<PAGE>


                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-QSB


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


                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2001


                        COMMISSION FILE NUMBER: 333-43664


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


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


                                  230 BROADWAY
                         LYNNFIELD, MASSACHUSETTS 01940
                    (Address of principal executive offices)


                                 (781) 593-8565
              (Registrant's telephone number, including area code)


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

Number of shares outstanding of our only class of common stock as of November
14, 2001:

                                    5,704,426

<PAGE>


PART I     FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEETS


<TABLE>
<CAPTION>

                                                                 SEPTEMBER 30,         MARCH 31,
                                                                      2001               2001
                                                                 -------------         ---------
                                                                  (UNAUDITED)
<S>                                                              <C>                  <C>
ASSETS
     Cash and cash equivalents...............................    $5,986,922           $ 7,180,340
     Securities..............................................       162,962               168,193
     Deposits with clearing organizations....................       175,000               175,000
     Accounts receivable.....................................     1,929,696             1,914,504
     Receivables from related parties........................       167,776               109,327
     Prepaid expenses........................................        70,848               102,589
     Prepaid income taxes....................................        83,206                88,123
     Property and equipment, net.............................       593,908               439,589
     Other assets............................................       271,759               304,725
     Deferred income tax asset, net..........................       195,000                    --
                                                                 ----------           -----------
          TOTAL ASSETS.......................................    $9,637,077           $10,482,390
                                                                 ==========           ===========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       2
<PAGE>


               INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

              CONDENSED CONSOLIDATED BALANCE SHEETS -- (CONTINUED)

<TABLE>
<CAPTION>

                                                                          SEPTEMBER 30,         MARCH 31,
                                                                               2001               2001
                                                                         --------------         ---------
                                                                           (UNAUDITED)
<S>                                                                       <C>                  <C>
LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
     Commissions payable.............................................     $1,140,295           $ 1,133,101
     Notes payable...................................................         91,945               454,262
     Accounts payable................................................        374,991               637,736
     Accrued expenses................................................        386,947               121,718
     Deferred income tax liability, net..............................             --                13,000
                                                                          ----------           -----------
          TOTAL LIABILITIES..........................................      1,994,178             2,359,817
                                                                          ----------           -----------

STOCKHOLDERS' EQUITY:
     Common stock, $.01 par value, authorized 10,000,000 shares at
        September 30, 2001 and March 31, 2001, issued 5,708,311 at
        September 30, 2001 and March 31, 2001, outstanding 5,704,426
        at September 30, 2001 and 5,708,311 at March 31, 2001........         42,258                42,258
     Additional paid-in capital......................................      8,141,198             8,151,760
     Retained deficit................................................       (463,623)              (65,771)
     Accumulated other comprehensive loss............................        (46,799)               (5,674)
     Treasury stock, at cost (3,885 shares)..........................        (30,135)                   --
                                                                          ----------           -----------
          TOTAL STOCKHOLDERS' EQUITY.................................      7,642,899             8,122,573
                                                                          ----------           -----------
          TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY.................     $9,637,077           $10,482,390
                                                                          ==========           ===========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       3
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                       THREE MONTHS ENDED
                                                                                         SEPTEMBER 30,
                                                                              ----------------------------------
                                                                                   2001                 2000
                                                                              ------------         -------------
  <S>                                                                         <C>                  <C>
  COMMISSION AND ADVISORY FEE INCOME..........................                $6,611,172           $6,525,132
  COST OF COMMISSION AND ADVISORY FEES........................                 5,183,257            5,277,346
                                                                              ----------           ----------

  GROSS PROFIT................................................                 1,427,915            1,247,786
                                                                              ----------           ----------
  SELLING AND ADMINISTRATIVE EXPENSES:
     Administrative...........................................                 1,380,376              972,890
     Selling..................................................                   248,189               92,010
                                                                              ----------           ----------
         TOTAL SELLING AND ADMINISTRATIVE EXPENSES............                 1,628,565            1,064,900
                                                                              ----------           ----------

  OPERATING (LOSS) INCOME ....................................                  (200,650)             182,886
                                                                              ----------           ----------
  OTHER INCOME (EXPENSE):
     Interest income..........................................                    48,692               33,189
     Interest expense.........................................                   (12,865)              (2,015)
                                                                              ----------           ----------
          NET OTHER INCOME....................................                    35,827               31,174
                                                                              ----------           ----------

  (LOSS) INCOME BEFORE TAXES..................................                  (164,823)             214,060
  BENEFIT (PROVISION) FOR INCOME TAXES........................                    41,500              (80,500)
                                                                              ----------           ----------

