<PAGE>
 
                    U.S. SECURITIES AND EXCHANGE COMMISSION
                                        
                            WASHINGTON, D. C. 20549
                                        
                              FORM 10-KSB/A NO. 2

               ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF

                       SECURITIES EXCHANGE ACT OF 1934.

                 For the fiscal year ended December 31, 1997.

                       Commission File Number:  0-25338

                      INTIME SYSTEMS INTERNATIONAL, INC.
                (Name of small business issuer in its charter)

           DELAWARE                         65-0480407
-------------------------------           (I.R.S. Employer          
(State or other jurisdiction of          Identification No.) 
 incorporation or organization)          

1601 Forum Place, West Palm Beach, FL           33401
-------------------------------------      ----------------
(Address of principal executive offices)      (Zip Code)

Issuer's telephone number: (561) 478-0022

Securities registered under Section 12(b) of the Exchange Act:

Title of each class       Name of each exchange on which registered
-------------------       -----------------------------------------
   None                   None

Securities registered under Section 12(g) of the Exchange Act:

     Units consisting of 1 share of Class A Common Stock and 1 Class A Warrant
     Class A Common Stock
     Class A Warrants

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

  YES    X    NO
      ------     ------   

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [X]

Revenues for its most recent fiscal year.  $13,881,632.

The aggregate market value of the voting stock held by non-affiliates based on
the closing price quoted by NASDAQ on March 
<PAGE>
 
14, 1997: $13,254,654. (Includes the value of Class A Common Stock. See Item
11).

Number of shares outstanding of each of the issuer's classes of common equity,
as of March 18, 1998:
     Class A Common Stock 4,516,496 Shares
     2,360,000 Class A Warrants

Documents incorporated by reference: NONE

Transitional Small Business Disclosure Format (check one):

  YES         NO   X
      -----      -----

                                       2
<PAGE>
 
                                   PART III
                                   --------

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

DIRECTORS AND EXECUTIVE OFFICERS

  The executive officers and directors of the Company are as follows:

NAME                     Age    Positions
----                     ---    ---------
William E. Berry         65     President, Secretary and Chairman of the Board
Michael D. Matte         39     Chief Financial Officer, Treasurer and Director
John E. Steiner          57     Director
Paul Piper               53     Director
Corine C. Goldkiller     51     Senior Vice President - Oracle

     WILLIAM E. BERRY has been the Company's president, secretary and a director
of the Company since January 1994. In September, 1997, Mr. Berry became the
Company's chairman of the board of directors. Mr. Berry co-founded The
Consulting Team, Inc. ("TEAM"), a subsidiary of the Company. Mr. Berry has been
chairman and chief executive officer of TEAM from its inception in 1985. In
addition to his duties as president and chief executive officer of the Company,
Mr. Berry is directly involved in the Company's marketing of the Company's
consulting services and its software product. Mr. Berry is the founder and past
president of the South Florida Chapter of the Association of Human Resource
Systems Professionals ("HRSP" now known as the International Association of
Human Resource Information Management ("IHRIM")) and served on the national
IHRIM Board of Directors from 1988 to 1993. Mr. Berry received the IHRIM "Summit
Award" for processional excellence in 1996. Mr. Berry also served on the SHRM
National Committee on Human Resource Information Systems from 1990-1991.

     MICHAEL D. MATTE joined the Company as its chief financial officer in
October 1996, was appointed its treasurer in September 1997 and was elected a
director in October 1997. He also assumed substantial operational duties in
September 1997. Prior to joining the Company, Mr. Matte served as chief
financial officer for Torwest, Inc., a United States holding company of a
Canadian conglomerate from 1992 through October 1996. Prior to that, he served
as a senior manager and in other capacities with Price Waterhouse LLP. Mr. Matte
is a CPA and a member of the American and Florida Institutes of Certified Public
Accountants.

                                       3
<PAGE>
 
     PAUL PIPER was appointed to the Company's board of directors in November
1997. In 1981 Mr. Piper co-founded Business Information Technology, Inc.
("BIT"), a human resources systems company. Mr. Piper was BIT's president and
chairman of the board from its inception until its acquisition in 1995 by a
large publicly held company. Mr. Piper retired after BIT's acquisition.

