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                                   FORM 10-K

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

/x/  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

                    For the Fiscal Year Ended June 30, 1999
                                       OR
/ /  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934 [FEE REQUIRED]
     For the Transition Period From____________to__________ Commission File
     Number 0-9993

                              MICROS SYSTEMS, INC.
                              --------------------

             (Exact name of registrant as specified in its charter)

                    Maryland                                52-1101488
                    --------                                ----------
         State or other jurisdiction of                  (I.R.S. Employer
         Incorporation or organization                 Identification No.)

              12000 Baltimore Avenue
               Beltsville, Maryland                         20705-1291
               --------------------                         ----------
     (Address of principal executive offices)               (Zip Code)

        Registrant's telephone number, including area code: 301-210-6000

          Securities registered pursuant to Section 12(b) of the Act:

                                      None

          Securities registered pursuant to Section 12(g) of the Act:

                    Common Stock, Par Value $.025 per share
                    ---------------------------------------
                                (Title of Class)

     Indicate by a check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                        Yes x      No
                           ----      ----

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. /_/

     At the close of business on August 31, 1999, there were issued and
outstanding 16,280,645, shares of Registrant's Common Stock at $.025 par value.
At such time the aggregate market value of the Registrant's Common Stock held
by nonaffiliates of the Registrant was $549,471,769.

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                      DOCUMENTS INCORPORATED BY REFERENCE

     Portions of the Proxy Statement for the 1999 Annual Meeting of
Shareholders, currently scheduled to be held on November 19, 1999, and to be
filed with the Commission pursuant to Regulation 14A of the Securities Exchange
Act of 1934, are incorporated by reference in Part III of this Form 10-K.

                                     PART I

ITEM 1.  BUSINESS

INTRODUCTION

     MICROS Systems, Inc. was incorporated in the State of Maryland in 1977 as
Picos Manufacturing, Inc. and, in 1978, changed its name to MICROS Systems,
Inc. (References to "MICROS" or the "Company" herein include the operations of
MICROS Systems, Inc. and its subsidiaries on a consolidated basis.) MICROS is a
leading worldwide designer, manufacturer, marketer and servicer of enterprise
information solutions for the global hospitality industry. The information
solutions consist of application specific software and hardware systems,
supplemented by services. The hospitality industry includes numerous defined
market segments such as lodging (including individual hotel sites, hotel
central reservation systems and customer information systems), table service
restaurants, quick service restaurants, entertainment venues such as stadiums
and arenas, business foodservice operations, transportation foodservice, and
cruise ships.

     MICROS's enterprise solutions are comprised of two major areas: (1) hotel
information systems; and (2) restaurant information systems. In addition to its
software enterprise solutions and hardware products, MICROS offers an extensive
array of support services and products for its hotel and restaurant information
systems. The hotel information systems consists of software encompassing
property management systems ("PMS"), central reservation systems ("CRS"), and
customer information systems ("CIS"). The restaurant information systems
consist of hardware and software for point-of-sale ("POS") and operational
applications.

     The Company's hotel information systems are installed worldwide in leading
hotel chains such as Marriott International, Radisson, Hilton International
(United Kingdom), Wyndham, Starwood, Ciga (Italy), Forte (United Kingdom),
Thistle (United Kingdom), Inter*Continental, Kempinski (Germany), Mandarin
Oriental (Hong Kong), Movenpick (Switzerland), Peninsula (Hong Kong), Ramada
Europe, Shangri-La International (Hong Kong) and Steigenberger (Germany).
Worldwide, there are currently over 7,500 MICROS PMS installations. The MICROS
CRS is installed in hotel chains such as Best Western International, Westin,
Wyndham, Concorde (France), Equatorial (Malaysia), First (Sweden), Oberoi
(India), Pan Pacific (Singapore), Rydges (Australia), Sokos (Finland), Stocks &
Stocks (South Africa), Sun International (South Africa), Thistle and Tourast
(Australia). The MICROS CIS has been sold to Concorde, Equatorial, First,
Scandic (Sweden), Rydges, Pernas (Singapore), Peninsula, Hilton, Hilton
International, Mandarin Oriental, Sun International, Sokos, Tourast, Oberoi and
Pan Pacific.

     MICROS's restaurant POS systems are installed worldwide. Major table
service restaurant chain customers include T.G.I. Friday's, Cracker Barrel,
Metromedia Restaurant Group, Perkins, Don Pablo's, La Madeleine, Host Services,
Aramark, Planet Hollywood, Ruby Tuesday's, Hard Rock Cafe, and Whitbread PLC
(United Kingdom). Major quick service chain restaurant ("QSR") customers
include numerous franchisees of Burger King, Arby's, various franchisees of
Tricon Global Restaurants, Inc. (Pizza Hut, KFC International, and Taco Bell),
Grandy's, Red Rooster (Australia), Subway, and Wendy's. Most of MICROS's QSR
installations are franchisees. MICROS's POS systems are also installed in hotel
restaurants in chains such as Marriott International, Hilton, Forte, Starwood,
Hyatt, Inter*Continental, Mandarin Oriental, Radisson, Delta (Canada), and
Ritz-Carlton. Additional significant markets for the Company's POS systems
include casinos, cruise ships, sports arenas, airport concourses, theme parks,
recreational centers, institutional food service organizations and specialty
retail shops. The Company has installed large POS systems in the Foxwood Hotel
and Casino (Ledyard, CT), Grand Casino (Australia), Luxor Hotel and Casino, MGM
Grand Hotel Casino and Theme Park, Mirage Casino, Bellagio and The Venetian,
the latter five casinos being located in Las Vegas, Nevada.

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PRODUCTS AND SERVICES

Hotel Information Systems

     For the hotel marketplace, MICROS develops, markets and distributes a
complete line of hotel software products and services. The hotel information
systems include property management systems ("PMS"), central reservation
systems ("CRS"), customer information systems ("CIS"), Internet based hotel
reservations services and support services. The PMS software provides for
reservations, guest accounting, sales and catering applications, travel agent
accounting, engineering management, and interfaces to central reservations and
global distribution systems. The CRS software allows hotels to coordinate,
process, track and analyze worldwide hotel customer reservations at a central
facility for electronic distribution to the appropriate lodging site. The CIS
software allows hotels to efficiently capture and track relevant information of
guests. The systems run on industry standard Intel-based personal computers
("PCs"). MICROS also offers an internet based hotel reservation service, called
hotelBANK, through a majority owned subsidiary called Fidelio Nordic Sverige
A.B., located in Stockholm, Sweden.

     MICROS markets its hotel products under the MICROS-Fidelio brand name. The
MICROS-Fidelio Suite operates on the Microsoft DOS operating system and
utilizes Novell's networking software. The systems run on an industry standard
Intel-based PC. In June 1997, MICROS-Fidelio introduced a version of the
MICROS-Fidelio Suite, called Version 7.0, which utilizes the Microsoft Windows
95 graphical user interface and an Oracle database. To date, over 800 sites are
installed with Version 7.0. MICROS has over 7,500 installations worldwide in
both international hotel chains and independent hotel/resort properties. The
Front Office PMS product is closely integrated with MICROS POS systems for
table service restaurants, including the option for a guest folio print and
check-out from the Company's 8700 HMS order entry terminal in a hotel
restaurant. MICROS plans on introducing an additional suite of MICROS-Fidelio
PMS products in fiscal 2000. These products are part of its Opera suite of
products, all of which will run on an Oracle database and operate on various
industry standard operating systems. MICROS also markets modified
MICROS-Fidelio PMS products and POS products specifically for the cruise ship
industry.

     In the fourth quarter of fiscal 1998, MICROS released the 3500 Front Desk
System ("FDS"). The 3500 FDS is a hotel PMS product designed for small to
mid-size hotels. The 3500 FDS operates under Microsoft's Windows 95/NT
operating system with a Sybase database. It is touchscreen based, and can
operate on MICROS's PCWS or industry standard Intel-based PCs. The product is
marketed through MICROS's direct and indirect distribution channels. To date,
MICROS has over 180 sites installed with the 3500 FDS.

Restaurant Information Systems

     MICROS's restaurant systems include point-of-sale ("POS") application
software encompassing transaction control, restaurant operations, accounting
data, interfaces to other systems, communications, hardware and support
services. Depending on the product installed, the systems run on either
proprietary or industry standard Intel-based PCs. During fiscal 1999, MICROS
introduced the Restaurant Enterprise Series ("RES") software suite. RES is a
software suite of products that encompass point-of-sale transaction control,
restaurant operations, data analysis, and communications. The POS software
constitutes the front-end application for the 3700, 3400 and 2800 POS systems.
The restaurant operations modules constitute the Enterprise Office suite. The
software modules include inventory, product forecasting, labor management, and
enterprise data management. These modules are designed to operate at a
restaurant site. For management of multiple restaurants, the RES includes a
suite of software products called Enterprise Management. This suite allows for
data to be transmitted to a remote site (including a corporation's
headquarters) for data collection and analysis. Additionally, changes such as
pricing and menus can be made at a remote site and downloaded to specified
restaurant locations. The Restaurant Enterprise Series is an important
component of MICROS's strategy to fully integrate point-of-sale transaction
processing with other restaurant operational and management functions.

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     The Company's restaurant POS systems for the table service/leisure and
entertainment markets are the 8700 Hospitality Management System ("HMS"), the
3700 POS system, and the 2700 and 2800 HMS (a version of the 2700 HMS). For the
quick service market, MICROS offers the 2400 Fast Food System and the 3400
Quick Service Advantage System. The Company also offers the MICROS PC
Workstation ("PCWS"), an Intel-based microprocessor personal computer, for sale
in both hospitality and non-hospitality markets. The PCWS is designed to
withstand the rigors of a restaurant environment.

     The 8700 HMS, released in September 1993, is designed for table service
and quick service restaurants in hotels, resorts, casinos, airports,
stadiums/arenas, theme parks and larger independent and chain restaurants. It
allows the user the flexibility to configure the system around various hardware
and software choices to control restaurant and food service operations at both
the server and management levels. Features of the 8700 HMS include customized
workstations, such as a flat keyboard and touchscreen, flexible guest check
printing, time and attendance capability, check tracking by table or check,
credit card authorization, extensive revenue center and system-wide reporting
(which analyzes sales mix, sales balancing, serving periods, table turns, time
periods, food cost and operator accountability), the ability to split checks
into multiple checks and hardware diagnostic and software confidence tests. The
8700 HMS POS product has an open systems architecture which allows its use on
an industry standard Intel-based PC as the server with the order entry
terminals being either the Company's proprietary order entry POS terminal
hardware or standard PCs. The 8700 HMS utilizes the SCO UNIX operating system,
which permits multi-tasking and multi-user operations. This architecture gives
it the ability to manage any size restaurant or food service operation.

     The 3700 POS, released in October 1996, is designed for table service
restaurants. It has an open systems architecture as it operates under
Microsoft's Windows 95/NT operating systems, utilizes either Microsoft's SQL or
Sybase's relational databases, and runs on an industry standard Intel-based
PCs. It utilizes a touchscreen, Microsoft Windows based graphical user
interface. Over 4,500 licenses have been sold since the product was introduced.
Its functionality is similar to the MICROS 8700 HMS.

