 2003 was
$10.4 million compared to $3.9 million in the prior year. We acquired
approximately $400 million of inforce revenue with our November 2002 acquisition
of LongMiller, which accounted for approximately $6.0 million of the
amortization expense in the six months of 2003.

Settlement of litigation - During the six months ended June 30, 2003, the
company received $1.5 million from a favorable lawsuit settlement.

Other income. For the six months ended June 30, 2003 and 2002, we received
rental income of approximately $181 thousand and $134 thousand, respectively,
from several tenants.

Interest expense - net. Net interest expense for the six months ended June 30,
2003 was $12.0 million compared to $662 thousand in 2002. With the November 2002
acquisition of LongMiller, we borrowed approximately $87.5 million on our line
of credit and issued $305 million of non-recourse asset-backed notes. This
acquisition-related debt significantly increased our net interest expense from
the six months ended June 30, 2003 compared to the six months ended June 30,
2002.

Income taxes. Income taxes for the six months ended June 30, 2003 were $2.9
million at an effective tax rate of 34.3% compared to $4.3 million at an
effective tax rate of 40.8% for the six months ended June 30, 2002. The

                                       10

<PAGE>

effective tax rate for the six months ended June 30, 2003 reflects an
anticipated $509 thousand net state tax refund. The decrease in the effective
tax rate is primarily related to the trueup of the estimated 2002 state tax
liability. The Company expects its normalized effective income tax rate to be
approximately 40.3% in future periods.

Net Income. Net income for the six months ended June 30, 2003 was $5.6 million,
or $0.30 per diluted common share versus net income of $5.8 million or $0.33 per
diluted share for the same period last year.

                                       11

<PAGE>

The tables that follow present the operating results of our six segments for the
three and six months ended June 30, 2003 and 2002.

         EXECUTIVE BENEFITS PRACTICE
<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED           SIX MONTHS ENDED
                                                                     JUNE 30,                    JUNE 30,
                                                                2003          2002         2003         2002
                                                                ----          ----         ----         ----
           <S>                                                   <C>           <C>          <C>          <C>
         REVENUE
                First year commissions and related fees        $4,265         $8,443      $12,682      $17,951
                Renewal commissions and related fees            9,876          9,033       28,661       33,271
                Reimbursable expenses                              62             29          140          131
                                                               ------         ------      -------      -------
                    TOTAL REVENUE                              14,203         17,505       41,483       51,353
         OPERATING EXPENSES
                Commission and fee                              5,865          7,946       17,910       25,724
                   % of revenue                                  41.3%          45.4%        43.2%        50.1%
                General and administrative                      8,392          8,381       17,429       16,475
                    % of revenue                                  59.1%         47.9%        42.0%        32.1%
                 Reimbursable expenses                             62             29          140          131
                Amortization                                    1,025          1,074        2,031        2,011
                                                               ------         ------      -------      -------
         OPERATING (LOSS) INCOME                              ($1,141)           $75       $3,973       $7,012
                    % of revenue                                (8.0%)           0.4%         9.6%        13.7%
                                                              ========        ======      =======       =======
</TABLE>

         As of January 1, 2003, we transferred the operations of Coates Kenney
         from Executive Benefits Practice to Human Capital Practice. As a
         result, the June 30, 2002 segment information has been reclassified to
         reflect this transfer.

         First year revenue was significantly lower in the Executive Benefits
         Practice, reflecting the continued difficult economic environment,
         which most directly affects this segment of the business. However,
         renewal revenue increased over the three months ended June 30, 2003 as
         the first year business from the prior year remained inforce. We may
         continue to experience revenue declines in future periods due to a weak
         economy. Commission expense as a percentage of total revenue declined
         from 45.4% for the three months ended June 30, 2002 to 41.3% for the
         three months ended June 30, 2003 due to the decline in new business
         which has a higher commission rate than renewal revenue. General and
         administrative expense includes approximately $246 thousand of
         restructuring charges recorded in accordance with Statement of
         Financial Accounting Standards ("SFAS") No. 146, Accounting for Costs
         Associated with Exit or Disposal Activities for the consolidation of
         the business support services. These expenses were accrued for in the
         accompanying condensed consolidated balance sheet as of June 30, 2003.

         Trends in the six month results ended June 30, 2003 as compared to the
         period in 2002 were generally the same as those experienced for the
         quarter. However, renewal revenue declined from the six months ended
         June 30, 2002 as a result of previously discussed split dollar
         legislation and lower deferrals into corporate compensation plans.
         General and administrative expense was impacted by approximately $335
         thousand of restructuring charges for the consolidation of the business
         support services and $711 thousand of charges associated with other
         severance agreements and lease terminations. These expenses are accrued
         for in the accompanying condensed consolidated balance sheet as of June
         30, 2003.

