<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2000

                                       OR

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

For the transition period from          to

                         Commission file number 0-23239

                                   UBICS, INC.
             (Exact name of registrant as specified in its charter)

          PENNSYLVANIA                                  34-1744587
(State or other Jurisdiction of            (I.R.S. Employer Identification No.)
 Incorporation or Organization)

   333 TECHNOLOGY DRIVE, SUITE 210, CANONSBURG, PENNSYLVANIA        15317
             (Address of Principal Executive Offices)             (Zip Code)

                                 (724) 746-6001
              (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 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 the number of shares outstanding of each of the issuer's
classes of Common Stock as of the latest practicable date:

                Class                            Outstanding at August 10, 2000
                -----                            ------------------------------

     Common Stock, $.01 par value                          7,012,151



<PAGE>   2




                                   UBICS, INC.

                                    Form 10-Q

                                TABLE OF CONTENTS

PART I - - FINANCIAL INFORMATION

Item 1.  Financial Statements

         Balance Sheets as of December 31, 1999 and June 30, 2000

         Statements of Operations for the three months ended June 30, 1999 and
         2000, and the six months ended June 30, 1999 and 2000

         Statements of Cash Flows for the six months ended June 30, 1999 and
         2000

         Notes to Unaudited Financial Statements

Item 2.  Management's Discussion and Analysis of Results of Operations and
         Financial Condition

PART II - - OTHER INFORMATION

Item 1.  Legal Proceedings

Item 2.  Changes in Securities and Use of Proceeds

Item 3.  Defaults upon Senior Securities

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

Item 5.  Other Information

Item 6.  Exhibits and Reports on Form 8-K

SIGNATURES



                                       2
<PAGE>   3




                                   UBICS, INC.

                           CONSOLIDATED BALANCE SHEETS
                 (DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                 DECEMBER 31,      JUNE 30,
                                                                    1999             2000
                                                                 ---------------------------
                                                                                 (UNAUDITED)
<S>                                                              <C>              <C>
ASSETS
CURRENT ASSETS:
     CASH AND CASH EQUIVALENTS                                   $ 12,027         $ 11,225
     ACCOUNTS RECEIVABLE, NET OF ALLOWANCE FOR
        DOUBTFUL ACCOUNTS OF $885
        AND $1,060, RESPECTIVELY                                    4,103            3,976
     UNBILLED RECEIVABLES                                           2,363            3,514
     EMPLOYEE ADVANCES                                                 52               80
     PREPAIDS AND OTHER                                               299              490
     DEFERRED TAX ASSET                                               495              495
                                                                 --------         --------
         TOTAL CURRENT ASSETS                                      19,339           19,780
                                                                 --------         --------
PROPERTY AND EQUIPMENT:
     LEASEHOLD IMPROVEMENT                                             40               40
     VEHICLES                                                          89               89
     COMPUTER EQUIPMENT AND SOFTWARE                                1,732            1,964
     FURNITURE AND FIXTURES                                           662              672
     OFFICE AND OTHER EQUIPMENT                                        42               46
                                                                 --------         --------
     TOTAL PROPERTY AND EQUIPMENT                                   2,565            2,811
ACCUMULATED DEPRECIATION                                             (470)            (639)
                                                                 --------         --------
     NET PROPERTY AND EQUIPMENT                                     2,095            2,172
                                                                 --------         --------
OTHER LONG TERM ASSETS                                                250              983
                                                                 --------         --------
       TOTAL ASSETS                                              $ 21,684         $ 22,935
                                                                 --------         --------

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
     ACCOUNTS PAYABLE                                               1,981            2,039
     PAYROLL LIABILITIES                                            1,717            2,191
     OTHER CURRENT LIABILITIES                                         97              672
     DUE TO AFFILIATES, NET                                            --               74
                                                                 --------         --------
     TOTAL LIABILITIES                                              3,795            4,976
                                                                 --------         --------
STOCKHOLDERS' EQUITY:
     PREFERRED STOCK, $.01 PAR VALUE, 2,000,000
        SHARES AUTHORIZED, NO SHARES ISSUED AND
        OUTSTANDING                                                    --               --
     COMMON STOCK, $.01 PAR VALUE, 20,000,000
        SHARES AUTHORIZED, 6,500,000 SHARES
        ISSUED                                                         65               65
ADDITIONAL PAID-IN CAPITAL                                         13,160           13,412
TREASURY STOCK - 20,200 SHARES,  AT COST                             (100)            (100)
                                                                 --------         --------
RETAINED EARNINGS                                                   4,764            4,582
     TOTAL STOCKHOLDERS' EQUITY                                    17,889           17,959
                                                                 --------         --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                       $ 21,684         $ 22,935
                                                                 ========         ========
</TABLE>




    The accompanying notes are an integral part of these financial statements




                                       3
<PAGE>   4




                                   UBICS, INC.