  NET (LOSS) INCOME...........................................                $ (123,323)          $  133,560
                                                                              ==========           ==========
  BASIC AND DILUTED (LOSS) EARNINGS PER COMMON SHARE:
     Net (loss) income........................................                $     (.02)          $      .03

  SHARE DATA:

  WEIGHTED AVERAGE SHARES USED IN BASIC (LOSS) EARNINGS
     PER COMMON SHARE CALCULATIONS............................                 5,704,426            4,645,311

  PLUS:  INCREMENTAL SHARES FROM ASSUMED CONVERSION OF STOCK
     OPTIONS..................................................                        --              105,090
                                                                              ----------           ----------
  WEIGHTED AVERAGE SHARES USED IN DILUTED (LOSS) EARNINGS
     PER COMMON SHARE CALCULATIONS............................                 5,704,426            4,750,401
                                                                              ==========           ==========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       4
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                         SIX MONTHS ENDED
                                                                                          SEPTEMBER 30,
                                                                                --------------------------------
                                                                                   2001                 2000
                                                                                -----------          -----------
  <S>                                                                           <C>                  <C>
  COMMISSION AND ADVISORY FEE INCOME.................................           $13,508,406          $14,352,038
  COST OF COMMISSION AND ADVISORY FEES...............................            10,992,256           11,818,880
                                                                                -----------          -----------

  GROSS PROFIT.......................................................             2,516,150            2,533,158
                                                                                -----------          -----------
  SELLING AND ADMINISTRATIVE EXPENSES:
     Administrative..................................................             2,731,429            1,916,846
     Selling.........................................................               523,126              216,595
                                                                                -----------          -----------

         TOTAL SELLING AND ADMINISTRATIVE EXPENSES...................             3,254,555            2,133,441
                                                                                -----------          -----------

  OPERATING (LOSS) INCOME ...........................................              (738,405)             399,717
                                                                                -----------          -----------

  OTHER INCOME (EXPENSE):
     Interest income.................................................               125,034               43,028
     Interest expense................................................               (23,929)              (6,936)
     Realized gain on sale of investments............................                31,948                   --
                                                                                -----------          -----------

          NET OTHER INCOME...........................................               133,053               36,092
                                                                                -----------          -----------

  (LOSS) INCOME BEFORE TAXES.........................................              (605,352)             435,809
  BENEFIT (PROVISION) FOR INCOME TAXES...............................               207,500             (181,500)
                                                                                -----------          -----------

  NET (LOSS) INCOME..................................................           $  (397,852)         $   254,309
                                                                                ===========          ===========
  BASIC AND DILUTED (LOSS) EARNINGS PER COMMON SHARE:
     Net (loss) income...............................................           $      (.07)         $       .05

  SHARE DATA:

  WEIGHTED AVERAGE SHARES USED IN BASIC (LOSS) EARNINGS
     PER COMMON SHARE CALCULATIONS...................................             5,706,358            4,645,311

  PLUS:  INCREMENTAL SHARES FROM ASSUMED CONVERSION OF STOCK OPTIONS                     --              105,090
                                                                                -----------          -----------
  WEIGHTED AVERAGE SHARES USED IN DILUTED (LOSS) EARNINGS
     PER COMMON SHARE CALCULATIONS...................................             5,706,358            4,750,401
                                                                                ===========          ===========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       5
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

      CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

                  THREE MONTHS ENDED SEPTEMBER 30, 2000 AND 2001

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                           Accumulated
                                                                Additional    Retained        Other
                                                                 Paid-In      Earnings     Comprehensive   Treasury
                                        Shares       Amount      Capital      (Deficit)    Income (Loss)    Stock        Total
                                      ----------     -------    ----------    ---------    -------------   --------    ----------
<S>                                    <C>           <C>        <C>           <C>            <C>           <C>         <C>
BALANCE AT JULY 1, 2000..............  4,645,311     $31,628    $1,744,602    $ 159,284      $ 31,948      $     --    $1,967,462

Comprehensive income:
       Net income....................                                           133,560

Other comprehensive income:
       Net unrealized loss...........                                                         (18,066)

         Comprehensive income........                                                                                     115,494
                                       ---------     -------    ----------    ---------      --------      --------    ----------

BALANCE AT SEPTEMBER 30, 2000........  4,645,311     $31,628    $1,744,602    $ 292,844      $ 13,882      $     --    $2,082,956
                                       =========     =======    ==========    =========      ========      ========    ==========

BALANCE AT JULY 1, 2001..............  5,708,311     $42,258    $8,141,198    $(340,300)     $(35,021)     $(30,135)   $7,778,000

