| DELAWARE(State or other jurisdiction of Incorporation or organization) | 94-3145844(I.R.S. Employer Identification No.) |
|------------------------------------------------------------------------|------------------------------------------------|

| Title of each classCOMMON STOCK, $0.01 PAR VALUE | Name of each exchange on which registeredThe NASDAQ STOCK MARKET, LLC |
|--------------------------------------------------|-----------------------------------------------------------------------|

| Large accelerated filer o                     | Accelerated filer x         |
|-----------------------------------------------|-----------------------------|
| Non-accelerated filer o                       | Smaller reporting company o |
| (Do not check if a smaller reporting company) |                        |

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| Part I                                                                                                                          | 1  |
|---------------------------------------------------------------------------------------------------------------------------------|----|
| Item 1—Business                                                                                                           | 1  |
| Item 1A—Risk Factors                                                                                                      | 6  |
| Item 1B—Unresolved Staff Comments                                                                                         | 7  |
| Item 2—Properties                                                                                                         | 13 |
| Item 3—Legal Proceedings                                                                                                  | 14 |
| Item 4—Removed And Reserved                                                                                               | 14 |
| Executive Officers Of The Registrant                                                                                            | 15 |
| Part II                                                                                                                         | 15 |
| Item 5—Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 15 |
| Item 6—Selected Financial Data                                                                                            | 18 |
| Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations                        | 19 |
| Item 7A—Quantitative and Qualitative Disclosures About Market Risk                                                        | 35 |
| Item 8—Financial Statements and Supplementary Data                                                                        | 36 |
| Report of Independent Registered Public Accounting Firm                                                                         | 37 |
| Item 9—Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                               | 72 |
| Item 9A—Controls and Procedures                                                                                           | 72 |
| Item 9B—Other Information                                                                                                 | 74 |
| Part III                                                                                                                        | 74 |
| Item 10—Directors, Executive Officers and Corporate Governance                                                            | 74 |
| Item 11—Executive Compensation                                                                                            | 74 |
| Item 12—Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                    | 74 |
| Item 13—Certain Relationships and Related Transactions and Director Independence                                          | 74 |
| Item 14—Principal Accountant Fees and Services                                                                            | 74 |
| Part IV                                                                                                                         | 75 |
| Item 15—Exhibits, Financial Statement Schedules                                                                           | 75 |
| Signatures                                                                                                                      | 78 |

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| ·   | Federal—which includes federal income and business tax payments; |
|--------------------|------------------------------------------------------------------------|

| ·   | State and Local—which includes state and local income tax payments and business tax payments; |
|--------------------|-----------------------------------------------------------------------------------------------------|

| ·   | Property Tax—which covers state and local real property tax; |
|--------------------|--------------------------------------------------------------------|

| ·   | Utility; |
|--------------------|----------|

| ·   | Education—which consists of services to post-secondary educational institutions; and |
|--------------------|--------------------------------------------------------------------------------------------|

| ·   | Other—includes local government fines and fees, motor vehicle registration and payments, rent, insurance, K-12 meal pay and fee payments and personal property tax payments. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Vertical                                                                               | Revenue ContributionFiscal year 2010 | CAGR(1) |
|----------------------------------------------------------------------------------------|--------------------------------------|---------|
| Federal                                                                                | 20.5%                                | (9.3)%  |
| State and Local                                                                        | 8.5%                                 | 5.4%    |
| Property Tax                                                                           | 27.3%                                | 3.1%    |
| Utility                                                                                | 15.3%                                | 55.6%   |
| Education                                                                              | 13.6%                                | 53.4%   |
| Other                                                                                  | 14.8%                                | 11.5%   |
|                                                                                   |                                 |    |
| Total                                                                                  | 100.0%                               | 8.6%    |
| (1)Compound Annual Growth Rate of EPS Revenue for Fiscal Year 2007 to Fiscal Year 2010 |

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| ·   | economic conditions in the marketplace, including recession; |
|--------------------|--------------------------------------------------------------|

| ·   | loss of significant clients; |
|--------------------|------------------------------|

| ·   | demand for our services; |
|--------------------|--------------------------|

| ·   | seasonality of business, resulting from timing of property tax payments and federal and state income tax payments; |
|--------------------|--------------------------------------------------------------------------------------------------------------------|

| ·   | timing of service and product implementations; |
|--------------------|------------------------------------------------|

| ·   | unplanned increases in costs; |
|--------------------|-------------------------------|

| ·   | delays in completion of projects; |
|--------------------|-----------------------------------|

| ·   | intense competition; |
|--------------------|----------------------|

| ·   | costs of compliance with laws and government regulations; and |
|--------------------|---------------------------------------------------------------|

| ·   | costs of acquisitions, consolidation and integration of new business and technology. |
|--------------------|--------------------------------------------------------------------------------------|

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| Name, age and position with Registrant                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Date electedor appointed |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------|
| Alex P. Hart, Age 48 (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                     |
| President, Chief Executive Officer and Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | August 2010              |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                     |
| Ronald W. Johnston, Age 64 (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                     |
| Senior Vice President, Chief Financial Officer                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | July 2008                |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                     |
| Keith S. Kendrick, Age 53 (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                     |
| Senior Vice President, Strategic Marketing                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | June 2008                |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                     |
| Atul Garg, Age 44 (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                     |
| Senior Vice President, Product Management                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | November 2010            |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                     |
| Keith S. Omsberg, Age 49 (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                     |
| Vice President, General Counsel and Corporate Secretary                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | April 2008               |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                     |
|     (a) Mr. Hart served as President of the Fuelman Fleet Cards business unit of Fleetcor Technologies, Inc., a provider of specialized payment products and services to commercial fleets, major oil companies and petroleum marketers, from September 2009 through August 2010.  From May 2007 to April 2008 Mr. Hart served as Executive Vice President and General Manager of Electronic Banking Services for Check Free Corporation, a provider of financial electronic commerce products and services.  From October 2002 to May 2007, he served as President and Chief Executive Officer of Corillian Corporation, a provider of online banking and bill payment software and services.                                                                                                                 |
|    (b)  Mr. Johnston served as a CFO partner with Tatum LLC, a professional services firm, from August 2007 through June 2008; CFO and Treasurer for Grantham Education Corporation, a for-profit post-secondary university, from October 2004 through March 2007; and CFO for WorldSpace Corporation, a satellite broadcast and content development company from September 2002 through September 2004.                                                                                                                                                                                                                                                                                                                                                                                                                      |
|     (c) Mr. Kendrick served as Senior Vice President, Corporate Marketing and Strategy with EFunds Corporation, a publicly traded enterprise payments and data solutions company, from December 2005 through September 2007 and co-founder and Chief Executive Officer of Vericate Corporation, an analytical software company focused on fraud detection in the retail drug transaction industry, from January 2003 through March 2005.                                                                                                                                                                                                                                                                                                                                                                                           |
|     (d)  Mr. Garg served as Executive consultant, Senior Vice President with Fleetcor Technologies, Inc., a provider of specialized payment products and services to commercial fleets, major oil companies and petroleum marketers, from June 2009 to October 2010.  Mr. Garg served as Senior Vice President, eBusiness from November 2007 to  May 2009, Senior Vice President, Small Business Cards from October 2006 to November 2007, Senior Manager, Commercial Cards and Small Business from October 2004 to October 2006 and Director, Project Development, Private Label Credit Card from June 2002 to  October 2004, for HSBC Bank USA, N.A., one of the world’s largest banks, providing personal financial services and commercial, global and private banking services. |
| (e)  Mr. Omsberg served as Assistant General Counsel of Tier from June 2002 to April 2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |

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|           |   | Fiscal year ended September 30, |   |
|----------------|--------|---------------------------------|--------|
|           |   | 2010                            |   |   | 2009 |   |
|           |   | High                            |   |   | Low |   |   | High |   |   | Low |   |
| First quarter  |   | $                               | 9.00   |   |   | $ | 7.43 |   |   | $ | 7.57 |   |   | $ | 3.41 |   |
| Second quarter |   | $                               | 8.32   |   |   | $ | 7.10 |   |   | $ | 6.39 |   |   | $ | 4.48 |   |
| Third quarter  |   | $                               | 8.58   |   |   | $ | 5.99 |   |   | $ | 7.90 |   |   | $ | 4.35 |   |
| Fourth quarter |   | $                               | 6.90   |   |   | $ | 4.53 |   |   | $ | 8.90 |   |   | $ | 7.10 |   |

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| MeasurementDate |   | TierTechnologies, Inc. |   |   | NASDAQComposite |   |   | Russell2000 |   |   | PeerGroup |   |
|-----------------|--------|------------------------|--------|--------|-----------------|--------|--------|-------------|--------|--------|-----------|--------|
| 9/30/05         |   | $                      | 100.00 |   |            | $      | 100.00 |        |   | $      | 100.00    |   |   | $ | 100.00 |   |
| 9/30/06         |   |                   | 78.61  |   |            |   | 106.39 |        |   |   | 109.92    |   |   |   | 118.44 |   |
| 9/30/07         |   |                   | 117.92 |   |            |   | 127.37 |        |   |   | 123.49    |   |   |   | 129.16 |   |
| 9/30/08         |   |                   | 85.09  |   |            |   | 96.70  |        |   |   | 105.60    |   |   |   | 115.92 |   |
| 9/30/09         |   |                   | 98.03  |   |            |   | 100.00 |        |   |   | 95.52     |   |   |   | 112.39 |   |
| 9/30/10         |   |                   | 64.05  |   |            |   | 112.86 |        |   |   | 108.27    |   |   |   | 134.99 |   |

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|                                                                 |   | Fiscal years ended September 30, |    |
|----------------------------------------------------------------------|--------|----------------------------------|---------|
|  (in thousands, except per share data)                          |   | 2010                             |    |   | 2009 |   |   | 2008 |   |   | 2007 |   |   | 2006 |   |
| Revenues                                                             |   | $                                | 130,224 |   |   | $ | 128,246 |   |   | $ | 122,571 |   |   | $ | 108,306 |   |   | $ | 90,916 |   |
| Costs and expenses                                                   |   |                             | 136,593 |   |   |   | 134,400 |   |   |   | 137,259 |   |   |   | 130,724 |   |   |   | 113,956 |   |
| Loss from continuing operations before other income and income taxes |   |                             | (6,369  | ) |   |   | (6,154 | ) |   |   | (14,688 | ) |   |   | (22,418 | ) |   |   | (23,040 | ) |
| Other income                                                         |   |                             | 451     |   |   |   | 723 |   |   |   | 2,731 |   |   |   | 4,094 |   |   |   | 3,470 |   |
| Loss from continuing operations before income taxes                  |   |                             | (5,918  | ) |   |   | (5,431 | ) |   |   | (11,957 | ) |   |   | (18,324 | ) |   |   | (19,570 | ) |
| Income tax provision                                                 |   |                             | 30      |   |   |   | 40 |   |   |   | 87 |   |   |   | 76 |   |   |   | 45 |   |
| Loss from continuing operations                                      |   |                             | (5,948  | ) |   |   | (5,471 | ) |   |   | (12,044 | ) |   |   | (18,400 | ) |   |   | (19,615 | ) |
| (Loss) income from discontinued operations, net                      |   |                             | (245    | ) |   |   | (6,035 | ) |   |   | (15,401 | ) |   |   | 15,366 |   |   |   | 10,164 |   |
| Net loss                                                             |   | $                                | (6,193  | ) |   | $ | (11,506 | ) |   | $ | (27,445 | ) |   | $ | (3,034 | ) |   | $ | (9,451 | ) |
|                                                                 |   |                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets                                                         |   | $                                | 113,025 |   |   | $ | 120,547 |   |   | $ | 137,351 |   |   | $ | 166,424 |   |   | $ | 169,860 |   |
| Long-term obligations, less current portion                          |   | $                                | 1,853   |   |   | $ | 1,121 |   |   | $ | 136 |   |   | $ | 200 |   |   | $ | 1,359 |   |
| (Loss) earnings per share—Basic and diluted:                   |   |                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Continuing operations                                                |   | $                                | (0.33   | ) |   | $ | (0.28 | ) |   | $ | (0.61 | ) |   | $ | (0.94 | ) |   | $ | (1.00 | ) |
| Discontinued operations                                              |   | $                                | (0.01   | ) |   | $ | (0.31 | ) |   | $ | (0.79 | ) |   | $ | 0.78 |   |   | $ | 0.52 |   |
| Loss per share—Basic and diluted                               |   | $                                | (0.34   | ) |   | $ | (0.59 | ) |   | $ | (1.40 | ) |   | $ | (0.16 | ) |   | $ | (0.48 | ) |
| Weighted average common shares used in computing:                    |   |                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic and diluted (loss) earnings per share                          |   |                             | 18,153  |   |   |   | 19,438 |   |   |   | 19,616 |   |   |   | 19,512 |   |   |   | 19,495 |   |

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|                             |   | Year ended September 30, 2010 |   |
|----------------------------------|--------|-------------------------------|--------|
| (in thousands, except per share) |   | Net (loss) income             |   |   | (Loss) earnings per share |   |
| Continuing Operations:           |   |                          |   |   |   |   |
| EPS                              |   | $                             | (6,207 | ) |   | $ | (0.34 | ) |
| Wind-down                        |   |                          | 259    |   |   |   | 0.01 |   |
| Total Continuing Operations      |   | $                             | (5,948 | ) |   | $ | (0.33 | ) |
|                             |   |                          |   |   |   |   |   |   |
| Total Discontinued Operations    |   | $                             | (245   | ) |   | $ | (0.01 | ) |
|                             |   |                          |   |   |   |   |   |   |
| Net loss                         |   | $                             | (6,193 | ) |   | $ | (0.34 | ) |