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 (DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                       Three Months                            Six Months
                                                      Ended June 30,                         Ended June 30,
                                            -----------------------------------------------------------------------

                                               1999                2000                1999                2000
                                            (unaudited)         (unaudited)         (unaudited)         (unaudited)
                                            -----------------------------------------------------------------------

<S>                                         <C>                 <C>                 <C>                 <C>
Revenues                                    $     9,632         $    10,123         $    18,717         $    19,367
Cost of revenues                                  6,983               7,345              13,593              14,157
                                            -----------         -----------         -----------         -----------
  Gross profit                                    2,649               2,778               5,124               5,210
Selling, general and
  administrative expense                          2,146               3,309               4,276               5,626
Merger related expenses                             869                  --                 869                  --
                                            -----------         -----------         -----------         -----------
Income / ( Loss ) from operations                  (366)               (531)                (21)               (416)
Interest income, net                                130                 171                 260                 329
                                            -----------         -----------         -----------         -----------
Income / (Loss ) before income taxes               (236)               (360)                239                 (87)
Provision (Credit) for income taxes                 (80)                (11)                102                  95
                                            -----------         -----------         -----------         -----------
  Net income / ( Loss )                     $      (156)        $      (349)        $       137         $      (182)
                                            ===========         ===========         ===========         ===========
Basic and diluted earnings / (Loss)         $     (0.02)        $     (0.05)        $      0.02         $     (0.03)
  per share                                 ===========         ===========         ===========         ===========

Weighted average shares                       6,479,800           6,479,800           6,479,800           6,479,800
  outstanding


Diluted average shares                        6,479,800           6,479,800           6,479,800           6,479,800
   outstanding
</TABLE>







    The accompanying notes are an integral part of these financial statements


                                       4
<PAGE>   5




                                   UBICS, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                        Six Months
                                                      Ended June 30,
                                                --------------------------
                                                  1999             2000
                                                --------------------------
<S>                                             <C>              <C>
Cash flows from operating activities:
  Net income / ( Loss )                         $    137         $   (182)
  Adjustments to reconcile net
     income to net cash provided by
     operating activities--
     Depreciation                                    134              169
     Stock based compensation                         --              252
     Changes in operating assets and
       liabilities--
       Accounts receivable, net                     (783)             127
       Unbilled receivables                          235           (1,151)
       Employee advances                              51              (28)
       Other long term assets                        (50)            (733)
       Due to affiliates, net                        (32)              74
       Deferred tax asset                            (53)              --
       Prepaids and other                           (462)            (191)
       Accounts payable                              318               58
       Payroll liabilities                           400              474
       Accrued taxes and other
          current liabilities                        593              575
                                                --------         --------
     Net cash (used) provided by
       operating activities                          488             (556)
                                                --------         --------

Cash flows from investing activities:
  Purchases of property and
     equipment                                      (298)            (246)
                                                --------         --------
     Net cash used by investing
       activities                                   (298)            (246)
                                                --------         --------

Net increase (decrease) in cash and cash
  equivalents                                        190             (802)
Cash and cash equivalents, at
  beginning of period                             11,470           12,027
                                                --------         --------
Cash and cash equivalents, at
  end of period                                 $ 11,660         $ 11,225
                                                ========         ========

Supplemental data:
  Cash payments for income taxes                $    744         $    212
</TABLE>


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



                                       5
<PAGE>   6


                                   UBICS, INC.

                     NOTES TO UNAUDITED FINANCIAL STATEMENTS
                 (DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)


1. BASIS OF PRESENTATION:

    The financial statements of UBICS, Inc. ("UBICS" or "the Company") presented
herein are unaudited. Certain information and footnote disclosures normally
prepared in accordance with generally accepted accounting principles have been
either condensed or omitted pursuant to the rules and regulations of the
Securities and Exchange Commission. Although the Company believes that all
adjustments, consisting of only normal recurring adjustments, necessary for a
fair presentation have been made, interim periods are not necessarily indicative
of the financial results of operations for a full year. As such, these financial
statements should be read in conjunction with the financial statements and notes
thereto included in the Company's Annual Report on Form 10-K for its fiscal year
ended December 31, 1999 filed on March 30, 2000.


2. OPERATIONS:

    UBICS, a Delaware corporation, provides information technology professional
services to large and mid-sized organizations. The Company provides its clients
with a wide range of professional services in such areas as client/server design
and development, enterprise resource planning package implementation and
customization, e-commerce applications design and development, applications
maintenance programming and database and systems administration.


3.  RELATED PARTY TRANSACTIONS:

     As of June 30, 2000, the Company had a net payable to the UB Group,
totaling $74, resulting from share of rent payable to the UB Group for premises
occupied by the Company in Sausalito, California and Bangalore, India.