Comprehensive loss:
       Net loss......................                                          (123,323)

Other comprehensive income:
       Net unrealized loss...........                                                         (11,778)

         Comprehensive loss..........                                                                                    (135,101)
                                       ---------     -------    ----------    ---------      --------      --------    ----------

BALANCE AT SEPTEMBER 30, 2001........  5,708,311     $42,258    $8,141,198    $(463,623)     $(46,799)     $(30,135)   $7,642,899
                                       =========     =======    ==========    =========      ========      ========    ==========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       6
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

      CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

                   SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 2001

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                             Accumulated
                                                                 Additional    Retained         Other
                                                                  Paid-In      Earnings      Comprehensive   Treasury
                                         Shares       Amount      Capital      (Deficit)     Income (Loss)    Stock        Total
                                        ---------     -------    ----------    ---------     -------------   --------    ----------
<S>                                     <C>           <C>        <C>           <C>              <C>          <C>         <C>
BALANCE AT APRIL 1, 2000.............   4,645,311     $31,628    $1,744,602    $  38,535        $ 31,948     $     --    $1,846,713

Comprehensive income:
     Net income......................                                            254,309

Other comprehensive income:
     Net unrealized loss.............                                                            (18,066)

       Comprehensive income..........                                                                                       236,243
                                        ---------     -------    ----------    ---------        --------     --------    ----------

BALANCE AT SEPTEMBER 30, 2000........   4,645,311     $31,628    $1,744,602    $ 292,844        $ 13,882     $     --    $2,082,956
                                        =========     =======    ==========    =========        ========     ========    ==========

BALANCE AT APRIL 1, 2001.............   5,708,311     $42,258    $8,151,760    $ (65,771)       $ (5,674)    $     --    $8,122,573

Offering costs.......................                               (10,562)                                                (10,562)

Comprehensive loss:
     Net loss........................                                           (397,852)

Other comprehensive income:
     Net unrealized loss.............                                                            (41,125)

       Comprehensive loss............                                                                                      (438,977)

Treasury stock acquired..............                                                                         (30,135)      (30,135)
                                        ---------     -------    ----------    ---------        --------     --------    ----------

BALANCE AT SEPTEMBER 30, 2001........   5,708,311     $42,258    $8,141,198    $(463,623)       $(46,799)    $(30,135)   $7,642,899
                                        =========     =======    ==========    =========        ========     ========    ==========

</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       7
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                         SIX MONTHS ENDED
                                                                                          SEPTEMBER 30,
                                                                                -------------------------------
                                                                                   2001                 2000
                                                                                ----------            ---------
<S>                                                                             <C>                   <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net (loss) income..................................................        $(397,852)            $ 254,309
     Adjustments to reconcile net (loss) income to net cash
        used for operating activities:
           Depreciation and amortization................................          101,704                35,981
           Deferred income (benefit) taxes..............................         (240,531)                5,000
     Changes in assets and liabilities:
           Accounts receivable..........................................          (15,192)             (241,502)
           Receivables from related parties.............................          (58,449)              (62,879)
           Prepaid expenses.............................................           31,741                20,884
           Prepaid income taxes.........................................            4,917               100,300
           Other assets.................................................          (17,034)             (249,540)
           Accounts payable.............................................         (262,745)             (196,836)
           Accrued expenses.............................................          265,229               (64,500)
           Commissions payable..........................................            7,194               270,512
                                                                                ---------             ---------

              NET CASH USED FOR OPERATING ACTIVITIES....................         (581,018)             (128,271)
                                                                                ---------             ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchase of property and equipment.................................         (206,023)              (24,002)
     Purchase of investments............................................           (3,363)               (1,675)
                                                                                ---------             ---------

              NET CASH USED FOR INVESTING ACTIVITIES....................         (209,386)              (25,677)
                                                                                ---------             ---------
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       8
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

         CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS -- (CONTINUED)

                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                           SIX MONTHS ENDED
                                                                                            SEPTEMBER 30,
                                                                                -----------------------------------
                                                                                   2001                     2000
                                                                                -----------              ----------
<S>                                                                             <C>                      <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
       Acquisition of treasury stock....................................           (30,135)                     --
       Offering costs...................................................           (10,562)               (185,421)
       Payments on note payable.........................................          (362,317)                (71,040)
                                                                                ----------               ---------

              NET CASH USED FOR FINANCING ACTIVITIES....................          (403,014)               (256,461)
                                                                                ----------               ---------