     JOHN E. STEINER has been a director of the Company since January 1994 and
co-founded TEAM with Mr. Berry. Prior to September 1997, Mr. Steiner served as
the Company's executive vice president and chairman of the board of directors
from January 1994 and was president of TEAM since its inception in 1985.

SECTION 16(a)  BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's officers, directors and persons who own
more than ten percent of a registered class of the Company's equity securities
to file reports of ownership and changes in ownership with the Securities and
Exchange Commission (the "SEC").  To the best of the Company's knowledge based
solely on its review of copies of such forms received or filed by it, or written
representations from certain reporting persons, all filings of Form 3, 4 and 5
required to be made with the SEC have been made.

ITEM 10.  EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION

     The following table sets forth certain information with respect to the
annual and long-term compensation of the Company's chief executive officer, its
two other executive officers and two former executive officers (the "Named
Executive Officers") whose total annual salaries and bonuses exceeded $100,000
for the fiscal year ended December 31, 1997.

                                       4
<PAGE>
 
                           SUMMARY COMPENSATION TABLE
                              ANNUAL COMPENSATION
                              -------------------

<TABLE>
<CAPTION>
         (a)                          (b)       (c)          (d)            (e)                (g)              (i)
                                                                                            Long-Term     
                                                                                           Compensation   
                                                                                              Awards     
                                                                                         ----------------
                                                                                           Securities                      
  Name and Principal                                                    Other Annual       Underlying        All Other     
       Position                      Year     Salary($)    Bonus($)    Compensation($)   Options/SARs(#)   Compensation($)  
----------------------              -------  -----------  -----------  ----------------  ----------------  ---------------- 
<S>                                 <C>      <C>          <C>          <C>               <C>               <C>
EXECUTIVE OFFICERS
------------------
William E. Berry, President           1997    $225,270     $ 1,500(1)      $11,320(2)        75,000(3)/0       $4,863(4) 
 (Chief Executive Officer)            1996    $196,795     $     0         $12,000(2)             0            $4,863(4) 
  and Chairman of the Board...        1995    $188,800     $ 5,665(5)      $ 7,132(2)             0            $    0     
                                
Michael Matte, Vice President
 of Finance (Chief Financial
 Officer), Treasurer and              1997    $126,250     $     0         $     0          100,000/0          $    0
 Director.....................        1996    $ 28,127     $     0         $     0           25,000/0          $    0 

                                      1997    $142,292     $10,000(6)      $     0                0            $    0
Corine C. Goldkiller, Senior          1996    $118,757     $     0         $     0           25,000/0          $    0
 Vice President...............        1995    $103,425     $ 7,500(7)      $     0                0            $    0 
 
FORMER EXECUTIVE OFFICERS
-------------------------
John E. Steiner, Executive            1997    $214,226     $ 1,500(1)      $11,988(2)        75,000(3)/0       $1,521(4)
 Vice President and                   1996    $196,795     $     0         $12,000(2)             0            $2,629(4)
 Director(8)..................        1995    $188,800     $ 5,665(5)      $ 4,893(2)             0            $    0    

                                      1997    $130,000     $     0         $     0                0            $    0(5) 
James C. Dean, Vice                   1996    $127,500     $     0         $     0                0            $    0   
 President(8).................        1995    $120,000     $20,000(7)      $     0           10,000/0          $    0    
</TABLE>
------------------------------
(1)  Pursuant to their employment agreements, Messrs. Berry and Steiner were
     paid bonuses of approximately $1,500 in 1997 based on the Company's net
     income in 1996.

(2)  Represents compensation in the form of a car allowance and related
     expenses. Also includes life insurance payments in 1995.

(3)  The Options vest and become exercisable only if the Escrowed Shares held by
     them are forfeited and cancelled. The forfeiture and cancellation of the
     Escrowed Shares are a condition to consummation of the Merger disclosed in
     Item 11 (the "Merger"). See Item 11 "Securities Ownership of Certain
     Beneficial Owners and Management-Change in Control". Messrs. Berry and
     Steiner will forfeit and cancel their respective Escrowed Shares
     immediately prior to the closing of the Merger. At the time of vesting of
     these Options, The Company will recognize compensation expense related to
     these Options of approximately $520,000.