                                       12
<PAGE>


         BANKING PRACTICE
<TABLE>
<CAPTION>
                                                            THREE MONTHS ENDED           SIX MONTHS ENDED
                                                                 JUNE 30,                    JUNE 30,
                                                             2003           2002         2003         2002
                                                             ----           ----         ----         ----
         <S>                                                <C>            <C>           <C>          <C>
         REVENUE
              First year commissions and related fees       $19,618        $10,248      $32,215      $17,244
              Renewal commissions and related fees           22,374          7,958       42,171       14,822
              Reimbursable expenses                              24             31           76           51
                                                            -------        -------      -------      -------
                 TOTAL REVENUE                               42,016         18,237       74,462       32,117
         OPERATING EXPENSES
              Commission and fee                             15,017          7,393       26,772       12,843
                 % of revenue                                  35.7%          40.5%        36.0%        40.0%
              General and administrative                     10,175          6,732       21,253       13,852
                 % of revenue                                 24.2%          36.9%         28.5%        43.1%
              Reimbursable expenses                              24             31           76           51
              Amortization                                    3,615            391        7,229          764
                                                            -------        -------      -------      -------
         OPERATING INCOME                                   $13,185         $3,690      $19,132       $4,607
                 % of revenue                                  31.4%          20.2%        25.7%        14.3%
                                                            =======        =======      =======      =======
</TABLE>


         Total first year revenue increased 91.4% to $19.6 million for the three
         months ended June 30, 2003 from $10.2 million for the three months
         ended June 30, 2002. The increase in revenue reflects continued strong
         demand in the community banking market compared to the prior year. In
         addition, total revenue for the three months ended June 30, 2003
         includes $500 thousand related to the Administrative Services Agreement
         entered into on September 25, 2002 with an affiliate of AUSA Holding,
         Inc. With interest rates remaining at very low historical levels, there
         is some uncertainty about sustaining the growth rates at this level due
         to product capacity and pricing concerns. Approximately $12.5 million
         of the increase in renewal revenue is attributable to the securitized
         inforce revenue stream from the acquisition of LongMiller. The Banking
         Practice experienced a $1.3 million chargeback during the three months
         ended June 30, 2003 of which approximately $750 thousand will be
         recovered from its consultants. Commission expense for the three months
         ended June 30, 2003 was $15.0 million, or 35.7% of revenue, compared to
         $7.4 million or 40.5% of revenue in the same period in 2002. The
         commission expense as a percentage of revenue continues to decrease as
         a result of a higher percentage of first year revenue produced by
         employee consultants versus the prior year. In addition, a larger
         percentage of total revenue consists of renewal revenue which has a
         lower commission expense percentage. General and administrative
         expenses for the three months ended June 30, 2003 were $10.2 million,
         or 24.2% of revenue, compared to $6.7 million or 36.9% of revenue for
         the comparable period in 2002, due to the increased headcount primarily
         from acquisitions and to support internal growth.

         Trends in the six month results ending June 30, 2003 as compared to the
         period in 2002 were generally the same as those experienced for the
         quarter.

                                       13

<PAGE>




         HEALTHCARE GROUP
<TABLE>
<CAPTION>

                                                            THREE MONTHS ENDED           SIX MONTHS ENDED
                                                                 JUNE 30,                    JUNE 30,
                                                            2003           2002        2003         2002
                                                           ------         ------      -------      -------
         <S>                                                <C>            <C>         <C>          <C>
         REVENUE
              First year commissions and related fees      $5,910         $6,806      $11,944      $13,408
              Renewal commissions and related fees          1,984          1,410        5,172        4,343
              Reimbursable expenses                           712            891        1,401        1,710
                                                           ------         ------      -------      -------
                 TOTAL REVENUE                              8,606          9,107       18,517       19,461
         OPERATING EXPENSES
              Commission and fee                              834            844        2,140        1,670
                 %  of revenue                                9.7%          9.3%          11.6%        8.6%
              General and administrative                    5,604          6,022       11,669       12,105

                 %  of revenue                               65.1%          66.1%        63.0%       62.2%
              Reimbursable expenses                           712            891        1,401        1,710
              Amortization                                    421            452          841          904
                                                           ------         ------      -------      -------
         OPERATING INCOME                                  $1,035           $898       $2,466       $3,072
                 %  of revenue                               12.0%           9.9%        13.3%        15.8%
                                                           ------         ------      -------      -------
</TABLE>

         Healthcare Group revenues were slightly lower for the three and six
         months ended June 30, 2003 compared to the prior year. Healthcare's
         2002 performance was good and the current Healthcare environment has
         been challenging. For the six months ended June 30, 2003, commission
         and general and administrative expenses include approximately $435
         thousand and $335 thousand, respectively, for costs associated with a
         severance agreement. Even with the inclusion of these expenses, general
         and administrative expenses declined by 3.6% as a result of the
         continued cost control measures.


                                       14

<PAGE>


              HUMAN CAPITAL PRACTICE
<TABLE>
<CAPTION>

                                                            THREE MONTHS ENDED           SIX MONTHS ENDED
                                                                 JUNE 30,                    JUNE 30,
                                                            2003          2002          2003         2002
                                                           ------         ------      -------      -------
              <S>                                         <C>            <C>          <C>          <C>
              REVENUE
                   Consulting fees                          $5,830         $3,947      $11,499       $6,201
                   Reimbursable expenses                       154             46          372          102
                                                            ------         ------      -------       ------
                       TOTAL REVENUE                         5,984          3,993       11,871        6,303
              OPERATING EXPENSES
                   General and administrative                7,222          4,510       13,440        6,482
                       %  of revenue                         120.7%        112.9%        113.2%       102.8%
                   Reimbursable expenses                       154             46          372          102
                                                            ------         ------      -------       ------
              OPERATING LOSS                               ($1,392)         ($563)     ($1,941)       ($281)
                       %  of revenue                         (23.3%)        (14.1%)      (16.4%)       (4.5%)
                                                           ========         =======     =======       =====

         As of January 1, 2003, we transferred the operations of Coates Kenney
         from Executive Benefits Practice to Human Capital Practice. As a
         result, the June 30, 2002 segment information has been reclassified to
         reflect this transfer.