NET DECREASE IN CASH AND CASH EQUIVALENTS...............................        (1,193,418)               (410,409)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD..........................         7,180,340                 844,603
                                                                                ----------               ---------

CASH AND CASH EQUIVALENTS, END OF PERIOD................................        $5,986,922               $ 434,194
                                                                                ==========               =========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
   Cash paid during the period for:
     Interest...........................................................        $   23,929               $   6,936
                                                                                ==========               =========
     Income taxes.......................................................        $       --               $  58,600
                                                                                ==========               =========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       9
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)


1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    BASIS OF PRESENTATION

         The accompanying unaudited condensed consolidated financial statements
    of Investors Capital Holdings, Ltd. (the Company) have been prepared in
    accordance with accounting principles generally accepted in the United
    States of America (GAAP) for interim financial information and with the
    instructions to Form 10-QSB. Accordingly, they do not include all of the
    information and footnotes required by GAAP for complete financial
    statements. In the opinion of management, these unaudited condensed
    consolidated financial statements contain all adjustments, consisting of
    only normal and recurring adjustments, necessary for a fair presentation
    of the financial position and results of operations. Operating results
    for the three-month and six-month periods ended September 30, 2001 are
    not necessarily indicative of the results that may be expected for the
    year ended March 31, 2002. The balance sheet at March 31, 2001 has been
    derived from the audited financial statements at that date, but does not
    include all of the information and footnotes required by GAAP for
    complete financial statements. These unaudited condensed consolidated
    financial statements should be read in conjunction with the Company's
    annual audited financial statements as of March 31, 2001 included in the
    Company's Form 10-KSB for the year ended March 31, 2001 filed with the
    Securities and Exchange Commission.

    USE OF ESTIMATES

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

    RECLASSIFICATIONS

         Certain amounts in the prior year have been reclassified to be
    consistent with the current year's statement presentation.


                                       10
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)


2.  SEGMENT INFORMATION

         The Company's reportable segments include investment services offered
    through Investors Capital Corporation (ICC) and asset management services
    offered through Eastern Point Advisors (EPA). This investment services
    segment includes securities, insurance, financial planning and related
    services. ICC earns commissions as a broker for its customers in the
    purchase and sale of securities on major exchanges. Asset management
    services generate recurring annual revenue from fees received on the
    management of customer accounts. EPA provides asset management and portfolio
    design services to a mutual fund and a variety of investors.

         Segment data presented includes the allocation of all corporate
    overhead to each segment. Intersegment revenue and expense, and receivables
    and payables, are eliminated between segments. Information concerning
    operations in the Company's segments of business is as follows:

<TABLE>
<CAPTION>

                                                                      THREE MONTHS ENDED
                                                                        SEPTEMBER 30,
                                                               -------------------------------
                                                                  2001                 2000
                                                               ----------           ----------
         <S>                                                   <C>                  <C>
         NON-INTEREST REVENUES:
             ICC...............................                $5,914,691           $5,791,497
             EPA...............................                   696,481              733,635
             ICH...............................                        --                   --
                                                               ----------           ----------
                  TOTAL........................                $6,611,172           $6,525,132
                                                               ==========           ==========

         NET INTEREST AND DIVIDENDS:
             ICC...............................                $   20,241           $   29,083
             EPA...............................                        --                   --
             ICH...............................                    28,451                4,106
                                                               ----------           ----------
                  TOTAL........................                $   48,692           $   33,189
                                                               ==========           ==========

         INCOME (LOSS):
             ICC...............................                $   57,130           $  219,824
             EPA...............................                    69,902               33,089
             ICH...............................                  (250,355)            (119,353)
                                                               ----------           ----------
                  TOTAL........................                $ (123,323)          $  133,560
                                                               ==========           ==========

         PERIOD END TOTAL ASSETS:
             ICC...............................                $3,453,746           $2,609,892
             EPA...............................                   658,633              647,462
             ICH...............................                 5,524,698            1,021,090
                                                               ----------           ----------
                  TOTAL........................                $9,637,077           $4,278,444
                                                               ==========           ==========
</TABLE>


                                       11
<PAGE>


                INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)


2.  SEGMENT INFORMATION (CONTINUED)

<TABLE>
<CAPTION>

                                                             SIX MONTHS ENDED
                                                              SEPTEMBER 30,
                                                    --------------------------------
                                                       2001                 2000
                                                    -----------          -----------
         <S>                                        <C>                  <C>
         NON-INTEREST REVENUES:
             ICC...............................     $12,124,303          $12,904,413
             EPA...............................       1,384,103            1,438,781
             ICH...............................              --                8,844
                                                    -----------          -----------
                  TOTAL........................     $13,508,406          $14,352,038
                                                    ===========          ===========