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| ·   | Expand market share in the biller direct market; |
|--------------------|--------------------------------------------------|

| ·   | Strengthen our technology environment; |
|--------------------|----------------------------------------|

| ·   | Establish a market driven approach to our business; |
|--------------------|-----------------------------------------------------|

| ·   | Strengthen our management team; and |
|--------------------|-------------------------------------|

| ·   | Improve profitability. |
|--------------------|------------------------|

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|                                                                |   |   Year ended |    |   | Variance      |   |
|---------------------------------------------------------------------|--------|------------------------|---------|--------|---------------|--------|
|                                                                |   | September 30,          |    |   | 2010 vs. 2009 |   |
| (in thousands, except percentages)                                  |   | 2010                   |    |   | 2009          |   |   |  $ |   |   |   | % |   |
| Revenues                                                            |   | $                      | 130,224 |   |          | $      | 128,246 |   |   | $ | 1,978 |   |   |   | 1.5 | % |
| Costs and expenses:                                                 |   |                   |    |   |          |   |   |   |   |   |   |   |   |   |   |   |
| Direct costs                                                        |   |                   | 98,328  |   |          |   | 95,594 |   |   |   | 2,734 |   |   |   | 2.9 | % |
| General and administrative                                          |   |                   | 25,199  |   |          |   | 25,529 |   |   |   | (330 | ) |   |   | (1.3 | )% |
| Selling and marketing                                               |   |                   | 6,355   |   |          |   | 6,708 |   |   |   | (353 | ) |   |   | (5.3 | )% |
| Depreciation and amortization                                       |   |                   | 6,711   |   |          |   | 6,569 |   |   |   | 142 |   |   |   | 2.2 | % |
| Total costs and expenses                                            |   |                   | 136,593 |   |          |   | 134,400 |   |   |   | 2,193 |   |   |   | 1.6 | % |
| Loss from continuing operations before other incomeand income taxes |   |                   | (6,369  | )      |          |   | (6,154 | ) |   |   | (215 | ) |   |   | 3.5 | % |
| Other income                                                        |   |                   | 451     |   |          |   | 723 |   |   |   | (272 | ) |   |   | (37.6 | )% |
| Loss from continuing operations before income taxes                 |   |                   | (5,918  | )      |          |   | (5,431 | ) |   |   | (487 | ) |   |   | (9.0 | )% |
| Income tax provision                                                |   |                   | 30      |   |          |   | 40 |   |   |   | (10 | ) |   |   | (25.0 | )% |
| Loss from continuing operations                                     |   |                   | (5,948  | )      |          |   | (5,471 | ) |   |   | (477 | ) |   |   | (8.7 | )% |
| Loss from discontinued operations, net                              |   |                   | (245    | )      |          |   | (6,035 | ) |   |   | 5,790 |   |   |   | 95.9 | % |
| Net loss                                                            |   | $                      | (6,193  | )      |          | $      | (11,506 | ) |   | $ | 5,313 |   |   |   | 46.2 | % |

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|                               |   | Year ended September 30, |    |   | Variance |   |
|------------------------------------|--------|--------------------------|---------|--------|----------|--------|
| (in thousands, except percentages) |   | 2010                     |    |   | 2009     |   |   |  $ |   |   |   | % |   |
| Revenues                           |   |                     |    |   |     |   |   |   |   |   |   |   |   |
| EPS                                |   | $                        | 127,223 |   |     | $      | 123,233 |   |   | $ | 3,990 |   |   |   | 3.2 | % |
| Wind-down                          |   |                     | 3,001   |   |     |   | 5,013 |   |   |   | (2,012 | ) |   |   | (40.1 | )% |
| Total                              |   | $                        | 130,224 |   |     | $      | 128,246 |   |   | $ | 1,978 |   |   |   | 1.5 | % |

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|                               |   | Year ended September 30, |   |   | Variance |   |
|------------------------------------|--------|--------------------------|--------|--------|----------|--------|
| (in thousands, except percentages) |   | 2010                     |   |   | 2009     |   |   |  $ |   |   |   | % |   |
| Direct costs                       |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| EPS:                               |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| Discount fees                      |   | $                        | 90,853 |   |     | $      | 88,657 |   |   | $ | 2,196 |   |   |   | 2.5 | % |
| Other costs                        |   |                     | 6,197  |   |     |   | 4,777 |   |   |   | 1,420 |   |   |   | 29.7 | % |
| Total EPS                          |   |                     | 97,050 |   |     |   | 93,434 |   |   |   | 3,616 |   |   |   | 3.9 | % |
| Wind-down                          |   |                     | 1,278  |   |     |   | 2,160 |   |   |   | (882 | ) |   |   | (40.8 | )% |
| Total                              |   | $                        | 98,328 |   |     | $      | 95,594 |   |   | $ | 2,734 |   |   |   | 2.9 | % |

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|                               |   | Year ended September 30, |   |   | Variance |   |
|------------------------------------|--------|--------------------------|--------|--------|----------|--------|
| (in thousands, except percentages) |   | 2010                     |   |   | 2009     |   |   |  $ |   |   |   | % |   |
| General and administrative         |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| EPS                                |   | $                        | 24,821 |   |     | $      | 24,509 |   |   | $ | 312 |   |   |   | 1.3 | % |
| Wind-down                          |   |                     | 378    |   |     |   | 1,020 |   |   |   | (642 | ) |   |   | (62.9 | )% |
| Total                              |   | $                        | 25,199 |   |     | $      | 25,529 |   |   | $ | (330 | ) |   |   | (1.3 | )% |

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|                               |   | Year ended September 30, |    |   | Variance |   |
|------------------------------------|--------|--------------------------|---------|--------|----------|--------|
| (in thousands, except percentages) |   | 2010                     |    |   | 2009     |   |   |  $ |   |   |   | % |   |
| Selling and marketing              |   |                     |    |   |     |   |   |   |   |   |   |   |   |
| EPS                                |   | $                        | 6,355   |   |     | $      | 6,697 |   |   | $ | (342 | ) |   |   | (5.1 | )% |
| Wind-down                          |   |                     | — |   |     |   | 11 |   |   |   | (11 | ) |   |   | (100.0 | )% |
| Total                              |   | $                        | 6,355   |   |     | $      | 6,708 |   |   | $ | (353 | ) |   |   | (5.3 | )% |

|                               |   | Year ended September 30, |   |   | Variance |   |
|------------------------------------|--------|--------------------------|--------|--------|----------|--------|
| (in thousands, except percentages) |   | 2010                     |   |   | 2009     |   |   |  $ |   |   |   | % |   |
| Depreciation and amortization      |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| EPS                                |   | $                        | 5,625  |   |     | $      | 4,885 |   |   | $ | 740 |   |   |   | 15.2 | % |
| Wind-down                          |   |                     | 1,086  |   |     |   | 1,684 |   |   |   | (598 | ) |   |   | (35.5 | )% |
| Total                              |   | $                        | 6,711  |   |     | $      | 6,569 |   |   | $ | 142 |   |   |   | 2.2 | % |

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|                                                                |   |  Year ended |    |   | Variance      |   |
|---------------------------------------------------------------------|--------|------------------|---------|--------|---------------|--------|
|                                                                |   | September 30,    |    |   | 2009 vs. 2008 |   |
| (in thousands, except percentages)                                  |   | 2009             |    |   | 2008          |   |   |  $ |   |   |   | % |   |
| Revenues                                                            |   | $                | 128,246 |   |          | $      | 122,571 |   |   | $ | 5,675 |   |   |   | 4.6 | % |
| Costs and expenses:                                                 |   |             |    |   |          |   |   |   |   |   |   |   |   |   |   |   |
| Direct costs                                                        |   |             | 95,594  |   |          |   | 95,234 |   |   |   | 360 |   |   |   | 0.4 | % |
| General and administrative                                          |   |             | 25,529  |   |          |   | 28,020 |   |   |   | (2,491 | ) |   |   | (8.9 | )% |
| Selling and marketing                                               |   |             | 6,708   |   |          |   | 8,677 |   |   |   | (1,969 | ) |   |   | (22.7 | )% |
| Depreciation and amortization                                       |   |             | 6,569   |   |          |   | 5,328 |   |   |   | 1,241 |   |   |   | 23.3 | % |
| Total costs and expenses                                            |   |             | 134,400 |   |          |   | 137,259 |   |   |   | (2,859 | ) |   |   | (2.1 | )% |
| Loss from continuing operations before other incomeand income taxes |   |             | (6,154  | )      |          |   | (14,688 | ) |   |   | 8,534 |   |   |   | 58.1 | % |
| Other income                                                        |   |             | 723     |   |          |   | 2,731 |   |   |   | (2,008 | ) |   |   | (73.5 | )% |
| Loss from continuing operations before income taxes                 |   |             | (5,431  | )      |          |   | (11,957 | ) |   |   | 6,526 |   |   |   | 54.6 | % |
| Income tax provision                                                |   |             | 40      |   |          |   | 87 |   |   |   | (47 | ) |   |   | (54.0 | )% |
| Loss from continuing operations                                     |   |             | (5,471  | )      |          |   | (12,044 | ) |   |   | 6,573 |   |   |   | 54.6 | % |
| Loss from discontinued operations, net                              |   |             | (6,035  | )      |          |   | (15,401 | ) |   |   | 9,366 |   |   |   | 60.8 | % |
| Net loss                                                            |   | $                | (11,506 | )      |          | $      | (27,445 | ) |   | $ | 15,939 |   |   |   | 58.1 | % |

|                               |   | Year ended September 30, |    |   | Variance |   |
|------------------------------------|--------|--------------------------|---------|--------|----------|--------|
| (in thousands, except percentages) |   | 2009                     |    |   | 2008     |   |   |  $ |   |   |   | % |   |
| Revenues                           |   |                     |    |   |     |   |   |   |   |   |   |   |   |
| EPS                                |   | $                        | 123,233 |   |     | $      | 116,641 |   |   | $ | 6,592 |   |   |   | 5.7 | % |
| Wind-down                          |   |                     | 5,013   |   |     |   | 5,930 |   |   |   | (917 | ) |   |   | (15.5 | )% |
| Total                              |   | $                        | 128,246 |   |     | $      | 122,571 |   |   | $ | 5,675 |   |   |   | 4.6 | % |

----

|                               |   | Year ended September 30, |   |   | Variance |   |
|------------------------------------|--------|--------------------------|--------|--------|----------|--------|
| (in thousands, except percentages) |   | 2009                     |   |   | 2008     |   |   |  $ |   |   |   | % |   |
| Direct costs                       |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| EPS:                               |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| Discount fees                      |   | $                        | 88,657 |   |     | $      | 87,082 |   |   | $ | 1,575 |   |   |   | 1.8 | % |
| Other costs                        |   |                     | 4,777  |   |     |   | 4,208 |   |   |   | 569 |   |   |   | 13.5 | % |
| Total EPS                          |   |                     | 93,434 |   |     |   | 91,290 |   |   |   | 2,144 |   |   |   | 2.3 | % |
| Wind-down                          |   |                     | 2,160  |   |     |   | 3,944 |   |   |   | (1,784 | ) |   |   | (45.2 | )% |
| Total                              |   | $                        | 95,594 |   |     | $      | 95,234 |   |   | $ | 360 |   |   |   | 0.4 | % |

----

|                               |   | Year ended September 30, |   |   | Variance |   |
|------------------------------------|--------|--------------------------|--------|--------|----------|--------|
| (in thousands, except percentages) |   | 2009                     |   |   | 2008     |   |   |  $ |   |   |   | % |   |
| General and administrative         |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| EPS                                |   | $                        | 24,509 |   |     | $      | 26,932 |   |   | $ | (2,423 | ) |   |   | (9.0 | )% |
| Wind-down                          |   |                     | 1,020  |   |     |   | 1,088 |   |   |   | (68 | ) |   |   | (6.3 | )% |
| Total                              |   | $                        | 25,529 |   |     | $      | 28,020 |   |   | $ | (2,491 | ) |   |   | (8.9 | )% |

----

|                               |   | Year ended September 30, |   |   | Variance |   |
|------------------------------------|--------|--------------------------|--------|--------|----------|--------|
| (in thousands, except percentages) |   | 2009                     |   |   | 2008     |   |   |  $ |   |   |   | % |   |
| Selling and marketing              |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| EPS                                |   | $                        | 6,697  |   |     | $      | 8,486 |   |   | $ | (1,789 | ) |   |   | (21.1 | )% |
| Wind-down                          |   |                     | 11     |   |     |   | 191 |   |   |   | (180 | ) |   |   | (94.2 | )% |
| Total                              |   | $                        | 6,708  |   |     | $      | 8,677 |   |   | $ | (1,969 | ) |   |   | (22.7 | )% |

|                               |   | Year ended September 30, |   |   | Variance |   |
|------------------------------------|--------|--------------------------|--------|--------|----------|--------|
| (in thousands, except percentages) |   | 2009                     |   |   | 2008     |   |   |  $ |   |   |   | % |   |
| Depreciation and amortization      |   |                     |   |   |     |   |   |   |   |   |   |   |   |
| EPS                                |   | $                        | 4,885  |   |     | $      | 3,900 |   |   | $ | 985 |   |   |   | 25.3 | % |
| Wind-down                          |   |                     | 1,684  |   |     |   | 1,428 |   |   |   | 256 |   |   |   | 17.9 | % |
| Total                              |   | $                        | 6,569  |   |     | $      | 5,328 |   |   | $ | 1,241 |   |   |   | 23.3 | % |

----

----

|   | Transaction-based contracts—revenues are recognized based on fees charged on a per-transaction basis or fees charged as a percentage of dollars processed; |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Time and materials contracts—revenues are recognized when we perform services and incur expenses; |
|--------|---------------------------------------------------------------------------------------------------------|

|   | Delivery-based contracts—revenues are recognized when we have delivered, and the customer has accepted, the product or service; and |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------|

|   | Software maintenance contracts—revenues are recognized on a straight-line basis over the contract term, which is typically one year. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

| (in thousands)                            |   | Total  |   |   | 2011   |   |   |   | 2012-2013 |   |    | 2014-2015 |   | Thereafter |
|-------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|---------|-----------|--------|------------|
| Capital lease obligations (equipment) (1) |   | $      | 78     |   |   | $      | 31     |   |      | $      | 47      |      | $      | —    |   | $ | — |   |
|                                      |   |   |   |   |   |   |   |   |      |   |    |      |   |       |   |   |   |   |   |
| Operating lease obligations:              |   |   |   |   |   |   |   |   |      |   |    |      |   |       |   |   |   |   |   |
| Facilities leases                         |   |   | 5,563  |   |   |   | 468    |   |      |   | 1,590   |      |   | 1,625      |   |   | 1,880 |   |
| Equipment leases                          |   |   | 23     |   |   |   | 6      |   |      |   | 12      |      |   | 5          |   |   | — |   |
|                                      |   |   |   |   |   |   |   |   |      |   |    |      |   |       |   |   |   |   |   |
| Purchase obligations:                     |   |   |   |   |   |   |   |   |      |   |    |      |   |       |   |   |   |   |   |
| Subcontractor                             |   |   | 110    |   |   |   | 110    |   |      |   | — |      |   | —    |   |   | — |   |
| Purchase order                            |   |   | 182    |   |   |   | 182    |   |      |   | — |      |   | —    |   |   | — |   |
| Total contractual obligations             |   | $      | 5,956  |   |   | $      | 797    |   |      | $      | 1,649   |      | $      | 1,630      |   | $ | 1,880 |   |
| (1) Includes interest payments of $1.     |   |   |   |   |   |   |

