<PAGE>
                       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 September 30, 2001

                                       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)

            DELAWARE                                    34-1744587
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

333 TECHNOLOGY DRIVE, SUITE 210 SOUTHPOINTE, 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 [ ]

         As of November 9, 2001, 7,112,124 shares of common stock, par value
$0.01 per share, of the Registrant were outstanding.



<PAGE>



                                   UBICS, INC.

                                    Form 10-Q

                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                     PART I - - FINANCIAL INFORMATION

<S>                           <C>                                                                            <C>
                     Item 1.  Financial Statements

                              Consolidated Balance Sheets as of September 30, 2001 and December 31, 2000     3

                              Consolidated Statements of Operations for the three months ended September
                              30, 2001 and 2000 and the nine months ended September 30, 2001 and 2000        4

                              Consolidated Statements of Cash Flows for the nine months ended September
                              30, 2001 and 2000                                                              5

                              Notes to Unaudited Consolidated Financial Statements                           6

                     Item 2.  Management's Discussion and Analysis of Results of Operations and Financial
                              Condition                                                                      9

                     Item 3.  Quantitative and Qualitative Disclosures About Market Risk                    13

                     PART II - - OTHER INFORMATION                                                          14

                     Item 1.  Legal Proceedings                                                             14

                     Item 2.  Changes in Securities and Use of Proceeds                                     14

                     Item 3.  Defaults Upon Senior Securities                                               14

                     Item 4.  Submission of Matters to a Vote of Security Holders                           14

                     Item 5.  Other Information                                                             14

                     Item 6.  Exhibits and Reports on Form 8-K                                              14

                     SIGNATURES
</TABLE>




                                       2
<PAGE>



                                   UBICS, INC.

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


<TABLE>
<CAPTION>
                                                                       SEPTEMBER 30,     DECEMBER 31,
                                                                           2001             2000
                                                                           ----             ----
                                                                       (UNAUDITED)        (AUDITED)
<S>                                                                      <C>              <C>
                      ASSETS
Current assets:
  Cash and cash equivalents .....................................        $  7,213         $ 10,477
  Accounts receivable, net of allowance for
     doubtful accounts of $500 and $1,100,
     respectively ...............................................           3,650            5,743
  Unbilled receivables ..........................................           2,291            2,412
  Employee advances .............................................              57               83
  Prepaids and other ............................................           2,871              683
  Deferred tax asset ............................................             487              607
                                                                         --------         --------
     Total current assets .......................................          16,569           20,005
                                                                         --------         --------
Property and equipment:
  Leasehold improvements ........................................             134               40
  Vehicles ......................................................              89               89
  Computer equipment and software ...............................           1,235            2,214
  Furniture and fixtures ........................................             805              696
  Office and other equipment ....................................               0               93
                                                                         --------         --------
     Total property and equipment ...............................           2,263            3,132
  Accumulated depreciation ......................................          (1,101)            (849)
                                                                         --------         --------
     Net property and equipment .................................           1,162            2,283
                                                                         --------         --------
     Goodwill, net of accumulated amortization
        of $211 and $56, respectively ...........................           5,131            1,627
    Notes receivable ............................................             983              983
                                                                         --------         --------
          Total assets ..........................................        $ 23,845         $ 24,898
                                                                         ========         ========

         LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable ..............................................        $  1,591         $  2,649
  Payroll liabilities ...........................................           2,379            2,246
  Other current liabilities .....................................           3,495              557
  Due to affiliates, net ........................................              24               --
                                                                         --------         --------
    Total current liabilities ...................................           7,489            5,452
  Long-term liabilities .........................................             407              122
                                                                         --------         --------
     Total liabilities ..........................................           7,896            5,574
                                                                         --------         --------
  Minority interest in consolidated subsidiary ..................              17               --
Common stock, subject to redemption, 183,200
    shares issued and outstanding ...............................             550              550
Stockholders' equity:
  Preferred stock, $0.01 par value, 2,000,000
    shares authorized, no shares issued and
    outstanding .................................................              --               --
  Common stock, $0.01 par value, 20,000,000
    shares authorized, 7,068,324 and 6,849,151
    shares issued and outstanding, respectively .................              71               68
  Additional paid-in capital ....................................          14,171           14,035
  Treasury stock - 94,600 and 20,200 shares, at
    cost, respectively ..........................................            (166)            (100)
  Retained earnings .............................................           1,321            4,771
  Accumulated other comprehensive income ........................             (15)               0
                                                                         --------         --------
     Total stockholders' equity .................................          15,382           18,774
                                                                         --------         --------
          Total liabilities and stockholders'
            equity ..............................................        $ 23,845         $ 24,898
                                                                         ========         ========
</TABLE>

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



                                       3
<PAGE>



                                   UBICS, INC.