         NET INTEREST AND DIVIDENDS:
             ICC...............................     $    37,109              $34,151
             EPA...............................              --                   --
             ICH...............................          87,925                8,877
                                                    -----------          -----------
                  TOTAL........................     $   125,034          $    43,028
                                                    ===========          ===========

         INCOME (LOSS):
             ICC...............................     $   (49,296)         $   441,870
             EPA...............................          61,058               74,587
             ICH...............................        (409,614)            (262,148)
                                                    -----------          -----------
                  TOTAL........................     $  (397,852)         $   254,309
                                                    ===========          ===========

         PERIOD END TOTAL ASSETS:
             ICC...............................     $ 3,453,746          $ 2,609,892
             EPA...............................         658,633              647,462
             ICH...............................       5,524,698            1,021,090
                                                    -----------          -----------
                  TOTAL........................     $ 9,637,077          $ 4,278,444
                                                    ===========          ===========
</TABLE>


                                       12
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS

OVERVIEW

     We are a financial services holding company that, through our
subsidiaries, provides investment advisory, insurance, financial planning and
related services. We operate in a highly regulated and competitive industry
that is influenced by numerous external factors such as economic conditions,
marketplace liquidity and volatility, monetary policy, global and national
political events, regulatory developments, competition and investor
preferences.

     Our revenues and net earnings may be either enhanced or diminished from
period to period by any one of or by a multiple of these external factors.

     In addition, the passage of the Graham-Leach-Bliley Act in November of 1999
repealed depression-era laws that separated commercial, investment banking and
insurance activities. Such repeal may result in the intensification of the
environment in which we compete by increasing the number of companies doing
business in the financial services arena.

RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED WITH THREE MONTHS ENDED
SEPTEMBER 30, 2000

     The Company had a consolidated operating loss of $200,650 for the three
months ended September 30, 2001 as compared to consolidated operating income
of $182,886 for the three months ended September 30, 2000. This decrease in
consolidated operating income of $383,536, or 209.7%, after the elimination
of all intersegment revenues and expenses, was attributable to a $316,113
decrease in operating income provided by the Company's subsidiary, Investors
Capital Corporation (ICC), a $103,580 decrease in operating income provided
by Investors Capital Holdings, Ltd (ICH), on a stand-alone basis, and a
$36,157 increase in operating income provided by the Company's subsidiary
Eastern Point Advisors (EPA). The $316,113 decrease in operating income
provided by ICC was mainly attributable to an increase of $320,571 in
administrative expenses due to the settlement of various lawsuits. The
$103,580 decrease in operating income provided by ICH was mainly attributable
to a $16,375 increase in legal and accounting fees, a $25,000 quarterly
charge for the amortization of the Company's investment in its insurance
subsidiary, ICC Insurance Agency, Inc. and a $36,750 increase in selling
expenses related to the engagement of various public relations firms. The
$36,157 increase in operating income provided by EPA was mainly attributable
to a higher gross margin resulting from investments shifting from variable
products to superior performing investment models.

     Consolidated commissions and advisory fee income of $6,611,172 for the
three months ended September 30, 2001 increased by $86,040, or 1.3%, as compared
to consolidated commissions and advisory fee income of $6,525,132 for the three
months ended September 30, 2000. This increase in gross revenues, after the
elimination of all intersegment revenues and expenses, was attributable to a
$123,194 increase in revenues provided by ICC and a $37,154 decrease in advisory
fee income provided by EPA. The increase of $123,194 in gross revenues provided
by ICC was driven by the receipt of basis-point income on money market accounts
following the re-negotiation of a service contract with our clearing firm,
Pershing. Excluding the receipt of the additional basis-point income,
consolidated commissions and advisory fee income for the three months ended
September 30, 2001 would have been consistent with the same period last year.

     Consolidated commissions and advisory fee expense of $5,183,257 for the
three months ended September 30, 2001 decreased by $94,089, or 1.8%, as compared
to consolidated commissions and advisory fee expense of $5,277,346 for the three
months ended September 30, 2000. This decrease, after the elimination of all
intersegment revenues and expenses, was attributable to an $89,161 decrease in
advisory fee expense incurred by EPA and a $4,928 decrease in commission expense
incurred by ICC. The decrease of $89,161 in advisory fee expense incurred by EPA
was the result of declining account values due to a decline in market
conditions.