----

| Report of Independent Registered Public Accounting Firm | 37 |
|---------------------------------------------------------|----|
| Consolidated Balance Sheets                             | 38 |
| Consolidated Statements of Operations                   | 39 |
| Consolidated Statements of Shareholders’ Equity   | 40 |
| Consolidated Statements of Comprehensive Loss           | 41 |
| Consolidated Statements of Cash Flows                   | 42 |
| Notes To Consolidated Financial Statements              | 44 |
| Note 1—Nature of Operations                       | 44 |
| Note 2—Summary of Significant Accounting Policies | 44 |
| Note 3—Investments                                | 49 |
| Note 4—Fair Value Measurements                    | 50 |
| Note 5—Customer Concentration and Risk            | 52 |
| Note 6—Property, Equipment and Software           | 53 |
| Note 7—Goodwill and Other Intangible Assets       | 54 |
| Note 8—Income Taxes                               | 55 |
| Note 9— Commitments And Contingencies             | 57 |
| Note 10—Related Party Transactions                | 59 |
| Note 11—Segment Information                       | 60 |
| Note 12—Shareholders’ Equity                | 62 |
| Note 13—Share-based Payment                       | 62 |
| Note 14—Discontinued Operations                   | 65 |
| Note 15—Loss per Share                            | 67 |
| Note 16—Acquisition                               | 67 |
| Note 17—Restructuring                             | 68 |
| Note 18—Subsequent Events                         | 69 |
| Selected Quarterly Financial Data (Unaudited)           | 70 |
| Schedule II                                             | 71 |

----

----

| CONSOLIDATED BALANCE SHEETS |
|-----------------------------|

| (in thousands)                                                                                                                                        |   | September 30,2010 |    |   | September 30,2009 |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------|---------|--------|------------------------|--------|
| ASSETS:                                                                                                                                               |   |                   |    |   |                   |   |
| Current assets:                                                                                                                                       |   |                   |    |   |                   |   |
| Cash and cash equivalents                                                                                                                             |   | $                      | 45,757  |   |                   | $      | 21,969 |   |
| Investments in marketable securities                                                                                                                  |   |                   | 8,249   |   |                   |   | 4,499 |   |
| Restricted investments                                                                                                                                |   |                   | 1,311   |   |                   |   | 1,361 |   |
| Accounts receivable, net                                                                                                                              |   |                   | 4,883   |   |                   |   | 4,790 |   |
| Settlements receivable, net                                                                                                                           |   |                   | 8,356   |   |                   |   | 10,592 |   |
| Prepaid expenses and other current assets                                                                                                             |   |                   | 1,407   |   |                   |   | 2,239 |   |
| Total current assets                                                                                                                                  |   |                   | 69,963  |   |                   |   | 45,450 |   |
|                                                                                                                                                  |   |                   |    |   |                   |   |   |   |
| Property, equipment and software, net                                                                                                                 |   |                   | 12,032  |   |                   |   | 7,990 |   |
| Goodwill                                                                                                                                              |   |                   | 17,381  |   |                   |   | 17,329 |   |
| Other intangible assets, net                                                                                                                          |   |                   | 7,477   |   |                   |   | 12,038 |   |
| Investments in marketable securities                                                                                                                  |   |                   | — |   |                   |   | 31,169 |   |
| Restricted investments                                                                                                                                |   |                   | 6,000   |   |                   |   | 6,000 |   |
| Other assets                                                                                                                                          |   |                   | 172     |   |                   |   | 571 |   |
| Total assets                                                                                                                                          |   | $                      | 113,025 |   |                   | $      | 120,547 |   |
|                                                                                                                                                  |   |                   |    |   |                   |   |   |   |
| LIABILITIES AND SHAREHOLDERS’ EQUITY:                                                                                                           |   |                   |    |   |                   |   |   |   |
| Current liabilities:                                                                                                                                  |   |                   |    |   |                   |   |   |   |
| Accounts payable                                                                                                                                      |   | $                      | 1,059   |   |                   | $      | 84 |   |
| Settlements payable                                                                                                                                   |   |                   | 10,716  |   |                   |   | 13,911 |   |
| Accrued compensation liabilities                                                                                                                      |   |                   | 4,261   |   |                   |   | 3,213 |   |
| Accrued discount fees                                                                                                                                 |   |                   | 4,624   |   |                   |   | 5,343 |   |
| Other accrued liabilities                                                                                                                             |   |                   | 2,718   |   |                   |   | 3,425 |   |
| Deferred income                                                                                                                                       |   |                   | 558     |   |                   |   | 861 |   |
| Total current liabilities                                                                                                                             |   |                   | 23,936  |   |                   |   | 26,837 |   |
| Other liabilities:                                                                                                                                    |   |                   |    |   |                   |   |   |   |
| Deferred rent                                                                                                                                         |   |                   | 1,257   |   |                   |   | — |   |
| Other liabilities                                                                                                                                     |   |                   | 596     |   |                   |   | 1,121 |   |
| Total other liabilities                                                                                                                               |   |                   | 1,853   |   |                   |   | 1,121 |   |
| Total liabilities                                                                                                                                     |   |                   | 25,789  |   |                   |   | 27,958 |   |
|                                                                                                                                                  |   |                   |    |   |                   |   |   |   |
| Commitments and contingencies (Note 9)                                                                                                                |   |                   |    |   |                   |   |   |   |
|                                                                                                                                                  |   |                   |    |   |                   |   |   |   |
| Shareholders’ equity:                                                                                                                           |   |                   |    |   |                   |   |   |   |
| Preferred stock, no par value; authorized shares:  4,579;no shares issued and outstanding                                                   |   |                   | — |   |                   |   | — |   |
| Common stock, $0.01 par value, and paid-in capital; shares authorized: 44,260;shares issued: 20,706 and 20,687; shares outstanding: 18,170 and 18,238 |   |                   | 193,620 |   |                   |   | 192,030 |   |
| Treasury stock—at cost, 2,536 and 2,449 shares                                                                                                  |   |                   | (21,020 | )      |                   |   | (20,271 | ) |
| Accumulated other comprehensive loss                                                                                                                  |   |                   | (1      | )      |                   |   | — |   |
| Accumulated deficit                                                                                                                                   |   |                   | (85,363 | )      |                   |   | (79,170 | ) |
| Total shareholders’ equity                                                                                                                      |   |                   | 87,236  |   |                   |   | 92,589 |   |
| Total liabilities and shareholders’ equity                                                                                                      |   | $                      | 113,025 |   |                   | $      | 120,547 |   |

----

| CONSOLIDATED STATEMENTS OF OPERATIONS |
|---------------------------------------|

|                                                                 |   | Year ended September 30, |    |
|----------------------------------------------------------------------|--------|--------------------------|---------|
| (in thousands, except per share data)                                |   | 2010                     |    |   | 2009 |   |   | 2008 |   |
|                                                                 |   |                     |    |   |   |   |   |   |   |
| Revenues                                                             |   | $                        | 130,224 |   |   | $ | 128,246 |   |   | $ | 122,571 |   |
|                                                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Costs and expenses:                                                  |   |                     |    |   |   |   |   |   |   |   |   |   |
| Direct costs                                                         |   |                     | 98,328  |   |   |   | 95,594 |   |   |   | 95,234 |   |
| General and administrative                                           |   |                     | 25,199  |   |   |   | 25,529 |   |   |   | 28,020 |   |
| Selling and marketing                                                |   |                     | 6,355   |   |   |   | 6,708 |   |   |   | 8,677 |   |
| Depreciation and amortization                                        |   |                     | 6,711   |   |   |   | 6,569 |   |   |   | 5,328 |   |
| Total costs and expenses                                             |   |                     | 136,593 |   |   |   | 134,400 |   |   |   | 137,259 |   |
|                                                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Loss from continuing operations before other income and income taxes |   |                     | (6,369  | ) |   |   | (6,154 | ) |   |   | (14,688 | ) |
|                                                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Other income:                                                        |   |                     |    |   |   |   |   |   |   |   |   |   |
| Interest income, net                                                 |   |                     | 414     |   |   |   | 754 |   |   |   | 2,731 |   |
| Gain (loss) on investment                                            |   |                     | 31      |   |   |   | (31 | ) |   |   | — |   |
| Gain on sale of assets                                               |   |                     | 6       |   |   |   | — |   |   |   | — |   |
| Total other income                                                   |   |                     | 451     |   |   |   | 723 |   |   |   | 2,731 |   |
|                                                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Loss from continuing operations before income taxes                  |   |                     | (5,918  | ) |   |   | (5,431 | ) |   |   | (11,957 | ) |
| Income tax provision                                                 |   |                     | 30      |   |   |   | 40 |   |   |   | 87 |   |
|                                                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Loss from continuing operations                                      |   |                     | (5,948  | ) |   |   | (5,471 | ) |   |   | (12,044 | ) |
| Loss from discontinued operations, net                               |   |                     | (245    | ) |   |   | (6,035 | ) |   |   | (15,401 | ) |
|                                                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Net loss                                                             |   | $                        | (6,193  | ) |   | $ | (11,506 | ) |   | $ | (27,445 | ) |
|                                                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Loss per share—Basic and diluted:                              |   |                     |    |   |   |   |   |   |   |   |   |   |
| From continuing operations                                           |   | $                        | (0.33   | ) |   | $ | (0.28 | ) |   | $ | (0.61 | ) |
| From discontinued operations                                         |   | $                        | (0.01   | ) |   | $ | (0.31 | ) |   | $ | (0.79 | ) |
| Loss per share—Basic and diluted                               |   | $                        | (0.34   | ) |   | $ | (0.59 | ) |   | $ | (1.40 | ) |
|                                                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Weighted average common shares used in computing:                    |   |                     |    |   |   |   |   |   |   |   |   |   |
| Basic and diluted loss per share                                     |   |                     | 18,153  |   |   |   | 19,438 |   |   |   | 19,616 |   |

----

| CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY |
|-------------------------------------------------------|

|                                                                                                       |   |                      |    |   |               |   |    |                |   |   |                |   |   |              |    |  Accumulated other |                |   |    |          |   |   | Total        |   |
|------------------------------------------------------------------------------------------------------------|--------|---------------------------|---------|--------|--------------------|--------|---------|---------------------|--------|--------|---------------------|--------|--------|-------------------|---------|-------------------------|---------------------|--------|---------|---------------|--------|--------|--------------|--------|
|                                                                                                       |   |  Common Stock Issued |    |   |  Paid-in-     |   |    | Treasury Stock      |   |   |  comprehensive |   |   |  Accumulated |    |                    |  shareholders' |   |
|  (in thousands)                                                                                       |   |  Shares         |    |   |  Amount  |   |    |  capital  |   |   | Shares              |   |   | Amount            |    |                    |  (loss) income |   |    |  deficit |   |   |  equity |   |
| Balance at September 30, 2007                                                                              |   |                      | 20,425  |   |               | $      | 204     |                |   | $      | 186,213             |   |   |              | (884    | )                       |                | $      | (8,684  | )             |   | $      | —      |   |   | $ | (40,219 | ) |   | $ | 137,514 |   |
| Net loss                                                                                                   |   |                      | — |   |               |   | — |                |   |   | —             |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | (27,445 | ) |   |   | (27,445 | ) |
| Exercise of stock options                                                                                  |   |                      | 194     |   |               |   | 2       |                |   |   | 1,281               |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | — |   |   |   | 1,283 |   |
| Share-based payment                                                                                        |   |                      | — |   |               |   | — |                |   |   | 2,399               |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | — |   |   |   | 2,399 |   |
| Unrealized loss on            investments                |   |                      | — |   |               |   | — |                |   |   | —             |   |   |              | — |                    |                |   | — |          |   |   | (2,504       | )      |   |   | — |   |   |   | (2,504 | ) |
| Balance at September 30, 2008                                                                              |   |                      | 20,619  |   |               |   | 206     |                |   |   | 189,893             |   |   |              | (884    | )                       |                |   | (8,684  | )             |   |   | (2,504       | )      |   |   | (67,664 | ) |   |   | 111,247 |   |
| Net loss                                                                                                   |   |                      | — |   |               |   | — |                |   |   | —             |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | (11,506 | ) |   |   | (11,506 | ) |
| Exercise of stock options                                                                                  |   |                      | 68      |   |               |   | 1       |                |   |   | 421                 |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | — |   |   |   | 422 |   |
| Share-based payment                                                                                        |   |                      | — |   |               |   | — |                |   |   | 1,509               |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | — |   |   |   | 1,509 |   |
| Repurchase of common            stock                    |   |                      | — |   |               |   | — |                |   |   | —             |   |   |              | (1,565  | )                       |                |   | (11,587 | )             |   |   | —      |   |   |   | — |   |   |   | (11,587 | ) |
| Impact of realized losses transferred from Accumulated Other Comprehensive Income and included in net loss |   |                      | — |   |               |   | — |                |   |   | —             |   |   |              | — |                    |                |   | — |          |   |   | 2,504        |   |   |   | — |   |   |   | 2,504 |   |
| Balance at September 30, 2009                                                                              |   |                      | 20,687  |   |               |   | 207     |                |   |   | 191,823             |   |   |              | (2,449  | )                       |                |   | (20,271 | )             |   |   | —      |   |   |   | (79,170 | ) |   |   | 92,589 |   |
| Net loss                                                                                                   |   |                      | — |   |               |   | — |                |   |   | —             |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | (6,193 | ) |   |   | (6,193 | ) |
| Exercise of stock options                                                                                  |   |                      | 19      |   |               |   | — |                |   |   | 82                  |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | — |   |   |   | 82 |   |
| Share-based payment                                                                                        |   |                      | — |   |               |   | — |                |   |   | 1,508               |   |   |              | — |                    |                |   | — |          |   |   | —      |   |   |   | — |   |   |   | 1,508 |   |
| Repurchase of common           stock                          |   |                      | — |   |               |   | — |                |   |   | —             |   |   |              | (87     | )                       |                |   | (749    | )             |   |   | —      |   |   |   | — |   |   |   | (749 | ) |
|   Unrealized loss on investment                                                                       |   |                      | — |   |               |   | — |                |   |   | —             |   |   |              | — |                    |                |   | — |          |   |   | (1           | )      |   |   | — |   |   |   | (1 | ) |
| Balance at September 30, 2010                                                                              |   |                      | 20,706  |   |               | $      | 207     |                |   | $      | 193,413             |   |   |              | (2,536  | )                       |                | $      | (21,020 | )             |   | $      | (1           | )      |   | $ | (85,363 | ) |   | $ | 87,236 |   |