         In May 2002, the Human Capital Practice was formed by combining our
         existing Rewards and Performance Group with the addition of 10 partners
         and 74 other employees from the Arthur Andersen Human Capital Practice.
         The six months ended June 30, 2003 results benefited from approximately
         $500 thousand of success fees. General and administrative expenses for
         the three months ended June 30, 2003 includes a severance charge of
         approximately $300 thousand. The Human Capital Practice results
         continue to be negatively affected by the challenging economic climate.

</TABLE>

              PEARL MEYER AND PARTNERS
<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED           SIX MONTHS ENDED
                                                                     JUNE 30,                    JUNE 30,
                                                                2003          2002          2003         2002
                                                               ------         ------      -------      -------
             <S>                                               <C>           <C>          <C>          <C>
              REVENUE
                   Consulting fees                             $2,843         $2,811       $5,899       $5,478
                   Reimbursable expenses                          502            325          920          678
                                                               ------         ------       ------       ------
                       TOTAL REVENUE                            3,345          3,136        6,819        6,156
              OPERATING EXPENSES
                   General and administrative                   2,337          2,332        4,928        4,749
                       %  of revenue                             69.9%          74.4%         72.3%        77.1%
                   Reimbursable expenses                          502            325          920          678
                                                               ------         ------       ------       ------
              OPERATING INCOME                                   $506           $479         $971         $729
                       %  of revenue                             15.1%          15.3%         14.2%        11.8%
                                                               ======         ======       ======       ======
</TABLE>

         Total consulting revenue increased 6.7% to $3.3 million for the three
         months ended June 30, 2003 compared to $3.1 million for the three
         months ended June 30, 2002. The practice continues to experience more
         sales activity as a result of engagements in its areas of expertise of
         corporate governance and executive compensation. General and
         administrative expense remained at $2.3 million for the three months
         ended June 30, 2003 and 2002. As a result of cost control efforts,
         general and administrative expenses as a percentage of total revenue
         declined.

                                       15

<PAGE>

         Total consulting revenue for the six months ended June 30, 2003
         increased 10.8% to $6.8 million from the prior year. General and
         administrative expenses for the six months ended June 30, 2003 include
         severance costs of approximately $123 thousand.



FEDERAL POLICY GROUP
<TABLE>
<CAPTION>
                                             THREE MONTHS ENDED                 SIX MONTHS ENDED
                                                    JUNE 30,                          JUNE 30,
                                             2003            2002             2003             2002
                                             ----            ----             ----             ----
<S>                                         <C>              <C>              <C>              <C>
REVENUE
     Consulting fees                        $2,393           $2,932           $6,925           $3,810
     Reimbursable expenses                      13                -               72                -
                                            ------           ------           ------           ------
          TOTAL REVENUE                      2,406            2,932            6,997            3,810
OPERATING EXPENSES
     General and administrative              1,831            1,513            3,481            2,004
%  of revenue                                 76.1%            51.6%            49.7%            52.6%
     Reimbursable expenses                      13                -               72                -
     Amortization                               96              138              192              165
                                            ------           ------           ------           ------
OPERATING INCOME                              $466           $1,281           $3,252           $1,641
%  of revenue                                 19.4%            43.7%            46.5%            43.1%
                                            ======           ======           ======           ======
</TABLE>


         Results for the three months ended June 30, 2002 included significant
         work-in-progess billings carried over from prior to the February 2002
         acquisition. Federal Policy Group had approximately $1.3 million of
         deferred revenue as of March 31, 2002 of which approximately $790
         thousand was earned during the three months ended June 30, 2002 and
         approximately $510 thousand was earned as work was completed during the
         remainder of 2002. During the second quarter 2003, Federal Policy Group
         hired four new employees who brought several new clients. With the
         addition of these employees, Federal Policy Group has a total of twelve
         employees.

         For the six months ended June 30, 2003, Federal Policy Group had six
         months of results compared to four months for the six months ended June
         30, 2002. Federal Policy Group was acquired on February 25, 2002.
         Federal Policy Group experienced good overall demand for its services
         and benefited from a $2.8 million success fee recorded and collected
         during the first quarter of 2003.

                                       16

<PAGE>

Results Attributable to Acquisitions

As an active acquirer, our operating results are significantly influenced by the
contributions of our acquired businesses. By definition, we consider any
business not appearing in four full quarters of operating results as being from
acquisitions. After that, they become part of existing business. Immaterial
acquisitions are not included in the acquisition column. An analysis of our
operating results, separating acquisitions from existing businesses for the
periods indicated, is as follows:


<TABLE>
<CAPTION>
                                                  THREE MONTHS ENDED                           THREE MONTHS ENDED
                                                   JUNE 30, 2003 (1)                            JUNE 30, 2002 (2)
                                        EXISTING     ACQUISITIONS      COMBINED      EXISTING      ACQUISITIONS   COMBINED
                                        --------     ------------      --------      --------      ------------   --------
<S>                                     <C>          <C>               <C>           <C>           <C>            <C>
Revenue
     First year commissions
     and consulting fees                 $41,027        $     -        $41,027       $32,260         $2,932       $35,192
     Renewal commissions and
     related fees                         22,265         12,498         34,763        18,376              -        18,376
     Reimbursable expenses                 1,468              -          1,468         1,322              -         1,322
                                        --------        -------        -------       -------         ------       -------
     Total Revenue                        64,760         12,498         77,258        51,958          2,932        54,890
Operating expenses
Commission and fee                        18,527          3,189         21,716        16,183              -        16,183
General and administrative                41,249            612         41,861        31,319          1,513        32,832
Reimbursable expenses                      1,468              -          1,468         1,322              -         1,322
Amortization                               2,143          3,054          5,197         1,959            138         2,097
Settlement of litigation                  (1,500)             -         (1,500)            -              -             -
                                         -------         ------        -------       -------         ------       -------
Operating income                         $ 2,873        $ 5,643        $ 8,516       $ 1,175         $1,281       $ 2,456
                                         =======        =======        =======       =======         ======       =======

                                                   SIX MONTHS ENDED                            SIX MONTHS ENDED
                                                   JUNE 30, 2003 (1)                            JUNE 30, 2002 (2)
                                        EXISTING     ACQUISITIONS      COMBINED      EXISTING      ACQUISITIONS   COMBINED
                                        --------     ------------      --------      --------      ------------   --------

Revenue
     First year commissions
and Consulting fees                      $81,844            $ -        $81,844       $61,191         $3,810      $ 65,001
     Renewal commissions and
Related fees                              53,113         23,958         77,071        53,251              -        53,251
     Reimbursable expenses                 2,981            -            2,981         2,672              -         2,672
                                         -------         ------        -------       -------         ------      --------
     Total Revenue                       137,938         23,958        161,896       117,114          3,810       120,924
Operating expenses
Commission and fee                        39,824          6,998         46,822        40,237              -        40,237
General and administrative                81,583          1,314         82,897        60,954          2,004        62,958
Reimbursable expenses                      2,981              -          2,981         2,672              -         2,672
Amortization                               4,266          6,109         10,375         3,763            165         3,928
Settlement of litigation                  (1,500)             -         (1,500)         -                 -             -
                                         -------         ------        -------       -------         ------      --------
Operating income                         $10,784         $9,537        $20,321       $ 9,488         $1,641      $ 11,129
                                         =======         ======        =======       =======         ======      ========

<FN>
     (1) includes operations of LongMiller which was acquired November 26, 2002.
     (2) Includes the operations of Federal Policy Group which was acquired February 25, 2002.
</FN>
</TABLE>

                                       17
<PAGE>


Caution should be used in analyzing and evaluating the foregoing. Acquisitions
have made, and are expected to make, a substantial contribution to our operating
performance and growth; however, the resources dedicated to our acquisition
program, if not used for acquisitions, would have been available to make an
impact on the performance of the existing business.

For the three months ended June 30, 2003, approximately 16.2% of gross revenue
and 66.3% of operating income came from acquisitions while 5.3% of gross revenue
and 52.2% of operating income were from acquisitions during the same period in
2002. For the six months ended June 30, 2003, approximately 14.8% of gross
revenue and 46.9% of operating income came from acquisitions while 3.2% of gross
revenue and 14.7% of operating income were from acquisitions during the same
period in 2002.  The increase in 2003 is primarily attributed to our acquisition
of LongMiller. We do not attribute a great deal of significance to the above
statistics for the following reasons:

        o    an acquisition's contribution to operating performance in any given
             period is considerably dependent on the timing of the transaction;

        o    an acquisition, by our definition for this purpose, is one that has
             not yet appeared in four quarters' operating results. As the value
             of these acquisitions add to our existing business base, the
             relative contribution of any subsequent acquisition may diminish;
             and

        o    acquisitions have made, and are expected to make, a substantial
             contribution to our operating performance and growth; however, the
             resources dedicated to our acquisition program would have been
             available to make an impact on the performance of the existing
             business.

                                       18

<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

Selected Measures of Liquidity and Capital Resources
<TABLE>
<CAPTION>
                                                                         JUNE 30,        DECEMBER 31,
                                                                          2003              2002
                                                                         --------        ------------
<S>                                                                      <C>             <C>
Cash and cash equivalents......................................          $13,901           $14,524
Working capital (1)............................................           $8,955           $19,405
Current ratio - to one.........................................             1.11              1.24
Shareholders' equity per common share (2)......................          $ 13.66            $13.35
Debt to total capitalization (3)...............................            61.1%             63.4%
<FN>
(1)  Includes restricted cash and current portion of debt associated with
     asset-backed notes
(2)  Total stockholders' equity divided by actual shares outstanding
(3)  Current debt plus long term debt divided by current debt plus long term
     debt plus stockholders' equity
</FN>
</TABLE>

As a financial company with historically strong operating cash flow, we believe
we have little need to maintain substantial cash balances. To the extent we have
net cash from operating activities, we use it to fund capital expenditures and
pay down our credit facility. We expect large cash outlays and future
acquisitions will be financed primarily through externally available funds.
However, we can offer no assurance such funds will be available and, if so, on
terms acceptable to us.