                                       5
<PAGE>
 
(4)  Represents life insurance payments.

(5)  Represents bonuses paid on 1994 net income in accordance with Messrs. Berry
     and Steiner's employment agreements.

(6)  Represents bonus granted in 1997 for performance in 1996.


(7)  Represents bonuses related to performance.

(8)  Messrs. Steiner and Dean's status as executive officers and employees
     ceased in September, 1997, although they received (or will receive)
     compensation through January 15, 1998 and May 31, 1998, respectively. Such
     compensation was accrued in the fiscal quarter September 30, 1997.

     The following table sets forth certain information with respect to stock
option grants to the Named Executive Officers during the fiscal year ended
December 31, 1997.

                     OPTION/SAR GRANTS IN LAST FISCAL YEAR
                               INDIVIDUAL GRANTS

<TABLE>
<CAPTION>
            (a)                      (b)                 (c)               (d)              (e)
                                                     
                                  Number of           % of Total                                   
                                  Securities         Options/SARs                                  
                                  Underlying          Granted to        Exercise or                
                                 Options/SARs         Employees         Base Price       Expiration 
           Name                    Granted          in Fiscal Year        ($/S(1)           Date
---------------------------  -------------------  ------------------  ---------------  --------------
<S>                          <C>                  <C>                 <C>              <C>
William E. Berry                   75,000/0               22%             $5.75(2)/0    07/01/2007(3) 
John E. Steiner(4)                 75,000/0               22%             $5.75(2)/0    07/01/2007(3) 
Michael Matte                     100,000(5)/0            29%             $4.52(6)/0    05/20/2007(3) 
Corine C. Goldkiller                    0/0                0%             $   0/0             0    
James C. Dean(4)                        0/0                0/0                0/0             0     
</TABLE>
------------------------------
(1)  All Options were granted at 100% of fair market value.

(2)  Originally granted at an exercise price of $6.50 and repriced in January
     1998.

(3)  These Options vest and become exercisable only if the Escrowed Shares held
     by them are forfeited and cancelled. The forfeiture and cancellation of the
     Escrowed Shares are a condition to consummation of the Merger. Messrs.
     Berry and Steiner will forfeit and cancel their respective Escrowed Shares
     immediately prior to the closing of the Merger. At the time of vesting of
     these Options, The Company will recognize compensation expense related to
     these Options of approximately $520,000.

(4)  Messrs. Steiner and Dean's status as executive officers ceased in September
     1997.

(5)  Options are not exercisable until the Escrowed Shares are forfeited, and
     they become fully vested upon a change in control. Due to the proposed
     Merger, the Escrowed Shares will be forfeited and the Options will become
     fully vested. Such events will trigger the recognition of compensation
     expense of approximately $466,000, pursuant to the terms of the option
     grant.

                                       6
<PAGE>
 
     (6)  Mr. Matte's Options were originally exercisable at $6.50 and were
          repriced in January 1998 based upon a provision in his employment
          agreement providing for repricing if the trading price of the Common
          Stock closes at least 25% below the exercise price for a period of
          time.

  The following table sets forth certain information with respect to the
exercise of options to purchase common stock and SARs during the fiscal year
ended December 31, 1997, and the unexercised options held and the value thereof
at that date, for each Named Executive Officer.

             AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
                     AND FISCAL YEAR-END OPTION/SAR VALUES

<TABLE>
<CAPTION>
 
       (a)                 (b)           (c)                 (d)                                (e)
                                                                                   
                                                      Number of Securities              Value of Unexercised  
                          Shares                     Underlying Unexercised                In-the-Money       
                       Acquired on       Value      Options/SARs at FY-End(#)         Options/SARs at FY-End($)       
       Name            Exercise(#)    Realized($)   Exercisable/Unexercisable(1)   (Exercisable/Unexercisable(2)(3)     
------------------     -----------    -----------   ----------------------------   --------------------------------
<S>                    <C>            <C>           <C>                            <C>
William E. Berry              0              0              0/75,000(4)                       $0/$0

John E. Steiner               0              0              0/75,000(4)                       $0/$0
                           
Michael D. Matte              0              0           12,500/112,500(5)                    $0/$0
                           
Corine C. Goldkiller          0              0             21,309/16,068                      $0/$0                
                           
James C. Dean(6)          7,738         44,493                  0/0                           $0/$0
</TABLE>
------------------------------

     (1)  Exercisable Options include all currently vested Options without
          restrictions.  Unexercisable Options include unvested Options, Options
          which are held in escrow and Options which have certain vesting and/or
          exercisability restrictions.