4. EARNINGS PER SHARE:

    Under Financial Accounting Standards Board Statement on Financial Accounting
Standards ("SFAS") No. 128, "Earnings Per Share," earnings per share are
classified as basic earnings per share and diluted earnings per share. Basic
earnings per share included only the weighted average common shares outstanding.
Diluted earnings per share included the weighted average common shares
outstanding and any dilutive common stock equivalent shares in the calculation.
All prior periods have been restated to reflect the Company's adoption of SFAS
No. 128. Treasury shares are treated as retired for earnings per share purposes.


    The following table reflects the calculation of earnings per share under
SFAS No. 128:



                                       6
<PAGE>   7




<TABLE>
<CAPTION>
      THREE MONTHS ENDED JUNE 30                                 1999          2000
      (Dollars in thousands, except per share data)

<S>                                                          <C>           <C>
      BASIC EARNINGS PER SHARE
      Net income/(loss)                                             (156)         (349)
      DIVIDED BY:
      Weighted average common shares                           6,479,800     6,479,800
      Basic earnings (loss) per share                              (0.02)        (0.05)
                                                             -----------   -----------

      DILUTED EARNINGS PER SHARE:
      Net income/(loss)                                             (156)         (349)
      DIVIDED BY:
      Weighted average common shares                           6,479,800     6,479,800
      Dilutive effect of options                                      --            --
                                                             -----------   -----------
      Dilutive average common shares                           6,479,800     6,479,800
      Diluted earnings/(loss) per share                            (0.02)        (0.05)




<CAPTION>
      SIX MONTHS ENDED JUNE 30                                    1999          2000
      (Dollars in thousands, except per share data)

<S>                                                          <C>           <C>
      BASIC EARNINGS PER SHARE
      Net income/(loss)                                              137          (182)
      DIVIDED BY:
      Weighted average common shares                           6,479,800     6,479,800
      Basic earnings per share                                      0.02         (0.03)
                                                             -----------   -----------

      DILUTED EARNINGS PER SHARE:
      Net income/(loss)                                              137          (182)
      DIVIDED BY:
      Weighted average common shares                           6,479,800     6,479,800
      Dilutive effect of options                                      --            --
                                                             -----------   -----------
      Dilutive average common shares                           6,479,800     6,479,800
      Diluted earnings/(loss) per share                             0.02         (0.03)
</TABLE>

    The exercise price of stock options to purchase an aggregate of 418,000
shares for the three months and six months ended June 30, 1999 and 411,000
shares for the comparable period in 2000, respectively, is less than the average
stock price for the period and such options have been excluded from the
calculation of diluted earnings per share as the effect would be anti-dilutive.



                                       7
<PAGE>   8




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

         The following discussion should be read in conjunction with, and is
qualified in its entirety by, the financial statements and notes thereto
included in Item 1 of this report.

         The following Management's Discussion and Analysis of Results of
Operations and Financial Condition contains certain forward looking statements
that involve substantial risks and uncertainties. When used in this section, the
words "anticipate," "believe," "estimate," "expect" and similar expressions as
they relate to the Company or its management are intended to identify such
forward looking statements. The factors that may cause actual results to differ
materially from the forward-looking statements include ability to recruit and
maintain qualified IT professionals, changes in laws and regulations
specifically immigration laws, competition and economic conditions in the
geographic regions in which the Company conducts its operations, general
economic conditions, success of the Company's marketing efforts and the demand
for outsourced IT professionals. The Company's actual results, performance or
achievements could differ materially from the results expressed in, or implied
by, these forward looking statements.


OVERVIEW

         UBICS, Inc. ("UBICS" or the "Company"), founded in 1993, provides IT
professional services to large and mid-sized organizations. UBICS provides its
clients with a wide range of professional services in such areas as
client/server design and development, enterprise resource planning ("ERP")
package implementation and customization, e-commerce applications design and
development, applications maintenance programming and database and systems
administration. UBICS' services are provided primarily on a time-and-materials
basis to client-managed projects, with UBICS IT professionals providing integral
support as project team members. With respect to website design and development
projects, UBICS' services are provided on a fixed price basis. The Company
currently has offices in the Pittsburgh, Pennsylvania and San Francisco,
California areas. UBICS is an affiliate of the UB Group, a multinational group
of companies headquartered in India (the "UB Group").

         The Company's revenues are based on the hourly billing of its IT
professional services and on the fixed prices for its website design and
development services. Revenue is recognized as services are provided. The
Company has increased the average billing rates of its IT professionals as the
demand for skilled and experienced professionals has expanded, in particular for
IT professionals placed on ERP package implementation and customization
projects. As of June 30, 2000, 64 IT professionals, or over one-fifth of the
Company's deployed IT professionals, were placed on such projects.