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


<TABLE>
<CAPTION>
                                                     THREE MONTHS                            NINE MONTHS
                                                  ENDED SEPTEMBER 30,                    ENDED SEPTEMBER 30,
                                                  -------------------                    -------------------
                                                2001                2000              2001                 2000
                                            (UNAUDITED)         (UNAUDITED)        (UNAUDITED)         (UNAUDITED)
<S>                                         <C>                 <C>                <C>                 <C>
Revenues                                    $     9,334         $    11,593        $    30,710         $    31,125
Cost of revenues                                  6,369               8,378             22,725              22,701
                                            -----------         -----------        -----------         -----------
  Gross profit                                    2,965               3,215              7,985               8,424
Selling, general and
  administrative expense                          5,871               2,753             13,063               8,379
Restructuring                                       892                   0                892                   0
                                            -----------         -----------        -----------         -----------
Income (loss) from operations                    (3,798)                462             (5,970)                 45
Interest income, net                                 70                 159                317                 488
                                            -----------         -----------        -----------         -----------
Income (loss) before income taxes                (3,728)                621             (5,653)                533
Provision (benefit) for income taxes             (1,528)                302             (2,203)                396
                                            -----------         -----------        -----------         -----------
    Net income (loss)                       $    (2,200)        $       319        $    (3,450)        $       137
                                            ===========         ===========        ===========         ===========
Basic and diluted earnings (loss)
   per share                                $     (0.31)        $      0.05        $     (0.49)        $      0.02
                                            ===========         ===========        ===========         ===========

Basic weighted average shares                 7,050,304           6,883,954          7,025,296           6,615,501
   outstanding
Diluted weighted average shares               7,050,304           6,899,290          7,025,296           6,744,655
   outstanding
</TABLE>

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



                                       4
<PAGE>


                                   UBICS, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                  NINE MONTHS
                                              ENDED SEPTEMBER 30,
                                          ---------------------------
                                             2001           2000
                                          (UNAUDITED)      (UNAUDITED)
                                          -----------      -----------

<S>                                        <C>
Cash flows from operating activities:
  Net income / (loss)                      $ (3,450)      $    139
  Adjustments to reconcile net
     loss to net cash used by
     operating activities--
     Depreciation                               527            271
     Amortization of goodwill                   156             28
    Asset impairment                            618             --
    Asset abandonment                           288
     Stock based compensation                                  252
     Changes in operating assets and
       liabilities--
       Accounts receivable, net               2,136           (943)
       Unbilled receivables                     379         (1,396)
       Employee advances                         26            (47)
       Other long term asset                                  (733)
       Due to affiliates, net                    24            108
       Deferred tax asset                       122
       Prepaids and other                    (2,176)           (65)
       Accounts payable                      (1,797)           489
       Payroll liabilities                      124            559
       Accrued taxes and other
          current liabilities                 1,321            628
                                                          --------
       Long-term liabilities                    283

     Net cash used by
       operating activities                  (1,419)          (710)
                                           --------       --------

Cash flows from investing activities:
  Purchases of property and
     equipment                                 (222)          (316)
     Cash of acquired entity                    144
     Cash paid for acquisitions              (1,701)
     Merger related expenses                                  (388)
                                           --------       ---------
     Net cash used by investing
        activities                           (1,779)          (704)
Financing Activities
  Treasury stock purchase                       (66)
  Total financing                               (66)
Net decrease in cash
  and cash equivalents                        (3,264)       (1,414)
Cash and cash equivalents, at
  beginning of period                        10,477         12,027
                                           --------       --------
Cash and cash equivalents, at
  end of period                            $  7,213       $ 10,613
                                           ========       ========

Supplemental data:
  Cash payments for income taxes           $              $    277
  Stock issued for purchase of
     SquareRadius, Inc.                                      1,175
  Acquisition
     Fair value of :
     Assets acquired                       $                    --
     Liabilities assumed                                        --
     Due to seller                                              --
     Cash acquired                         $                    --
</TABLE>


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



                                       5
<PAGE>


                                   UBICS, INC.

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


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 accounting principles generally accepted in
the United States 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, 2000 as filed on March 30,
2001.

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 September 30, 2001, the Company had a net payable to the UB Group,
totaling $24,000, resulting from its share of rent payable to the UB Group for
premises occupied by the Company in Bangalore, India.