     (2)  Based upon a fair market value at fiscal year end of $4.875 per share
          minus the exercise price.

     (3)  None of the options were in-the-money.

     (4)  The Options vest and become exercisable only if the Escrowed Shares
          held by them are forfeited and cancelled.  The forfeiture and
          cancellation of the Escrowed Shares are a condition to consummation of
          the Merger.  Messrs. Berry and Steiner will forfeit and cancel their
          respective Escrowed Shares immediately prior to the closing of the
          Merger.  At the time of vesting of these Options, The Company will
          recognize compensation expense related to these Options of
          approximately $520,000.

     (5)  Options are not exercisable until the Escrowed Shares are forfeited,
          and they become fully vested upon a change in control.  Due to the
          proposed Merger, the Escrowed Shares will be forfeited and the Options
          will become fully vested.  Such events will trigger the recognition of
          compensation expense of approximately $466,000, pursuant to the terms
          of the Option grant.

                                       7
<PAGE>
 
(6)  Mr. Dean's status as an employee ceased on September 15, 1997. Accordingly,
     all of Mr. Dean's options were cancelled effective December 15, 1997.

EMPLOYMENT AND CONSULTING AGREEMENTS

     On November 25, 1997, the Company entered into a new three-year employment
agreement with Mr. William E. Berry, its president, expiring in November 2000.
The agreement with Mr. Berry provides for a base annual salary of $250,000
subject to cost of living increases and an incentive bonus equal to 10% of the
Company's net pretax income above $500,000 (without resort to any consumer price
increase) up to 100% of his salary. Mr. Berry may terminate his agreement if:
(i) his duties are substantially modified, (ii) the Company materially breaches
such agreement or (iii) if any entity or person not currently an executive
officer or stockholder of the Company either individually or as part of a group
becomes the beneficial owner of 30% or more of the Class A Common Stock of the
Company (the "Voluntary Termination Provisions"). In such an event, Mr. Berry
may elect to either: (a) receive full compensation and benefits payable under
his employment agreement for the remainder of the term of the agreement, or (b)
a release from the non-competition provisions of his agreement. The effect of
such provisions may discourage a hostile takeover even if in the best interest
of all other stockholders. The agreement also provides for a $500,000 key man
life insurance policy, the proceeds to be assigned as Mr. Berry directs. Mr.
Berry is also subject to non-competition and non solicitation of customers
provisions in favor of the Company.

     In May 1997, the Company entered into a three-year written employment
agreement with Mr. Michael D. Matte, its chief financial officer, replacing his
then current agreement and providing a substantially higher compensation
package. The board of directors took this action to retain Mr. Matte after he
announced his resignation eight months after commencement of employment. The
board provided the new compensation package in order to induce Mr. Matte to
reject an offer from a company about to effect an initial public offering, which
offer contained substantial equity incentives. Mr. Matte's new agreement
provides for an annual salary of $130,000, subject to cost of living increases
and an incentive bonus equal to 10% of the Company's net pretax income above
$500,000 limited to 100% of his salary (without resort to any consumer price
increase). Mr. Matte was also granted 100,000 Options exercisable at $6.50 per
share repriced in January 1998 to $4.52, as discussed above. Such Options will
vest upon the forfeiture and cancellation of the Escrowed Shares. Such Options
are also subject to forfeiture provisions and vest bi-annually in equal
increments over a three year term commencing June 30, 1997. Such Options shall
immediately vest upon sale by the principal stockholders of all or 90% of the
Company's Class A Common Stock owned by them or partial sale of the Company's
assets or a sale of a subsidiary. In certain circumstances involving a sale of
the Company as defined in the employment agreement, Mr. Matte is entitled to
receive a cash payment, of $900,000 either from the Company's principal
stockholders or from the Company.