Summarizing our cash flow, comparatively, for the six months ended June 30, 2003
and 2002:
<TABLE>
<CAPTION>
                                                                          2003              2002
<S>                                                                     <C>                <C>
                                                                        --------           -------
Cash flows provided by/(used in):
   Operating activities........................................         $ 30,801            $3,334
   Investing activities........................................           (7,371)          (19,078)
   Financing activities........................................          (24,053)           18,499
</TABLE>

Cash Flows from Operating Activities

Our cash flows from operating activities for the six months ended June 30, 2003,
compared with the same six month period in 2002, was as follows:

<TABLE>
<CAPTION>
                                                                           2003             2002
                                                                         --------          -------
<S>                                                                     <C>                <C>
Net income plus non-cash expenses                                        $22,377           $12,829
Increases (decreases) in operating assets and liabilities                  8,424            (9,495)
                                                                         -------           -------
Cash flows from operating activities                                     $30,801           $ 3,334
                                                                         =======           =======
</TABLE>

Estimated Future Gross Renewal Revenue

The following tables represent the estimated gross renewal revenue associated
with the business-owned life insurance policies owned by our clients as of June
30, 2003. The projected gross revenues are not adjusted for mortality, lapse or
other factors that may impair realization, have not been discounted to reflect
their net present value, and do not reflect the commission expense we must pay
to consultants when we recognize the related revenue. We cannot assure you that
commissions under these policies will be received. These projected gross
revenues are based on the beliefs and assumptions of management and are not
necessarily indicative of the revenue that may actually be realized in the
future and we cannot assure you that commissions under these policies will be
received.

Non-securitized Gross Inforce Revenues. The following table represents the
estimated gross inforce revenue associated with business owned life insurance
policies owned by our clients as of June 30, 2003, not including estimated
securitized inforce revenues, which are set forth in a separate table.

                                       19

<PAGE>

<TABLE>
<CAPTION>
                         EXECUTIVE            BANKING         HEALTHCARE
                     BENEFITS PRACTICE        PRACTICE           GROUP           TOTAL
                     -----------------        --------           -----           -----
       <S>           <C>                      <C>               <C>             <C>
       2004               $52,065             $37,718           $6,107          $95,890
       2005                42,922              33,875            5,744           82,541
       2006                37,302              34,244            5,466           77,012
       2007                33,742              33,441            5,172           72,355
       2008                29,870              34,727            4,638           69,235
       2009                29,052              35,452            4,031           68,535
       2010                27,873              36,395            3,449           67,717
       2011                28,103              37,608            2,829           68,540
       2012                28,141              38,527            1,997           68,665
       2013                28,965              39,750            1,514           70,229
                         --------            --------          -------         --------
      Total              $338,035            $361,737          $40,947         $740,719
                         ========            ========          =======         ========

  June 30, 2002          $297,541            $275,918          $39,628         $613,087
                         ========            ========          =======         ========
</TABLE>

At June 30, 2003, our ten-year gross inforce revenue projection amounted to
$740.7 million. This balance represents a 20.8% increase in our residual book of
business over the June 30, 2002 balance.

Ten-year inforce revenues net of commission expense are $538.7 million and
$421.8 million as of June 30, 2003 and June 30, 2002, respectively.

Securitized Gross Inforce Revenues. The following table represents the estimated
gross inforce revenue associated with our securitized inforce bank-owned life
insurance policies as of June 30, 2003. These revenue streams are restricted for
the specific purpose of paying off our asset-backed notes which were issued in
connection with the acquisition of LongMiller in November 2002.

<TABLE>
<CAPTION>
                                                            SECURITIZED
                                                          BANKING PRACTICE
                                                       -----------------------
                               <S>                                    <C>
                               2004                                   $45,726
                               2005                                    44,571
                               2006                                    46,064
                               2007                                    48,363
                               2008                                    50,556
                               2009                                    52,762
                               2010                                    55,060
                               2011                                    56,897
                               2012                                    59,150
                               2013                                    62,112
                                                       -----------------------
                               Total June 30, 2003                   $521,261
                                                       =======================
</TABLE>

The ten-year inforce revenues net of commission expense are $407.3 million as of
June 30, 2003.

Human Capital Practice, Pearl Meyer and Partners, and Federal Policy Group
generate fee-based revenues and do not produce inforce revenues.

Cash Used in Investing Activities

Approximately $4.5 million of cash used in investing activities represented
earnout payments to prior owners of certain of our acquired businesses and the
purchase of inforce revenue from one of our practice presidents and
approximately $2.9 million was used for the purchase of equipment.

A substantial amount of the purchase price of our acquisitions is paid in cash.
This is primarily due to our desire to avoid diluting our existing stockholders.
We expect acquisitions to continue and be financed primarily from available
credit lines and possible additional equity. However, we can offer no assurances
such will be the case.

                                       20

<PAGE>


Cash Flows from Financing Activities

On May 23, 2003, the Company raised approximately $15 million from its
participation in a pooled trust preferred transaction, in which it issued
long-term subordinated debt securities with a floating rate, currently around
5.5%. The Company used the net proceeds of approximately $14.5 million to pay
down the term portion of its credit facility. The pooled trust preferred debt is
payable in one payment in 30 years with interest paid quarterly.