     Effective April 1, 2001, the Company has entered into an agreement to
sublease office space from United Breweries of America. The terms of the
agreement require the Company to pay United Breweries of America $7,700 per
month through March 31, 2003. A total of $161,700 was charged to the
restructuring charge for unused office space.

     As of September 30, 2001, the Company has written off $81,298 of accounts
receivable from Amplified.com, following that company's bankruptcy and
subsequent liquidation. The former Chief Executive Officer of Amplified.com
serves on the Board of Directors of the Company.

4.       COMPREHENSIVE INCOME:

     Total comprehensive income for the three and nine months ended September
30, 2001 and 2000 was as follows (in thousands):

<TABLE>
<CAPTION>
                                                     THREE MONTHS                            NINE MONTHS
                                                  ENDED SEPTEMBER 30,                    ENDED SEPTEMBER 30,
                                                  -------------------                    -------------------
                                                2001                2000              2001                 2000
                                            (UNAUDITED)         (UNAUDITED)        (UNAUDITED)         (UNAUDITED)
<S>                                         <C>                 <C>                <C>                 <C>
Net income (loss)                           $    (2,200)        $       319        $    (3,450)         $      137
Other comprehensive income
Foreign currency translation
  adjustments                                       (19)                 --                (19)                 --
 Gross profit                               $    (2,219)        $       319        $    (3,469)         $      137
                                            ===========         ===========        ===========          ==========
</TABLE>

5.       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 include only the weighted average common shares outstanding.
Diluted earnings per share include the weighted average common shares
outstanding and any dilutive common stock equivalent shares in the calculation.
Treasury shares are treated as retired for earnings per share purposes.


                                       6
<PAGE>

The following table reflects the calculation of earnings per share under SFAS
No. 128 (dollars in thousands, except for per share amounts):

<TABLE>
<CAPTION>
            THREE MONTHS ENDED  SEPTEMBER 30             2001                2000
            --------------------------------         -----------         -----------

<S>                                                  <C>                 <C>
            BASIC EARNINGS PER SHARE:
            Net income (loss)                        $    (2,200)        $       319
            DIVIDED BY:
            Weighted average common shares             7,050,304           6,883,954
            Basic earnings (loss) per share          $     (0.31)        $      0.05
                                                     ===========         ===========

            DILUTED EARNINGS PER SHARE:
            Net income (loss)                        $    (2,200)        $       319
            DIVIDED BY:
            Weighted average common shares             7,050,304           6,883,954
            Dilutive effect of options                        --              15,336
                                                     -----------         -----------
            Dilutive average common shares             7,050,304           6,899,290
            Diluted earnings (loss) per share        $     (0.31)        $      0.05
                                                     ===========         ===========
</TABLE>


<TABLE>
<CAPTION>
            NINE MONTHS ENDED SEPTEMBER 30               2001                 2000
            ------------------------------           -----------         -----------

<S>                                                  <C>                 <C>
            BASIC EARNINGS PER SHARE:
            Net income (loss)                        $    (3,450)        $       137
            DIVIDED BY:
            Weighted average common shares             7,025,296           6,615,501
            Basic earnings (loss) per share          $     (0.49)        $      0.02
                                                     ===========         ===========

            DILUTED EARNINGS PER SHARE:
            Net income (loss)                        $    (3,450)        $       137
            DIVIDED BY:
            Weighted average common shares             7,025,296           6,615,501
            Dilutive effect of options                        --             129,154
                                                     -----------         -----------
            Dilutive average common shares             7,025,296           6,744,655
            Diluted earnings (loss) per share        $     (0.49)        $      0.02
                                                     ===========         ===========
</TABLE>


     The effect of the assumed exercise of stock options to purchase an
aggregate of 1,002,000 shares of the Company's common stock for the three months
and nine months ended September 30, 2001 and 1,210,000 shares for the comparable
periods in 2000 have been excluded from the calculation of diluted earnings per
share as the effect would be anti-dilutive as a result of the net loss incurred
in such periods.

6.       ACQUISITION:

The Company completed the acquisition of all of the outstanding common stock of
Oakwood Technical Services Limited, European Software Services (UK) Limited and
Reflex I.T. Solutions Limited in the United Kingdom on March 30, 2001 for a
consideration of 1.4 million Pounds Sterling. The consideration is payable as
follows :

     (a)      An amount of 490,000 Pounds Sterling by wire transfer to the
              seller on closing

     (b)      Second installment of 303,333 Pounds Sterling payable six months
              after the closing date

     (c)      Third installment of 303,333 Pounds Sterling payable on the first
              anniversary of the closing date; and

     (d)      Fourth and final installment of 303,334 Pounds Sterling payable
              eighteen months after the closing date.