                                       13
<PAGE>


     Consolidated administrative expenses of $1,380,376 for the three months
ended September 30, 2001 increased by $407,486, or 41.9%, as compared to
consolidated administrative expenses of $972,890 for the three months ended
September 30, 2000. This increase, after the elimination of all intersegment
revenues and expenses, was attributable to a $320,571 increase in administrative
expenses incurred by ICC, a $66,833 increase in administrative expenses incurred
by ICH, on a stand-alone basis and a $20,082 increase in administrative expenses
incurred by EPA. The increase of $320,571 in administrative expenses incurred by
ICC was mainly the result of a $236,810 increase in legal expense resulting from
the settlement of various lawsuits. The increase of $66,833 in administrative
expenses incurred by ICH was mainly the result of a $16,375 increase in legal
and accounting fees and a $25,000 quarterly charge for the amortization of the
Company's investment in its insurance subsidiary, ICC Insurance Agency, Inc.

     Consolidated selling expenses of $248,189 for the three months ended
September 30, 2001 increased by $156,179, or 169.7%, as compared to
consolidated selling expenses of $92,010 for the three months ended September
30, 2000. This increase, after the elimination of all intersegment revenues
and expenses, was attributable to a $123,660 increase in selling expenses
incurred by ICC, a $36,750 increase in selling expenses incurred by ICH, on a
stand-alone basis, and a $4,231 decrease in selling expenses incurred by EPA.
The increase of $123,660 in selling expenses incurred by ICC was mainly
attributable to an expense adjustment for promotional income for the three
months ended September 30, 2000. The increase of $36,750 in selling expenses
incurred by ICH, on a stand-alone basis, was the result of engaging public
relations firms during the three months ended September 30, 2001.

     The Company had a consolidated net loss of $123,323 for the three months
ended September 30, 2001 as compared to consolidated net income of $133,560
for the three months ended September 30, 2000. This $256,883, or 192.3%,
decrease in net earnings, after the elimination of all intersegment revenues
and expenses, was attributable to a $162,694 decrease in net income provided
by ICC, a $131,002 decrease in net income provided by ICH, on a stand-alone
basis, and a $36,813 increase in net income provided by EPA. The $162,694
decrease in net income provided by ICC was mainly attributable to the
$236,810 increase in legal expense resulting from the settlement of various
lawsuits. The $131,002 decrease in net income provided by ICH was the result
of a $16,375 increase in legal and accounting fees, a $25,000 quarterly
charge for the amortization of the Company's investment in its insurance
subsidiary, ICC Insurance Agency, Inc. and an increase of $36,750 in selling
expenses resulting from the engagement of public relations firms during the
three months ended September 30, 2001.

     The Company had a consolidated income tax benefit of $41,500 for the
three months ended September 30, 2001 as compared to consolidated income
taxes of $80,500 for the three months ended September 30, 2000. This increase
of $122,000, or 151.6%, in income tax benefit was mainly attributable to the
increase in operating loss from the comparable prior period.

SIX MONTHS ENDED SEPTEMBER 30, 2001 COMPARED WITH SIX MONTHS ENDED
SEPTEMBER 30, 2000

     The Company had a consolidated operating loss of $738,405 for the six
months ended September 30, 2001 as compared to consolidated operating income
of $399,717 for the six months ended September 30, 2000. This decrease of
$1,138,122, or 284.7%, in consolidated operating income, after the
elimination of all intersegment revenues and expenses, was attributable to a
$865,441 decrease in operating income provided by the Company's subsidiary,
Investors Capital Corporation (ICC), a $222,550 decrease in operating income
provided by Investors Capital Holdings, Ltd (ICH), on a stand-alone basis,
and a $50,131 decrease in operating income provided by the Company's
subsidiary Eastern Point Advisors (EPA). The $865,441 decrease in operating
income provided by ICC was mainly attributable to increases of $586,540 and
$271,004 in administrative and selling expenses, respectively, in
anticipation of an expanding market. The $222,550 decrease in operating
income provided by ICH was mainly attributable to a $74,613 increase in legal
and accounting fees, a $50,000 charge for the amortization of the Company's
investment in its insurance subsidiary, ICC Insurance Agency, Inc. and a
$66,649 increase in expenses associated with public relations.


                                       14
<PAGE>


     Consolidated commissions and advisory fee income of $13,508,406 for the six
months ended September 30, 2001 decreased by $843,632, or 5.9%, as compared to
consolidated commissions and advisory fee income of $14,352,038 for the six
months ended September 30, 2000. This decrease in gross revenues, after the
elimination of all intersegment revenues and expenses, was attributable to a
$780,110 decrease in revenues provided by ICC, a $54,678 decrease in advisory
fee income provided by EPA and a $8,844 decrease in other income provided by
ICH, on a stand-alone basis. The decrease of $780,110 in gross revenues provided
by ICC was mainly driven by a sharp decline in the market as compared to the
same period last year.