In order to finance the acquisition of LongMiller, we entered into a
securitization of a majority of the inforce revenues of LongMiller, raising $305
million of gross proceeds. The securitization is broken into four traunches,
each rated by Standard & Poors. The traunches consist of the A-1 and A-2 class
totaling approximately $167 million and each rated "AAA", B-class traunch of
$108 million rated "A" and the C-class traunch of $30 million rated "BBB". The
weighted average interest cost over the 20-year life of the asset-backed notes
is approximately seven percent. The securitized net inforce revenues, which are
expected to be approximately $40.6 million in 2003, are used to pay interest and
principal to the bondholders. Assuming the securitized notes are paid in
accordance with the payment schedule, the securitization will provide residual
cash flow to us of approximately five percent of the securitized inforce revenue
in the initial years, and our total residual interest would equal approximately
28 percent of the total present value of the securitized inforce revenue over
the expected life of the asset-backed notes. Such residual interest could be
substantially less if the notes do not amortize as expected. The securitization
is treated as debt, is included in the Banking Practice segment, and is
generally non-recourse to corporate assets.

As of June 30, 2003, we had restricted cash of approximately $13.4 million. This
cash is not available for general corporate purposes, but is solely used to
service the securitization indebtedness incurred to finance the acquisition of
LongMiller. A certain variable portion of the restricted cash is remitted to us
after bondholders are paid.

In May 2002, we amended our December 28, 1999 Credit Agreement to increase the
amount available under the credit facility to $125.0 million, of which $77.2
million was outstanding at June 30, 2003. We converted $50 million of the
year-end amount under the revolving credit facility to term debt at December 31,
2002. The term debt is payable quarterly over five years under the term facility
agreement. We had $42.8 million available under our credit lines at June 30,
2003. The revolving portion of our credit facility is scheduled to terminate on
December 31, 2003, at which time any revolving debt would convert to term debt
payable in quarterly installments over five years. We are currently in
discussions with our lenders to extend and amend the terms of our credit
agreement. There is no assurance that our lenders will extend and/or amend the
terms of our credit agreement.

The restrictive covenants under the existing loan agreement provide for the
maintenance of a minimum ratio of fixed charges, a maximum allowable leverage
ratio, a minimum amount of net worth (stockholders' equity), and a maximum ratio
of debt to capitalization. We were in compliance with all our restrictive
covenants as of June 30, 2003. Our restrictive covenants may limit our borrowing
ability under our credit line.

We believe that our cash flow from operating activities will continue to provide
sufficient funds to service our debt obligations. However, as our business
grows, our working capital and capital expenditure requirements will also
continue to increase. There can be no assurance that the net cash flow from
operations will be sufficient to meet our anticipated cash flow requirements or
that we will not require additional debt or equity financing in the future.

                                       21

<PAGE>

The following table provides information about our remaining debt obligations
for the years ended December 31. The table presents principal cash flows and
related interest rates by expected maturity dates totaling $392.9 million.

<TABLE>
<CAPTION>
                                                                           EXPECTED MATURITY DATE
                                                                           ----------------------
                                                                                                   2008 AND
                                          2003        2004       2005       2006        2007      THEREAFTER      TOTAL
                                          ----        ----       ----       ----        ----      ----------      -----
     <S>                                  <C>        <C>         <C>        <C>         <C>       <C>             <C>
     LIABILITIES
     Long term debt
       Note to former shareholder         $591      $1,274     $1,407     $1,553        $691              -      $5,516
        Average interest rate             10.0%       10.0%      10.0%      10.0%       10.0%             -
       Term debt                         5,000      10,000     10,000      5,495           -              -      30,495
        Average interest rate (1) (2)     3.28%       3.28%      3.28%
       Revolver (3)                          -       9,346      9,346      9,346       9,346          9,347      46,731
        Average interest rate (2) (4)        -       3.32%      3.32%      3.32%       3.32%           3.32%
       Pooled trust preferred                -           -          -          -           -         15,000      15,000
         Average interest rate (5)                                                                      5.5%
       Asset-backed notes                2,813      13,183     11,831     12,188      12,367        242,732     295,114
        Average interest rate (6)          6.2%        6.2%       6.2%       6.2%        6.2%           6.9%
<FN>
     (1) This rate is three-month LIBOR plus our spread of 225 basis points as
         of June 30, 2003. Our spread may change depending on our financial
         leverage.

     (2) Three-month LIBOR interest rate has been hedged with the interest rate
         swaps discussed in Item 3 below.

     (3) Assumes revolver amount at June 30, 2003 terms out per credit agreement
         at year-end.

     (4) The average interest rate of borrowings at prime and three-month LIBOR
         at June 30, 2003.

     (5) This rate is three-month LIBOR plus a spread of 420 basis points as of
         June 30, 2003.

     (6) This rate is the average interest rate on the outstanding asset-backed
         notes as of June 30, 2003.
</FN>
</TABLE>

The interest rate on the outstanding term debt and revolver is variable based on
current prime or LIBOR rates.

Below is a summary of our contractual cash obligations and other commitments and
contingencies:

<TABLE>
<CAPTION>
                                                                                         2008 AND
                                                                                         --------
                                    2003       2004        2005       2006       2007     THEREAFTER    TOTAL
                                    ----       ----        ----       ----       ----     ----------    -----
<S>                                 <C>        <C>         <C>        <C>        <C>     <C>            <C>

         Debt................      $ 8,404    $33,803     $32,584    $28,582    $22,404    $267,079   $392,856
         Operating leases....        5,300     10,484      10,468      9,952      9,496      25,090     70,790
         Contingent
         consideration                   -      7,099       5,855      2,355          -           -     15,309
                                 ---------- ---------- ----------- ---------- ---------- ----------- ----------
              Total..........      $13,704    $51,386     $48,907    $40,889    $31,900    $292,169   $478,955
                                 ========== ========== =========== ========== ========== =========== ==========
</TABLE>