         UBICS effectively minimizes the number of days IT professionals are not
assigned to projects by proactively marketing these professionals to clients.
Resource managers closely monitor the availability of IT professionals and
utilize subcontractors when UBICS IT professionals are unavailable. The Company
maintains strong relationships with nearly 75 subcontractors located worldwide.
Approximately 39% of the Company's revenues were derived from IT professionals
deployed from subcontractors for the three months ended June 30, 2000. As of
June 30, 2000, IT professionals deployed from subcontractors comprised 110 of
the Company's 310 deployed IT professionals. The Company believes that its
network of subcontractors enables it to maintain closer relationships with
clients by fulfilling more of their needs for IT professional services.
Management believes that as the Company increases its investment in recruiting
and retaining qualified IT professionals, the ratio of UBICS IT professionals to
subcontractor IT professionals will increase.

         Since inception the Company has developed relationships with 500
clients in a range of industries and currently has IT professionals deployed at
over 212 of these clients. The Company's five largest clients accounted for
approximately 22% of revenues for the second quarter of 2000. While this revenue
concentration has remained fairly constant over the last four quarters, the
Company believes that continuing growth in its



                                       8
<PAGE>   9

client base and revenues should reduce the percentage of revenue attributable to
its largest clients. The Company's strategy is to continue to provide services
to clients across the U.S. in a range of industries, in order to reduce credit
risk from conditions or occurrences within any specific industry or region in
which these clients operate.

RESULTS OF OPERATIONS

         The following table sets forth, for the periods indicated, selected
statements of operations data as a percentage of revenues:

                             PERCENTAGE OF REVENUES

<TABLE>
<CAPTION>
                                                THREE MONTHS                    SIX MONTHS
                                               ENDED JUNE 30,                 ENDED JUNE 30,
                                               --------------                 --------------
                                            1999            2000           1999           2000
                                            ----            ----           ----           ----

<S>                                         <C>            <C>            <C>            <C>
Revenues ..........................         100.0%         100.0%         100.0%         100.0%
Cost of revenues ..................          72.5           72.6           72.6           73.1
                                            -----          -----          -----          -----
Gross profit ......................          27.5           27.4           27.4           26.9
Selling, general and
  administrative expense ..........          22.3           32.7           22.9           29.0
Merger related expenses ...........           9.0             --            4.6             --
                                            -----          -----          -----          -----
Income (Loss) from operations .....          (3.8)          (5.3)          (0.1)          (2.1)
Interest income, net ..............           1.4            1.7            1.4            1.7
                                            -----          -----          -----          -----
Income (Loss) before income taxes .          (2.4)          (3.6)           1.3           (0.4)
Provision (credit) for income taxes          (0.8)          (0.2)           0.6            0.5
                                            -----          -----          -----          -----
Net income (loss) .................          (1.6)%         (3.4)%          0.7%          (0.9)%
                                            =====          =====          =====          =====
</TABLE>


THREE MONTHS ENDED JUNE 30, 2000 COMPARED TO THREE MONTHS ENDED JUNE 30, 1999.

Revenues

         Revenues for the quarter ended June 30, 2000 were $10.1 million,
compared to $9.6 million for the quarter ended June 30, 1999, an increase of
$0.5 million, or 5%. The increase in revenues was due to an increase in the
number of IT professionals deployed to provide services to new and existing
clients.

Gross Profit

         Gross profit for the second quarter of 2000 was $2.8 million, compared
to $2.6 million for the second quarter of 1999, an increase of $0.2 million, or
5%. Gross profit as a percentage of revenues decreased to 27.4% for the second
quarter of 2000, compared to 27.5% for the second quarter of 1999. The decrease
in gross profit as a percentage of revenues was due to an increase in the number
of employee professionals waiting to be deployed.

Selling, General and Administrative Expense

         Selling, general and administrative expense for the quarter ended June
30, 2000 was $3.3 million, compared to $2.1 million for the same quarter of
1999, an increase of $1.2 million, or 54%. Selling, general and administrative
expense as a percentage of revenues increased to 32.7% for the second quarter of
2000. These expenses were from 22.3% for the second quarter of 1999. The
increase in expense was primarily due to one-




                                       9
<PAGE>   10

time expenses aggregating $0.9 million. These expenses were $0.5 million payable
to the Company's former Chief Executive Officer as part of his severance
agreement, $0.1 million paid to the Company's new Chief Executive Officer as a
signing bonus pursuant to his employment agreement and $0.35 million
representing the value of 100,000 shares of common stock granted to the
Company's new Chief Executive Officer pursuant to his employment agreement.

Merger related expenses

         Merger related expenses for the quarter ended June 30, 1999 were $0.9
million. These expenses as a percentage of revenue were as 9.0%. These expenses
relate to the aborted acquisition of privately held R Systems, Inc and are
one-time in nature.