----

| CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS |
|-----------------------------------------------|

|                                                                                                     |   | Year ended September 30, |    |
|----------------------------------------------------------------------------------------------------------|--------|--------------------------|---------|
| (in thousands)                                                                                           |   | 2010                     |    |   | 2009 |   |   | 2008 |   |
| Net loss                                                                                                 |   | $                        | (6,193  | ) |   | $ | (11,506 | ) |   | $ | (27,445 | ) |
| Other comprehensive (loss) income, net of taxes:                                                         |   |                     |    |   |   |   |   |   |   |   |   |   |
| Investments in marketable securities:                                                                    |   |                     |    |   |   |   |   |   |   |   |   |   |
| Unrealized loss                                                                                          |   |                     | (1      | ) |   |   | — |   |   |   | (2,504 | ) |
| Impact of realized loss transferred from Accumulated Other Comprehensive Income and included in net loss |   |                     | — |   |   |   | 2,504 |   |   |   | — |   |
| Other comprehensive (loss) income                                                                        |   |                     | (1      | ) |   |   | 2,504 |   |   |   | (2,504 | ) |
| Comprehensive loss                                                                                       |   | $                        | (6,194  | ) |   | $ | (9,002 | ) |   | $ | (29,949 | ) |

----

| CONSOLIDATED STATEMENTS OF CASH FLOWS |
|---------------------------------------|

|                                                                         |   | Year ended September 30, |    |
|------------------------------------------------------------------------------|--------|-------------------------------|---------|
| (In thousands)                                                               |   | 2010                          |    |   | 2009 |   |   | 2008 |   |
| CASH FLOWS FROM OPERATING ACTIVITIES:                                        |   |                          |    |   |   |   |   |   |   |
| Net loss                                                                     |   | $                             | (6,193  | ) |   | $ | (11,506 | ) |   | $ | (27,445 | ) |
| Less: Loss from discontinued operations, net                                 |   |                          | (245    | ) |   |   | (6,035 | ) |   |   | (15,401 | ) |
| Loss from continuing operations, net                                         |   |                          | (5,948  | ) |   |   | (5,471 | ) |   |   | (12,044 | ) |
| Non-cash items included in net loss from continuing operations:              |   |                          |    |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                |   |                          | 6,712   |   |   |   | 6,642 |   |   |   | 5,497 |   |
| Provision for doubtful accounts                                              |   |                          | 1,304   |   |   |   | 417 |   |   |   | 239 |   |
| Deferred rent                                                                |   |                          | 388     |   |   |   | — |   |   |   | — |   |
| Share-based compensation                                                     |   |                          | 1,012   |   |   |   | 2,522 |   |   |   | 2,224 |   |
| (Gain) loss on trading investments                                           |   |                          | (31     | ) |   |   | 31 |   |   |   | — |   |
| Gain on sale of equipment                                                    |   |                          | (10     | ) |   |   | — |   |   |   | — |   |
| Other                                                                        |   |                          | 1       |   |   |   | (19 | ) |   |   | 453 |   |
| Net effect of changes in assets and liabilities:                             |   |                          |    |   |   |   |   |   |   |   |   |   |
| Accounts and settlements receivable, net                                     |   |                          | 839     |   |   |   | (6,510 | ) |   |   | 473 |   |
| Prepaid expenses and other assets                                            |   |                          | 629     |   |   |   | (89 | ) |   |   | 261 |   |
| Accounts payable and accrued liabilities                                     |   |                          | (2,681  | ) |   |   | 5,399 |   |   |   | 311 |   |
| Income taxes receivable                                                      |   |                          | 84      |   |   |   | 1 |   |   |   | 19 |   |
| Deferred income                                                              |   |                          | (303    | ) |   |   | (929 | ) |   |   | (859 | ) |
| Cash provided by (used in) operating activities from continuing operations   |   |                          | 1,996   |   |   |   | 1,994 |   |   |   | (3,426 | ) |
| Cash (used in) provided by operating activities from discontinued operations |   |                          | (855    | ) |   |   | (5,187 | ) |   |   | 3,955 |   |
| Cash provided by (used in) by operating activities                           |   |                          | 1,141   |   |   |   | (3,193 | ) |   |   | 529 |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:                                        |   |                          |    |   |   |   |   |   |   |   |   |   |
| Purchases of available-for-sale securities                                   |   |                          | (23,587 | ) |   |   | (38,455 | ) |   |   | (7,325 | ) |
| Sales and maturities of available-for-sale securities                        |   |                          | 19,886  |   |   |   | 36,371 |   |   |   | 33,815 |   |
| Sales of trading securities                                                  |   |                          | 31,200  |   |   |   | 125 |   |   |   | — |   |
| Sales and maturities of restricted investments                               |   |                          | — |   |   |   | 500 |   |   |   | 1,250 |   |
| Purchase of equipment and software                                           |   |                          | (5,244  | ) |   |   | (3,889 | ) |   |   | (1,951 | ) |
| ChoicePay asset purchase net of cash acquired                                |   |                          | — |   |   |   | (6,927 | ) |   |   | — |   |
| Additions to goodwill—ChoicePay                                        |   |                          | (52     | ) |   |   | — |   |   |   | — |   |
| Collection of note receivable                                                |   |                          | 527     |   |   |   | 71 |   |   |   | — |   |
| Proceeds from sale of equipment                                              |   |                          | 10      |   |   |   | — |   |   |   | — |   |
| Cash provided by (used in) investing activities from continuing operations   |   |                          | 22,740  |   |   |   | (12,204 | ) |   |   | 25,789 |   |
| Cash provided by investing activities from discontinued operations           |   |                          | 610     |   |   |   | 818 |   |   |   | 3,678 |   |
| Cash provided by (used in) investing activities                              |   |                          | 23,350  |   |   |   | (11,386 | ) |   |   | 29,467 |   |
| CASH FLOWS FROM FINANCING ACTIVITIES:                                        |   |                          |    |   |   |   |   |   |   |   |   |   |
| Net proceeds from issuance of common stock                                   |   |                          | 82      |   |   |   | 421 |   |   |   | 1,283 |   |
| Purchase of company stock                                                    |   |                          | (749    | ) |   |   | (11,587 | ) |   |   | — |   |
| Capital lease obligations and other financing arrangements                   |   |                          | (36     | ) |   |   | (21 | ) |   |   | (56 | ) |
| Cash (used in) provided by financing activities from continuing operations   |   |                          | (703    | ) |   |   | (11,187 | ) |   |   | 1,227 |   |
| Cash used in financing activities from discontinued operations               |   |                          | — |   |   |   | — |   |   |   | (4 | ) |
| Cash (used in) provided by financing activities                              |   |                          | (703    | ) |   |   | (11,187 | ) |   |   | 1,223 |   |
| Net increase (decrease) in cash and cash equivalents                         |   |                          | 23,788  |   |   |   | (25,766 | ) |   |   | 31,219 |   |
| Cash and cash equivalents at beginning of period                             |   |                          | 21,969  |   |   |   | 47,735 |   |   |   | 16,516 |   |
| Cash and cash equivalents at end of period                                   |   | $                             | 45,757  |   |   | $ | 21,969 |   |   | $ | 47,735 |   |

----

| CONSOLIDATED SUPPLEMENTAL CASH FLOW INFORMATION |
|-------------------------------------------------|

|                                                                                      |   | Year ended September 30, |    |
|-------------------------------------------------------------------------------------------|--------|--------------------------|---------|
| (in thousands)                                                                            |   | 2010                     |    |   | 2009 |   |   | 2008 |   |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:                                        |   |                     |    |   |   |   |   |   |   |
| Cash paid during the period for:                                                          |   |                     |    |   |   |   |   |   |   |
| Interest                                                                                  |   | $                        | 26      |   |   | $ | 14 |   |   | $ | 11 |   |
| Income taxes paid, net                                                                    |   | $                        | 35      |   |   | $ | 38 |   |   | $ | 24 |   |
| SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:                     |   |                     |    |   |   |   |   |   |   |   |   |   |
| Tenant improvement acquired with deferred rent credit                                     |   | $                        | 959     |   |   | $ | — |   |   | $ | — |   |
|  Investments released from restriction                                               |   | $                        | 50      |   |   | $ | — |   |   | $ | 2,415 |   |
|  Equipment acquired under capital lease obligations and other financing arrangements |   | $                        | — |   |   | $ | 116 |   |   | $ | 28 |   |
|  Fair value of ARS Rights                                                            |   | $                        | 3,289   |   |   | $ | 3,289 |   |   | $ | — |   |
|  Receivables from third parties                                                      |   | $                        | — |   |   | $ | 950 |   |   | $ | — |   |
|  Transfer from available-for-sale to trading securities, at par value                |   | $                        | — |   |   | $ | 31,325 |   |   | $ | — |   |
|  Fair value adjustment of trading securities                                         |   | $                        | 3,320   |   |   | $ | 816 |   |   | $ | — |   |
| SUPPLEMENTAL SCHEDULE OF INVESTING ACTIVITIES:                                            |   |                     |    |   |   |   |   |   |   |   |   |   |
|  Purchase price of ChoicePay acquisition                                             |   | $                        | — |   |   | $ | 7,597 |   |   | $ | — |   |
|  Fair value of identifiable net assets acquired                                      |   | $                        | — |   |   | $ | 4,794 |   |   | $ | — |   |
|  Goodwill arising from ChoicePay acquisition                                         |   | $                        | — |   |   | $ | 2,803 |   |   | $ | — |   |

----

| NOTES TO CONSOLIDATED FINANCIAL STATEMENTS |
|--------------------------------------------|

| NOTE 1—NATURE OF OPERATIONS |
|-----------------------------------|

| ·   | Federal—which includes federal income and business tax payments; |
|--------------------|------------------------------------------------------------------------|

| ·   | State and Local—which includes state and local income tax payments and business tax payments; |
|--------------------|-----------------------------------------------------------------------------------------------------|

| ·   | Property Tax— which covers state and local real property tax; |
|--------------------|---------------------------------------------------------------------|

| ·   | Utility; |
|--------------------|----------|

| ·   | Education—which consists of services to post-secondary educational institutions; and |
|--------------------|--------------------------------------------------------------------------------------------|

| ·   | Other—which includes local government fines and fees, motor vehicle registration and payments, rent, insurance, K-12 education meal pay and fee payments, and personal property tax payments. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
|---------------------------------------------------------|

----

----

----

----

----

| NOTE 3—INVESTMENTS |
|--------------------------|

----

|                                             |   | September 30, 2010 |    |   | September 30, 2009     |   |
|--------------------------------------------------|--------|--------------------|---------|--------|------------------------|--------|
| (in thousands)                                   |   | Amortized cost     |    |   | Unrealized gain/(loss) |   |   | Estimated fair value |   |   | Amortized cost |   |   | Net lossimpact |   |   | Estimated fair value |   |
| Short-term investments in marketable securities: |   |               |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Available for sale securities:                   |   |               |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Discount notes                                   |   | $                  | 8,199   |   |                   | $      | — |   |   | $ | 8,199 |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |
| Certificate of Deposit                           |   |               | 50      |   |                   |   | — |   |   |   | 50 |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Treasury bills                                   |   |               | — |   |                   |   | — |   |   |   | — |   |   |   | 4,499 |   |   |   | — |   |   |   | 4,499 |   |
| Total available for sale securities              |   |               | 8,249   |   |                   |   | — |   |   |   | 8,249 |   |   |   | 4,499 |   |   |   | — |   |   |   | 4,499 |   |
|                                             |   |               |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-term investments in marketable securities:  |   |               |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Trading Investments:                             |   |               |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Debt securities (State and local bonds)          |   |               | — |   |                   |   | — |   |   |   | — |   |   |   | 31,200 |   |   |   | (3,320 | ) |   |   | 27,880 |   |
| Auction rate securities Rights Series            |   |               | — |   |                   |   | — |   |   |   | — |   |   |   | — |   |   |   | 3,289 |   |   |   | 3,289 |   |
| Total trading investments                        |   |               | — |   |                   |   | — |   |   |   | — |   |   |   | 31,200 |   |   |   | (31 | ) |   |   | 31,169 |   |
|                                             |   |               |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total investments                                |   | $                  | 8,249   |   |                   | $      | — |   |   | $ | 8,249 |   |   | $ | 35,699 |   |   | $ | (31 | ) |   | $ | 35,668 |   |

| NOTE 4—FAIR VALUE MEASUREMENTS |
|--------------------------------------|

|   Level 1— | Quoted prices in active markets for identical assets or liabilities.  Our Level 1 investments include: money market accounts, U.S. treasury securities, discount notes and commercial paper. |
|-----------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   Level 2— | Inputs other than quoted prices in active markets, that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.  Our Level 2 investments consist of certificates of deposit, which we value at cost. |
|-----------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   Level 3— | Unobservable inputs, for which there is little or no market data for the assets or liabilities.  Our Level 3 investments consisted of auction rate securities and our auction rate securities rights (see Note 3—Investments for more information on these securities), which we valued using the income approach. |
|-----------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Fair value measurements as of September 30, 2010 |   |
|-------------------------------------------------------|--------|
|                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| (in thousands)                                        |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |   | Total |   |
| Cash equivalents:                                     |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Treasury bills                                   |   | $ | 23,514 |   |   | $ | — |   |   | $ | — |   |   | $ | 23,514 |   |
| Money market                                          |   |   | 1,932 |   |   |   | — |   |   |   | — |   |   |   | 1,932 |   |
|                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investments in marketable securities:                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Discount notes                                        |   |   | — |   |   |   | 8,199 |   |   |   | — |   |   |   | 8,199 |   |
| Certificates of deposit                               |   |   | — |   |   |   | 50 |   |   |   | — |   |   |   | 50 |   |
|                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Restricted investments:                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Money market                                          |   |   | 6,000 |   |   |   | — |   |   |   | — |   |   |   | 6,000 |   |
| Certificates of deposit                               |   |   | — |   |   |   | 1,311 |   |   |   | — |   |   |   | 1,311 |   |
|                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                 |   | $ | 31,446 |   |   | $ | 9,560 |   |   | $ | — |   |   | $ | 41,006 |   |

| Fair value measurements as of September 30, 2009 |   |
|--------------------------------------------------|--------|
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| (in thousands)                                   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |   | Total |   |
| Cash equivalents:                                |   |   |   |   |   |   |   |   |   |   |   |   |
| Money market                                     |   | $ | 816 |   |   | $ | — |   |   | $ | — |   |   | $ | 816 |   |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investments in marketable securities:            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Treasury bills                              |   |   | 4,499 |   |   |   | — |   |   |   | — |   |   |   | 4,499 |   |
| Debt securities                                  |   |   | — |   |   |   | — |   |   |   | 27,880 |   |   |   | 27,880 |   |
| Auction Rate Securities Rights                   |   |   | — |   |   |   | — |   |   |   | 3,289 |   |   |   | 3,289 |   |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Restricted investments:                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Money market                                     |   |   | 6,000 |   |   |   | — |   |   |   | — |   |   |   | 6,000 |   |
| Certificates of deposit                          |   |   | — |   |   |   | 1,361 |   |   |   | — |   |   |   | 1,361 |   |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                            |   | $ | 11,315 |   |   | $ | 1,361 |   |   | $ | 31,169 |   |   | $ | 43,845 |   |