Intangible Assets and Renewal Revenue

Intangible assets arise as a direct result of our acquisition program and
acquisitions have been an important contribution to our past and expected future
growth. In most of our acquisitions, we acquire very little in the way of
tangible assets; therefore a substantial portion of the purchase price is
typically allocated to intangible assets. Intangible assets, net of
amortization, arising from our purchased businesses consist of the following:

                                       22
<PAGE>
                                                   JUNE 30,         DECEMBER 31,
                                                     2003               2002
                                                     ----               ----
     Present value of inforce revenue            $470,473           $479,561
     Goodwill                                     118,415            117,803
     Non-compete agreements                         2,518              2,831
                                                 --------           --------
               Total                             $591,406           $600,195
                                                 ========           ========
    As a percentage of total assets                  82.7%              81.7%
    As a percentage of stockholders' equity         236.4%             248.9%

The present value of inforce revenue is the net discounted cash flow from the
book of business of those companies having future renewal revenue at the time we
acquired them. The amounts allocated to inforce revenue are determined using the
discounted cash flow of future commission adjusted for expected persistency,
mortality and associated costs. The balance of the excess purchase price over
the net tangible and identifiable intangible assets has been allocated to
goodwill. The inforce revenue is amortized over its period of duration, which is
normally twenty to thirty years. Many factors outside our control determine the
persistency of our inforce business and we cannot be sure that the value we
allocated will ultimately be realized.

Non-compete agreements are amortized over the periods of the agreements.

RECENT ACCOUNTING PRONOUNCEMENTS

In June 2002, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 146, Accounting for Costs
Associated with Exit or Disposal Activities, which nullifies Emerging Issues
Task Force ("EITF") Issue No. 94-3, Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in a Restructuring). SFAS No. 146 requires companies to recognize
costs associated with exit or disposal activities when they are incurred, rather
than at the date of commitment to an exit or disposal plan. We adopted SFAS No.
146 as of January 1, 2003, as described in Note 4.

In November 2002, the FASB issued FASB Interpretation ("FIN") No. 45,
Guarantor's Accounting and Disclosure Requirements for Guarantees, Including
Indirect Guarantees of Indebtedness of Others, an interpretation of FASB
Statements No. 5, 57, and 107 and rescission of FASB Interpretation No. 34. This
Interpretation elaborates on the existing disclosure requirements for most
guarantees, including loan guarantees such as standby letters of credit. It also
clarifies that at the time a company issues a guarantee, the company must
recognize an initial liability for the fair value, or market value, of the
obligations it assumes under that guarantee and must disclose that information
in its interim and annual financial statements. The initial recognition and
initial measurement provisions of FIN No. 45 are applicable on a prospective
basis to guarantees issued or modified after December 31, 2002. The disclosure
requirements of FIN No. 45 are effective for financial statements of interim or
annual periods ending after December 15, 2002. The adoption of this
interpretation did not have a material impact on our condensed consolidated
financial statements.

In 2003, the FASB issued FIN No. 46, Consolidation of Variable Interest
Entities--an interpretation of ARB No. 51. FIN No. 46 provides guidance on the
identification of entities for which control is achieved through means other
than voting rights (variable interest entities or "VIE") and how to determine
when and which business enterprises should consolidate the VIE. FIN No. 46
requires that both the primary beneficiary and all other enterprises with a
significant variable interest in a VIE make additional disclosures. We are
required to apply the requirements of FIN 46 starting with its third quarter
2003 Form 10-Q filing. We do not anticipate the adoption of this interpretation
will have a material impact on our condensed consolidated financial statements.


                                       23
<PAGE>


In accordance with EITF Issue No. 00-21, Revenue Arrangements with Multiple
Deliverables, a vendor should evaluate all deliverables in an arrangement to
determine whether they represent separate units of accounting. The evaluation
must be performed at the inception of the arrangement and as each item in the
arrangement is delivered. EITF 00-21 is effective for revenue arrangements
entered into in fiscal periods beginning after June 15, 2003. We do not
anticipate the adoption of the requirements of the consensus reached in this
issue will have a material impact on our condensed consolidated financial
statements.

In April 2003, the FASB issued SFAS No. 149, "Amendment of Statement 133 on
Derivative Instruments and Hedging Activities." SFAS No. 149 amends and
clarifies financial accounting and reporting of derivative instruments,
including certain derivative instruments embedded in other contracts and for
hedging activities under FASB Statement No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 149 is generally effective for
contracts entered into or modified after June 30, 2003 and for hedging
relationships designated after June 30, 2003. We do not anticipate the adoption
of this statement to have a material impact on our condensed consolidated
financial statements.

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Instruments
with Characteristics of both Liabilities and Equity." SFAS No. 150 establishes
standards for classifying and measuring certain financial instruments with
characteristics of both liabilities and equity. SFAS No. 150 is effective for
all financial instruments entered into or modified after May 31, 2003, and
otherwise is effective at the beginning of the first interim period beginning
after June 15, 2003. We do not anticipate the adoption of this statement to have
a material impact on our condensed consolidated financial statements.

RELATED PARTY TRANSACTIONS

We lease 16,266 square feet of office space and hanger space for the corporate
aircraft from entities owned by our Chairman and Chief Executive Officer, for
approximately $445 thousand annually. The office space lease expires on February
21, 2009.