The excess of the purchase price over the net assets acquired ( $2,531,024 ) has
been allocated to goodwill.

The Company, through its UBIX Computer Services subsidiary, completed the
acquisition of seventy percent (70%) of the equity share capital of DSF Internet
Services Private Limited ("DSF") in India on September 6, 2001 for a
consideration of US$825,000. UBICS also paid $175,000 and issued 219,173 shares
of the common stock of the Company to Fifth Dimension Limited for its services
in connection with the transaction. The $825,000 purchase price is payable as
follows:

     (a) An amount of $87,500 by wire transfer to the seller as a down payment
         on June 5, 2001

     (b) An amount of $125,000 to the seller on the closing date

     (c) Second installment of $112,500 payable six months after the closing
         date

     (d) Third installment of $200,000 payable on the first anniversary of the
         closing date



                                       7
<PAGE>


     (e) Fourth installment of $200,000 payable eighteen months after the
         closing date

     (f) Fifth installment of $100,000 payable on the later of:

         i.   May 30, 2003

         ii.  Ten days after all taxes payable by DSF in connection with the
              agreement have been determined

         iii. The business day following the date that UBICS receives payment of
              the working capital adjustment, if any, under the agreement

The $175,000 was paid to Fifth Dimension on the closing date. The 219,173 shares
of the common stock of the Company were issued to Fifth Dimension on the closing
date and deposited into escrow. The shares may be released to Fifth Dimension as
follows:

     (a) 65,752 shares of the common stock of the Company may be released to
         Fifth Dimension at any time on or after the closing date

     (b) Second installment of 43,835 shares of the common stock of the Company
         may be released to Fifth Dimension six months after the closing date

     (c) Third installment of 43,835 shares of the common stock of the Company
         may be released to Fifth Dimension on the first anniversary of the
         closing date

     (d) Fourth installment of 43,835 shares of the common stock of the Company
         may be released to Fifth Dimension eighteen months after the closing
         date

     (e) Fifth installment of 21,916 shares of the common stock of the Company
         may be released to Fifth Dimension on the later of :

         i.   May 30, 2003

         ii.  Ten days after all taxes payable by DSF in connection with the
              agreement have been determined

         iii. The business day following the date that UBICS received payment of
              the working capital adjustment, if any, under the agreement

The excess of the purchase price over the net assets acquired ($1,128,231) has
been allocated to goodwill.

7.       USE OF ESTIMATES:

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

8.       RESTRUCTURING:

     The Company recorded a restructuring charge of $892,000 in the quarter
ended September 30, 2001, of which approximately $460,000 was associated with a
write-off of unused office space, approximately $170,000 was related to merging
the Company's UB Interactive division with its SquareRadius subsidiary,
approximately $160,000 was associated with a write-off of obsolete assets, and
approximately $100,000 was related to a reduction in workforce to better reflect
market opportunities.

9.       CHANGE OF ESTIMATE:

     As of July 1, 2001, the Company prospectively revised the remaining lives
of its computer equipment, software, and furniture. This change reduced income
for the three and nine months ended September 30, 2001 by $96,170 after related
income taxes.

10.      SHARE REPURCHASE PROGRAM:

     On July 3, 2001, the Company announced that its Board of Directors had
approved a stock repurchase plan for up to $500,000 of the total outstanding
shares of the Company. The repurchases of common stock may occur from time to
time on the open market or through privately negotiated transactions funded
through cash on hand. As of November 1, 2001, the Company has purchased 119,200
shares at a cost of $94,134 and has placed these shares in treasury. Any gains
or losses incurred on the transactions based upon these shares will be properly
offset to additional paid-in-capital in accordance with generally accepted
accounting principles.




                                       8
<PAGE>

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

         The following discussion and analysis should be read in conjunction
with Part II, Item 7 of the Company's Annual Report on Form 10-K for the year
ended December 31, 2000 (the "2000 Form 10-K"). The following discussion should
also be read in conjunction with the Consolidated Financial Statements and notes
thereto appearing elsewhere in this Quarterly Report on Form 10-Q ("Form 10-Q").
The information contained herein is not a comprehensive management overview and
analysis of the financial condition and results of operations of the Company,
but rather updates disclosures made in the 2000 Form 10-K.

         Some of the statements in this Form 10-Q that are not historical facts
are forward-looking statements. These forward-looking statements include the
Company's financial, growth, and liquidity projections, as well as statements
concerning the Company's plans, strategies, intentions and beliefs concerning
the Company's business, cash flows, costs, and the markets in which the Company
operates.