----

| (in thousands)                                                                                                             |   | Significant unobservable inputs (Level 3) |    |
|----------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|---------|
| Balance at October 1, 2009                                                                                                 |   | $                                         | 31,169  |   |
| Sale of debt securities                                                                                                    |   |                                      | (31,200 | ) |
| Gain on investments included in earnings                                                                                   |   |                                      | 31      |   |
| Balance at September, 2010                                                                                                 |   | $                                         | — |   |
| Gain included in Other income for the fiscal year ended September 30, 2010 related to assets sold                     |   | $                                         | 31      |   |
|                                                                                                                       |   |                                      |    |   |
|                                                                                                                       |   |                                      |    |   |
| (in thousands)                                                                                                             |   | Significant unobservable inputs (Level 3) |    |
| Balance at October 1, 2008                                                                                                 |   | $                                         | 28,821  |   |
|  Change in temporary valuation adjustment included in Accumulated other comprehensive loss                            |   |                                      | 2,504   |   |
| Loss on investments included in earnings                                                                                   |   |                                      | (3,320  | ) |
| Sale of debt security                                                                                                      |   |                                      | (125    | ) |
| Recognition of ARS rights                                                                                                  |   |                                      | 3,289   |   |
| Balance at September 30, 2009                                                                                              |   | $                                         | 31,169  |   |
| Loss included in Other income for the fiscal year ended September 30, 2009 related to assets held as of September 30, 2009 |   | $                                         | (31     | ) |

| NOTE 5—CUSTOMER CONCENTRATION AND RISK |
|----------------------------------------------|

|                                 |   | Year ended September 30, |   |
|--------------------------------------|--------|--------------------------|--------|
| (in thousands)                       |   | 2010                     |   |   | 2009 |   |   | 2008 |   |
| Revenue                              |   | $                        | 21,763 |   |   | $ | 24,354 |   |   | $ | 32,572 |   |
| Percentage of EPS operations revenue |   |                     | 17.1   | % |   |   | 19.8 | % |   |   | 27.8 | % |

----

| NOTE 6—PROPERTY, EQUIPMENT AND SOFTWARE |
|-----------------------------------------------|

|                                                                 |   | September 30, |   |
|----------------------------------------------------------------------|--------|---------------|--------|
| (in thousands)                                                       |   | 2010          |   |   | 2009 |   |
| Software (a)                                                         |   | $             | 7,961  |   |   | $ | 5,003 |   |
| Computer equipment                                                   |   |          | 6,214  |   |   |   | 4,563 |   |
| Furniture and equipment                                              |   |          | 912    |   |   |   | 1,294 |   |
| Land and building                                                    |   |          | 2,651  |   |   |   | 2,651 |   |
| Leasehold improvements                                               |   |          | 1,356  |   |   |   | 290 |   |
| Total property, equipment and software, gross                        |   |          | 19,094 |   |   |   | 13,801 |   |
| Less: Accumulated depreciation and amortization                      |   |          | (7,062 | ) |   |   | (5,811 | ) |
| Total property, equipment and software, net                          |   | $             | 12,032 |   |   | $ | 7,990 |   |
| (a) Includes internally developed software in development phase |   |

|                                                                             |   | Year ended September 30, |    |
|----------------------------------------------------------------------------------|--------|--------------------------|---------|
| (in thousands)                                                                   |   | 2010                     |    |   | 2009 |   |   | 2008 |   |
| Depreciation and amortization expenses for property, equipment and software:     |   |                     |    |   |   |   |   |   |   |
| Included in Direct costs:                                                        |   |                     |    |   |   |   |   |   |   |
| Software                                                                         |   | $                        | — |   |   | $ | 26 |   |   | $ | 12 |   |
| Property and equipment                                                           |   |                     | — |   |   |   | 47 |   |   |   | 78 |   |
| Total included in Direct costs                                                   |   |                     | — |   |   |   | 73 |   |   |   | 90 |   |
| Included in Depreciation and amortization:                                       |   |                     |    |   |   |   |   |   |   |   |   |   |
| Software                                                                         |   |                     | 767     |   |   |   | 410 |   |   |   | 180 |   |
| Property and equipment                                                           |   |                     | 1,384   |   |   |   | 1,198 |   |   |   | 964 |   |
| Total included in Depreciation and amortization                                  |   |                     | 2,151   |   |   |   | 1,608 |   |   |   | 1,144 |   |
| Total depreciation and amortization expense for property, equipment and software |   | $                        | 2,151   |   |   | $ | 1,681 |   |   | $ | 1,234 |   |

----

| NOTE 7—GOODWILL AND OTHER INTANGIBLE ASSETS |
|---------------------------------------------------|

| (in thousands)                    |   | EPS    |   |   | Wind-down |   |    | Total  |   |
|-----------------------------------|--------|--------|--------|--------|-----------|--------|---------|--------|--------|
| Balance at September 30, 2008     |   | $      | 14,526 |   |      | $      | — |   |   | $ | 14,526 |   |
| ChoicePay, Inc. Asset Purchase    |   |   | 2,803  |   |      |   | — |   |   |   | 2,803 |   |
|                              |   |   |   |   |      |   |    |   |   |   |   |   |
| Balance at September 30, 2009     |   |   | 17,329 |   |      |   | — |   |   |   | 17,329 |   |
| ChoicePay, Inc. earn-out payments |   |   | 52     |   |      |   | — |   |   |   | 52 |   |
|                              |   |   |   |   |      |   |    |   |   |   |   |   |
| Balance at September 30, 2010     |   | $      | 17,381 |   |      | $      | — |   |   | $ | 17,381 |   |

|                                    |                |   | September 30, 2010 |   |   | September 30, 2009       |   |
|-----------------------------------------|---------------------|--------|--------------------|--------|--------|--------------------------|--------|
| (in thousands)                          | Amortization period |   | Gross              |   |   | Accumulated amortization |   |   | Net |   |   | Gross |   |   | Accumulated amortization |   |   | Net |   |
| Client relationships                    | 8-16 years          |   | $                  | 30,037 |   |                     | $      | (24,378 | ) |   | $ | 5,659 |   |   | $ | 30,037 |   |   | $ | (20,557 | ) |   | $ | 9,480 |   |
| Technology and research and development | 5 years             |   |               | 5,618  |   |                     |   | (4,556 | ) |   |   | 1,062 |   |   |   | 5,618 |   |   |   | (4,192 | ) |   |   | 1,426 |   |
| Trademarks                              | 6-10 years          |   |               | 3,463  |   |                     |   | (2,707 | ) |   |   | 756 |   |   |   | 3,463 |   |   |   | (2,331 | ) |   |   | 1,132 |   |
| Other intangible assets, net            |                |   | $                  | 39,118 |   |                     | $      | (31,641 | ) |   | $ | 7,477 |   |   | $ | 39,118 |   |   | $ | (27,080 | ) |   | $ | 12,038 |   |

----

| (in thousands)                    |   | Futureexpense |   |
|-----------------------------------|--------|---------------|--------|
| Years ending September 30,        |   |          |   |
| 2011                              |   | $             | 3,434  |   |
| 2012                              |   |          | 2,940  |   |
| 2013                              |   |          | 587    |   |
| 2014                              |   |          | 134    |   |
| 2015                              |   |          | 100    |   |
| Thereafter                        |   |          | 282    |   |
| Total future amortization expense |   | $             | 7,477  |   |

| NOTE 8—INCOME TAXES |
|---------------------------|

|                             |   | Continuing Operations         |    |   | Discontinued Operations       |   |
|----------------------------------|--------|-------------------------------|---------|--------|-------------------------------|--------|
|                             |   | Year ended September 30, |    |   | Year ended September 30, |   |
| (in thousands)                   |   | 2010                          |    |   | 2009                          |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
| Current income tax provision:    |   |                          |    |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| State                            |   | $                             | 30      |   |                          | $      | 40 |   |   | $ | 87 |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |
| Federal                          |   |                          | — |   |                          |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Total provision for income taxes |   | $                             | 30      |   |                          | $      | 40 |   |   | $ | 87 |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |

|                                    |   | Year ended September 30, |    |
|-----------------------------------------|--------|-------------------------------|---------|
|                                    |   | 2010                          |    |   | 2009 |   |   | 2008 |   |
| U.S. statutory federal tax rate         |   |                          | 34.0    | % |   |   | 34.0 | % |   |   | 34.0 | % |
| State taxes, net of federal tax benefit |   |                          | 4.4     | % |   |   | 2.9 | % |   |   | 4.1 | % |
| Tax exempt interest income              |   |                          | — |   |   |   | — |   |   |   | 0.1 | % |
| Non-deductible expenses                 |   |                          | (0.7    | )% |   |   | (0.7 | )% |   |   | (0.6 | )% |
| Valuation allowance                     |   |                          | (34.7   | )% |   |   | (32.9 | )% |   |   | (34.1 | )% |
| Stock-based compensation                |   |                          | (3.7    | )% |   |   | (4.8 | )% |   |   | (3.6 | )% |
| Other                                   |   |                          | — |   |   |   | 0.8 | % |   |   | (0.6 | )% |
| Effective tax rate                      |   |                          | (0.7    | )% |   |   | (0.7 | )% |   |   | (0.7 | )% |

----

|                                  |   | September 30, |    |
|---------------------------------------|--------|--------------------|---------|
| (in thousands)                        |   | 2010               |    |   | 2009 |   |
| Deferred tax assets:                  |   |               |    |   |   |   |
| Accrued expenses                      |   | $                  | 1,645   |   |   | $ | 1,224 |   |
| Accounts receivable allowance         |   |               | 407     |   |   |   | 13 |   |
| Intangibles                           |   |               | 1,016   |   |   |   | 4,129 |   |
| Other deferred tax assets             |   |               | 1,699   |   |   |   | 1,030 |   |
| Net operating loss carryforward       |   |               | 42,515  |   |   |   | 38,111 |   |
| Valuation allowance                   |   |               | (44,980 | ) |   |   | (43,763 | ) |
| Total deferred tax assets             |   |               | 2,302   |   |   |   | 744 |   |
|                                  |   |               |    |   |   |   |   |   |
| Deferred tax liabilities:             |   |               |    |   |   |   |   |   |
| Investment in subsidiary              |   |               | 286     |   |   |   | 286 |   |
| Depreciation                          |   |               | 159     |   |   |   | 132 |   |
| Other deferred tax liabilities        |   |               | 1,857   |   |   |   | 326 |   |
| Total deferred tax liabilities        |   |               | 2,302   |   |   |   | 744 |   |
|                                  |   |               |    |   |   |   |   |   |
| Net deferred tax assets (liabilities) |   | $                  | — |   |   | $ | — |   |

----

| NOTE 9— COMMITMENTS AND CONTINGENCIES |
|---------------------------------------------|

----

----

| (in thousands)                                                                                                                                                                                                                                |   | Operating leases |   |   | CapitalLeases (1)(2) |   |    | Total  |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------|--------|--------|----------------------|--------|---------|--------|--------|
| Twelve months ending September 30,                                                                                                                                                                                                            |   |             |   |   |                 |   |    |   |   |
| 2011                                                                                                                                                                                                                                          |   | $                | 474    |   |                 | $      | 31      |   |   | $ | 505 |   |
| 2012                                                                                                                                                                                                                                          |   |             | 798    |   |                 |   | 30      |   |   |   | 828 |   |
| 2013                                                                                                                                                                                                                                          |   |             | 804    |   |                 |   | 17      |   |   |   | 821 |   |
| 2014                                                                                                                                                                                                                                          |   |             | 826    |   |                 |   | — |   |   |   | 826 |   |
| 2015                                                                                                                                                                                                                                          |   |             | 805    |   |                 |   | — |   |   |   | 805 |   |
| Thereafter                                                                                                                                                                                                                                    |   |             | 1,880  |   |                 |   | — |   |   |   | 1,880 |   |
| Total minimum lease payments                                                                                                                                                                                                                  |   | $                | 5,587  |   |                 | $      | 78      |   |   | $ | 5,665 |   |
| (1)   On our Consolidated Balance Sheets, the amount due within twelve months is included in Other accrued liabilities. The remainder is included in Other liabilities.(2) Total amount includes interest payments of $1. |   |

| NOTE 10—RELATED PARTY TRANSACTIONS |
|------------------------------------------|

----

| NOTE 11—SEGMENT INFORMATION |
|-----------------------------------|

| (in thousands)                                                                                        |   | EPS    |    |   | Wind-down |   |    | Total  |   |
|-------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|-----------|--------|---------|--------|--------|
| Fiscal year ended September 30, 2010:                                                                 |   |   |    |   |      |   |    |   |   |
| Revenues                                                                                              |   | $      | 127,223 |   |      | $      | 3,001   |   |   | $ | 130,224 |   |
| Costs and expenses:                                                                                   |   |   |    |   |      |   |    |   |   |   |   |   |
| Direct costs                                                                                          |   |   | 97,050  |   |      |   | 1,278   |   |   |   | 98,328 |   |
| General and administrative                                                                            |   |   | 24,821  |   |      |   | 378     |   |   |   | 25,199 |   |
| Selling and marketing                                                                                 |   |   | 6,355   |   |      |   | — |   |   |   | 6,355 |   |
| Depreciation and amortization                                                                         |   |   | 5,625   |   |      |   | 1,086   |   |   |   | 6,711 |   |
| Total costs and expenses                                                                              |   |   | 133,851 |   |      |   | 2,742   |   |   |   | 136,593 |   |
| (Loss) income from continuing operations before     other income and income taxes |   |   | (6,628  | )      |      |   | 259     |   |   |   | (6,369 | ) |
| Other income:                                                                                         |   |   |    |   |      |   |    |   |   |   |   |   |
| Interest income (expense)                                                                             |   |   | 414     |   |      |   | — |   |   |   | 414 |   |
| Gain on investment                                                                                    |   |   | 31      |   |      |   | — |   |   |   | 31 |   |
| Gain on sale of asset                                                                                 |   |   | 6       |   |      |   | — |   |   |   | 6 |   |
| Total other income                                                                                    |   |   | 451     |   |      |   | — |   |   |   | 451 |   |
| (Loss) income from continuing operations before taxes                                                 |   |   | (6,177  | )      |      |   | 259     |   |   |   | (5,918 | ) |
| Income tax provision                                                                                  |   |   | 30      |   |      |   | — |   |   |   | 30 |   |
| (Loss) income from continuing operations                                                              |   | $      | (6,207  | )      |      | $      | 259     |   |   | $ | (5,948 | ) |