     The 2700 HMS, of which the first version was released in March 1989, is a
stand-alone intelligent terminal designed for table service restaurants, both
large and small. The 2700 HMS, available in both an entry level and premium
configured platform, relies on proprietary terminal architecture and interfaces
with Microsoft's DOS/Windows, Intel-based PC back office software systems. The
2700 HMS Touchscreen System, released in September 1991, combines touchscreen
technology with the Company's 2700 HMS POS system. It offers an easy-touch
electronic keypad with up to 60 entry points that can be customized according
to size and characters, dual LCD screens to speed order entry and reduce
operator error, PC compatibility, lead-through prompting and reprogramming of
the system software and keyboards through remote communications via phone
lines. In 1999, a version of the 2700 HMS was released under the name 2800 HMS.
The 2800 HMS incorporates the feature set of the 2700 HMS, Version 5.0, but has
the ability to utilize the restaurant operations software developed for the
3700 POS.

     For quick service restaurants, MICROS markets the 2400 Fast Food System
("FFS") and the 3400 Quick Service Advantage  ("QSA") System.  The MICROS 2400
FFS, released in October 1991, features a proprietary, networked intelligent
terminal architecture.  A remote printer and video screen subsystem accommodate
a wide variety of kitchen production and order routing schemes.  The system's
application software addresses quick service requirements in the areas of order
entry, drive-thru operations, inventory tracking, employee timekeeping/labor
tracking and data communications and produces a variety of management reports
through an interface with back office, PC based software systems.  MICROS
offers a back office management information systems software package called the
2400 Manager Workstation Plus ("MWS+").  The MWS+ software, released in June
1995, and subsequently modified with additional features, is a PC-based
software product which provides for management analysis of sales and
operational trends at quick service restaurants, both at the store and
corporate levels, and permits the integration of point-of-sale functions with
in-store back office, regional and home office management information system
functions.  The 3400 QSA, released in October 1997, has an open system
architecture as it operates under Microsoft's Windows 95/NT operating systems,
utilizes Microsoft's Access database, and runs on an industry standard Intel-
based microprocessor PC.  Its functionality is similar to the 2400 FFS.  MICROS
purchased a perpetual license to the source code from a third party in 1999,
pursuant to which it maintains full and unrestricted development rights to the
product.

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     The Company's design architecture allows existing users of many MICROS POS
products to access new technologies and applications in conjunction with their
existing MICROS POS system. In addition, many MICROS products interface with
various back office accounting and property management systems, including the
Company's hotel PMS products.

Services

      MICROS provides a wide range of service products and services to its
customers. Products include spare parts, media supplies (ribbons, paper, etc.),
active power-line conditioners and uninterruptable power supplies. Services
include installation, operator and manager training, on-site hardware
maintenance, application software support, credit card software support,
systems configuration, network support and consulting. In fiscal 1996, MICROS
commenced the implementation of a customer service management system developed
by Clarify Inc. The company continues to develop and enhance this system. MICROS
uses the Clarify system to provide support of its POS and PMS products and
services for the United States, United Kingdom and Germany. The system supports
approximately 70% of worldwide sales.

     MICROS provides hardware and software maintenance via a combination of its
direct, indirect, and third party service providers, including Inacom
Corporation (which merged with Vanstar Corporation in 1999). MICROS operates a
help desk seven days a week, 24 hours per day in its Beltsville headquarters
facilities. This central support operation receives support calls from
customers and addresses them on-line or dispatches a service call to the
appropriate local service provider. Internationally, in-country support is
provided by the local sales entity, whether it be a MICROS subsidiary or
distributor. MICROS maintains support centers in Neuss, Germany, Buenos Aires,
Argentina and Sydney, Australia. MICROS's corporate customer service, which is
located in Beltsville, provides back-up support for its regional centers.

     MICROS believes that its services are an important competitive factor and
differentiator in customer purchasing decisions. Service revenue constituted
approximately 35% of MICROS's total revenues in each of fiscal years 1999, 1998
and 1997.

SALES, MARKETING AND DISTRIBUTION

     The Company considers its direct and indirect global distribution network
a major strength. This network has been built over the past 22 years. The
Company, its U.S. based dealers, and international distributors work closely
together in seeking to identify new customers, products, services and markets,
as well as to serve the Company's existing customer base with enhanced products
and services.

     The Company's products are sold primarily through two channels: (i) the
Direct Sales Channel, comprised of the Company's owned sales distribution
network consisting of both domestic (9) and foreign sales operations (22), and
the MICROS major account program directed to designated regional, national, and
international customers; and (ii) the Indirect Sales Channel, an independent
sales distribution network consisting of approximately 87 U.S. dealers and 67
international distributors.

     Foreign sales, including export sales from the United States, accounted for
approximately 51%, 54%, and 51% of the Company's total revenue in fiscal 1999,
1998 and 1997, respectively.

RESEARCH AND DEVELOPMENT

     The products sold by the Company are subject to rapid and continual
technological change. Accordingly, the Company must continually develop
innovative systems incorporating the newest technologies. Products available
from the Company, as well as its competitors, have increasingly offered a wider
range of features and capabilities.

     The Company conducts its core POS product software and hardware
development at its corporate headquarters in Beltsville, Maryland. To
facilitate rapid responses for various regional application needs outside the
United States, MICROS conducts software development in its Neuss, Germany and
Kuala Lumpur, Malaysia support offices. In addition, the Company continually
examines and evaluates software and hardware products and designs

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created by third parties and has acquired and may in the future acquire rights
to such products and designs.

     In fiscal 1998, MICROS started using the hardware design services of SCI
Systems, Inc. ("SCI"). This outsourcing allowed the Company to reduce its
internal staff of designers while increasing its capacity to design new
hardware platforms. MICROS still retains an in-house design capability. See
also Manufacturing in Part I of this Form 10-K.

     MICROS-Fidelio hotel PMS, CRS, and CIS development is primarily conducted
in Naples, Florida. This office has a staff of over one hundred people. The
office became the primary development center upon the closure of MICROS's
Munich office. The Company moved most of the development to Naples while the
remaining resources were relocated to MICROS's Neuss, Germany office. In
addition to the Neuss office, additional software development is conducted in
Stockholm, Sweden and Tel Aviv, Israel. The multi-location development base
allows MICROS flexibility in conducting software development on a
cost-effective basis maximizing utilization of existing personnel. MICROS
maintains close relationships with major software operating and database
companies such as Oracle, Novell, Sybase, and Microsoft. These relationships
are important to MICROS so it can readily incorporate software changes from
these companies into its products. MICROS's international offices may also
conduct specific product enhancement activities to meet specific interface
needs, local requirements, and customer requests.

     Research and development expenses (exclusive of capitalized software
development costs), which consist primarily of labor costs, amounted to $14.4
million, $14.0 million and $11.2 million for fiscal years 1999, 1998 and 1997,
respectively. Actual research and development expenditures, including
capitalized software development costs of $7.9 million, $9.1 million and $4.3
million for fiscal years 1999, 1998 and 1997, respectively, amounted to $22.3
million, $23.1 million and $15.5 million for fiscal years 1999, 1998 and 1997,
respectively.

COMPETITION

     The Company believes that its competitive strengths include its
established global distribution and service network, its ability to offer a
broad array of hardware, software and service products to the hospitality
industry and its corporate focus on providing information systems solutions
principally to the hospitality industry.

     The markets in which the Company competes are highly competitive. There
are worldwide at least 40 competitors that offer some form of sophisticated POS
system similar to the Company's and over 100 PMS competitors. Competitors in
the POS marketplace include full service providers such as Eltrax (Squirrel
POS), Panasonic, Positouch, Infogenesis, Ibertech (Aloha POS), Hospitality
Solutions International, GEAC, NCR (Compris POS), Radiant Systems, Tridex
(Progressive POS), Par Technology and hardware providers such as IBM, NCR, and
Javelin, who market their products in conjunction with independent software
vendors. There are also numerous smaller companies that license their
POS-oriented software with PC-based systems in regional markets.

     Many of the over 100 competitors in the PMS market are small companies
with software designed to run on industry standard PCs. There are, however,
various major competitors including Eltrax (Lodgistix and Encore PMS), MAI
Systems, REZsolutions, GEAC, Springer-Miller, and property management systems
developed and marketed by major hotel chains for their corporate-owned
operations and franchisees.

     The CRS market is highly fragmented, with most central reservation systems
being customized systems for each hotel chain or allied reservation group. The
competitors in this market consist of in-house development efforts by chains,
property management competitors such as REZsolutions, Springer-Miller, and
specialized central reservation providers such as Travel Services
International, WizCom International, Pegasus, and JC Penney Telemarketing. The
market for central reservation systems is highly competitive.

    MICROS believes that the CIS market has various competitors. Those that
offer such a product are generally smaller companies targeting specialized
segments of the market. However, most of the systems in place today are
customized solutions developed by specific chains for their own use. These
customized systems are thus not marketed to other hotel chains. The CIS market
is relatively new, and thus the future growth and direction of such is
uncertain.

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MANUFACTURING

     The Company's manufacturing program seeks to maintain flexibility and
reduce costs by emphasizing the strategic outsourcing of key products and
subassemblies. Pursuant to an agreement with SCI Systems, Inc., of Huntsville,
Alabama, MICROS contracts to have its POS terminals, PCWS terminals, and
certain communication boards manufactured by SCI. The Company entered into this
non-exclusive agreement in order to lower its manufacturing costs, expand the
availability of POS and PCWS terminals, and to improve product quality.

     The decision to outsource the Company's manufacturing was based upon an
extensive analysis of projected long-term product costs, current and projected
terminal demand relative to internal manufacturing capacity, targeted product
quality levels, and internal design and manufacturing capabilities. The
analysis indicated that MICROS could potentially obtain desired products from
SCI at a lower cost than the Company could produce. SCI also had sufficient
assembly capacity to meet MICROS's forecasted sales demand, and was capable of
achieving targeted product quality levels. MICROS retains a limited
manufacturing capability of certain products. While MICROS believes that there
are entities other than SCI that could provide manufacturing capabilities, any
default by SCI or disruption in its manufacturing process could have a
short-term material adverse impact on the operations of MICROS.

     Material sourcing is based on availability, service, cost, delivery and
quality of the purchased items from domestic and international suppliers. Some
items are custom manufactured to the Company's design specifications. MICROS
believes that the loss of its current sources for components would not have a
material adverse effect on the Company's business since other sources of supply
are generally available. The Company believes it maintains good relationships
with its suppliers.

EMPLOYEES

     As of June 30, 1999, the Company had approximately 1,952 full-time
employees. Approximately 958, or 49% of these employees are based in the United
States, with the majority of this group based in the Company's Beltsville,
Maryland headquarters, and the balance of this group employed principally at
the Company's regional district offices and its product development facility in
Naples, Florida. Approximately 711, or 36% of the Company's employees are
employed in Europe/Africa/Middle East. The remaining 283 international
employees, or 15% of the total, are employed in the Pacific Rim and elsewhere,
in offices including those located in Hong Kong, Singapore, Malaysia and
Australia. On an aggregate basis, the Company had approximately 1,623 employees
in sales/marketing, customer support services and administration and finance;
250 employees in product development; and 79 employees in operations. The
Company is not a party to any collective bargaining agreement and, except as
where mandated by law, none of its employees is represented by a labor union.
MICROS believes its relations with its employees to be good.