Interest Income Net

         Interest income for the second quarter of 2000 was $171,000, compared
to interest income of $130,000 for the second quarter of 1999. The increase
resulted from reinvesting of interest earned on the short term investments.

Provision for Income Taxes

         The Company's effective tax rate was 3.1% for the first quarter ended
June 30, 2000 compared to 33.8% for the quarter ended June 30, 1999. The
reduction is mainly due to certain expenses not considered to be expenses
for tax purposes for the quarter ended June 30, 2000.


SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO SIX MONTHS ENDED JUNE 30, 1999.

Revenues

         Revenues for the six months ended June 30, 2000 were $19.4 million,
compared to $18.7 million for the six months ended June 30, 1999, an increase of
$0.7 million, or 3%. The increase in revenues was due to an increase in the
number of IT professionals deployed to provide services to new and existing
clients.

Gross Profit

         Gross profit for the first six months of 2000 was $5.2 million,
compared to $5.1 million for the first six months of 1999, an increase of $0.1
million, or 2%. Gross profit as a percentage of revenues decreased to 26.9% for
the six months ended June 30 2000, compared to 27.4% for the same period of
1999. The decrease in gross profits as a percentage of revenues was due to an
increase in the number of employee professionals waiting to be deployed.

Selling, General and Administrative Expense

         Selling, general and administrative expense for the six months ended
June 30, 2000 was $5.6 million, compared to $4.3 million for the same period of
1999, an increase of $1.3 million or 32%. Selling, general and administrative
expense as a percentage of revenues increased to 29.0% for the six months ended
June 30, 2000 from 22.9% for the six months ended June 30, 1999. The increase in
expense was primarily due to one-time expenses aggregating $0.9 million. These
expenses were $0.5 million payable to the Company's former Chief Executive
Officer as part of his severance agreement, $0.1 million paid to the Company's
new Chief Executive Officer as a signing bonus pursuant to his employment
agreement and $0.35 million representing the value of 100,000 shares of common
stock granted to the Company's new Chief Executive Officer pursuant to his
employment agreement.



                                       10
<PAGE>   11

Merger related expenses

         Merger related expenses for the six months ended June 30, 1999 were
$0.9 million. These expenses as a percentage of revenue were 4.6%. These
expenses relate to the aborted acquisition of privately held R Systems, Inc and
are one-time in nature.

Interest Income Net

         Interest income for the first six months of 2000 was $329,000, compared
to interest income of $260,000 for the first six months of 1999. The increase
resulted from reinvesting of interest earned on the short term investments.

Provision for Income Taxes

         The Company's effective tax rate was 109.2% for the six months ended
June 30, 2000 compared to 42.7% for the six months ended June 30, 1999. The
reduction is mainly due to certain expenses not considered to be expenses for
tax purposes for the quarter ended June 30, 2000.


LIQUIDITY AND CAPITAL RESOURCES

         In November 1997, the Company generated net proceeds of approximately
$13.2 million from its underwritten initial public offering of 1,500,000 shares
of Common Stock (the "Offering"). The Company used approximately $775,000 of the
net proceeds of the Offering to repay its outstanding indebtedness under a
$1,000,000 Committed Line of Credit from PNC Bank, National Association. The
Company also has used a portion of the net proceeds of the Offering for general
corporate purposes and intends to use a portion of such net proceeds for the
capital expenditures described below.

         The Company's principal uses of cash have been to fund receivables and
other working capital, reflecting the Company's growth. Net cash used by
operating activities was $808,000 for the first six months of 2000 compared to
net cash generated by operating activities of $488,000 for the same period in
1999.

         Capital expenditures for the first six months of 2000 and 1999 were
$246,000 and $298,000, respectively. The Company intends to use approximately
$2.0 million of the remaining net proceeds of the Offering to expand its
existing operations, including approximately $1.2 million for the expansion of
the Company's recruiting and training center in India. The initial phase of the
center was placed in operation in the fall of 1998 and the expansion is expected
to be operational by the end of 2000 (including additional purchase of hardware
and software with respect thereto). Because the Company currently has a
sufficient supply of IT professionals awaiting deployment, as well as a shift in
the Company's strategic focus in favor of domestic sales growth, the Company has
deferred previously disclosed plans to establish offshore recruiting offices in
various foreign locations. Except as set forth above, the Company currently has
no material commitments for capital expenditures.

         The Company currently anticipates that the proceeds from the Offering,
together with the existing sources of liquidity and cash generated from
operations, will be sufficient to satisfy its cash needs at least through the
next twelve months.