                                       8
<PAGE>
 
Mr. Matte's employment agreement has provision whereby if he voluntarily
terminates or is terminated without cause, he shall receive severance equal to
three times his salary for the last fiscal year. The 100,000 Options under his
current agreement will become exercisable and the $900,000 additional bonus will
not be earned as a result of the Merger. Upon termination of Mr. Matte's
previous employment agreement, Mr. Matte will receive the severance payments
described above. Additionally, in January 1998 the Company was authorized by its
board of directors to pay Mr. Matte, a bonus in 1998 of up to $40,000, subject
to meeting performance criteria established by Mr. Berry, in view of Mr. Matte's
substantial new duties.

     One of the conditions of the Merger "Merger Agreement" (with ARIS
Corporation ("ARIS")) is that the existing employment agreement of Mr. Berry
will be terminated and that a proposed new agreement be executed. Mr. Berry's
proposed new agreement is for a two-year term at an annual salary of $175,000
per year (without costs-of living increases) and provides for a maximum annual
bonus of $25,000. Additionally, Mr. Berry shall receive a $150,000 signing bonus
and 10,000 ARIS Options vesting over a two-year period. The Voluntary
Termination Provisions in Mr. Berry's proposed new agreement have been modified
and apply only if there is a material breach by ARIS.

     The Merger Agreement further provides that Mr. Matte will enter into a new
employment agreement immediately following the closing of the Merger. Mr.
Matte's proposed new agreement is for a one-year term at the same base salary
($130,000 per year). Mr. Matte shall receive a $25,000 signing bonus and 8,000
ARIS Options vesting annually over a four-year term. His maximum bonus shall be
$25,000. His proposed new agreement eliminates all compensation arrangements
arising in the event of a change of control, partial sale or sale.

     In fiscal 1997, Ms. Corine C. Goldkiller, the Company's senior vice
president of human resources consultant, received a salary increase from
$125,000 per annum to $150,000 per annum as an incentive increase. Additionally,
Ms. Goldkiller was granted a $10,000 bonus for her efforts in fiscal 1996.

DIRECTORS' COMPENSATION

     The Company's outside directors receive $1,250 for each meeting attended,
as cash compensation for serving on the Board of Directors in addition to
reimbursement of reasonable expenses incurred in attending meetings. Pursuant to
the Company's 1994 Stock Option Plan (the "Plan"), directors who are not
employees receive a grant of 12,000 10-year Options which vest in 1/6 increments
every June 30 and December 31 provided the director is still serving in that
capacity. The 1994 initial grant of directors' options to the Company's outside
directors fully vested in December 1996. Accordingly, they each automatically
received a new grant of 12,000 Options on January 1, 1997, exercisable at $7.25
per share. In accordance with the Plan, Mr. Paul Piper, who

                                       9
<PAGE>
 
became a director in November 1997, received a grant of 12,000 Options
exercisable at $7.00 per share, of which 2,000 Options are vested. Directors who
are employees of the Company or its subsidiaries do not receive any compensation
for their services as directors.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth as of April 15, 1998 certain information
relating to the beneficial ownership of the Company's Class A Common Stock by
any person (including any "group") known by the Company (i) to be the beneficial
owner of more than 5% of such securities, (ii) each director and nominee, (iii)
each Named Executive Officer in the Summary Compensation Table, and (iv) all
executive officers and directors as a group. In January of 1998, all holders of
the Company's Class B Common Stock agreed to convert those securities to Class A
Common Stock, thereby eliminating "super-voting rights" previously in existence.
The table below gives effect to the conversion.