----

| (in thousands)                                                                                        |   | EPS    |    |   | Wind-down |   |    | Total  |   |
|-------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|-----------|--------|---------|--------|--------|
| Fiscal year ended September 30, 2009:                                                                 |   |   |    |   |      |   |    |   |   |
| Revenues                                                                                              |   | $      | 123,233 |   |      | $      | 5,013   |   |   | $ | 128,246 |   |
| Costs and expenses:                                                                                   |   |   |    |   |      |   |    |   |   |   |   |   |
| Direct costs                                                                                          |   |   | 93,434  |   |      |   | 2,160   |   |   |   | 95,594 |   |
| General and administrative                                                                            |   |   | 24,509  |   |      |   | 1,020   |   |   |   | 25,529 |   |
| Selling and marketing                                                                                 |   |   | 6,697   |   |      |   | 11      |   |   |   | 6,708 |   |
| Depreciation and amortization                                                                         |   |   | 4,885   |   |      |   | 1,684   |   |   |   | 6,569 |   |
| Total costs and expenses                                                                              |   |   | 129,525 |   |      |   | 4,875   |   |   |   | 134,400 |   |
| (Loss) income from continuing operations before     other income and income taxes |   |   | (6,292  | )      |      |   | 138     |   |   |   | (6,154 | ) |
| Other income (expense):                                                                               |   |   |    |   |      |   |    |   |   |   |   |   |
| Interest income (expense)                                                                             |   |   | 754     |   |      |   | — |   |   |   | 754 |   |
| Loss on investment                                                                                    |   |   | (31     | )      |      |   | — |   |   |   | (31 | ) |
| Total other income                                                                                    |   |   | 723     |   |      |   | — |   |   |   | 723 |   |
| (Loss) income from continuing operations before taxes                                                 |   |   | (5,569  | )      |      |   | 138     |   |   |   | (5,431 | ) |
| Income tax provision                                                                                  |   |   | 40      |   |      |   | — |   |   |   | 40 |   |
| (Loss) income from continuing operations                                                              |   | $      | (5,609  | )      |      | $      | 138     |   |   | $ | (5,471 | ) |

| (in thousands)                                                                               |   | EPS    |    |   | Wind-down |   |    | Total  |   |
|----------------------------------------------------------------------------------------------|--------|--------|---------|--------|-----------|--------|---------|--------|--------|
| Fiscal year ended September 30, 2008:                                                        |   |   |    |   |      |   |    |   |   |
| Revenues                                                                                     |   | $      | 116,641 |   |      | $      | 5,930   |   |   | $ | 122,571 |   |
| Costs and expenses:                                                                          |   |   |    |   |      |   |    |   |   |   |   |   |
| Direct costs                                                                                 |   |   | 91,290  |   |      |   | 3,944   |   |   |   | 95,234 |   |
| General and administrative                                                                   |   |   | 26,932  |   |      |   | 1,088   |   |   |   | 28,020 |   |
| Selling and marketing                                                                        |   |   | 8,486   |   |      |   | 191     |   |   |   | 8,677 |   |
| Depreciation and amortization                                                                |   |   | 3,900   |   |      |   | 1,428   |   |   |   | 5,328 |   |
| Total costs and expenses                                                                     |   |   | 130,608 |   |      |   | 6,651   |   |   |   | 137,259 |   |
| Loss from continuing operations before     other income and income taxes |   |   | (13,967 | )      |      |   | (721    | )      |   |   | (14,688 | ) |
| Other income (expense):                                                                      |   |   |    |   |      |   |    |   |   |   |   |   |
| Interest income (expense)                                                                    |   |   | 2,733   |   |      |   | (2      | )      |   |   | 2,731 |   |
| Total other income (expense)                                                                 |   |   | 2,733   |   |      |   | (2      | )      |   |   | 2,731 |   |
| Loss from continuing operations before taxes                                                 |   |   | (11,234 | )      |      |   | (723    | )      |   |   | (11,957 | ) |
| Income tax provision                                                                         |   |   | 87      |   |      |   | — |   |   |   | 87 |   |
| Loss from continuing operations                                                              |   | $      | (11,321 | )      |      | $      | (723    | )      |   | $ | (12,044 | ) |

----

|                               |   | As of September 30, |    |
|------------------------------------|--------|---------------------|---------|
| (in thousands)                     |   | 2010                |    |   | 2009 |   |
| Continuing Operations:             |   |                |    |   |   |   |
| EPS                                |   | $                   | 112,368 |   |   | $ | 117,920 |   |
| Wind-down                          |   |                | 657     |   |   |   | 2,627 |   |
| Total assets                       |   | $                   | 113,025 |   |   | $ | 120,547 |   |
| Expenditures for long-lived assets |   | $                   | 6,254   |   |   | $ | 5,724 |   |

| NOTE 12—SHAREHOLDERS’ EQUITY |
|------------------------------------------|

| NOTE 13—SHARE-BASED PAYMENT |
|-----------------------------------|

----

|                                                                 |   | September 30, |    |
|----------------------------------------------------------------------|--------|---------------|---------|
|                                                                 |   | 2010          |    |   | 2009 |   |   | 2008 |   |
| Weighted-average assumptions used in Black-Scholes model:            |   |          |    |   |   |   |   |   |   |
| Expected period that options will be outstanding (in years)          |   |          | 5.00    |   |   |   | 5.00 |   |   |   | 5.00 |   |
| Interest rate (based on U.S. Treasury yields at time of grant)       |   |          | 1.40    | % |   |   | 2.02 | % |   |   | 3.52 | % |
| Volatility                                                           |   |          | 45.50   | % |   |   | 45.60 | % |   |   | 42.87 | % |
| Dividend yield                                                       |   |          | — |   |   |   | — |   |   |   | — |   |
| Weighted-average fair value of options granted                       |   | $             | 2.08    |   |   | $ | 2.14 |   |   | $ | 3.98 |   |
| Weighted-average intrinsic value of options exercised (in thousands) |   | $             | 24      |   |   | $ | 81 |   |   | $ | 251 |   |

|                                                      |   |                |   |   | Weighted-average |   |                       |   |
|-----------------------------------------------------------|--------|---------------------|--------|--------|------------------|--------|----------------------------|--------|
| (in thousands, except price and years)                    |   | Shares under option |   |   | Exercise price   |   | Remaining contractual term |   | Aggregate intrinsic value |   |
| Options outstanding at October 1, 2009                    |   |                | 2,359  |   |             | $      | 7.86                       |   |   |   |   |   |
| Granted                                                   |   |                | 400    |   |             |   | 5.06                       |   |   |   |   |   |
| Exercised                                                 |   |                | (19    | )      |             |   | 4.25                       |   |   |   |   |   |
| Forfeitures or expirations                                |   |                | (287   | )      |             |   | 7.84                       |   |   |   |   |   |
| Options outstanding at September 30, 2010                 |   |                | 2,453  |   |             | $      | 7.43                       |   | 7.15 years |   | $ | 508 |   |
| Options vested and expected to vest at September 30, 2010 |   |                | 2,074  |   |             | $      | 7.50                       |   | 6.27 years |   | $ | 388 |   |
| Options exercisable at September 30, 2010                 |   |                | 1,338  |   |             | $      | 7.89                       |   | 6.08 years |   | $ | 144 |   |

|                                                         |   | September 30, 2010 |    |
|--------------------------------------------------------------|--------|--------------------|---------|
|                                                         |   | Payable in shares  |    |   | Payable in cash |   |
| Weighted-average assumptions used in Monte Carlo simulation: |   |               |    |   |   |   |
| Original period over which units vest (in years)             |   |               | 3.00    |   |   |   | 3.00 |   |
| Remaining period that units will be outstanding (in years)   |   |               | 0.58    |   |   |   | 0.58 |   |
| Interest rate (based on U.S. Treasury yield)                 |   |               | 1.98    | % |   |   | 0.20 | % |
| Volatility                                                   |   |               | 39.53   | % |   |   | 46.84 | % |
| Dividend yield                                               |   |               | — |   |   |   | — |   |
| Weighted-average fair value of options granted               |   | $                  | 3.50    |   |   | $ | — |   |

----

| (in thousands)                                              |   | Equity Award |   |   | Liability Award |   |
|-------------------------------------------------------------|--------|--------------|--------|--------|-----------------|--------|
| Expense recognized for fiscal year ended September 30, 2010 |   | $            | 622    |   |            | $      | (195 | ) |
| Expense recognized through September 30, 2010               |   | $            | 1,388  |   |            | $      | 1 |   |
| Estimated expense to be recognized through April 2011*      |   | $            | 363    |   |            | (a)    |   |

|  *   The CEO departed on June 23, 2010. Pursuant to the terms of his employment agreement, these RSUs remain ungranted and are subject to award in the circumstances described in the Enterprise Value Award Plan and related documents.a. Liability awards are revalued at the end of every quarter based on the closing price of our stock on the last day of the quarter and other assumptions noted above as used in the Monte Carlo simulation.  We are unable to estimate the expense expected to be recognized for these awards. |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                |   | Total restricted stock units awarded |   | Vesting date |
|---------------------|--------|-------------------------------------------|--------|--------------|
| 2009 annual meeting |   |                                      | 72,000 |         | March 20, 2012 |
| 2010 annual meeting |   |                                      | 54,000 |         | May 11, 2011 |

| (in thousands)                                              |   | 2010 annual meeting |   |   | 2009 annual meeting |   |
|-------------------------------------------------------------|--------|---------------------|--------|--------|---------------------|--------|
| Expense recognized for fiscal year ended September 30, 2010 |   | $                   | 125    |   |                | $      | 187 | (a) |
| Expense recognized through September 30, 2010               |   | $                   | 125    |   |                | $      | 289 | (a) |
| Estimated expense to be recognized through vesting date     |   | (b)                 |   |   | (b)                 |   |

|  a. This amount includes the $0.1 million recognized related to the acceleration for the two board members not standing for re-election at our 2010 annual meeting.b. Liability awards are revalued at the end of every quarter based on the closing price of our stock on the last day of the quarter.  We are unable to estimate the expense expected to be recognized for these awards. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                         |   | Payable in cash |    |
|--------------------------------------------------------------|--------|-----------------|---------|
| Weighted-average assumptions used in Monte Carlo simulation: |   |            |    |
| Original period over which units vest (in years)             |   |            | 3.00    |   |
| Expected period that units will be outstanding (in years)    |   |            | 1.18    |   |
| Interest rate (based on U.S. Treasury yield)                 |   |            | 0.30    | % |
| Volatility                                                   |   |            | 38.13   | % |
| Dividend yield                                               |   |            | — |   |
| Weighted-average fair value of options granted               |   | $               | 0.55    |   |

| (in thousands)                                              |   | Liability Award |   |
|-------------------------------------------------------------|--------|-----------------|--------|
| Expense recognized for fiscal year ended September 30, 2010 |   | $               | (613   | ) |
| Expense recognized through September 30, 2010               |   | $               | 134    |   |
| Estimated expense to be recognized through December 2011    |   | (a)             |   |

|  (a) Liability awards are revalued at the end of every quarter based on the closing price of our stock on the last day of the quarter and other assumptions noted above as used in the Monte Carlo simulation.  We are unable to estimate the expense expected to be recognized for these awards. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| NOTE 14—DISCONTINUED OPERATIONS |
|---------------------------------------|

|                        |   | Year ended September 30, |    |
|-----------------------------|--------|--------------------------|---------|
| (in thousands)              |   | 2009                     |    |   | 2008 |   |
| Impairment expense          |   |                     |    |   |   |   |
| Goodwill impairment         |   | $                        | — |   |   | $ | 8,790 |   |
| Long-lived asset impairment |   |                     | 2,594   |   |   |   | 8,974 |   |
| Total impairment expense    |   | $                        | 2,594   |   |   | $ | 17,764 |   |

----

|                                        |   | Year ended September 30, |    |
|---------------------------------------------|--------|--------------------------|---------|
| (in thousands)                              |   | 2010                     |    |   | 2009 |   |   | 2008 |   |
| Revenues (Discontinued Operations):         |   |                     |    |   |   |   |   |   |   |
| GBPO                                        |   | $                        | — |   |   | $ | — |   |   | $ | 20,235 |   |
| PSSI                                        |   |                     | — |   |   |   | 4,777 |   |   |   | 24,608 |   |
| Total revenues                              |   | $                        | — |   |   | $ | 4,777 |   |   | $ | 44,843 |   |
| (Loss) income from discontinued operations: |   |                     |    |   |   |   |   |   |   |   |   |   |
| GBPO                                        |   | $                        | — |   |   | $ | (59 | ) |   | $ | 6,448 |   |
| PSSI                                        |   |                     | (573    | ) |   |   | (4,511 | ) |   |   | (21,674 | ) |
| Other/eliminations                          |   |                     | — |   |   |   | — |   |   |   | 757 |   |
| Total (loss) income before taxes            |   | $                        | (573    | ) |   | $ | (4,570 | ) |   | $ | (14,469 | ) |
|  Gain (loss) on disposal               |   |                     |    |   |   |   |   |   |   |   |   |   |
| GBPO                                        |   | $                        | 610     |   |   | $ | (22 | ) |   | $ | (1,028 | ) |
| PSSI                                        |   |                     | (282    | ) |   |   | (1,472 | ) |   |   | 85 |   |
| Other/eliminations                          |   |                     | — |   |   |   | 29 |   |   |   | 11 |   |
| Net loss from discontinued operations       |   | $                        | (245    | ) |   | $ | (6,035 | ) |   | $ | (15,401 | ) |