These statements are based on information currently available to the Company,
and the Company assumes no obligation to update these statements as
circumstances change. There are risks and uncertainties that could cause actual
events to differ materially from these forward-looking statements. These risks
include, but are not limited to, the level of market demand for the Company's
services, the highly-competitive market for the types of services that the
Company offers, market conditions that could cause the Company's customers to
reduce their spending for the Company's services or cause prospective customers
to decide not to engage third-party providers of IT services, the Company's
ability to acquire new businesses and to grow its existing businesses, the
Company's ability to attract and retain qualified personnel, currency
fluctuations and market conditions in India and elsewhere around the world, and
the Company's ability to reduce costs and conserve cash in an uncertain economic
environment. While the Company cannot predict all of these risks and
uncertainties, investors should also review the risks and uncertainties
described in the 2000 Form 10-K.

OVERVIEW

         UBICS was founded in 1993 and now provides, together with its operating
subsidiaries, information technology ("IT") professional services and e-commerce
services to large and mid-sized organizations. UBICS and its subsidiaries
provide their clients with a wide range of IT and e-commerce 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. These services are provided in a variety of computing
environments and use leading technologies, including client/server architecture,
object oriented programming languages and tools, distributed database management
systems and the latest networking and communications technologies. UBICS' IT
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 e-commerce applications design and development
projects, UBICS' services are provided on a fixed price basis.

         The Company's revenues are based on the hourly billing of its IT
professional services and on the fixed prices for its e-commerce applications
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 September 30, 2001, 49 IT professionals, or nearly 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.
Practice Managers closely monitor the availability of IT professionals and
utilize subcontractors when UBICS IT professionals are unavailable. The Company
maintains strong relationships with nearly 80 subcontractors located worldwide.
Approximately 31% of the Company's revenues was derived from IT professionals
deployed from subcontractors for the three months ended September 30, 2001. As
of September 30, 2001, IT professionals deployed from subcontractors comprised
81 of the Company's 235 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 638
clients in a range of industries and currently has IT professionals deployed at
nearly 120 of these clients. The Company's five largest clients accounted for
approximately 26% of revenues for the third quarter of 2001. While this revenue
concentration has remained fairly constant, the Company believes that the
continuing growth in its client base and revenues should reduce the percentage
of revenue attributable to its largest clients. The




                                       9
<PAGE>
Company's strategy is to continue to provide services to clients 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.

         On March 30, 2001, the Company completed the acquisition of all of the
outstanding common stock of Oakwood Technical Services Limited, European
Software Services (UK) Limited and Reflex I.T. Solutions Limited in the United
Kingdom for a consideration of 1.4 million Pounds Sterling.

         On September 6, 2001, the Company, through its UBIX Computer Services
Limited subsidiary, completed the acquisition of seventy percent (70%) of the
equity share capital of DSF Internet Services Private Limited in India for a
purchase price of $825,000. UBICS also paid $175,000 and issued 219,173 shares
of the common stock of the Company to Fifth Dimension Limited for its services
in connection with the transaction.

RESULTS OF OPERATIONS

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


<TABLE>
<CAPTION>
                                              PERCENTAGE OF REVENUES

                                                  THREE MONTHS                   NINE MONTHS
                                               ENDED SEPTEMBER 30,           ENDED SEPTEMBER 30,
                                               -------------------          -------------------
                                               2001           2000          2001           2000
                                               ----           ----          ----           ----
<S>                                           <C>            <C>           <C>            <C>
Revenues .............................        100.0%         100.0%        100.0%         100.0%
Cost of revenues .....................         68.2           72.3          74.0           72.9
                                              -----          -----         -----          -----
Gross profit .........................         31.8           27.7          26.0           27.1
Selling, general and administrative ..         62.9           23.7          42.5           26.9
expense
Restructuring ........................          9.6            0.0           2.9            0.0
                                              -----          -----         -----          -----
Income / (Loss)  from operations .....        (40.7)           4.0         (19.4)           0.1
Interest income net ..................          0.7            1.4           1.0            1.6
                                              -----          -----         -----          -----
Loss before income taxes .............        (39.9)           5.4         (18.4)           1.7
(Benefit) / Provision for income taxes        (16.4)           2.6          (7.2)           1.3
                                              -----          -----         -----          -----
Income / (loss) before minority ......        (23.6)%          2.8%        (11.2)%          0.4%
interest
Minority interest in income of
consolidated subsidiary ..............          0.0            0.0           0.0            0.0
                                              -----          -----         -----          -----
Net income / (loss) ..................        (23.6)%          2.8%        (11.2)%          0.4%
                                              =====          =====         =====          =====
</TABLE>

THREE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO THREE MONTHS ENDED SEPTEMBER
30, 2000.