FOREIGN SALES AND FOREIGN MARKET RISK

     The Company recorded foreign sales, including exports from the United
States, of approximately $171,585,000 during fiscal 1999 to customers located
primarily in Europe, Africa, the Middle East, Australia, Asia, and Canada.
Comparable sales in fiscal 1998 were $150,023,000 and in fiscal 1997 were
approximately $117,115,000. See Management's Discussion and Analysis of
Financial Condition and Results of Operations for discussion of the Company's
currency mix with regard to revenues. See Note 14 of Notes to Consolidated
Financial Statements for additional geographic data.

     The Company has experienced rapid growth internationally. MICROS's
significant international business and presence does expose the Company to
certain market risks, such as currency, interest rate and political risks. With
respect to currency risk, the Company transacts business in over 24 different
currencies through its foreign subsidiaries. The fluctuation of currencies
impacts sales and profitability. Frequently, sales and the costs associated
with such sales are not always denominated in the same currency. Given the fact
that the Company transacts business in many different currencies, adverse
declines in certain currencies can be offset by favorable advances in other
currencies. While the Company has not to date invested in financial instruments
designed to protect against currency fluctuations, the Company will continue to
evaluate the need to do so in the future.

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     Additionally, the Company is subject to interest rate fluctuations in
foreign countries to the extent that the Company elects to borrow in the local
foreign currency. In the past, this has not been an issue of concern as the
Company has the capacity to elect to borrow in other currencies with more
favorable interest rates. While the Company has not to date invested in
financial instruments designed to protect against interest rate fluctuations,
the Company will continue to evaluate the need to do so in the future.

     Finally, the Company is subject to political risk, especially in
developing countries with uncertain or unstable political structures or
regimes. The Company is also subject to the effects of, and changes in, laws
and regulations, other activities of governments, agencies and similar
organizations, especially in light of the current weak Asian economic
conditions, which may prompt certain legislative reform. The Company does not
believe at this time that it is exposed to unusual political risk that could
have a material adverse impact on the Company.

PATENTS

     The Company holds no patents and believes that its competitive position is
not materially dependent upon patent protection. The technology used in the
design and manufacture of most of the Company's hardware products is generally
known and available to others. With respect to the Company's software products,
it relies on nondisclosure agreements, and an array of U.S. and foreign
copyright laws for protection. In the U.S. and in most countries, it is
believed that both statutory and common law provides the Company with a certain
level of protection. Notwithstanding the above, there is a risk that third
party entities, including competitors, could attempt to misappropriate the
Company's intellectual property. Given this potential risk, the Company has
implemented certain procedures to monitor misappropriation of its intellectual
property.

FLUCTUATIONS AND CUSTOMERS

     The Company's quarterly operating results have varied in the past and may
vary in the future depending upon such factors as the timing of new product
introductions, changes in the pricing and promotion policies of the Company and
its competitors, market acceptance of new products and enhanced versions of
existing products and the capital expenditure budgets of its customers.
Moreover, the Company has experienced increased seasonality of its business,
given the continued increase of international sales. In particular, with the
European summer holiday, the Company generally anticipates lower sales volume
in the first fiscal quarter relative to other quarters. Additionally, with the
relative slowdown in corporate buying at the beginning of the calendar year,
which is MICROS's third fiscal quarter, revenue growth in the third quarter
over the preceding second quarter may not equal the Company's overall fiscal
year-to-year growth rate. Nonetheless, the Company believes that
quarter-to-quarter historic comparisons of its results are not necessarily
meaningful or indicative of future performance.

     No single customer accounts for 10% or more of the Company's consolidated
revenues, nor is any portion of the Company's business subject to renegotiation
of profits or termination of contracts or subcontracts at the election of the
U.S. Federal Government.

ENVIRONMENTAL MATTERS

     The Company believes that it is in compliance in all material respects
with all applicable environmental laws and does not anticipate that such
compliance will have a material effect on its future capital expenditures,
earnings or competitive position with respect to any of its operations.

BACKLOG

     The Company generally has a backlog of approximately one month's revenue,
substantially all of which is cancelable at any time prior to shipment, although
historically few orders have been canceled. As of June 30, 1999 and 1998, the
backlog totaled approximately $44.3 million and $26.7 million respectively.

OTHER

     The Company currently has a $45.0 million multi-currency unsecured
committed line of credit with Bank of America expiring on December 31, 1999.
Prior to this upcoming expiration date, the Company anticipates that it will
renew this line of credit for an additional one-year period. This line of credit

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was increased from $35.0 million to $45.0 million pursuant to an amendment
entered into on December 15, 1998. The Company has the one-time option to
convert the line of credit into a three-year secured term loan upon expiration
of the line of credit. Interest due under the line of credit will be calculated
as follows: (i) in the event the advance is in U.S. dollars, at the option of
the Company, either the bank's prime rate minus one half of one percent (.50%)
per annum, or the LIBOR rate plus one and one eighth percent (1.125%) per
annum; or (ii) in the event the advance is made in a currency other than the
U.S. dollar, the LIBOR rate for the applicable denominated currency selected,
plus one and one eighth percent (1.125%) per annum. Interest due under the
three-year secured term loan shall be, at the option of the Company, the prime
rate or the treasury bill rate (adjusted to a constant maturity of three years)
plus two and one quarter percent (2.25%). Under the terms of the current loan
agreement, the Company may borrow up to $45.0 million less the amount of
outstanding letters of credit. Amounts outstanding under the line are payable
on demand and are not secured by the assets of the Company. The agreement
requires the Company to satisfy certain financial covenants. In addition, the
agreement limits the assumption of additional indebtedness and restricts the
Company's payment of dividends other than stock dividends.

     During fiscal 1997 MICROS maintained three unsecured committed lines of
credit with BFH Bank, Hypobank and Commerzbank. The Company no longer maintains
lines of credit with BHF Bank and Hypobank, effective May 31, 1997. It has
retained its credit relationship with Commerzbank and during fiscal 1998
amended and increased its credit facility with this bank so that the Company's
borrowing limit was increased from DM 7.0 million to DM 15.0 million
(approximately $7.9 million at the June 30, 1999 exchange rate) and the Company
may borrow in the form of either a line of credit or term debt. Under the
Commerzbank credit facility, the Company has a balance of DM 10.0 million
(approximately $5.3 million at the June 30, 1999 exchange rate) in the form of
balloon debt and has no line of credit borrowings (see Notes 5 and 6 of Notes
to Consolidated Financial Statements).

     The Company initially borrowed DM 30.0 million under the Bank of America
line of credit in connection with the Company's acquisition of Fidelio Software
in November 1995. During fiscal 1997, 1998 and 1999, the Company reduced its
Bank of America balance by borrowing on three occasions from Commerzbank. As of
June 30, 1999, the Company had discharged in full all amounts borrowed under the
Bank of America line of credit. The Company has approximately $47.6 million
available under these credit agreements.

     Certain MICROS foreign subsidiaries maintain additional lines of credit,
none of which is considered material.

RECENT DEVELOPMENTS

     On September 8, 1999, the Company and Mr. A.L. Giannopoulos, the Company's
President and Chief Executive Officer, entered into the third Amendment (the
"Amendment") to Employment Agreement (the "Agreement") dated June 1, 1995. The
Amendment extends the term of the Agreement for a three-year period, with the
Agreement as amended expiring on June 30, 2005. The Amendment also provides for
salary and target bonuses for the three-year extension period.

BUSINESS AND INVESTMENT RISKS; INFORMATION RELATING TO FORWARD-LOOKING
STATEMENTS

     The Company has experienced rapid revenue growth at a rate that it
believes has significantly exceeded that of the global market for point-of-sale
computer systems and property management information systems products for the
hospitality industry. Although the Company currently anticipates continued
revenue growth at a rate in excess of such market, and therefore an increase in
its overall market share, it does not expect to maintain growth at historic
levels, and there can be no assurance that any particular level of growth can
be achieved. In addition, due to the competitive nature of the market, the
Company continues to experience gross margin pressure on its products and
service offerings, and the Company expects product and service margins to
decline. There can be no assurance that the Company will be able to continue to
increase sufficiently sales of its higher margin products, including software,
to prevent future declines in the Company's overall gross margin.

     Moreover, MICROS's financial results in any single quarter are dependent
upon the timing and size of customer orders and the shipment of products for
large orders. Large software orders from customers may account for more

                                       9

<PAGE>   10

than an insignificant portion of earnings in any quarter. The customers with
whom MICROS does the largest amount of business are expected to vary from year
to year as a result of the timing for the roll-out of each customer's system.
Furthermore, if a customer delays or accelerates its delivery requirements or a
product's completion is delayed or accelerated, revenues expected in a given
quarter may be deferred or accelerated into subsequent or earlier quarters.

     The market price of MICROS Common Stock is volatile, and may be subject to
significant fluctuations in response to variations in MICROS's quarterly
operating results and other factors such as announcements of technological
developments or new products by MICROS, customer roll-outs, technological
advances by existing and new competitors, and general market conditions in the
hospitality industry. In addition, conditions in the stock market in general
and shares of technology companies in particular have experienced significant
price and volume fluctuations which have at times been unrelated to the
operating performance of companies.

     The statements contained herein not based on historic facts are
forward-looking statements, within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended, that involve risks and uncertainties. Past performance is not
necessarily a strong or reliable indicator of future performance. Actual
results could differ materially from past results, estimates, projections, or
forward looking statements made by, or on behalf of, MICROS. Primary risks are
disclosed in the Company's press releases and periodic SEC filings. Some of the
additional risks and uncertainties include the following:

-- MICROS's actions in connection with continued and increasing price and
product competition in many product areas, including but not limited to PC
Workstations, and the impact on sales margins for those items;

-- Difficulties or delays in the development, production, testing and marketing
of products, including a failure to deliver new products and technologies when
scheduled, announced or generally anticipated; the failure of customers to
accept these products or technologies when planned; any defects in products;
MICROS's inability to differentiate its products; and a failure of
manufacturing efforts, whether internal or through MICROS's third party
manufacturing entities;

-- Implementation of a cost-effective service structure capable of servicing
increasingly complex software systems in increasingly more remote locations;
additional costs and expenses associated with servicing and supporting open
systems, which generally incorporate third party software products (the support
and service of which may be more difficult and costly);

-- Unanticipated manufacturing, supply, service or labor difficulties
experienced by certain large MICROS vendors, including Inacom Corporation and
SCI Systems, Inc., resulting in a disruption or discontinuation of the services
or products provided to MICROS;

--The technological risks of large customer roll-outs, especially where the
contracts involve new technology such as the MICROS-Fidelio integrated hotel
information system known as Opera, or third party software; and installation of
which the customer requires MICROS to provide;

-- The outcome of various international political and governmental efforts to
stabilize economic conditions in Asia; China's actions with respect to the
valuation of its currency; the potential that the weak economic conditions in
Southeast Asia could spread to other countries where MICROS conducts and
anticipates further generation of business, including Australia, Singapore,
Malaysia, China and Japan;

-- Because more than half of MICROS's sales are outside the U.S., MICROS's
results could be significantly affected by weak economic conditions in
countries in which it does business, and emerging markets in which there tend
to be significant growth, and by changes in foreign currency exchange rates
affecting those countries;

-- The ability of MICROS to recruit and retain engineers and other
highly-skilled personnel, especially in light of increasingly tight labor
markets in the technology industry;

-- Controlling expenses associated with the rapid expansion of the Company's
infrastructure necessitated by increase in sales volume;

                                       10

<PAGE>   11

-- Although MICROS attempts to protect its proprietary technology through a
combination of trade secrets, patent and copyright law, nondisclosure
agreements and technical measures, such protection may not preclude competitors
from developing products with features similar to MICROS's products;

-- The costs and other effects of legal and administrative cases and
proceedings, settlements and investigations, claims, and changes in those
items, and developments or assertions by or against MICROS relating to
intellectual property rights and intellectual property licenses;

-- The effects of, and changes in, laws and regulations, other activities of
governments, agencies and similar organizations, especially in light of the
current weak Asian economic conditions, which may prompt certain legislative
reform;

-- Unanticipated impact of Year 2000 issues, particularly the failure of
products from major suppliers to function properly in the Year 2000;
unanticipated Year 2000 software defects and/or litigation expenses, including
suits where MICROS is named as a result of MICROS products interfacing to third
party non-compliant products;

-- Unanticipated impact of issues relating to the adoption and implementation
of a common currency, the Euro, by the European Economic and Monetary Union;
unanticipated litigation expenses relating to the adoption and implementation
of the Euro, including suits where MICROS is named as a result of MICROS
products interfacing to third party non-compliant products.