----

|                                         |   | Year ended September 30, |    |
|----------------------------------------------|--------|--------------------------|---------|
| (in thousands, except per share data)        |   | 2010                     |    |   | 2009 |   |   | 2008 |   |
| Numerator:Loss from:                         |   |                     |    |   |   |   |   |   |   |
| Continuing operations, net of income taxes   |   | $                        | (5,948  | ) |   | $ | (5,471 | ) |   | $ | (12,044 | ) |
| Discontinued operations, net of income taxes |   |                     | (245    | ) |   |   | (6,035 | ) |   |   | (15,401 | ) |
| Net loss                                     |   | $                        | (6,193  | ) |   | $ | (11,506 | ) |   | $ | (27,445 | ) |
| Denominator:                                 |   |                     |    |   |   |   |   |   |   |   |   |   |
| Weighted-average common shares outstanding   |   |                     | 18,153  |   |   |   | 19,438 |   |   |   | 19,616 |   |
| Effects of dilutive common stock options     |   |                     | — |   |   |   | — |   |   |   | — |   |
| Adjusted weighted-average shares             |   |                     | 18,153  |   |   |   | 19,438 |   |   |   | 19,616 |   |
| Loss per basic and diluted share             |   |                     |    |   |   |   |   |   |   |   |   |   |
| From continuing operations                   |   | $                        | (0.33   | ) |   | $ | (0.28 | ) |   | $ | (0.61 | ) |
| From discontinued operations                 |   | $                        | (0.01   | ) |   | $ | (0.31 | ) |   | $ | (0.79 | ) |
| Loss per basic and diluted share             |   | $                        | (0.34   | ) |   | $ | (0.59 | ) |   | $ | (1.40 | ) |

|                                                                         |   | Year ended September 30, |   |
|------------------------------------------------------------------------------|--------|--------------------------|--------|
| (in thousands)                                                               |   | 2010                     |   |   | 2009 |   |   | 2008 |   |
| Weighted-average options excluded from computation of diluted loss per share |   |                     | 1,274  |   |   |   | 1,422 |   |   |   | 1,709 |   |

| NOTE 16—ACQUISITION |
|---------------------------|

----

|                                  |   |
|---------------------------------------|--------|
| (in thousands)                        |   | As of January 27, 2009 |   |
| Assets                                |   |   |   |
| Cash and cash equivalents             |   | $ | 4,552 |   |
| Accounts receivable, net              |   |   | 248 |   |
| Prepaid assets                        |   |   | 140 |   |
| Property, equipment and software, net |   |   | 1,250 |   |
| Other intangible assets, net          |   |   | 3,544 |   |
| Total assets acquired                 |   |   | 9,734 |   |
|                                  |   |   |   |   |
| Liabilities                           |   |   |   |   |
| Settlements payable                   |   |   | 3,892 |   |
| Other accrued liabilities             |   |   | 1,048 |   |
| Total liabilities assumed             |   |   | 4,940 |   |
|                                  |   |   |   |   |
| Net assets acquired                   |   | $ | 4,794 |   |

|                                                     |   | Year ended September 30, |    |
|----------------------------------------------------------|--------|--------------------------|---------|
| (in thousands, except per share data)                    |   | 2009                     |    |   | 2008 |   |
| Revenues—continuing operations                     |   | $                        | 130,472 |   |   | $ | 128,446 |   |
| Net loss—continuing operations                     |   |                     | (7,034  | ) |   |   | (15,781 | ) |
| Net loss                                                 |   |                     | (13,069 | ) |   |   | (31,182 | ) |
| Basic/diluted loss per share—continuing operations |   | $                        | (0.36   | ) |   | $ | (0.80 | ) |
| Basic/diluted loss per share                             |   | $                        | (0.67   | ) |   | $ | (1.59 | ) |

| NOTE 17—RESTRUCTURING |
|-----------------------------|

|                                          |   | Year ended September 30, |   |
|-----------------------------------------------|--------|--------------------------|--------|
| (in thousands)                                |   | 2009                     |   |   | 2008 |   |
| Office closure costs (net of sublease income) |   | $                        | 630    |   |   | $ | 6 |   |
| Severance costs                               |   |                     | 778    |   |   |   | 845 |   |
| Total restructuring liability charges         |   | $                        | 1,408  |   |   | $ | 851 |   |

----

| (in thousands)                |   | Severance |    |   | Facilities closures |    |    | Total  |   |
|-------------------------------|--------|-----------|---------|--------|---------------------|---------|---------|--------|--------|
| Balance at September 30, 2008 |   |  $   | 596     |   |                |  $ | — |   |   |  $ | 596 |   |
| Additions                     |   |      | 778     |   |                |    | 630     |   |   |   | 1,408 |   |
| Cash payments                 |   |      | (1,356  | )      |                |    | (394    | )      |   |   | (1,750 | ) |
| Balance at September 30, 2009 |   |      | 18      |   |                |    | 236     |   |   |   | 254 |   |
| Additions/(reductions)        |   |      | — |   |                |    | (21     | )      |   |   | (21 | ) |
| Cash payments                 |   |      | (18     | )      |                |    | (215    | )      |   |   | (233 | ) |
|                          |   |      |    |   |                |    |    |   |   |   |   |   |
| Balance at September 30, 2010 |   | $         | — |   |                | $       | — |   |   | $ | — |   |

| NOTE 18—SUBSEQUENT EVENTS |
|---------------------------------|

----

| SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) |
|-----------------------------------------------|

|                                                                                                                                                                        |   | 2010 fiscal quarters |    |   | 2009 fiscal quarters |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------|---------|--------|----------------------|--------|
| (In thousands, except per share data)                                                                                                                                       |   | Fourth               |    |   | Third                |   |   | Second |   |   | First |   |   | Fourth |   |   | Third |   |   | Second |   |   | First |   |
| Consolidated statements of operations data:                                                                                                                                 |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenues                                                                                                                                                                    |   | $                    | 27,335  |   |                 | $      | 39,447 |   |   | $ | 30,674 |   |   | $ | 32,768 |   |   | $ | 25,685 |   |   | $ | 44,213 |   |   | $ | 28,608 |   |   | $ | 29,740 |   |
| Costs and expenses:                                                                                                                                                         |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Direct costs                                                                                                                                                                |   |                 | 21,089  |   |                 |   | 30,611 |   |   |   | 22,536 |   |   |   | 24,092 |   |   |   | 19,038 |   |   |   | 33,367 |   |   |   | 20,771 |   |   |   | 22,418 |   |
| General and administrative                                                                                                                                                  |   |                 | 6,730   |   |                 |   | 5,950 |   |   |   | 6,192 |   |   |   | 6,327 |   |   |   | 5,118 |   |   |   | 6,269 |   |   |   | 7,512 |   |   |   | 6,630 |   |
| Selling and marketing                                                                                                                                                       |   |                 | 1,920   |   |                 |   | 1,396 |   |   |   | 1,438 |   |   |   | 1,601 |   |   |   | 1,244 |   |   |   | 2,236 |   |   |   | 1,912 |   |   |   | 1,316 |   |
| Depreciation and      amortization                                                                                                                      |   |                 | 1,798   |   |                 |   | 1,670 |   |   |   | 1,635 |   |   |   | 1,608 |   |   |   | 1,628 |   |   |   | 1,858 |   |   |   | 1,624 |   |   |   | 1,459 |   |
| (Loss) income  from continuing         operations                                                                              |   |                 | (4,202  | )      |                 |   | (180 | ) |   |   | (1,127 | ) |   |   | (860 | ) |   |   | (1,343 | ) |   |   | 483 |   |   |   | (3,211 | ) |   |   | (2,083 | ) |
| Total other income                                                                                                                                                          |   |                 | 22      |   |                 |   | 117 |   |   |   | 173 |   |   |   | 139 |   |   |   | 115 |   |   |   | 163 |   |   |   | 253 |   |   |   | 192 |   |
| (Loss) income from continuing operations before income taxes                                                                                                                |   |                 | (4,180  | )      |                 |   | (63 | ) |   |   | (954 | ) |   |   | (721 | ) |   |   | (1,228 | ) |   |   | 646 |   |   |   | (2,958 | ) |   |   | (1,891 | ) |
| Income tax provision (benefit)                                                                                                                                              |   |                 | 18      |   |                 |   | 157 |   |   |   | (145 | ) |   |   | — |   |   |   | 37 |   |   |   | 1 |   |   |   | 1 |   |   |   | 1 |   |
|  (Loss) income  from continuing          operations                                                                  |   |                 | (4,198  | )      |                 |   | (220 | ) |   |   | (809 | ) |   |   | (721 | ) |   |   | (1,265 | ) |   |   | 645 |   |   |   | (2,959 | ) |   |   | (1,892 | ) |
| (Loss) income from discontinued operations, net                                                                                                                             |   |                 | (306    | )      |                 |   | (180 | ) |   |   | 295 |   |   |   | (54 | ) |   |   | 37 |   |   |   | (408 | ) |   |   | (2,402 | ) |   |   | (3,262 | ) |
| Net (loss) income                                                                                                                                                           |   | $                    | (4,504  | )      |                 | $      | (400 | ) |   | $ | (514 | ) |   | $ | (775 | ) |   | $ | (1,228 | ) |   | $ | 237 |   |   | $ | (5,361 | ) |   | $ | (5,154 | ) |
| Weighted average shares issued and outstanding:                                                                                                                             |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                                                                                                                       |   |                 | 18,153  |   |                 |   | 18,151 |   |   |   | 18,151 |   |   |   | 18,156 |   |   |   | 19,438 |   |   |   | 19,458 |   |   |   | 19,711 |   |   |   | 19,735 |   |
| Diluted                                                                                                                                                                     |   |                 | 18,153  |   |                 |   | 18,151 |   |   |   | 18,151 |   |   |   | 18,156 |   |   |   | 19,438 |   |   |   | 19,597 |   |   |   | 19,711 |   |   |   | 19,735 |   |
| Performance ratios:                                                                                                                                                         |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Return on average assets                                                                                                                                                    |   |                 | (3.85   | )%     |                 |   | (0.32 | )% |   |   | (0.42 | )% |   |   | (0.66 | )% |   |   | (1.00 | )% |   |   | 0.18 | % |   |   | (4.05 | )% |   |   | (3.78 | )% |
| Return on average shareholders'      equity                                                                                                             |   |                 | (5.05   | )%     |                 |   | (0.44 | )% |   |   | (0.56 | )% |   |   | (0.84 | )% |   |   | (1.27 | )% |   |   | 0.23 | % |   |   | (5.05 | )% |   |   | (4.68 | )% |
| Total ending equity to total      ending assets                                                                                                         |   |                 | 77.18   | %      |                 |   | 75.30 | % |   |   | 72.13 | % |   |   | 77.58 | % |   |   | 79.66 | % |   |   | 78.89 | % |   |   | 79.87 | % |   |   | 80.54 | % |
| Total average equity to total average assets                                                                                                                                |   |                 | 76.21   | %      |                 |   | 73.68 | % |   |   | 74.76 | % |   |   | 76.62 | % |   |   | 79.25 | % |   |   | 79.38 | % |   |   | 80.21 | % |   |   | 80.77 | % |
| Per share of common stock data:                                                                                                                                             |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (Loss) earnings per share—Basic & Diluted:                                                                                                                        |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Continuing operations(1)                                                                                                                                                    |   | $                    | (0.23   | )      |                 | $      | (0.01 | ) |   | $ | (0.04 | ) |   | $ | (0.04 | ) |   | $ | (0.06 | ) |   | $ | 0.03 |   |   | $ | (0.15 | ) |   | $ | (0.10 | ) |
| Discontinued operations(1)                                                                                                                                                  |   | $                    | (0.02   | )      |                 | $      | (0.01 | ) |   | $ | 0.01 |   |   | $ | 0.00 |   |   | $ | 0.00 |   |   | $ | (0.02 | ) |   | $ | (0.12 | ) |   | $ | (0.16 | ) |
| (Loss) earnings per share—Basic & Diluted                                                                                                                         |   | $                    | (0.25   | )      |                 | $      | (0.02 | ) |   | $ | (0.03 | ) |   | $ | (0.04 | ) |   | $ | (0.06 | ) |   | $ | 0.01 |   |   | $ | (0.27 | ) |   | $ | (0.26 | ) |
| Book value per share                                                                                                                                                        |   | $                    | 4.81    |   |                 | $      | 5.03 |   |   | $ | 5.03 |   |   | $ | 5.04 |   |   | $ | 4.76 |   |   | $ | 5.18 |   |   | $ | 5.24 |   |   | $ | 5.53 |   |
|                                                                                                                                                                        |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average balance sheet data:                                                                                                                                                 |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets                                                                                                                                                                |   | $                    | 117,114 |   |                 | $      | 123,894 |   |   | $ | 122,234 |   |   | $ | 117,055 |   |   | $ | 122,477 |   |   | $ | 129,077 |   |   | $ | 132,435 |   |   | $ | 136,397 |   |
| Total liabilities                                                                                                                                                           |   | $                    | 27,861  |   |                 | $      | 32,606 |   |   | $ | 30,851 |   |   | $ | 25,031 |   |   | $ | 25,409 |   |   | $ | 26,617 |   |   | $ | 26,205 |   |   | $ | 26,230 |   |
| Total shareholders' equity                                                                                                                                                  |   | $                    | 89,253  |   |                 | $      | 91,288 |   |   | $ | 91,383 |   |   | $ | 92,024 |   |   | $ | 97,068 |   |   | $ | 102,460 |   |   | $ | 106,230 |   |   | $ | 110,167 |   |
| Market price per share of common stock:                                                                                                                                     |   |                 |    |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| High                                                                                                                                                                        |   | $                    | 6.90    |   |                 | $      | 8.58 |   |   | $ | 8.32 |   |   | $ | 9.00 |   |   | $ | 8.90 |   |   | $ | 7.90 |   |   | $ | 6.39 |   |   | $ | 7.57 |   |
| Low                                                                                                                                                                         |   | $                    | 4.53    |   |                 | $      | 5.99 |   |   | $ | 7.10 |   |   | $ | 7.43 |   |   | $ | 7.10 |   |   | $ | 4.35 |   |   | $ | 4.48 |   |   | $ | 3.41 |   |
| (1) The sum of quarterly per share amounts may not equal annual per share amounts as the quarterly calculations are based on varying number of shares of common stock. |   |

----

| SCHEDULE II |
|-------------|

| VALUATION AND QUALIFYING ACCOUNTS |
|-----------------------------------|

|  (in thousands)                   |   | Balance at beginning of period |   |   | Additions/ (reductions) |   |   | Write-offs |   |   | Balance atend of period |   |
|----------------------------------------|--------|--------------------------------|--------|--------|-------------------------|--------|--------|------------|--------|--------|-------------------------|--------|
| Year ended September 30, 2010:         |   |                           |   |   |                    |   |   |       |   |   |                    |   |
| Allowance for receivables              |   | $                              | 388    |   |                    | $      | 1,304  |       |   | $      | (622                    | )      |   | $ | 1,070 |   |
| Allowance for sales returns            |   |                           | 131    |   |                    |   | 529    |       |   |   | (613                    | )      |   |   | 47 |   |
| Deferred tax asset valuation allowance |   |                           | 43,763 |   |                    |   | 1,217  |       |   |   | —                 |   |   |   | 44,980 |   |
|                                   |   |                           |   |   |                    |   |   |       |   |   |                    |   |   |   |   |   |
| Year ended September 30, 2009:         |   |                           |   |   |                    |   |   |       |   |   |                    |   |   |   |   |   |
| Allowance for receivables              |   | $                              | 346    |   |                    | $      | 417    |       |   | $      | (375                    | )      |   | $ | 388 |   |
| Allowance for sales returns            |   |                           | 95     |   |                    |   | 374    |       |   |   | (338                    | )      |   |   | 131 |   |
| Deferred tax asset valuation allowance |   |                           | 36,698 |   |                    |   | 7,065  |       |   |   | —                 |   |   |   | 43,763 |   |
|                                   |   |                           |   |   |                    |   |   |       |   |   |                    |   |   |   |   |   |
| Year ended September 30, 2008:         |   |                           |   |   |                    |   |   |       |   |   |                    |   |   |   |   |   |
| Allowance for receivables              |   | $                              | 1,195  |   |                    | $      | (557   | )          |   | $      | (292                    | )      |   | $ | 346 |   |
| Allowance for sales returns            |   |                           | 273    |   |                    |   | 208    |       |   |   | (386                    | )      |   |   | 95 |   |
| Deferred tax asset valuation allowance |   |                           | 28,875 |   |                    |   | 7,823  |       |   |   | —                 |   |   |   | 36,698 |   |
| Inventory allowance                    |   |                           | 75     |   |                    |   | 390    |       |   |   | (465                    | )      |   |   | — |   |
|                                   |   |                           |   |   |                    |   |   |       |   |   |                    |   |   |   |   |   |