Revenues

         Revenues for the quarter ended September 30, 2001 were $9.3 million,
compared to $11.6 million for the quarter ended September 30, 2000, a decrease
of $2.3 million, or 19%. The decrease in revenues was due to weaker demand in
the IT staffing industry. The number of the Company's deployed IT professionals
decreased to 235 at September 30, 2001 from 337 at September 30, 2000.

Gross Profit

         Gross profit consists of revenues less cost of revenues. Cost of
revenues is comprised principally of IT professional salaries and benefits,
including subcontractor professional costs and relocation expenses. Gross profit
for the quarter ended September 30, 2001 was $3.0 million, compared to $3.2
million for the quarter ended September 30, 2000, a decrease of $0.2 million, or
6.3%. Gross profit as a percentage of revenues increased to 31.8% for the
quarter ended September 30, 2001 from 27.7% for the quarter ended September 30,
2000. The increase in gross profit as a percentage of revenues resulted
primarily from better management of its bench, i.e., its undeployed IT
professionals, and more placements on ERP projects where the Company can charge
higher hourly rates.

Selling, General and Administrative Expenses

         Selling, general and administrative ("SG&A") expenses consist of costs
associated with the Company's sales and marketing efforts, executive, finance
and human resource functions, facilities, telecommunications and other general
overhead expenses. SG&A expenses for the quarter ended September 30, 2001 were
$5.9 million, compared to $2.8 million for the quarter ended September 30,





                                       10
<PAGE>
2000, an increase of $3.1 million or 110.7%. SG&A expenses for the quarter
ended September 30, 2001 included $2.5 million of special charges. The weaker
demand in the staffing industry led the Company to conduct a review of its
internal operations and resulted in the following charges. The Company wrote-off
$1.3 million of receivables that were deemed uncollectible. The Company recorded
charges of approximately $800,000 associated with medical costs, vacation,
variable executive compensation and payroll taxes. Also during the third
quarter, the company accrued approximately $130,000 associated with preliminary
results of a state sales tax review presently in progress. Finally, to conform
with lives more predominantly used in the industry, a decision was made to
change the estimated useful life for the Company's computers to three years from
five years and change the useful life of furniture and equipment to five years
from a seven years. This resulted in a charge of approximately $180,000. SG&A
expenses as a percentage of revenues increased to 62.9% for the quarter ended
September 30, 2001 from 23.7% for the comparable quarter in 2000.

Restructuring

         The Company recorded a restructuring charge of $892,000 in the quarter
ended September 30, 2001, of which approximately $460,000 was associated with a
write-off of unused office space, approximately $170,000 was related to merging
the Company's UB Interactive division with its SquareRadius subsidiary,
approximately $160,000 was associated with a write-off of obsolete assets, and
approximately $100,000 was related to a reduction in workforce to better reflect
market opportunities.

Interest Income, Net

         Interest income, net for the quarter ended September 30, 2001, was
$70,000 compared to interest income of $159,000 for the quarter ended September
30, 2000. The decrease resulted from the reduction in the amount of cash
available for short term investments.

Provision (Benefit) for Income Taxes

         The Company's effective tax benefit was 41.0% for the quarter ended
September 30, 2001, compared to an effective tax rate of 48.6% for the quarter
ended September 30, 2000.

Net Income (Loss)

         Net loss for the quarter ended September 30, 2001 was $2,200,000,
compared to net income of $319,000 for the quarter ended September 30, 2000, a
decrease of $1,881,000 or 789.7%. The net loss as a percentage of revenues
increased to (23.6)% for the quarter ended September 30, 2000, compared to net
income of 2.8% for the quarter ended September 30, 2000. The decrease in net
income was due to the $892,000 restructuring charge and the $2,465,000 special
charge discussed above.

NINE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
2000.

Revenues

         Revenues for the nine months ended September 30, 2001 were $30.7
million, compared to $31.1 million for the nine months ended September 30, 2000,
a decrease of $0.4 million, or 1.3%. The decrease in revenues was due to weaker
demand in the IT Staffing industry. The number of the Company's deployed IT
professionals decreased to 235 at September 30, 2001 from 337 at September 30,
2000.