ITEM 2.  PROPERTIES

     The Company's executive offices and main administrative and manufacturing
facilities are currently located in Beltsville, Maryland. The Company conducts
sales, marketing, customer support and product development activities for its
POS operations at this location. The MICROS-Fidelio hotel group's headquarters,
where the Company conducts a significant portion of the PMS sales, marketing
and customer support activities, has been relocated and consolidated from
Munich, Germany to Neuss, Germany. Currently, the Company leases approximately
31,000 feet in a Neuss office building pursuant to a lease agreement expiring
in May 2003, with an option to renew for an additional five-year term.

     The Beltsville, Maryland campus is comprised of the following four
buildings: (i) 12000 Baltimore Avenue, which is approximately 60,000 square
feet under lease by the Company pursuant to a lease agreement expiring January
31, 2000, with the right to renew month to month; (ii) 12050 Baltimore Avenue,
which is approximately 90,000 square feet, with approximately 72,355 under
lease by the Company pursuant to a lease agreement expiring March 31, 2000;
(iii) 6900 Virginia Manor Road, in which 36,700 square feet is leased by the
Company pursuant to a lease agreement expiring September 30, 2001; and (iv)
11950 Baltimore Avenue, in which 8,600 square feet is leased by the Company
pursuant to a lease agreement expiring March 31, 2000.

     Over the past year, MICROS had amended the above leases in anticipation of
its move to a new corporate headquarters in the Spring of 2000. In July 1998,
MICROS entered into a construction agreement and a lease agreement
(collectively, the "Orix Agreements") with Orix Columbia, Inc., a wholly-owned
subsidiary of Orix USA Corporation. In accordance with the terms of the Orix
Agreements, Orix has commenced construction of a 250,000 square foot building
located on a twenty acre parcel in Columbia, Maryland. It is anticipated that
construction will be completed in March 2000. Orix will continue to own the
facility. The new facility shall serve as the new worldwide corporate
headquarters for MICROS, allowing MICROS to exit the facilities in Beltsville,
Maryland.

     The Orix Agreements commit MICROS to lease all 250,000 square feet from
Orix, for a ten-year period commencing upon completion of the facility. The
Orix Agreements also provide MICROS with the right to demand the construction
of a new building adjacent to the new corporate headquarters building, thereby
providing MICROS with expansion space, if subsequently required.

     The cost per square foot on a fully operational basis of the new facility
is approximately 15% greater than the average cost per square foot of the
existing Beltsville facilities. Total lease expenditures for Maryland offices
will increase, as the aggregate amount of space to which the Company has
committed has

                                       11

<PAGE>   12

increased. The amount of required space has increased (and it is anticipated
will continue to increase) as a result of the growth the Company has and
expects to continue to experience. Moreover, as actual lease liabilities for
the new facility are computed on the basis of the actual costs of the
construction of the facility, the final cost of the rent may vary from current
projections. Finally, MICROS anticipates incurring certain one-time expenses
associated with its relocation to the new facility. These one-time relocation
expenses may range between $800,000 and $1,300,000.

     To satisfy other sales, service and support, and product development
needs, the Company leases space in twelve cities domestically, including
Boston, Chicago, Los Angeles and other major metropolitan areas, and in over
twenty cities worldwide, including London, Paris, Kuala Lumpur, Sydney and Hong
Kong.

     In general, the Company believes that additional space will be available
as needed.

ITEM 3.  LEGAL PROCEEDINGS

     MICROS is and has been involved in legal proceedings arising in the normal
course of business. The Company is of the opinion, based upon presently
available information and the advice of counsel concerning pertinent legal
matters, that any resulting liability should not have a material adverse effect
on the Company's results of operations or financial position.

     On March 25, 1997, Budgetel Inns, Inc. ("Budgetel") filed suit against
MICROS in the United States Federal District Court in the Eastern District of
Wisconsin. Budgetel alleges, among other things, that MICROS breached a March
1993 software support agreement by failing to provide full support to this
software package licensed to Budgetel in 1993. MICROS filed its answer to the
complaint in September of 1999. MICROS also filed a counterclaim against
Budgetel, alleging breach of contract and defamation. While the ultimate
outcome of litigation is uncertain, and while litigation is inherently
difficult to predict, the Company is of the opinion, based upon presently
available information and the advice of counsel concerning pertinent legal
matters, that resulting liability, if any, should not have a material adverse
effect on the Company's results of operations or financial position.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     During the fourth quarter of fiscal 1999, no matters were submitted to a
vote of security holders.

                                       12

<PAGE>   13

                                    PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER
         MATTERS

Price Range of Common Stock

     As of August 31, 1999, there were approximately 394 record holders of the
Company's Common Stock, $.025 par value.

      The Company's Common Stock (symbol "MCRS") is traded on the National
Association of Securities Dealers Automated Quotation ("NASDAQ") system. The
following table shows the range of trading prices for the period indicated, as
reported by NASDAQ. All references to the number of common shares and per share
amounts presented in Part II of this Form 10-K have been retroactively restated
to reflect a two-for-one stock split effected in the form of a stock dividend
in the fourth quarter of fiscal 1998.

     On August 31, 1999 the closing price for the stock was $33.75.

<TABLE>
<CAPTION>
                                                         Price Range*
                                                         ------------
                                                         (in dollars)
                                                      ------------------
                                                      High           Low
                                                     ------         -----
   <S>                        <C>                    <C>           <C>
   Year Ended June 30, 1999
   7/01/98 - 9/30/98          (First Quarter)         38-7/8         23-15/16
   10/01/98 - 12/31/98        (Second Quarter)        32-7/8         22-1/16
   1/01/99 - 3/31/99          (Third Quarter)         33-5/16        27-5/8
   4/01/99 - 6/30/99          (Fourth Quarter)        35             29-1/2

   Year Ended June 30, 1998
   7/01/97 - 9/30/97          (First Quarter)         25             20-5/16
   10/01/97 - 12/31/97        (Second Quarter)        27-3/4         21-1/4
   1/01/98 - 3/31/98          (Third Quarter)         30-11/32       22-3/16
   4/01/98- 6/30/98           (Fourth Quarter)        33-1/2         27

   Year Ended June 30, 1997
   7/01/96 - 9/30/96          (First Quarter)         15-5/8          9-3/8
   10/01/96 - 12/31/96        (Second Quarter)        17-7/8         14
   1/01/97 - 3/31/97          (Third Quarter)         20-3/8         14-3/8
   4/01/97- 6/30/97           (Fourth Quarter)        21             15
</TABLE>

*  The stock prices are reflective of a two-for-one stock split effected in the
   form of a stock dividend on June 23, 1998.

     The Company has never paid a cash dividend and has no current intention to
pay any cash dividends. Its current policy is to retain earnings and use funds
for the operation and expansion of its business. In addition, certain
indebtedness restricts the amount of cash dividends which may be payable. The
Company is a party to a line of credit agreement expiring December 31, 1999,
which restricts the payment of dividends other than stock dividends (see Note 5
of Notes to Consolidated Financial Statements). Future cash dividend policy
will be determined by the Board of Directors based on the Company's earnings,
financial condition, capital requirements and other existing conditions.

                                       13

<PAGE>   14



ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA (in thousands except per share
         amounts)

<TABLE>
<CAPTION>
                                                                  Fiscal Years Ended June 30,
                                                          1999      1998      1997      1996      1995
                                                          ----      ----      ----      ----      ----
<S>                                                    <C>        <C>      <C>        <C>       <C>
       Statement of Operations Data
          Revenue                                       $335,094  $280,245  $228,169  $178,049  $112,021
          Income from operations                         $48,645   $34,077   $27,836    $4,031   $16,542
          Net income                                     $27,294   $19,641   $16,332    $2,392   $11,577
          Basic net income per common share (1) (2)        $1.69     $1.23     $1.03     $0.15     $0.74
          Diluted net income per common share (1) (2)      $1.60     $1.18     $1.01     $0.15     $0.73
          Cash dividends                                      --        --        --        --        --
       Balance Sheet Data
          Working capital                                $75,301   $45,399   $27,838   $20,695   $37,029
          Total assets                                  $232,130  $204,611  $161,605  $136,836   $89,644
          Long-term debt and capital leases (3)           $6,148    $9,790   $10,135   $15,524    $5,614
          Shareholders' equity                          $119,273   $91,733   $71,727   $56,195   $53,450
          Book value per share                             $7.36     $5.70     $4.49     $3.54     $3.40
       Additional Data
           Weighted average number of common shares
           Outstanding- basic                             16,140    16,027    15,918    15,794    15,670
                      - diluted                           17,034    16,690    16,101    16,012    15,904
</TABLE>

(1)  Included in fiscal 1998 net income per share is a charge relating to the
     closure of the Company's Munich, Germany headquarters in the amount of
     $0.08 per share (basic) and $0.07 per share (diluted). Also included in
     fiscal 1998 net income per share is a charge for a change in accounting
     principle in the amount of $0.02 per share.

(2)  Included in fiscal 1996 net income per share is a charge for purchased
     in-development software technology in the amount of $0.51 per share
     relating to the acquisition of Fidelio.

(3)  Including current portion.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

Results of Operations

Comparison of Fiscal 1999 to Fiscal 1998:

     The Company recorded diluted net income of $1.60 per common share in
fiscal 1999, compared with diluted net income of $1.18 per common share in
fiscal 1998. The increase in net income is primarily attributable to higher
sales volumes generating a higher gross margin in absolute dollars, offset
partially by increased cost of sales, operating expenses and other
non-operating expenses.

     Revenue of $335.1 million for fiscal 1999 increased $54.8 million, or
19.6%, compared to the same period last year. A comparison of the sales mix for
fiscal years 1999 and 1998 is as follows:

<TABLE>
<CAPTION>
                                                            Year Ended  June 30,
                                                            --------------------
               Percent of total revenue                      1999        1998
                                                             -----       ----
               <S>                                         <C>         <C>
               Hardware                                      46.0%       44.7%
               Software                                      18.7%       20.6%
               Service                                       35.3%       34.7%
                                                            ------      ------
                                                            100.0%      100.0%
                                                            ======      ======
</TABLE>

     Software sales represented a smaller proportion of total sales in fiscal
1999 in comparison to fiscal 1998, although this category continued to grow in
absolute dollars. Hardware sales reflect strong demand for the Company's PC
Workstation and computers purchased for re-sale. Service sales increased in
comparison to fiscal 1998, primarily due to the additional service work
attributable to increased sales volumes along with the maintenance revenues
associated with new and existing customers.