On May 16, 2003, we acquired the inforce revenue from the president of one of
our practices for approximately $900 thousand. The inforce revenue relates to
policies sold by the president when he was a consultant prior to his employment
as practice president. The inforce revenue is being amortized over 30 years in
the Executive Benefits Practice segment.

During the first quarter 2003, we paid Randy Pohlman, a member of our Board of
Directors, $40 thousand as a referral fee. This amount was accrued in our
financial statements as of December 31, 2002.

Robert Long became a member of our Board of Directors, filling a vacant seat, in
January 2003 in connection with the LongMiller acquisition. He received a
substantial amount of the proceeds, including asset-backed notes, from the
November 2002 purchase of LongMiller.

On September 25, 2002, we entered into an Administrative Services Agreement and
Bonus Forfeiture Agreement with an affiliate of AUSA Holding, Inc., one of our
principal stockholders. During 2002, we received $2.5 million for services
rendered prior to and through September 30, 2002 and recognized a total of $3.2
million in the last half of 2002, pursuant to this agreement. Under the terms of
this agreement, we expect to continue to receive approximately $2.5 million
annually from the carrier for a period of 30 years depending upon certain
conditions. Of this annual amount, $2.0 million is included in the cash flows
securitizing the asset-backed notes issued to finance the acquisition of
LongMiller, and we will not have access to this cash for general corporate
purposes until the securitization notes are fully paid. This revenue, net of
amounts provided for chargebacks, is being recognized on a monthly basis
beginning in October 2002. The amounts received are subject to chargeback
(reimbursement of a portion of amounts received) if any policies under this
agreement are surrendered or if there is a section 1035 exchange. Any chargeback
amounts are deducted from the next scheduled payment. There is a receivable of
approximately $644 thousand included in the condensed consolidated balance sheet
as of June 30, 2003. We received approximately $1.2 million during the three
months ended June 30, 2003.

We have certain split dollar policies with four of our officers. All policies
have been terminated except one policy which is expected to be terminated in
2003.


                                       24
<PAGE>

                                   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.


                                                  CLARK, INC.



Date  August 19, 2003                     /s/  Tom Wamberg
      ---------------                     --------------------------------------
                                                     Tom Wamberg
                                          President and Chief Executive Officer


Date  August 19, 2003                     /s/  Thomas M. Pyra
      ---------------                     --------------------------------------
                                                  Thomas M. Pyra
                                     Vice President and Chief Financial Officer
                                             (Principal Financial Officer)


                                       25
<PAGE>

                                  EXHIBIT INDEX

3.1      Certificate of Incorporation (Incorporated herein by reference to
         Exhibit 3.1 of Clark's Registration Statement on Form S-1, File No.
         333-56799, filed with the SEC on June 15, 1998).

3.2      Certificate of Amendment of Certificate of Incorporation (Incorporated
         herein by reference to Exhibit 3.3 to Amendment No.1 to the Clark's
         Registration Statement on Form S-1, File No. 333-56799, filed with the
         SEC on July 27, 1998).

3.3      Certificate of Amendment of Certificate of Incorporation (Incorporated
         herein by reference to Exhibit 5 of Clark's Registration Statement on
         Form 8-A, File No. 001-31256, filed with the SEC on February 28, 2002).

3.4      Certification of Amendment of Certification of Incorporation
         (Incorporated herein by reference to Exhibit 3.6 of Clark's Quarterly
         Report on Form 10-Q, File No. 001-31256, filed with the SEC on August
         14, 2002).

3.5      Certificate of Amendment of Certificate of Incorporation (Incorporated
         herein by reference to Exhibit 4.5 of Clark's Registration Statement on
         Form S-8, File No. 333-106538, filed with the SEC on June 26, 2003).

3.6      Bylaws of Clark, Inc. (Incorporated herein by reference to Exhibit 4.6
         of Clark's Registration Statement on Form S-8, File No. 333-106538,
         filed with the SEC on June 26, 2003).

3.7      Certificate of Designation of Series A Junior Participating Preferred
         Stock (Incorporated herein by reference to Exhibit 3.4 to Amendment No.
         2 to Clark's Registration Statement on Form S-1, File No. 333-56799,
         filed with the SEC on August 11, 1998).

4.1      Specimen Certificate for shares of Common Stock, par value $.01 per
         share, of Clark Holdings, Inc. (Incorporated herein by reference to
         Exhibit 4.1 of Clark's Amendment No. 1 to the Registration Statement on
         Form S-1, File No. 333-56799, filed with the SEC on July 27, 1998).

4.2      Rights Agreement, dated as of July 10, 1998, by and between Clark
         Holdings, Inc. and The Bank of New York (Incorporated herein by
         reference to Exhibit 4.4 of Clark's Quarterly Report on Form 10-Q, File
         No. 000-24769, filed with the SEC on November 16, 1998).

31.1     Certification of Chief Executive Officer pursuant to Section 302 of
         Sarbanes-Oxley Act of 2002.*

31.2     Certification of Chief Financial Officer pursuant to Section 302 of
         Sarbanes-Oxley Act of 2002.*

32.1     Certification of Chief Executive Officer and Chief Financial Officer
         pursuant to Section 906 of Sarbanes-Oxley Act of 2002.**


___________________________
*        Filed herewith.
**       Previously filed on August 14, 2003.

                                       26