     Consolidated commissions and advisory fee expense of $10,992,256 for the
six months ended September 30, 2001 decreased by $826,624, or 7.0%, as compared
to consolidated commissions and advisory fee expense of $11,818,880 for the six
months ended September 30, 2000. This decrease, after the elimination of all
intersegment revenues and expenses, was attributable to a $772,213 decrease in
commission expense incurred by ICC and a $54,411 decrease in advisory fee
expense provided by EPA. The decrease of $772,213 in commission expense incurred
by ICC was mainly driven by a sharp decline in the market as compared to the
same period last year.

     Consolidated administrative expenses of $2,731,429 for the six months ended
September 30, 2001 increased by $814,583, or 42.5%, as compared to consolidated
administrative expenses of $1,916,846 for the six months ended September 30,
2000. This increase, after the elimination of all intersegment revenues and
expenses, was attributable to a $586,540 increase in administrative expenses
incurred by ICC, a $169,698 increase in administrative expenses incurred by ICH,
on a stand-alone basis and a $58,345 increase in administrative expenses
incurred by EPA. The increase of $586,540 in administrative expenses incurred by
ICC was mainly the result of an increase in payroll and payroll related expenses
as ICC had expanded its human resources in anticipation of an expanding market
and an increase in legal expense resulting from the settlement of lawsuits. The
increase of $169,698 in administrative expenses incurred by ICH was mainly the
result of a $74,613 increase in legal and accounting fees and a $50,000 charge
for the amortization of the Company's investment in its insurance subsidiary,
ICC Insurance Agency, Inc.

     Consolidated selling expenses of $523,126 for the six months ended
September 30, 2001 increased by $306,531, or 141.5%, as compared to consolidated
selling expenses of $216,595 for the six months ended September 30, 2000. This
increase, after the elimination of all intersegment revenues and expenses, was
attributable to a $271,004 increase in selling expenses incurred by ICC, a
$44,008 increase in selling expenses incurred by ICH, on a stand-alone basis,
and an $8,481 decrease in selling expenses incurred by EPA. The increase of
$271,004 in selling expenses incurred by ICC was attributable to the recognition
of promotional income during the three months ended September 30, 2000.

     The Company had a consolidated net loss of $397,852 for the six months
ended September 30, 2001 as compared to consolidated net income of $254,309
for the six months ended September 30, 2000. This $652,161, or 256.4%,
decrease in net earnings, after the elimination of all intersegment revenues
and expenses, was attributable to a $491,166 decrease in net income provided
by ICC, a $147,466 decrease in net income provided by ICH, on a stand-alone
basis and a $13,529 decrease in net income provided by EPA. The $491,166
decrease in net income provided by ICC was mainly attributable to increases
of $586,540 and $271,004 in administrative and selling expenses,
respectively, as the Company expanded its operations in anticipation of an
expanding market, and a decrease of $386,329 in income tax expense resulting
from the increase in operating loss from the comparable prior period.

     The Company had a consolidated income tax benefit of $207,500 for the
six months ended September 30, 2001 as compared to consolidated income taxes
of $181,500 for the six months ended September 30, 2000. This increase of
$389,000 or 214.3%, in income tax benefit was mainly attributable to the
increase in operating loss from the comparable prior period.

                                       15
<PAGE>


LIQUIDITY AND CAPITAL RESOURCES

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

     As of September 30, 2001, cash and cash equivalents totaled $5,986,922
as compared to $7,180,340 as of March 31, 2001. Working capital as of
September 30, 2001 was $6,777,232 as compared to $7,378,259 as of March 31,
2001.

     As of September 30, 2001, our net capital ratio for the broker-dealer was
2.27 to 1 as compared to (41.5) to 1 as of September 30, 2000. The SEC requires
that we maintain a net capital of $100,000 and a ratio of aggregate indebtedness
to net capital not to exceed 15 to 1. This SEC requirement is also referred to
as the "net capital ratio" or the "net capital rule." Indebtedness generally
includes all money owed by a company, and net capital includes cash and assets
that are easily converted into cash. SEC rules also prohibit "equity capital,"
which, under the net capital rule, includes the subordinated loans from being
withdrawn or cash dividends from being paid if our net capital ratio would
exceed 10 to 1 if we would have less than our minimum required net capital. As
of September 30, 2001, we had net capital of $855,319 as compared to net capital
of ($43,893) as of September 30, 2000. This resulted in excess net capital of
$725,864 and a net capital deficiency of $165,318, respectively, for the
applicable periods. The net capital deficiency as of September 30, 2000 resulted
from the subsequent discovery of underaccrued commissions on November 9, 2000,
which impacted the March 31, 2000 net capital computation and therefore, the
September 30, 2000 net capital computation.