                                       11
<PAGE>   12
RECENTLY ISSUED FINANCIAL ACCOUNTING STANDARDS

         In June 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities" (SFAS No. 133). The Statement establishes
accounting and reporting standards requiring that every derivative instrument
(including certain derivative instruments embedded in other contracts) be
recorded in the balance sheet as either an asset or liability measured at its
fair value. The Statement requires that the changes in the derivative's fair
value be recognized currently in earnings unless specific hedge accounting
criteria are met. Special accounting for qualifying hedges allows a derivative's
gains and losses to offset related results on the hedged item in the income
statement, and requires that a company must formally document, designate, and
assess the effectiveness of transactions that receive hedge accounting. SFAS No.
133 was originally effective for fiscal years beginning after June 15, 1999.

         In June 1999, the FASB issued Statement of Financial Accounting
Standards No. 137, "Accounting for Derivative Instruments and Hedging Activities
- Deferral of the Effective Date of FASB Statement No. 133" ("SFAS 137")
delaying the effective date of SFAS 133 for all fiscal years beginning after
June 15, 2000.

         The Company does not believe there will be a material impact on the
financial statements related to this FASB.

         In December 1999, the Securities and Exchange Commission released Staff
Accounting Bulletin No. 101, "Revenue Recognition" ("SAB No. 101"), to provide
guidance on the recognition, presentation and disclosure of revenue in financial
statements. SAB No. 101 explains the SEC's general framework for revenue
recognition. SAB No. 101 does not change existing literature on revenue
recognition, but rather clarifies the SEC's position on preexisting literature.
This SAB must be adopted by the Company by December 31, 2000. While the Company
has not completed the review of the effect of the SAB, management does not
presently believe that its adoption will have a significant impact on financial
position or results of operations.

U.S. REGULATION OF IMMIGRATION

         The Company's services historically have been performed in the U.S. and
the Company has recruited most of its IT professionals outside the U.S. The
Company's business, therefore, is subject to U.S. immigration laws. Over 90% of
the Company's IT professionals are citizens of other countries, with most of
those in the U.S. working under H-1B temporary work permits. There is a limit on
the number of new H-1B permits that may be approved in any U.S. government
fiscal year. In the federal fiscal year ended September 30, 1998, this limit was
reached in May and in the federal fiscal year ended September 30, 1999, this
limit was reached in June. The inability to obtain additional H-1B permits
during the federal fiscal year ended September 30, 1999 resulted in increased
use of subcontractor professionals by UBICS.

         During 1998, the U.S. government increased the limit on the number of
new H-1B permits to 115,000 for each of the 1999 and 2000 federal fiscal years,
and to 107,500 for fiscal year 2001 before reverting to existing limits from
fiscal year 2002 onwards. Despite the increase in the limit, this limit was
reached in June 1999 for the federal fiscal year ended September 30, 1999 and in
March 2000 for the current fiscal year ending September 30, 2000.

         In the current federal fiscal year, and in future years where the limit
on H-1B permits is reached, the Company may again be unable to obtain enough
H-1B permits to meet its requirements. If the Company were unable to obtain H-1B
permits for its IT professionals in sufficient quantities or at a sufficient
rate, the Company's business, operating results and financial condition could be
materially adversely affected.



                                       12
<PAGE>   13

         The U.S. Government, in connection with its increase in the limit on
H-1B permits, also imposed a fee to be paid by companies for new approvals and
for renewals. UBICS does not anticipate that the imposition of such fees will
have a material adverse impact on its results of operations.

         Congress and administrative agencies with jurisdiction over immigration
matters have periodically expressed concerns over the levels of legal and
illegal immigration into the U.S. These concerns have often resulted in proposed
legislation, rules and regulations aimed at reducing the number of work permits
that may be issued. Any changes in such laws making it more difficult to hire
foreign nationals or limiting the ability of the Company to retain foreign
employees could require the Company to incur additional unexpected labor costs
and expenses. Any such restrictions or limitations on the Company's hiring
practices could have a material adverse effect on the Company's business,
operating result and financial condition.




                                       13
<PAGE>   14


                          PART II -- OTHER INFORMATION

Item 1.  Legal Proceedings -- Not Applicable

Item 2.  Changes in Securities and Use of Proceeds -- Not applicable

         (a)      Not applicable.

         (b)      Not applicable.

         (c)      Not applicable.

         (d)      The following information relates to the Company's use of the
         net proceeds of the Company's initial public offering (the "Offering"):

                  On October 27, 1997, the Company's registration statement on
         Form S-1, No. 333-35171, became effective. The Company sold a total of
         1,500,000 shares of common stock, par value $.01 per share at a price
         per share of $10.00 pursuant to the Offering. The Offering, which was
         managed by Parker/Hunter Incorporated, as lead underwriter, and Scott &
         Stringfellow, Inc., as co-manager, closed on November 4, 1997.