                                       14

<PAGE>   15


     Combined hardware and software revenues for fiscal 1999 increased $33.5
million, or 18.3%, while service revenues increased $21.3 million or 21.9%,
over the same period a year earlier.

     The Company's revenues for fiscal 1999 were transacted in approximately
twenty-four currencies, while in fiscal years 1998 and 1997, the Company's
revenues were transacted in approximately twenty-five and twenty currencies,
respectively. The relative mix over the past three years is as follows:

<TABLE>
<CAPTION>
                              Year Ended June 30,
                              -------------------
Revenues by currency (1)      1999    1998    1997
                              ----    ----    ----
<S>                           <C>     <C>     <C>
United States Dollar           57%     56%     58%
German Mark                    15%     15%     11%
U.K. Pound Sterling             8%      8%      6%
French Franc                    4%      4%      4%
Swedish Krona                   3%      4%      4%
Australian Dollar               2%      2%      3%
Chinese Renminbi                1%      2%      --
Italian Lira                    1%      1%      1%
Finnish Markka                  1%      1%      1%
All Other Currencies (2)        8%      7%     12%
                                --      --     ---
Total                         100%    100%    100%
                              ====    ====    ====
</TABLE>

(1)  Calculated using average exchange rates for the year.
(2)  Represents approximately 15 currencies in fiscal 1999, approximately 16
currencies in fiscal year 1998 and approximately 12 currencies in fiscal year
1997.

     Cost of sales, as a percentage of revenue, increased to 51.1% from 50.9%
for fiscal 1999 compared to fiscal 1998. Cost of sales for hardware and
software products, as a percentage of related revenue, was 52.5% in fiscal 1999
compared to 50.2% for the same period a year earlier. The increase in cost of
sales was primarily due to decreased margins on hardware sales and a lower
proportion of higher margin software sales included in the sales mix.

     Service costs, as a percentage of service revenue, decreased to 48.2% in
fiscal 1999 compared to 52.2% in fiscal 1998. The decreased costs in comparison
to fiscal 1998 were primarily due to continued expansion of the Company's
customer base and the ability to increase service revenues at a rate in excess
of service costs.

     Selling, general and administrative expenses increased $12.2 million, or
15.5%, in fiscal 1999 compared to fiscal 1998. As a percentage of revenue,
selling, general and administrative expenses decreased to 27.1% in fiscal 1999
compared to 28.1% in fiscal 1998 as sales grew at a rate in excess of these
expenses. The decrease as a percentage of revenue is primarily due to the
Company's continued and successful efforts to reduce the growth in its selling,
general and administrative expenses.

     Research and development expenses (exclusive of capitalized software
development costs), which consist primarily of labor costs, increased $0.4
million, or 3.2%, in fiscal 1999 compared to fiscal 1998. As a percentage of
revenue, research and development expenses (exclusive of capitalized software
development costs) decreased to 4.3% in fiscal 1999 compared to 5.0% in fiscal
1998. Actual research and development expenditures, including capitalized
software development costs of $7.9 million in fiscal 1999 and $9.1 million in
fiscal 1998, decreased $0.7 million, or 3.1%, compared to the same period a
year earlier. As a percentage of revenue, research and development expenditures
(inclusive of capitalized software development costs) amounted to 6.7% in
fiscal 1999 compared to 8.2% in fiscal 1998. The decrease in absolute dollars
is primarily due to decreased expenditures for development of the Company's
hotel systems products, largely as a result of eliminating high-cost outside
software consultants/developers, or replacing such with lower-cost software
development employees.

     Office closure costs of $0.4 million in fiscal 1999 and $2.2 million in
the fourth quarter of fiscal 1998 relate to charges recorded in connection with
the permanent closure of the Company's Munich, Germany facility. The costs in
fiscal 1999 relate to the relocation of former Munich employees to their new
places of employment within the Company. The costs in fiscal 1998 represented
primarily severance benefits for terminated employees along with a provision to
accrue for the remaining lease commitment at that location.

                                       15

<PAGE>   16


     Income from operations for fiscal 1999 was $48.6 million, or 14.5% of
revenue, compared to income of $34.1 million in fiscal 1998, or 12.2% of
revenue. The Company's higher income from operations is primarily due to higher
sales and lower operating expenses as a percentage of sales. Excluding the
impact of the Munich office closure, income from operations would have been
$49.1 million or 14.6% of revenue in fiscal 1999, compared to $36.3 million or
13.0% of revenue in fiscal 1998.

     Interest income for 1999 increased $0.2 million, or 81.8%, compared to
fiscal 1998. The increase is due primarily to the Company's higher average cash
balance during the fourth quarter of fiscal 1999. Interest expense increased
$0.8 million, or 44.8%, compared to fiscal 1998. The increase in interest
expense for the period is primarily due to the Company's increase in its line
of credit borrowings for the first nine months of fiscal 1999, which were
substantially paid off in the fourth quarter of fiscal 1999.

     The effective tax rate for fiscal 1999 was 40.8% compared to 38.8% for
fiscal 1998. The increase is due to a shift in the mix of earnings towards
countries with higher tax rates. The effective tax rate for fiscal 2000 is not
anticipated to vary significantly from that of fiscal 1999.

     The cumulative effect of a change in accounting principle represents a
one-time after-tax charge of $0.4 million, or $0.02 per common share in fiscal
1998. This one-time charge, which was $0.7 million on a pre-tax basis, stems
from a charge taken in the second quarter of fiscal 1998 in conjunction with a
ruling issued by the Financial Accounting Standards Board Emerging Issues Task
Force, EITF Issue No. 97-13. This ruling required all previously capitalized
business process re-engineering costs incurred in conjunction with a technology
transformation project to be immediately expensed in the Company's quarter
ending December 31, 1997. Additionally, all such future costs are to be
expensed as incurred. The charge represents the business process re-engineering
costs capitalized through December 31, 1997 relating to MICROS's installation
of a new management information system. Prior to this ruling, these costs had
been capitalized and were to be amortized over the useful life of the system.

Year 2000

     The Company has substantially completed the process of reviewing its
business systems, and querying its customers, vendors and resellers with
respect to Year 2000 compliance issues. The "Year 2000 Issue" is the result of
computer programs being written using two digits rather than four to define the
applicable year. Any of the Company's computer programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than the year 2000. This could result in a system failure or miscalculations
causing disruptions of operations, including, among other things, a temporary
inability to process transactions, send invoices, or engage in normal business
activities.

     In 1997, the Company created a corporate-wide Year 2000 project team
representing all business units of the Company. The team was divided into three
segments, each of which was tasked with analyzing one of the following three
sets of issues: (i) Year 2000 compliance issues with respect to Company
internal information technology systems and non-information technology systems;
(ii) Year 2000 compliance issues with respect to the information systems of
certain key Company vendors and suppliers; and (iii) Year 2000 compliance
issues with respect to Company products that the Company sells and licenses to
its worldwide customer base.

Year 2000 Compliance Issues with respect to Company Internal Systems

     The Company's Management Information Systems Department assumed all Year
2000 obligations associated with testing, analyzing and implementing the
Company's internal information systems. Although these activities were not
formally assigned to the MIS department until 1997, the department had
nonetheless embraced such as part of its implementation of new enterprise
resources planning systems ("ERP") in 1996. This implementation involved
replacing all internal information systems with Oracle Applications Release
10.7. As part of this implementation, the Company required certification that
all Oracle products were Year 2000 compliant, which such certification has been
provided. On March 1, 1999, Micros upgraded the Oracle ERP systems to Release
11.0, Oracle's latest release. This upgrade assured that all critical ERP
systems are fully Year 2000 compliant. Moreover, the Company has completed
testing of all of the key components of the hardware operating the ERP. The
tests did not uncover any Year 2000 related issues. Internationally, the
Company is in the process of implementing Year 2000 compliant

                                       16

<PAGE>   17

Oracle applications at certain central locations

Year 2000 Compliance Issues with respect to the Information Systems of Certain
Key Company Vendors and Suppliers

     In addition to internal Year 2000 activities and the review and
remediation of the Company's internal information systems, the Company is in
contact with its key suppliers and vendors to assess their compliance. The
Company has received to date certain assurances from these suppliers and
vendors that any Year 2000 issues from which they suffer will not materially
adversely affect MICROS. The Company continues to elicit information where a
vendor fails to provide responses, or fails to provide complete responses.
There can, however, be no absolute assurance that there will not be a material
adverse effect on the Company if third parties do not convert their systems in
a timely manner and in a way that is compatible with the Company's systems, or
fail to disclose problems in their applications or support systems. The Company
believes that its current and future actions with suppliers will minimize these
risks.

Year 2000 Compliance Issues with respect to Company Products that the Company
Sells and Licenses to its Worldwide Customer Base

     Finally, the Company has completed the testing of its existing standard
product offerings. The testing entailed performing an analysis of standard
products using testing protocols developed internally. While testing was not
performed on each of the individual customized products (defined as special
products developed for individual customers, as opposed to "off the shelf"
products offered as standard products) distributed, testing was performed on
defined classes of customized products. The testing was not performed with
respect to any legacy products that the Company does not currently sell or
support. Where testing determined that a product had Year 2000 related issues,
the Company developed a fix, or provided the customer with a migration path to a
product that is Year 2000 compliant. As part of the testing effort, MICROS
engaged Oracle Corporation ("Oracle") to examine and test certain proprietary
time-sensitive software modules. Oracle has completed its examination, having
determined that, while there were several immaterial non-compliant items, the
code examined was Year 2000 compliant. MICROS has evaluated and, if appropriate,
addressed the issues identified by Oracle. While certain potential issues have
been identified to date, the expense of upgrading product applications to be
Year 2000 compliant has not been material. The Company maintains a site on its
web page, which details the products that the Company will test or has tested,
and the Year 2000 compliance status thereof. The site is updated approximately
every four weeks. The last update was on September 23, 1999.

Year 2000 Compliance Costs

     To date, the Company has expensed all incremental costs related to the
Year 2000 analysis and remediation efforts. Internal and external costs
specifically associated with modifying software for the Year 2000 will be
charged to expense as incurred. All of these costs are being funded through
operating cash flows. Management's current estimate (including the Year 2000
issues identified to date) is that the costs associated with the Year 2000
issue should not have a material adverse effect on the results of operations or
financial position of the Company in any given quarter. However, the Company is
not certain that it has fully identified such impact or whether the Company can
resolve it without disruption of its business or incurring significant expense.
To date, not including the costs incurred to upgrade the Company's internal
management information systems, the Company has incurred approximately $1.3
million in expenditures related to the Year 2000 issue. Costs capitalized to
date to implement the Company's new Year 2000 compliant internal management
information systems, which address a large variety of informational and
processing needs, are approximately $7.0 million.

     The Company believes it has diligently addressed the Year 2000 issues and
that it has satisfactorily resolved any significant Year 2000 problems. The
status of all of these efforts has been provided on the Company's Year 2000
Internet web page, which is updated monthly. In the remaining months of 1999,
the Company will continue to pursue the following three efforts: (i) testing
and, if necessary, correcting certain customized products that have been
offered; (ii) responding to any new issues that may be identified, whether
those in the Company's products, or in third party products on which the
operation of the Company's products are dependent; and (iii) finalizing the
customer support plans worldwide for the anticipated increase in calls and
questions during the three month period

                                       17

<PAGE>   18


commencing December 1, 1999.