Gross Profit

         Gross profit for the nine months ended September 30, 2001 was $8.0
million, compared to $8.4 million for the comparable period in 2000, a decrease
of $0.4 million, or 4.8%. Gross profit as a percentage of revenues decreased to
26.0% for the nine months ended September 30, 2001, from 27.1% for the
comparable period in 2000. The decrease in gross profit as a percentage of
revenues resulted primarily from an increase in the ratio of employee
consultants waiting to be deployed and from increases in rates charged by
subcontractors.

Selling, General and Administrative Expense

         SG&A expenses for the nine months ended September 30, 2001 were $13.1
million, compared to $8.4 million for the nine months ended September 30, 2000,
an increase of $4.7 million or 56.0%. Included in the $13.1 million were $3.1
million of special





                                       11
<PAGE>
charges. The weaker demand in the staffing industry led the Company to conduct
a review of its internal operations and resulted in the following charges. The
Company wrote down $1.3 million of receivables that were deemed uncollectible.
The Company recorded charges of approximately $800,000 associated with medical
costs, vacation, variable executive compensation and payroll taxes. The Company
wrote off $618,000 of excess costs related to in-house implementation of
PeopleSoft's ERP software. Also during the third quarter, the Company accrued
approximately $130,000 associated with preliminary results of a state sales tax
review presently in progress. Finally, to conform with lives more predominately
used in the industry, a decision was made to change the estimated useful life
for the Company's computers to three years from five years and change the useful
life of furniture and equipment to five years from a seven years. This resulted
in a charge of approximately $180,000. SG&A expenses as a percentage of revenues
increased to 42.5% for the nine months ended September 30, 2001 from 26.9% for
the comparable nine month period in 2000.

Restructuring

         The Company recorded a restructuring charge of $892,000 in the quarter
ended September 30, 2001, of which approximately $460,000 was associated with a
write-off of unused office space, approximately $170,000 was related to merging
the Company's UB Interactive division with its SquareRadius subsidiary,
approximately $160,000 was associated with a write-off of obsolete assets, and
approximately $100,000 was related to a reduction in workforce to better reflect
market opportunities.

Interest Income Net

         Interest income for the first nine months of 2001 was $317,000,
compared to interest income of $488,000 for the first six months of 2000. The
decrease resulted from the reduction in the amount available for short term
investments.

Provision (Benefit) for Income Taxes

         The Company's effective tax benefit was 39.0% for the nine months ended
September 30, 2001, compared to an effective tax rate of 74.3% for the nine
months ended September 30, 2000.

Net Income (Loss)

         Net loss for the nine months ended September 30, 2001 was $3.5 million,
compared to net income of $0.1 million for the nine months ended September 30,
2000, a decrease of $3.6 million, or 360%. The net loss as a percentage of
revenues increased to (11.2)% for the nine months ended September 30, 2001,
compared to net income of 0.4% for the nine months ended September 30, 2000. The
decrease in net income was due to the $892,000 restructuring charge and the
$2,465,000 special charge discussed above, and a write-off of $618,000 of excess
costs related to in-house implementation of PeopleSoft's ERP software.


LIQUIDITY AND CAPITAL RESOURCES

         Net cash used by operating activities was $1.4 million for the nine
months ended September 30, 2001 compared to net cash used by operating
activities of $0.7 million for the comparable period in 2000. Net cash used by
operating activities for the nine months ended September 30, 2001 is primarily
due to a net loss of $3.4 million. Net cash used by operating activities for the
nine months ended September 30, 2000 is primarily due to an increase in unbilled
receivables of $1.4 million and accounts receivable of $0.9 million, offset by a
decrease in accounts payable, payroll liabilities and other current liabilities
aggregating to $1.7 million.

         Capital expenditures for the nine months ended September 30, 2001 and
2000 were $222,000 and $316,000, respectively. Because of the economic slowdown,
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 $7.2 in available cash
balances, 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.

         The Company's functional currency for financial reporting purposes is
the US Dollar. The Company generally invoices its clients and pays expenses in
the local currency of the country in which the client is located. Statements of
Operations translation gains and losses arising from differences between the
functional and local currencies are recognized in the Consolidated Statements of
Operations, and have not had a significant impact on the results of operations.
Balance Sheet gains and losses as a result of fluctuations in foreign currency



                                       12
<PAGE>
exchange rates are recognized in the Consolidated Balance Sheet as a component
of comprehensive income. The Company continually evaluates the economic
conditions of each country in which it operates, and bases its foreign currency
accounting policies on those assessments.