----

| ·   | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

|   | Financial Statements – The financial statements are set forth under Item 8 of this Annual Report on Form 10-K.  See Financial Statements and Supplementary Data on page 36. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Financial Statement Schedules – Schedule II—Valuation and Qualifying Accounts is set forth under Item 8 of this Annual Report on Form 10-K on page 71.  All other schedules have been omitted because they were either not required or not applicable or because the information is otherwise included. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Exhibits |
|--------|----------|

| Exhibit number | Exhibit description                                                                                                                                                                                                  |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.1            | Purchase and Sale Agreement between Tier Technologies, Inc. and Informatix, Inc., dated June 30, 2008 (1)                                                                                                            |
| 2.2            | Asset Purchase Agreement between Tier Technologies, Inc., Cowboy Acquisition Company and ChoicePay, Inc., dated as of January 13, 2009 (2)                                                                           |
| 3.1            | Restated Certificate of Incorporation (3)                                                                                                                                                                            |
| 3.2            | Amended and Restated Bylaws of Tier Technologies, Inc., as amended (4)                                                                                                                                               |
| 4.1            | Form of common stock certificate (3)                                                                                                                                                                                 |
| 4.2            | See Exhibits 3.1 and 3.2, for provisions of the Restated Certificate of Incorporation and Amended and Restated Bylaws, as amended of the Registrant defining rights of the holders of common stock of the Registrant |
| 10.1           | Amended and Restated 1996 Equity Incentive Plan, dated January 28, 1999 (5)*                                                                                                                                    |
| 10.2           | Form of Incentive Stock Option Agreement under the Registrant’s Amended and Restated 1996 Equity Incentive Plan (6)*                                                                                           |
| 10.3           | Form of Nonstatutory Stock Option Agreement under the Registrant’s Amended and Restated 1996 Equity IncentivePlan (6)*                                                                                         |
| 10.4           | Amended and Restated 2004 Stock Incentive Plan (7)*                                                                                                                                                                  |
| 10.5           | Form of Incentive Stock Option Agreement under the Registrant’s Amended and Restated 2004 Stock Incentive Plan (7)*                                                                                            |
| 10.6           | Form of Nonstatutory Stock Option Agreement under the Registrant’s Amended and Restated 2004 Stock Incentive Plan (7)*                                                                                    |
| 10.7           | Form of Restricted Stock Agreement under the Registrant’s Amended and Restated 2004 Stock Incentive Plan (7)*                                                                                                  |
| 10.8           | Form of California Indemnification Agreement (8)                                                                                                                                                                     |
| 10.9           | Form of Delaware Indemnification Agreement for officers (9)                                                                                                                                                          |
| 10.10          | Form of Delaware Indemnification Agreement for directors (9)                                                                                                                                                         |
| 10.11          | Tier Corporation 401(k) Plan, Summary Plan Description (8)*                                                                                                                                                          |
| 10.12          | Supplemental Indemnity Agreement by and between Registrant and Bruce R. Spector, dated September 2, 2004 (10)*                                                                                                  |
| 10.13          | Amended and Restated Credit and Security Agreement between the Registrant, Official Payments Corporation, EPOS Corporation and City National Bank dated March 6, 2006 (11)                                           |
| 10.14          | Employment Agreement between Tier Technologies, Inc., and Ronald L. Rossetti, dated July 26, 2006 (12)*                                                                                                              |
| 10.15          | Non-Statutory Stock Option Agreement between Tier and Ronald L. Rossetti, dated July 26, 2006 (12)*                                                                                                                  |
| 10.16          | Option Grants awarded to Charles Berger, Morgan Guenther, and fifteen other employees, dated August 24, 2006 (13)*                                                                                                   |
| 10.17          | First Amendment to Amended and Restated Credit and Security Agreement dated March 20, 2007 between the Registrant, Official Payments Corporation, EPOS Corporation and City National Bank (14)                       |
| 10.18          | Second Amendment to Amended and Restated Credit and Security Agreement dated September 26, 2007 between the                                                                                                     |

----

|  Exhibit number |  Exhibit description                                                                                                                                                                                   |
|----------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                 | Registrant, Official Payments Corporation, EPOS Corporation and City National Bank (15)                                                                                                                     |
| 10.19                | Share Repurchase Agreement between CPAS Systems, Inc., Tier Ventures Corporation and Tier Technologies, Inc. dated June 29, 2007 (16)                                                                       |
| 10.20                | Employment Agreement between Tier Technologies, Inc. and Ronald L. Rossetti, dated April 30, 2008. (17)*                                                                                                    |
| 10.21                | Employment Agreement between Tier Technologies, Inc. and Keith Kendrick, dated June 30, 2008 (18)*                                                                                                          |
| 10.22                | Employment Agreement between Tier Technologies, Inc. and Ronald W. Johnston, dated July 1, 2008 (18)*                                                                                                       |
| 10.23                | Third Amendment to Amended and Restated Credit and Security Agreement between Tier Technologies, Inc., Official Payments Corporation, EPOS Corporation and City National Bank dated September 29, 2008 (19) |
| 10.24                | Employment Agreement between Tier Technologies, Inc. and Nina K. Vellayan, dated September 22, 2008 (20)                                                                                                    |
| 10.25                | Enterprise Value Award Plan Amendment to Reflect Supplemental Award dated December 4, 2008 between Tier Technologies, Inc. and Ronald L. Rossetti (21)*                                                     |
| 10.26                | Tier Technologies, Inc. Executive Performance Stock Unit Plan (22)*                                                                                                                                         |
| 10.27                | Employment Agreement between Tier Technologies, Inc. and Keith Omsberg, effective as of May 6, 2009 (23)*                                                                                                   |
| 10.28                | Renewal Letter: Short Clear Extension of Termination Date between Tier Technologies, Inc., Official Payments Corporation, EPOS Corporation and City National Bank (24)                                      |
| 10.29                | Amendment of Solicitation/Modification of Contract No. 0001 dated October 30, 2009 between the Internal Revenue Service and Official Payments Corporation (25)                                              |
| 10.30                | Amendment of Solicitation/Modification of Contract No. 0002 dated January 4, 2010 between the Internal Revenue Service and Official Payments Corporation (25)                                               |
| 10.31                | Amendment of Solicitation/Modification of Contract No. 0003 dated March 29, 2010 between the Internal Revenue Service and Official Payments Corporation (25)                                                |
| 10.32                | Amendment of Solicitation/Modification of Contract No. 0004 dated March 30, 2010 between the Internal Revenue Service and Official Payments Corporation (25)                                                |
| 10.33                | Amendment of Solicitation/Modification of Contract No. 0005 dated April 15, 2010 between the Internal Revenue Service and Official Payments Corporation (25)                                                |
| 10.34                | Deed of Lease agreement between Tier Technologies, Inc. and Sunrise Campus Investors, LLC, dated December 9, 2009. (26)                                                                                |
| 10.35                | Agreement dated as of January 8, 2010 among Giant Investment, LLC, Parthenon Investors II, L.P., PCap Partners II, LLC, PCap II, LLC, John C. Rutherford, and Tier Technologies, Inc. (27)                  |
| 10.36                | Agreement dated February 25, 2010 among Discovery Equity Partners, L.P., Discovery Group I, LLC, Daniel J. Donoghue, and Michael R. Murphy and Tier Technologies, Inc. (28)                                 |
| 10.37                | Fourth Amendment to Amended and Restated Credit and Security Agreement dated January 14, 2010 between Tier Technologies, Inc., Official Payments Corporation and City National Bank. (29)                   |
| 10.38                | Letter Agreement dated July 15, 2010 between Charles W. Berger and Tier Technologies, Inc. (30)                                                                                                             |
| 10.39                | Employment Agreement between Tier Technologies, Inc. and Alex P. Hart, dated August 10, 2010 (31)                                                                                                           |
| 10.40                | First amendment to Employment Agreement between Tier Technologies, Inc and Alex P. Hart, dated August 13, 2010 (32)                                                                                         |
| 10.41                | Severance Agreement and Release of Claims dated August 17, 2010 between Nina Vellayan and Tier Technologies, Inc. (33)                                                                                      |
| 10.42                | Amendment of Solicitation/Modification of Contract No. 0006 dated July 12, 2010 between the Internal Revenue Service and Official Payments Corporation † ‡                                      |
| 10.43                | Letter of amendment to Employment Agreement dated August 31, 2010, between Ronald W. Johnston and Tier Technologies, Inc. †*                                                                          |
| 10.44                | Letter of amendment to Employment Agreement dated November 3, 2010, between Keith Omsberg and Tier Technologies, Inc. †*                                                                              |
| 10.45                | Employment Agreement between Tier Technologies, Inc. and Atul Garg, dated October 19, 2010 †*                                                                                                         |

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|  Exhibit number                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  Exhibit description                                                                                                                                 |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.46                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Nonstatutory Stock Option Agreement for Inducement Grant between Tier Technologies, Inc. and Alex P. Hart †*                                        |
| 10.47                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Incentive and Nonstatutory Stock Option Agreement between Tier Technologies, Inc. and Alex P. Hart †*                                               |
| 21.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Subsidiaries of the Registrant †                                                                                                                    |
| 23.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Consent of McGladrey & Pullen, LLP, Independent Registered Public Accounting Firm †                                                             |
| 31.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Certification of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934 †          |
| 31.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Certification of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934 †          |
| 32.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 † |
| 32.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 † |
| * Management contract or compensatory plan required to be filed as an exhibit to this report† Filed as an exhibit to this report‡ Confidential treatment requested as to certain portions, which portions were omitted and filed separately with the Securities and Exchange Commission pursuant to a Confidential Treatment Request. (1) Filed as an exhibit to Form 10-Q, filed July 7, 2008, and incorporated herein by reference(2) Filed as an exhibit to Form 8-K, filed on January 20, 2009, and incorporated herein by reference  (3) Filed as an exhibit to Form 8-K, filed on July 19, 2005, and incorporated herein by reference  (4) Filed as an exhibit to Form 8-K, filed on February 24, 2009, and incorporated herein by reference  (5) Filed as an exhibit to Form 10-Q, filed May 11, 2001, and incorporated herein by reference  (6) Filed as an exhibit to Form 8-K, filed November 12, 2004, and incorporated herein by reference  (7) Filed as an exhibit to Form 8-K, filed July 5, 2005 and incorporated herein by reference  (8) Filed as an exhibit to Form S-1 (No. 333-37661), filed on October 10, 1997, and incorporated herein by reference(9) Filed as an exhibit to Form 10-K, filed December 14, 2007, and incorporated herein by reference(10) Filed as an exhibit to Form 10-K, filed December 28, 2004, and incorporated herein by reference(11) Filed as an exhibit to Form 8-K, filed March 9, 2006, and incorporated herein by reference(12) Filed as an exhibit to Form 8-K, filed August 1, 2006, and incorporated herein by reference(13) Filed as a Form 8-K, filed August 29, 2006, and incorporated herein by reference(14) Filed as an exhibit to Form 8-K, filed March 28, 2007, and incorporated herein by reference(15) Filed as an exhibit to Form 8-K, filed September 27, 2007, and incorporated herein by reference(16) Filed as an exhibit to Form 8-K, filed July 3, 2007, and incorporated herein by reference(17) Filed as an exhibit to Form 10-Q, filed May 6, 2008, and incorporated herein by reference(18) Filed as an exhibit to Form 8-K, filed July 7, 2008, and incorporated herein by reference(19) Filed as an exhibit to Form 8-K, filed October 3, 2008, and incorporated herein by reference(20) Filed as an exhibit to Form 10-K, filed December 8, 2008, and incorporated herein by reference(21) Filed as an exhibit to Form 10-Q, filed May 11, 2009, and incorporated herein by reference(22) Filed as a Form 8-K, filed January 22, 2009, and incorporated herein by reference(23) Filed as an exhibit to  Form 8-K, filed May 19, 2009, and incorporated herein by reference(24) Filed as an exhibit to Form 10-K, filed November 10, 2009, and incorporated herein by reference(25) Filed as an exhibit to Form 10-K/A (Amendment 3), filed June 22, 2010 and incorporated herein by reference(26)Filed as an exhibit to Form 10-Q, filed February 9, 2010, and incorporated herein by reference(27) Filed as an exhibit to Form 8-K, filed January 11, 2010, and incorporated herein by reference(28) Filed as an exhibit to Form 8-K, filed March 1, 2010, and incorporated herein by reference(29) Filed as an exhibit to Form 10-Q, filed May 10, 2010, and incorporated herein by reference(30) Filed as an exhibit to Form 8-K, filed July 19, 2010, and incorporated herein by reference(31) Filed as an exhibit to Form 8-K, filed August 11, 2010, and incorporated herein by reference(32) Filed as an exhibit to Form 8-K, filed August 18, 2010, and incorporated herein by reference(33) Filed as an exhibit to Form 8-K, filed August 18, 2010, and incorporated herein by reference |

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|                                 | TIER TECHNOLOGIES, INC. |
|--------------------------------------|------------------------------|
| Dated:   November 22, 2010 |   By:              |   /s/ ALEX P. HART Alex P. HartPresident, Chief Executive Officer |

| Signature                                       | Title                                                                                        | Date              |
|-------------------------------------------------|----------------------------------------------------------------------------------------------|-------------------|
|                                            |                                                                                         |              |
| /s/ ALEX P. HART Alex P. Hart                   | President, Chief Executive Officer  (principal executive officer)                  | November 22, 2010 |
|  /s/ RONALD W. JOHNSTON Ronald W. Johnston |  Chief Financial Officer (principal financial officer and principal accounting officer) | November 22, 2010 |
|  /s/ CHARLES W. BERGER Charles W. Berger   |   Director                                                                         | November 22, 2010 |
|  /s/ JOHN J. DELUCCA John J. Delucca       |   Director                                                                         | November 22, 2010 |
|  /s/ MORGAN P. GUENTHER Morgan P. Guenther |   Director                                                                         | November 22, 2010 |
|  /s/ PHILIP G. HEASLEY Philip G. Heasley   |   Director                                                                         | November 22, 2010 |
|  /s/ DAVID A. POE David A. Poe             |   Director                                                                         | November 22, 2010 |
|  /s/ RONALD L. ROSSETTI Ronald L. Rossetti |   Director                                                                         | November 22, 2010 |
|  /s/ ZACHARY F. SADEK Zachary F. Sadek     |   Director                                                                         | November 22, 2010 |

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