Contingency Plans

     The Company is currently developing a contingency plan for its products.
This plan includes having had Oracle test and verify certain products, and
increasing current staffing levels in customer service functions for the three
month period commencing December 1, 1999. While the Company believes that its
current product set will not have any material Year 2000 issues, the Company
anticipates increased call volume during this period. With respect to internal
information systems, MICROS does not intend to develop a full contingency plan
involving implementation of an actual back-up enterprise resource planning
system. Given the complexity of the Company's Oracle enterprise resource
planning system, it is neither practical nor cost effective to develop such a
back-up contingency approach. For this reason, and as noted above, MICROS has
thoroughly tested and certified the current internal systems so as to reduce
the risk that problems have not been identified and addressed prior to January
1, 2000. Additionally, in order to test further the internal systems, MICROS
scheduled and now has completed a "dry run" test in August of 1999, during which
the dates contained in the enterprise resource planning system were scrolled
forward to January 1, 2000. These tests did not uncover any Year 2000 related
issues, and the systems performed without any failures or inaccuracies. However,
Year 2000 issues in the Company's enterprise resource planning system, if gone
undetected or uncorrected, could have a material adverse impact on the Company's
results of operations or financial condition.

Euro Conversion

     On January 1, 1999, certain member nations of the European Economic and
Monetary Union ("EMU") adopted a common currency, the Euro. For a three-year
transition period, both the Euro and individual participants' currencies will
remain in circulation. After June 30, 2002, the Euro will be the sole legal
tender for EMU countries. The adoption of the Euro will affect a multitude of
financial systems and business applications as the commerce of these nations
will be transacted in the Euro and the existing national currency during the
transition period. As of June 30, 1999, of the eleven countries currently
admitted to the EMU, the Company has subsidiary operations in six of those
countries and distributor relationships in the remaining five countries.

     MICROS is currently addressing Euro related issues and its impact on
information systems, currency exchange rate risk, taxation, contracts,
competition and pricing. Action plans currently being implemented are expected
to result in compliance with all laws and regulations; however, there can be no
certainty that such plans will be successfully implemented or that external
factors will not have an adverse effect on the Company's operations. Moreover,
there is still some uncertainty with respect to the interpretation of certain
Euro regulations, and the impact of the regulations on the Company's Euro
implementation. Any costs associated with the adoption of the Euro will be
expensed as incurred. The Company currently does not expect these costs to be
material to its results of operations, financial condition or liquidity.

Comparison of Fiscal 1998 to Fiscal 1997:

     The Company recorded diluted net income of $1.18 per common share in
fiscal 1998, compared with diluted net income of $1.01 per common share in
fiscal 1997. The increase in net income was primarily attributable to higher
sales volumes generating a higher gross margin in absolute dollars, offset
partially by increased cost of sales, operating expenses and other
non-operating and other expenses.

                                       18

<PAGE>   19


     Revenue of $280.2 million for fiscal 1998 increased $52.1 million, or
22.8%, compared to the same period last year. A comparison of the sales mix for
fiscal years 1998 and 1997 is as follows:

<TABLE>
<CAPTION>
                                                          Year Ended  June 30,
                                                          -------------------
                                                           1998        1997
                                                           ----        ----
            <S>                                          <C>          <C>
            Hardware                                       44.7%       45.1%
            Software                                       20.6%       20.1%
            Service                                        34.7%       34.8%
                                                          ------      ------
                                                          100.0%      100.0%
                                                          ======      ======
</TABLE>

     While hardware sales represent a smaller proportion of total sales in
fiscal 1998 in comparison to fiscal 1997, this category continued to grow in
absolute dollars. The dollar increase was primarily attributable to increased
sales of the Company's own PCWS ("PC Workstation") and computers purchased for
re-sale. The increase in software for the year, relative to total sales, was due
to sales arising from the Company's central reservation and customer information
system hotel products along with increases experienced in the Company's 3700 and
3400 QSA restaurant POS products. Service sales increased in absolute dollars in
comparison to fiscal 1997, and at a rate approximately equal to that of combined
hardware and software sales. Service sales have increased primarily due to the
additional service work attributable to increased sales volumes along with the
maintenance revenues associated with those new customers.

     Combined hardware and software revenues for fiscal 1998 increased $34.2
million, or 23.0%, while service revenues increased $17.8 million or 22.5%,
over the same period a year earlier.

     The Company's revenues for fiscal 1998 were transacted in approximately
twenty-five currencies, while in fiscal years 1997 and 1996, the Company's
revenues were transacted in approximately twenty currencies.  The relative mix
over the past three years was as follows:

<TABLE>
<CAPTION>
                              Year Ended June 30,
                              -------------------
Revenues by currency (1)      1998    1997    1996
                              ----    ----    ----
<S>                          <C>     <C>     <C>
United States Dollar           56%     58%     65%
German Mark                    15%     11%     10%
U.K. Pound Sterling             8%      6%      6%
French Franc                    4%      4%      5%
Swedish Krona                   4%      4%      3%
Australian Dollar               2%      3%      1%
Chinese Renminbi                2%      --      --
Singapore Dollar                1%      2%      1%
All Other Currencies (2)        8%     12%      9%
                                --     ---      --
Total                         100%    100%    100%
                              ====    ====    ====
</TABLE>

(1) Calculated using average exchange rates for the year.
(2) Represents approximately 17 currencies in fiscal 1998 and approximately 13
currencies in fiscal years 1997 and 1996.

     Until fiscal 1996, the Company had historically transacted business
primarily in the United States Dollar and, to a lesser extent, in European
currencies, as a result of its Europe-based subsidiaries. During fiscal 1996,
as a result of the Fidelio acquisition on November 30, 1995, the Company
expanded its revenue mix to a higher proportion of revenues denominated in the
German Mark and other foreign currencies. Beginning in fiscal 1997, the Company
experienced a full year's amount of sales from Fidelio and its subsidiaries
that have contributed to the further diversification of currencies in
comparison to prior years.

     Cost of sales, as a percentage of revenue, increased to 50.9% from 49.1%
for fiscal 1998 compared to fiscal 1997. Cost of sales for hardware and
software products, as a percentage of related revenue, was 50.2% in fiscal 1998
compared to 48.4% for the same period a year earlier. The increase in cost of
sales was as a result of a shift in the demand of hardware products towards
higher-cost products, including the Company's own PCWS and computers purchased
for re-sale.

     Service costs, as a percentage of service revenue, increased to 52.2% in
fiscal 1998 compared to 50.3% in fiscal

                                       19

<PAGE>   20

1997. The increased costs in comparison to fiscal 1997 were primarily due to
continued investment in the Company's service organization and the costs
associated with training new service personnel.

Selling, general and administrative expenses increased $9.0 million, or 12.9%,
in fiscal 1998 compared to fiscal 1997. As a percentage of revenue, selling,
general and administrative expenses decreased to 28.1% in fiscal 1998 compared
to 30.5% in fiscal 1997 as sales grew at a rate in excess of these expenses.
The decrease as a percentage of revenue was primarily due to the Company's
continued and successful efforts to reduce or limit the growth in its selling,
general and administrative expenses.

     Research and development expenses (exclusive of capitalized software
development costs), which consist primarily of labor costs, increased $2.8
million, or 25.0%, in fiscal 1998 compared to fiscal 1997. As a percentage of
revenue, research and development expenses (exclusive of capitalized software
development costs) increased to 5.0% in fiscal 1998 compared to 4.9% in fiscal
1997. Actual research and development expenditures, including capitalized
software development costs of $9.1 million in fiscal 1998 increased $7.6
million, or 48.9%, compared to the same period a year earlier. As a percentage
of revenue, research and development expenditures (inclusive of capitalized
software development costs) amounted to 8.2% in fiscal 1998 compared to 6.8% in
fiscal 1997. The increase in absolute dollars was primarily due to increased
expenditures for development of the Company's hotel systems products, mainly
those in development at the Company's Naples, Florida office and, to a lesser
extent, continued increased spending for the development of the Company's
restaurant POS products.

     Office closure costs of $2.2 million relate to the charge recorded during
the fourth quarter of fiscal 1998 in connection with the closure of the
Company's Munich, Germany headquarters. Those costs represented primarily
severance benefits for terminated employees along with a provision to accrue
for the remaining lease commitment at this location. The Company anticipated an
additional $0.4 million in relocation expenses would be incurred during the
first half of fiscal 1999 and recorded as expense when incurred.

     Income from operations for fiscal 1998 was $34.1 million, or 12.2% of
revenue, compared to income of $27.8 million in fiscal 1997. The Company's
higher income from operations was primarily due to higher sales. Excluding the
impact of the Munich office closure, income from operations would have been
$36.3 million or 13.0% of revenue, compared to 12.2% in fiscal 1997.

     Interest income for 1998 decreased $0.2 million or 36.7%, compared to
fiscal 1997. The decrease was due to the use of cash needed for working capital
along with a reduction in the Company's average cash balance during fiscal 1998
compared to fiscal 1997. Interest expense increased $0.3 million or 21.7%,
compared to fiscal 1997. The increase in interest expense for the period was
primarily due to the Company's increase in its line of credit borrowings.

     The effective tax rate for fiscal 1998 was 38.8% compared to 38.4% for
fiscal 1997. The effective tax rate for fiscal 1999 may be higher than 38.8%
due to a shift in the mix of earnings towards countries with higher tax rates
and pending the uncertain extension of the domestic research and development
tax credit into fiscal 1999.

     The cumulative effect of a change in accounting principle represents a
one-time after-tax charge of $0.4 million, or $.02 per common share. This
one-time charge, which was $0.7 million on a pre-tax basis, stems from a charge
taken in the second quarter of fiscal 1998 in conjunction with a ruling issued
by the Financial Accounting Standards Board Emerging Issues Task Force, EITF
Issue No. 97-13. This ruling required all previously capitalized business
process re-engineering costs incurred in conjunction with a technology
transformation project to be immediately expensed in the Company's quarter
ending December 31, 1997. Additionally, all such future costs are to be
expensed as incurred. The charge represents the business process re-engineering
costs capitalized through December 31, 1997 relating to MICROS's installation
of a new management information system. Prior to that ruling, those costs had
been capitalized and were to be amortized over the useful life of the system.

Liquidity and Capital Resources

     The Company has a $45.0 million multi-currency unsecured committed line of
credit with Bank of America,

                                       20

<PAGE>   21

expiring on December 31, 1999. Prior to this upcoming expiration date, the
Company anticipates that it will renew this line of credit for an additional
one-year period. This line of credit was increased from $35.0 million to $45.0
million pursuant to an amendment entered into on December 15, 1998. The Company
has the one-time option to convert the line of credit into a three-year secured
term loan upon expiration of the line of credit. As of June 30, 1999, there are
no borrowings on this line of credit.