RECENTLY ISSUED FINANCIAL ACCOUNTING STANDARDS

In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards No. 141, "Accounting for Business
Combinations" (SFAS No. 141) and Statement of Financial Accounting Standards No.
142, "Accounting for Goodwill and Other Intangible Assets" (SFAS No. 142). SFAS
No 141 requires all business combinations initiated after June 30, 2001 to be
accounted for using the purchase method. Under SFAS No 142, goodwill and
intangible assets with indefinite lives are no longer amortized but are reviewed
annually (or more frequently if impairment indicators arise) for impairment.
Separable intangible assets that are not deemed to have indefinite lives will
continue to be amortized over their useful lives (but with no maximum life). The
amortization provisions of SFAS No 142 apply to goodwill and intangible assets
acquired after June 30, 2001. With respect to goodwill and intangible assets
acquired prior to July 1, 2001, the Company is required to adopt SFAS No 142
effective January 1, 2002. The Company is currently evaluating the effect that
the adoption of the goodwill impairment provisions of SFAS No 142 that are
effective January 1, 2002 will have on its results of operations and financial
position. Goodwill amortization of $64,759 per quarter will no longer be
recorded beginning January 1, 2002.

         In August 2001, SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets" was issued. This statement addresses financial
accounting and reporting for the impairment or disposal of long-lived assets.
This statement supersedes FASB Statement No. 121, "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", APB Opinion
No. 30, "Reporting the Results of Operations - Reporting the Effects of Disposal
of a Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactions" and ARB No. 51, "Consolidated Financial
Statements". This statement is effective for fiscal years beginning after
December 15, 2001, and interim periods within those fiscal years. The Company is
currently evaluating the impact of this statement on its financial position and
results of operations.

ITEM 3. QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

         The Company currently does not invest excess funds in derivative
financial instruments or other market risk sensitive instruments for the purpose
of managing its foreign currency exchange rate risk or for any other purpose.


                                       13
<PAGE>



                          PART II -- OTHER INFORMATION

Item 1.  Legal Proceedings

         Nothing to report under this item.

Item 2.  Changes in Securities and Use of Proceeds

         On September 6, 2001, the Company issued 219,173 shares of its common
stock to Fifth Dimension Limited, a Mauritius company, in consideration of
services rendered by Fifth Dimension Limited in connection with the Company's
acquisition of 70% of the outstanding equity share capital of DSF Internet
Services Private Limited, an Indian company. The offer and sale of such shares
was not subject to registration under the Securities Act of 1933, as amended,
(the "Securities Act"), because such offer and sale occurred outside the United
States within the meaning of Rule 901 under the Securities Act.

Item 3.  Defaults Upon Senior Securities

         Nothing to report under this item.

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

         Nothing to report under this item.

Item 5.  Other Information

         Nothing to report under this item.

Item 6.  Exhibits and Reports on Form 8-K

(a)      Exhibits:


                  2.1      Share Purchase Agreement dated as of March 30, 2001
                           between UBICS, Inc. and Teksys, Inc. (2)

                  2.2      Share Purchase Agreement, dated as of September 4,
                           2001, among UBIX Computer Services Limited and Anmol
                           Taneja and Vani Taneja (3)

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

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

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

                      (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 Form 8-K of the
                           registrant dated March 30, 2001

                      (3)  Incorporated by reference to Form 8-K of the
                           registrant dated September, 2001


(b)      Reports on Form 8-K:

         During the third quarter of 2001, UBICS filed with the SEC:

                  i.    a Form 8-K, dated August 7, 2001, reporting that the
                        common stock of the Company failed to meet the NASDAQ
                        National Market continued listing requirement for
                        minimum market value of a public float; and

                  ii.   a Form 8-K, dated September 21, 2001, reporting the
                        acquisition by the Company of DSF Internet Services
                        Private Limited, a company incorporated under the laws
                        of India.



                                       14
<PAGE>


                                   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: November 14, 2001

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

                                         By: /s/ Neil M. Ebner
                                         -------------------------------
                                         Neil M. Ebner
                                         Vice President - Finance and
                                         Chief Financial Officer




                                       15
<PAGE>


                                  EXHIBIT INDEX


                  2.1      Share Purchase Agreement dated as of March 30, 2001
                           between UBICS, Inc. and Teksys, Inc. (2)

                  2.2      Share Purchase Agreement, dated as of September 4,
                           2001, among UBIX Computer Services Limited and Anmol
                           Taneja and Vani Taneja (3)

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

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

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

                      (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 Form 8-K of the
                           registrant dated March 30, 2001

                      (3)  Incorporated by reference to Form 8-K of the
                           registrant dated September 21, 2001


                                       16