                  The following table summarizes the expenses incurred for the
         Company's account in connection with the Offering:

                         Underwriting discounts                   $1,050,000
                         Finder's fees                                    --
                         Expenses paid to or for underwriters             --
                         Other expenses                              775,000
                                                                  ----------
                         TOTAL                                    $1,825,000


                  The following table summarizes the amount of net offering
                  proceeds to the Company ($13,175,000) used for the purposes
                  listed below:

                         Construction of plant, building                  $0
                           and facilities
                         Purchase and installation of machinery    2,851,000
                           and equipment
                         Acquisition of other business(es)                 0
                         Repayment of indebtedness                   775,000
                         Working capital                                   0
                         Temporary investments*                    9,549,000
                         Other Purposes                                    0
                                                                 -----------
                         Total                                   $13,175,000


-------------
*Such amount is currently invested in a nine-month ready access certificate of
deposit with PNC Bank.



                                       14
<PAGE>   15


Item 3.  Defaults Upon Senior Securities -- Not Applicable

Item 4.  Submission of Matters to a Vote of Security Holders -- Not Applicable

Item 5.  Other Information -- Not Applicable

Item 6.  Exhibits and Reports on Form 8-K


(a)      Exhibits:

         3(i)     Amended and Restated Certificate of Incorporation of UBICS,
                  Inc. (1)

         3(ii)    Amended and Restated Bylaws of UBICS, Inc. (1)

         10.1     UBICS, Inc. 1997 Stock Option Plan (2)

         10.2     Noncompetition Agreement dated October 27, 1997 among the
                  Company, Vijay Mallya and UB Information Consultancy Services,
                  Ltd. (3)

         10.3     Employment Agreement between the Registrant and Vijay Mallya
                  (3)

         10.4     Employment Agreement between the Registrant and Manohar B.
                  Hira (3)

         10.6     Employment Agreement between the Registrant and Babu Srinivas
                  (3)

         10.7     Employment Agreement dated September 1, 1999 between the
                  Registrant and Dennis M. Stocker (4)

         10.8     Agreement of Severance, Waiver and Release dated March 18,
                  1999 between the Company and Manohar B. Hira (5)

         10.9     Services Agreement dated October 27, 1997 among the Company,
                  Vijay Mallya and United Breweries Limited (3)

         10.10    Form of Director Indemnification Agreement (3)

         10.11    Form of Sublease and Consent among the Company, Marin
                  Executive Park and United Breweries of American, Inc. (3)

         10.12    Noncompetition Agreement dated October 27, 1997 among the
                  Company, Vijay Mallya and United Breweries Limited (3)

         10.13    Noncompetition Agreement dated October 27, 1997 among the
                  Company, Vijay Mallya and UB International Limited (3)

         10.14    Services Agreement dated October 27, 1997 among the Company,
                  Vijay Mallya and UB International Limited (3)

         10.15    Lease Agreement dated June 30, 1998 between the Company and
                  Stealth Technology Associates (6)



                                       15
<PAGE>   16

         10.16    Amendment to Agreement of Severance Waiver and Release dated
                  December 1, 1999 between the Company and Manohar B. Hira (7)

         10.17    Amendment No. 2 to Agreement of Severance Waiver and Release
                  dated as of March 31, 1999 between the Company and Manohar B.
                  Hira (7)

         10.18    Amendment No. 3 to Agreement of Severance Waiver and Release
                  dated as of March 31, 1999 between the Company and Manohar B.
                  Hira (8)

         10.19    Employment Agreement dated June 22, 1998 between the Company
                  and Patrick Ghilani (8)

         10.20    Agreement dated August 20, 1999 between the Company and
                  Patrick Ghilani (8)

         10.21    Amendment to Employment Agreement dated as of January 1, 2000
                  between the Company and Babu Srinivas (8)

         10.22    Employment Agreement dated June 7, 2000 between the Company
                  and Robert C. Harbage

         10.22    Acquisition and Stock Exchange Agreement dated July 5, 2000
                  among the Company, Cobalt Creative, Inc. and the Shareholders
                  of Cobalt Creative, Inc.

         27       Financial Data Schedule


--------------------

(1)      Incorporated by reference to the registrant's Registration Statement on
         Form S-1, No. 333-35171, filed September 8, 1997.

(2)      Incorporated by reference to the registrant's Schedule 14A filed on
         November 5, 1999.

(3)      Incorporated by reference to Post-Effective Amendment No. 1 to the
         registrant's Registration Statement on Form S-1, No. 333-35171, filed
         October 29, 1997.

(4)      Incorporated by reference to the registrant's Quarterly Report on Form
         10-Q for the quarter ended September 30, 1999.

(5)      Incorporated by reference to the registrant's Annual Report on Form
         10-K for the year ended December 31, 1998.

(6)      Incorporated by reference to the registrant's Quarterly Report on Form
         10-A for the quarter ended September 30, 1998.

(7)      Incorporated by reference to the registrant's Annual Report on Form
         10-K for the year ended December 31, 1998.