     In addition, the Company has a credit relationship with Commerzbank and
during fiscal 1998 amended and increased its credit facility with this bank so
that the Company's borrowing limit was increased from DM 7.0 million to DM 15.0
million (approximately $7.9 million at the June 30, 1999 exchange rate) and the
Company may borrow in the form of either a line of credit or term debt. Under
the Commerzbank credit facility, the Company has a balance of DM 10.0 million
(approximately $5.3 million at the June 30, 1999 exchange rate) in the form of
balloon debt and has no line of credit borrowings.  As the Company has
significant international operations, its DM-denominated borrowings do not
represent a significant foreign exchange risk. The Company  does not currently
engage in any foreign exchange hedging.

     Net cash provided by operating activities for fiscal 1999 was $47.6
million versus $5.7 million for fiscal 1998. The Company used $13.5 million for
investing activities in fiscal 1999, including $15.0 million for the purchase of
property, plant, and equipment, internally developed software as well as
software purchased from a third party and $1.7 million for business
acquisitions, offset by the proceeds from the sale of two of the Company's
buildings for $3.3 million. Net financing activities for fiscal 1999 used $24.8
million, primarily stemming from $33.9 million in repayments on the lines of
credit, long term debt and capital lease obligation, offset by $6.9 million in
borrowings on the line of credit and long term debt during fiscal 1999. Proceeds
from the issuance of stock under the Company's stock option plan provided $1.8
million for fiscal 1999 and $1.6 million for fiscal 1998. The income tax benefit
from the exercise of disqualified and non-qualified stock options provided $0.4
million in both fiscal 1999 and 1998.

     As a result of all of the above, the cash position of the Company at
June 30, 1999 was $22.8 million.  All cash is being held for the operation and
expansion of the business.

     The Company anticipates that its cash flow from operations along with
available lines of credit, in conjunction with other lines of credit for which
the Company may be eligible or lines of credit to be renewed or converted into
term debt, are sufficient to provide the working capital needs of the Company
for the foreseeable future. The Company anticipates that its rate of property,
plant and equipment expenditures for fiscal 2000 will increase approximately
$4.0 million over fiscal 1999 expenditures primarily for the purchase of
furniture and fixtures for its new headquarters building.

     Financial indicators of the Company's liquidity and capital resources as
of June 30, 1999 and 1998 were:

<TABLE>
<CAPTION>
      In thousands, except ratios                          1999            1998
--------------------------------------                     ----            ----
<S>                                                    <C>             <C>
Cash and cash equivalents                               $22,806         $13,592
                                                        =======         =======
Available credit facilities                             $52,900         $43,300
Outstanding credit facilities                             5,300          31,000
                                                          -----          ------
Unused credit facilities                                $47,600         $12,300
                                                        =======         =======
Working capital                                         $75,301         $45,399
                                                        =======         =======
Long-term debt and capital lease obligations:
     Current                                               $455          $2,250
     Non-current                                          5,693           7,540
                                                          -----           -----
          Total                                          $6,148          $9,790
                                                         ======          ======
Shareholders' equity                                   $119,273         $91,733
                                                       ========         =======
Current ratio                                              1.77            1.46
                                                           ====            ====
</TABLE>

Inflation

     The Company has not experienced any significant impact as a result of
inflation.

                                       21

<PAGE>   22


ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

      See Part I, Item I, Foreign Sales and Foreign Market Risks, and Part II,
Item 7. Additionally, MICROS's unsecured committed line of credit with
Bank of America bears interest at a floating rate. MICROS does not invest in
financial instruments designed to protect against interest rate fluctuations,
although will continue to evaluate the need to do so in the future.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     See Part IV, Item 14(a) 1.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

     None.

                                       22

<PAGE>   23


                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

<TABLE>
<CAPTION>
        Name                                 Position
-------------------              ----------------------------------
<S>                              <C>
Louis M. Brown, Jr.              Director and Chairman of the Board

Daniel Cohen                     Director

A. L. Giannopoulos               Director, President and Chief Executive Officer

Bernard Jammet                   Executive Vice President, Product Development

F. Suzanne Jenniches             Director

Carroll H. Johnson               Executive Vice President, Operating Units Group

Gary C. Kaufman                  Executive Vice President, Finance and
                                 Administration and Chief Financial Officer

Ronald J. Kolson                 Executive Vice President, Procurement &
                                 Logistics

Thomas L. Patz                   Sr. Vice President and General Counsel

John G. Puente                   Director

Dwight S. Taylor                 Director

Roberta J. Watson                Vice President and Controller
</TABLE>

Directors of the Registrant are elected for a term of one year.

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

     Directors and Executive Officers of the Registrant during fiscal 1999:

     Louis M. Brown, Jr., 56, has been a Director of the Company since 1977.
Mr. Brown held the position of President and Chief Executive Officer from
January 1986 until his appointment as Chairman of the Board in January 1987. He
also serves as President and a director of IDEAS, Inc., a supplier of high
technology, custom-engineered products and services. Mr. Brown serves as
Chairman of Autometric, Inc. and of Planning Systems, Inc.  He is a graduate of
The Johns Hopkins University (B.E.S.-E.E.).

     Daniel Cohen, 44, has been a Director of the Company since November 1992.
Mr. Cohen currently serves as President of Bartech Systems International, Inc.,
a Delaware corporation. Until June 30, 1997, Mr. Cohen was Managing Director of
Fidelio-MICROS France, S.A., a subsidiary of MICROS Systems, Inc. and
distributor of the Company's products.  Formerly, Mr. Cohen was Managing
Director and principal shareholder of D.A.C. Systemes/MICROS France, a company
he founded in 1986 and which MICROS acquired in 1995.  Mr. Cohen is a graduate
of the Hotel School of Lausanne, Switzerland, from which he holds a Masters
degree in Hotel Administration.

     A. L. Giannopoulos, 59, has been a Director since March 1992 and was
elected President and Chief Executive Officer in May 1993. Effective as of June
1, 1995, Mr. Giannopoulos resigned as General Manager of the Westinghouse
Information and Security Systems Divisions, having been with Westinghouse for
30 years, and was hired by the Company pursuant to an Employment Agreement to
terminate December 31, 1999, subsequently amended to terminate on June 30,
2005. In prior assignments at Westinghouse, Mr. Giannopoulos was General
Manager of the Automation Division and National Industrial Systems Sales Force,
Industries Group. Mr. Giannopoulos currently serves as a Trustee of Capitol
College and as a director of V-One Corporation, a public company

                                       23

<PAGE>   24

engaged in the software development of virtual private networks. Mr.
Giannopoulos is a graduate of Lamar University with a Bachelor of Science
degree in Electrical Engineering.

     Bernard Jammet, 40, joined the Company in July 1984 as European Sales
Manager. In 1988, he was named Managing Director for Europe/Africa/Middle East
Operations and was promoted to Vice President in November 1990. In November
1994, he was promoted to the position of Senior Vice President, International
Operations. In October 1998, he was appointed Executive Vice President, Product
Development. Before joining MICROS, Mr. Jammet was employed with the former
MICROS distributor for France. Mr. Jammet is a graduate of the Hotel School of
Lausanne, Switzerland, with a Masters degree in Hotel Administration.

     F. Suzanne Jenniches, 51, has been a Director of the Company since October
1996. She is Vice President of Communications Systems for the Electronic
Sensors and Systems Sector of Northrop Grumman, which designs and develops
advanced communications systems for both government and commercial
applications. Ms. Jenniches is past President of the national Society of Women
Engineers, has served on the Board of Governors for the American Association of
Engineering Societies, and is currently a board member of the State of
Maryland's Greater Baltimore Committee Technology Council. Ms. Jenniches is a
graduate of Clarion College and holds a Masters degree in Environmental
Engineering from The Johns Hopkins University.

     Carroll H. Johnson, 53, joined the Company in September 1998 as Director
of Strategic Analysis.  In January 1999, Mr. Johnson was appointed Senior Vice
President, Operating Units Group, and in September, promoted to the position of
Executive Vice President, Operating Units Group.  Previously, Mr. Johnson was
the President and CEO of the Friendship Federal Credit Union.  Mr. Johnson was
a director from May 1994 through August 1995 and Divisions Controller for
Westinghouse Commercial Systems Division.  Mr. Johnson is a graduate of the
University of Baltimore, with a Bachelor of Science degree in Accounting.

     Gary C. Kaufman, 49, served as a Director of the Company from January 1991
until May 1994 when he was appointed to Vice President, Finance and
Administration and Chief Financial Officer. Subsequent to June 30, 1996, he was
promoted to Senior Vice President, Finance and Administration and Chief
Financial Officer, and in September 1999, was promoted to Executive Vice
President, Finance and Administration and Chief Financial Officer. Previously,
Mr. Kaufman was Division Controller for Westinghouse Security and Network
Services Divisions, having been with Westinghouse for 20 years in various
financial positions. Mr. Kaufman is a graduate of the University of Dayton with
a Bachelor of Science degree in Accounting and is also a Certified Public
Accountant.

     Ronald J. Kolson, 45, joined the Company in April 1984 as Controller.  In
September 1987 he was promoted to Vice President, Finance and Administration
and Chief Financial Officer.  In 1994, he was promoted to the position of
Executive Vice President and Chief Operating Officer.  Mr. Kolson currently
serves as Executive Vice President, Procurement and Logistics.  Mr. Kolson is a
graduate of The Pennsylvania State University with a Bachelor of Science degree
in Accounting and is also a Certified Public Accountant.

     Thomas L. Patz, 39, joined the Company in August 1995 as General Counsel.
In November 1996, he was promoted to the position of Vice President and General
Counsel.  In September 1999, Mr. Patz was promoted to his present position of
Sr. Vice President and General Counsel.  Previously, Mr. Patz was Assistant
General Counsel of Westinghouse Electric Corporation.  Mr. Patz is a 1982
graduate of Brown University with a Bachelor of Arts degree in English, and a
1985 graduate of the University of Virginia School of Law with a degree of
Juris Doctor.  Mr. Patz is a member of the Maryland State Bar.

     John G. Puente, 69, has been a Director since May 1996. He is the Chairman
of E-Cargo (Internet Cargo Services, Inc.), a company that coordinates product
shipments over the Internet. Until August 1999, Mr. Puente served as Chairman
of Telogy Networks, Inc., a developer of communications software products, at
which time it was acquired by Texas Instruments. Mr. Puente is on the Board of
Directors of Primus Telecommunications, a long distance telecommunications
service provider. Previously, he was Chairman and Chief Executive Officer of
Orion Network Systems, a company which provides satellite services and
facilities. Prior to joining Orion, Mr. Puente was Vice Chairman of M/A-Com, a
supplier of microwave components and systems to the telecommunications
industry. He was a founder and Chairman of Digital Communications Corporation
(now Hughes Network Systems) and SouthernNet, a fiber optic long distance
company which merged to form Telecom USA and was later acquired by

                                       24

<PAGE>   25

MCI. Mr. Puente is a graduate of Polytechnic Institute of New York and now
serves on the Board of Trustees of that institution, and he holds a Masters
degree from Stevens Institute of Technology. He is Chairman of the Board of
Trustees of Capitol College.

     Dwight S. Taylor, 54, has been a Director of the Company since 1997. He is
President of Corporate Development Services, LLC ("CDS"), a commercial real
estate development firm with offices in Columbia, Maryland, and a subsidiary of
Corporate Offices Properties Trust (NYSE:OFC). Mr. Taylor has been employed by
CDS (or Constellation Real Estate, Inc., an entity with which CDS merged in
1998) in various capacities for the last 15 years. Mr. Taylor is also a member
of the Board of Directors of the Associated Black Charities, of which he was
formerly its Chairman, and the National Association of Industrial and Office
Properties. Mr. Taylor is a 1968 graduate of Lincoln University with a Bachelor
of Science degree in Economics.