<TABLE>
<CAPTION>
                                                                      Amount and
                                                                      Nature of            Percentage of
                                      Name and Address                Beneficial        Outstanding Securities
      Title of Class                  Beneficial Owner               Ownership(1)            Owned(1)(2)
----------------------------  ---------------------------------  -------------------  --------------------------
<S>                           <C>                                <C>                  <C>
Class A Common Stock           William E. Berry                   1,220,626(2)(3)(4)              27%
                               1601 Forum Place                                                           
                               West Palm Beach, FL  33041                                                 
                                                                                                          
                                                                                                           
Class A Common Stock           John E. and Carol E. Steiner       1,220,626(2)(4)                 27%
                               1116 Grand Cay Drive                                                       
                               Palm Beach Gardens, FL  33418                                              
                                                                                                          
                                                                                                         
Class A                        Michael D. Matte                      12,500(4)                    *
Common Stock                   1601 Forum Place                                                         
and Vested Options             West Palm Beach, FL  33041                                               
                                                                                                        
                                                                                                         
Class A Common Stock           Corine C. Goldkiller                  29,044(5)                    *
and Vested Options             1601 Forum Place                                                         
                               West Palm Beach, FL  33041                                               
                                                                                                        
                                                                                                         
Class A Common Stock and       Paul Piper                             2,500(6)                    *
 Unvested Options              6 Snug Hill Court                                                        
                               Hockessin, DE  19707                                                     
                                                                                                        
                                                                      
Class A Common Stock and       All Directors and Executive            2,485,296                   54%
 Vested Options                Officers of the Company as a group                                        
                               (five persons)(2)(3)(4)(5)(6)      
</TABLE>

                                      10
<PAGE>
 
------------------------------
 * Less than 1%

(1)  Unless otherwise indicated, the Company believes that all persons named in
     the table have sole voting and investment power with respect to all
     securities beneficially owned by them. Except as otherwise indicated, each
     beneficial owner's percentage ownership is determined by assuming that
     Options, warrants and convertible securities that are held by such person
     (but not those held by any other person) and which are exercisable or
     convertible within 60 days have been exercised or converted.

(2)  Includes 929,603 Escrowed Shares beneficially owned each by Messrs. Steiner
     and Berry.

(3)  Includes 2,000 shares of Class A Common Stock owned by Mr. Berry and
     1,218,626 shares of Class A Common Stock held in the name of William E.
     Berry, Declaration of Trust U/A which is controlled by William E. Berry,
     Trustee.

(4)  Includes shares of Class A Common Stock underlying 12,500 vested Options
     exercisable at $6.50 per share granted to Mr. Michael Matte, the Company's
     chief financial officer.

(5)  Includes 12,378 shares of Class A Common Stock (of which 7,735 are Escrowed
     Shares) and 16,666 shares of Class A Common Stock underlying vested Options
     exercisable at $1.76 and $7.25 per share, respectively.

(6)  Includes 2,000 shares of Class A Common Stock underlying vested Options,
     which the Company granted to Mr. Piper exercisable at $7.00 per share.

CHANGES IN CONTROL

     The Company entered into a Merger Agreement on April 26, 1998 with ARIS,
located in Bellevue, Washington.  The Merger is subject to approval by the
Company's stockholders, effectiveness of a registration statement, which was
filed on Tuesday May 5, 1998 with the SEC and certain other conditions.  Under
the terms of the Merger, ARIS will be the surviving corporation.  None of the
Company's current directors and executive officers shall be directors or
executive officers of ARIS.  ARIS shall exchange 0.266 shares of its common
stock for each share of the Company's Class A Common Stock (assuming conversion
of all Class B Common Stock) subject to adjustment as described in the
registration statement.

                                      11
<PAGE>
 
ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     For information concerning the Company's employment agreements with its
officers, see Item 10. Executive Compensation - Employment and Consulting
Agreements.

     In January 1998, the Company repriced all existing employee and management
Options which were "out-of-the money" to an exercise price of $5.75 per share.
Included in this repricing were 75,000 Options granted to each of Messrs.
William E. Berry and John E. Steiner in July 1997 (originally exercisable at
$6.50 per share) and 25,000 Options granted to Mr. Michael Matte when he joined
the Company in October 1996 (originally exercisable at $6.75 per share). Mr.
Matte's 100,000 Options (originally exercisable at $6.50 per share) were also
repriced in January 1998 to $4.52 per share pursuant to a provision in his
employment agreement as described above. In January 1998, the Company granted
new immediately exercisable Options to employees who held Options (exercisable
at $1.76 per share) that had been escrowed pursuant to the Escrow Agreement. A
condition of this grant, however, was the cancellation of the escrowed Options.
Ms. Goldkiller, one of these employees receiving new Options, received a new
grant of 7,735 Options exercisable at $5.75 per share and agreed to the
cancellation of her escrowed Options.