(8)      Incorporated by reference to the registrant's Quarterly Report on Form
         10-Q for the quarter ended March 31, 2000.



(b)      Reports on Form 8-K:

         No reports on Form 8-K were filed for the three months ended June 30,
         1999.




                                       16
<PAGE>   17




                                   SIGNATURES

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


                              UBICS, Inc.
                              (Registrant)


Date: August 14, 2000

                              By: /s/Robert C. Harbage
                                  -----------------------------
                                       Robert C. Harbage
                                       President


                              By: /s/Babu Srinivas
                                  -----------------------------
                                       Babu Srinivas
                                       Vice President - Finance and Acting Chief
                                       Financial Officer





                                       17
<PAGE>   18



                                  EXHIBIT INDEX

<TABLE>
<CAPTION>
No.      Description                                                                                                   Page
---      -----------                                                                                                   ----

<S>      <C>                                                                                                           <C>
         3(i)     Amended and Restated Certificate of Incorporation of UBICS, Inc. (1)

         3(ii)    Amended and Restated Bylaws of UBICS, Inc. (1)

         10.1     UBICS, Inc. 1997 Stock Option Plan (2)

         10.2     Noncompetition Agreement dated October 27, 1997 among the Company, Vijay Mallya and UB
                  Information Consultancy Services, Ltd. (3)

         10.3     Employment Agreement between the Registrant and Vijay Mallya (3)

         10.4     Employment Agreement between the Registrant and Manohar B. Hira (3)

         10.6     Employment Agreement between the Registrant and Babu Srinivas (3)

         10.7     Employment Agreement dated September 1, 1999 between the Registrant and Dennis M. Stocker (4)

         10.8     Agreement of Severance, Waiver and Release dated March 18, 1999 between the Company and Manohar
                  B. Hira (5)

         10.9     Services Agreement dated October 27, 1997 among the Company, Vijay Mallya and United Breweries
                  Limited (3)

         10.10    Form of Director Indemnification Agreement (3)

         10.11    Form of Sublease and Consent among the Company, Marin Executive Park and United Breweries of
                  American, Inc. (3)

         10.12    Noncompetition Agreement dated October 27, 1997 among the Company, Vijay Mallya and United
                  Breweries Limited (3)

         10.13    Noncompetition Agreement dated October 27, 1997 among the Company, Vijay Mallya and UB
                  International Limited (3)

         10.14    Services Agreement dated October 27, 1997 among the Company, Vijay Mallya and UB International
                  Limited (3)

         10.15    Lease Agreement dated June 30, 1998 between the Company and Stealth Technology Associates (6)

         10.16    Amendment to Agreement of Severance Waiver and Release dated December 1, 1999 between the
                  Company and Manohar B. Hira (7)

         10.17    Amendment No. 2 to Agreement of Severance Waiver and Release dated as of March 31, 1999 between
                  the Company and Manohar B. Hira (7)
</TABLE>



                                       18
<PAGE>   19

<TABLE>
<S>      <C>                                                                                                           <C>
         10.18    Amendment No. 3 to Agreement of Severance Waiver and Release dated as of March 31, 1999 between
                  the Company and Manohar B. Hira (8)

         10.19    Employment Agreement dated June 22, 1998 between the Company and Patrick Ghilani (8)

         10.20    Agreement dated August 20, 1999 between the Company and Patrick Ghilani (8)

         10.21    Amendment to Employment Agreement dated as of January 1, 2000 between the Company and Babu
                  Srinivas (8)

         10.22    Employment Agreement dated June 7, 2000 between the Company and Robert C. Harbage

         10.23    Acquisition and Stock Exchange Agreement dated July 5, 2000 among the Company, Cobalt Creative,
                  Inc. and the Shareholders of Cobalt Creative, Inc.

         27       Financial Data Schedule
</TABLE>


----------------
(1)      Incorporated by reference to the registrant's Registration Statement on
         Form S-1, No. 333-35171, filed September 8, 1997.

(2)      Incorporated by reference to the registrant's Schedule 14A filed on
         November 5, 1999.

(3)      Incorporated by reference to Post-Effective Amendment No. 1 to the
         registrant's Registration Statement on Form S-1, No. 333-35171, filed
         October 29, 1997.

(4)      Incorporated by reference to the registrant's Quarterly Report on Form
         10-Q for the quarter ended September 30, 1999.

(5)      Incorporated by reference to the registrant's Annual Report on Form
         10-K for the year ended December 31, 1998.

(6)      Incorporated by reference to the registrant's Quarterly Report on Form
         10-A for the quarter ended September 30, 1998.

(7)      Incorporated by reference to the registrant's Annual Report on Form
         10-K for the year ended December 31, 1998.

(8)      Incorporated by reference to the registrant's Quarterly Report on Form
         10-Q for the quarter ended March 31, 2000.



                                       19