     Net cash used for operating activities was $581,018 for the six months
ended September 30, 2001 as compared to net cash used for operating activities
of $128,271 for the six months ended September 30, 2000. This increase in cash
flow used for operating activities was primarily the result of increases in
administrative and selling expenses.

     Net cash used for investing activities was $209,386 for the six months
ended September 30, 2001 as compared to $25,677 for the six months ended
September 30, 2000. This increase in cash flow used for investing activities was
primarily the result of acquisitions of equipment in developing our Internet
capabilities.

     Net cash used for financing activities was $403,014 for the six months
ended September 30, 2001 as compared to $256,461 for the six months ended
September 30, 2000. This increase in cash used for financing activities was
mainly the result of an increase in payments on the financing of the Company's
insurance policies.


                                       16
<PAGE>


EFFECT OF RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

     In June of 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities." SFAS No. 133, as amended by SFAS
No. 138, establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts and for hedging activities. The statement is effective for all fiscal
quarters of fiscal years beginning after June 15, 2000. In management's opinion,
SFAS No. 133 did not have a material effect on the Company's consolidated
financial statements.

     FASB has issued SFAS No. 140, "Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities." This Statement replaces
SFAS No. 125, "Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities," and rescinds SFAS No. 127, "Deferral of the
Effective Date of Certain Provisions of SFAS No. 125." SFAS No. 140 provides
accounting and reporting standards for transfers and servicing of financial
assets and extinguishments of liabilities. This statement provides consistent
standards for distinguishing transfers of financial assets that are sales
from transfers that are secured borrowings. This statement is effective for
transfers and servicing of financial assets and extinguishments of
liabilities occurring after March 31, 2001. However, the disclosure
provisions are effective for fiscal years ending after December 15, 2000. The
effect of this statement did not have a material impact on the Company's
financial position or results of operations.

     SFAS No. 141 improves the consistency of the accounting and reporting for
business combinations by requiring that all business combinations be accounted
for under a single method - the purchase method. Use of the pooling-of-interests
method is no longer permitted. SFAS No. 141 requires that the purchase method be
used for business combinations initiated after June 30, 2001. Management does
not anticipate any impact on the consolidated financial statements upon adoption
of this statement.

     SFAS No. 142 requires that goodwill no longer be amortized to earnings,
but instead be reviewed for impairment. The amortization of goodwill ceases
upon adoption of this statement, which for most companies, will be January 1,
2002. Management does not anticipate any impact on the consolidated financial
statements upon adoption of this statement.

EFFECTS OF INFLATION

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


                                       17
<PAGE>


PART II  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

     Our broker-dealer subsidiary, Investors Capital Corporation, was engaged in
a material NASD Arbitration in which four of our registered representatives were
alleged to have made misrepresentations in the sale of unsecured promissory
notes in a Florida company that has since filed for bankruptcy protection. Our
broker-dealer subsidiary did not pre-approve these sales, had no knowledge of
them and further did not receive any compensation from these sales. We were
involved in this matter under agency principles for our alleged failure to
supervise the registered representatives involved.

     This Arbitration, Rimmler, et al. v. Investors Capital Corporation was
originally filed with the NASD on February 3, 2000 in Boca Raton, Florida.
Without admitting fault and in exchange for a full and complete release from
any and all claims relating thereto, this matter was settled on September 28,
2001. Investors Capital Corporation contributed $75,521 to the total
settlement in this matter.

     There has been no other material change in the status of the legal
proceedings discussed in our Registration Statement that became effective on
February 8, 2001 or any subsequent filings.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(b)      Reports on Form 8-K.

              A report on Form 8-K was filed on September 21, 2001 setting forth
         the dismissal of our certifying accountants, Cayer, Prescott, Clune &
         Chatellier, LLP. Pursuant to SEC requests, a Form 8-K/A was filed on
         October 11, 2001, October 22, 2001 and November 8, 2001 clarifying this
         dismissal.


                                       18
<PAGE>


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized on November 14, 2001.

                                        INVESTORS CAPITAL HOLDINGS, LTD.

                                        By: /s/ Theodore E. Charles
                                            ----------------------------
                                        Theodore E. Charles
                                        President



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