     During 1997, the Company employed three of Mr. John E. Steiner's adult
children in various non-management positions. One of these individuals reported
to Mr. Steiner. The aggregate compensation paid to Mr. Steiner's children in
1997 was $89,257. Currently, the Company employs one of Mr. Steiner's adult
children.

     In connection with Mr. Steiner's move to West Palm Beach, Florida caused by
the moving of the Company's administrative offices from South Carolina, the
Company agreed to reimburse him for housing, relocation expenses and other
expenses up to $65,000. To date, the Company has reimbursed Mr. Steiner $14,149
for such expenses. Additionally, in connection with Mr. Steiner's early
termination without cause in September 1997, the Company paid Mr. Steiner three
months' severance aggregating $54,951, including unused vacation time, health
and dental premiums following expiration of his employment agreement in February
1998. Such amounts were accrued at time of termination.

     In June 1997, the Company engaged Mr. Sherman Drusin, then an outside
director to act as a management and sales consultant to its consulting services
business. In November 1997, Mr. Drusin resigned as a director and consultant.
During fiscal 1997, the Company paid Mr. Drusin $97,228 in connection with his
consulting services.

     In connection with Mr. James Dean's termination in September 1997, the
Company paid him $44,587, equal to four months salary including health insurance
payments.

                                      12
<PAGE>
 
ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibits

     3.0   By-laws of InTime Systems International, Inc., as amended*
     3.1   Certificate of Incorporation*
     3.2   Amendment No. 1 to Certificate of Incorporation*
     4.    Escrow Agreement*
     10.   Employment Agreement of William E. Berry
     10.1  Employment Agreement of Michael Matte
     10.2  1994 Stock Option Plan*
     10.3  Amendment to 1994 Stock Option plan**
     10.4  Second Amendment to 1994 Stock Option Plan****
     10.5  Third Amendment to 1994 Stock Option Plan***
     21.   Subsidiaries of InTime Systems International, Inc.****
     23.   Consent of Price Waterhouse LLP*****


*     Contained in Registration Statement on Form SB-2 filed on December 16,
      1994.

**    Contained in the Registration Statement on Form S-8 filed on December 29,
      1995.

***   Contained in the Registration Statement on Form S-8 filed on April 18,
      1997.

****  Contained in Amendment No. 2 to the Registration Statement on Form SB-2
      filed on February 15, 1995.

***** Contained in Form 10-KSB filed on or about March 30, 1998.

(b)  REPORTS ON FORM 8-K

     No reports on Form 8-K were filed during the period covered by this report.

                                      13
<PAGE>
 
                                  SIGNATURES

     In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                       INTIME SYSTEMS INTERNATIONAL, INC.
                                       -----------------------------------------
                                       Registrant



                                       By:  /s/ William E. Berry
                                          --------------------------------------
                                          William E. Berry
                                          President, (Chief Executive Officer)

                                       14
<PAGE>
 
     Exhibits

     3.0   By-laws of InTime Systems International, Inc., as amended*
     3.1   Certificate of Incorporation*
     3.2   Amendment No. 1 to Certificate of Incorporation*
     4.    Escrow Agreement*
     10.   Employment Agreement of William E. Berry
     10.1  Employment Agreement of Michael Matte
     10.2  1994 Stock Option Plan*
     10.3  Amendment to 1994 Stock Option plan**
     10.4  Second Amendment to 1994 Stock Option Plan****
     10.5  Third Amendment to 1994 Stock Option Plan***
     21.   Subsidiaries of InTime Systems International, Inc.****
     23.   Consent of Price Waterhouse LLP*****


*     Contained in Registration Statement on Form SB-2 filed on December 16,
      1994.

**    Contained in the Registration Statement on Form S-8 filed on December 29,
      1995.

***   Contained in the Registration Statement on Form S-8 filed on April 18,
      1997.

****  Contained in Amendment No. 2 to the Registration Statement on Form SB-2
      filed on February 15, 1995.

***** Contained in Form 10-KSB filed on or about March 30, 1998.