     Roberta J. Watson, 38, joined the Company in November 1987 as Manager of
Accounting.  In March 1990, she was promoted to the position of Controller, and
in November 1994, she was promoted to Vice President and Controller. Ms. Watson
holds a Bachelor of Science degree in Accounting from the State University of
New York and is a Certified Public Accountant.

     Information relating to filings made pursuant to Section 16 of the
Securities Exchange Act of 1934 will be set forth in the Company's Proxy
Statement, and is incorporated herein by reference.

ITEM 11.  EXECUTIVE COMPENSATION AND TRANSACTIONS

     The information required by Item 11 will be set forth in the Company's
Proxy Statement under the caption "Executive Compensation", and such
information is incorporated herein by reference.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The information required by Item 12 will be set forth in the Company's
Proxy Statement under the caption "Security Ownership of Certain Beneficial
Owners and Management", and such information is incorporated herein by
reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     During fiscal 1998, Daniel Cohen was compensated $97,000 in consideration
for his provision of consulting services to the Company. Mr. Cohen's consultant
agreement with the Company terminated on June 30, 1998. Additionally, pursuant
to the terms of the Purchase Agreement dated August 25, 1995 under which the
Company purchased from Mr. Cohen and his family the remaining 77% of D.A.C.
Systemes/MICROS France and AD-Maintenance Informatique ("ADMI") the Company did
not already own, the Company owes as of the end of each fiscal year $408,000
and $466,000 for fiscal 1999 and 1998, respectively. The payments are made
during the first fiscal quarter of the following year per the agreement.

     During fiscal 1999 and 1998, the Company compensated Louis M. Brown, Jr.,
Chairman of the Board, $241,000 and $230,000, respectively, for consulting
services provided to the Company. Effective June 30, 1995, the Company and Mr.
Brown entered into a Consulting Agreement terminating June 30, 2000, pursuant
to which Mr. Brown is to provide on the average 20 hours per week of consulting
services to the Company in exchange for a base consulting fee commencing at
$150,000 plus a target bonus of $70,000, with annual adjustments.

                                       25

<PAGE>   26

                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

                                                                            Page
                                                                             No.
                                                                            ----
(a)  The following documents are filed as a part of this report:

 1.  Financial Statements:
     Report of Independent Accountants                                       29
     Consolidated balance sheets as of June 30,
        1999 and 1998                                                        30
     Consolidated statements of operations for
        the years ended June 30, 1999, 1998 and 1997                         31
     Consolidated statements of shareholders' equity
        for the years ended June 30, 1999, 1998 and 1997                     32
     Consolidated statements of cash flows for the years
        ended June 30, 1999, 1998 and 1997                                   33
     Notes to consolidated financial statements                              35

 2.  Financial Statement Schedules:
        Schedule II, Valuation and qualifying accounts                       53
        and reserves
        All other schedules are omitted because they are
        not applicable, or not required, or the required
        information is included in the financial statements
        or notes thereto.

 3.  Exhibits:

     3(i).       Articles of Incorporation of the Company are incorporated
                 herein by reference to Exhibit 3 to the Annual Report on
                 Form 10-K of the Company for the Fiscal Year ended June 30,
                 1990.

     3(i)(a).    Articles of Amendment to Articles of Incorporation are
                 incorporated herein by reference to Exhibit 3(i) to the
                 Quarterly Report on Form 10-Q of the Company for the period
                 ended December 31, 1997.

     3(i)(b).    Articles of Amendment to Articles of Incorporation are
                 incorporated herein by reference to Exhibit 3(i) to the
                 Quarterly Report on Form 10-Q of the Company for the period
                 ended December 31, 1998.

     3(ii).      By-laws of the Company as in effect on the date hereof is
                 incorporated herein by reference to Exhibit 3 to the Annual
                 Report on Form 10-K of the Company for the Fiscal Year ended
                 June 30, 1990.

     10a1.       Amendment and Restatement of MICROS Systems, Inc. Stock
                 Option Plan is incorporated herein by reference to Exhibit
                 4.1 to the Registration Statement on Form S-8 of the Company
                 filed on February 16, 1990.

     10a2.       First Amendment to the Amendment and restatement of MICROS
                 Systems, Inc. Stock Option Plan constituting Exhibit 10a1
                 hereto is incorporated herein by reference to Exhibit 4.2 to
                 the Registration Statement on Form S-8 of the Company filed on
                 February 16, 1990.


     10b1.       MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                 incorporated herein by reference to Exhibit A to the Proxy
                 Statement of the Company for the 1993 Annual Meeting of
                 Shareholders.

     10b2.       MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                 incorporated herein by reference to Exhibit A to the Proxy
                 Statement of the Company for the 1995 Annual Meeting



                                       26

<PAGE>   27


                 of Shareholders.

     10b3.       MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                 incorporated herein by reference to Exhibit A to the Proxy
                 Statement of the Company for the 1996 Annual Meeting of
                 Shareholders.

     10b4.       MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                 incorporated herein by reference to Exhibit A to the Proxy
                 Statement of the Company for the 1997 Annual Meeting of
                 Shareholders.

     10b5.       MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                 incorporated herein by reference to Exhibit A to the Proxy
                 Statement of the Company for the 1998 Annual Meeting of
                 Shareholders.

     10c.        Underwriting Agreement dated July 6, 1995 by and among MICROS
                 Systems, Inc., Westinghouse Electric Corporation, Westinghouse
                 Holdings Corporation, J.P. Morgan Securities, Inc., Morgan
                 Stanley & Co. Incorporated and Smith Barney, Inc. is
                 incorporated herein by reference to Exhibit 10d to the Annual
                 Report on Form 10-K of the Company for the Fiscal Year ended
                 June 30, 1995.

     10d.        Employment Agreement dated June 1, 1995 between MICROS
                 Systems, Inc. and A. L. Giannopoulos is incorporated herein by
                 reference to Exhibit 10e to the Annual Report on Form 10-K of
                 the Company for the Fiscal Year ended June 30, 1995.

     10e.        First Amendment to Employment Agreement dated February 6, 1997
                 between MICROS Systems, Inc. and A. L. Giannopoulos is
                 incorporated herein by reference to Exhibit 10 to the
                 Quarterly Report on Form 10-Q of the Company for the period
                 ended December 31, 1996.

     10f.        Second Amendment to Employment Agreement dated February 1,
                 1998 between MICROS Systems, Inc. and A. L. Giannopoulos is
                 incorporated herein by reference to Exhibit 10 to the
                 Quarterly Report on Form 10-Q of the Company for the period
                 ended December 31, 1997.

     10g.        Third Amendment to Employment Agreement dated September 8,
                 1999 between MICROS Systems, Inc. and A. L. Giannopoulos.

     10h.        Consulting Agreement dated June 30, 1995 between MICROS
                 Systems, Inc. and Louis M. Brown, Jr. is incorporated herein
                 by reference to Exhibit 10 to the Annual Report on Form 10-K
                 of the Company for the Fiscal Year ended June 30, 1995.

     10i.        First Amendment to Consulting Agreement dated February 1, 1999
                 between MICROS Systems, Inc. and Louis M. Brown, Jr. is
                 incorporated herein by reference to Exhibit 10 to the
                 Quarterly Report on Form 10-Q of the Company for the period
                 ended December 31, 1998.

     10j.        MICROS Systems, Inc. Bonus and Incentive Plan is incorporated
                 herein by reference to Exhibit 10 to the Quarterly Report on
                 Form 10-Q of the Company for the period ended September 30,
                 1994.

     10k.        Employment Agreement dated May 28, 1997 between MICROS
                 Systems, Inc. and Gary C. Kaufman is incorporated herein by
                 reference to Exhibit 10 to the Annual Report on Form 10-K of
                 the Company for the Fiscal Year ended June 30, 1997.

     10l.        First Amendment to Employment Agreement dated October 1, 1998
                 between MICROS Systems, Inc. and Gary C. Kaufman is
                 incorporated herein by reference to Exhibit 10 to the
                 Quarterly Report on Form 10-Q of the Company for the period
                 ended December 31, 1998.

     10m.        Employment Agreement dated May 28, 1997 between MICROS
                 Systems, Inc. and Ronald J. Kolson is incorporated herein by
                 reference to Exhibit 10 to the Annual Report on Form 10-K of
                 the Company for the Fiscal Year ended June 30, 1997.

                                       27

<PAGE>   28

     10n.        Consulting Agreement dated July 1, 1997 between MICROS
                 Systems, Inc. and Daniel Cohen is incorporated herein by
                 reference to Exhibit 10 to the Annual Report on Form 10-K of
                 the Company for the Fiscal Year ended June 30, 1997.

     11.         Statement Regarding Computation of Earnings Per Share.

     21.         Subsidiaries of the Company.

     23.         Consent of Independent Accountants.

     27.         Financial Data Schedule.

(b)  Reports on form 8-K:

     No reports on Form 8-K have been filed during the fourth quarter of the
fiscal year ended June 30, 1999.

     The annual report will be mailed to shareholders prior to the annual
meeting scheduled for November 19, 1999.

                                       28

<PAGE>   29


                       REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Shareholders of MICROS Systems, Inc.

In our opinion, the consolidated financial statements listed in the index
appearing under Item 14(a)(1) on page 26 present fairly, in all material
respects, the financial position of MICROS Systems, Inc. and its subsidiaries
at June 30, 1999 and 1998, and the results of their operations and their cash
flows for each of the three years in the period ended June 30, 1999, in
conformity with generally accepted accounting principles. In addition, in our
opinion, the financial statement schedule listed in the index appearing under
Item 14(a)(2) on page 26 presents fairly, in all material respects, the
information set forth therein when read in conjunction with the related
consolidated financial statements. These financial statements and financial
statement schedule are the responsibility of the Company's management; our
responsibility is to express an opinion on these financial statements and
financial statement schedule based on our audits. We conducted our audits of
these statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for the opinion expressed above.

PricewaterhouseCoopers LLP

Baltimore, Maryland
August 25, 1999

                                       29

<PAGE>   30


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                          as of June 30, 1999 and 1998
                     (in thousands, except per share data)

<TABLE>
<CAPTION>
                                                              1999         1998
                                                             ------       ------
<S>                                                       <C>          <C>
ASSETS
Current assets:
     Cash and cash equivalents                               $22,806     $13,592
     Accounts receivable, net of allowance for doubtful
         accounts of $3,618 in 1999 and  $2,298 in 1998      101,019      85,436
     Inventories                                              32,605      32,232
     Deferred income taxes                                     5,637       4,715
     Prepaid expenses and other current assets                11,040       7,136
                                                              ------       -----
          Total current assets                               173,107     143,111

Property, plant and equipment, net                            15,687      21,764
Deferred income taxes, non-current                             4,186       4,644
Goodwill and intangible assets, net of accumulated
          amortization of $12,277 in 1999 and
          $8,883 in 1998                                      16,255      17,597
Purchased and internally developed software costs, net
          of accumulated amortization of $8,805 in
          1999 and $6,654 in 1998                             22,607      16,964
Other assets                                                     288         531
                                                                 ---         ---
Total assets                                                $232,130    $204,611
                                                            ========    ========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
     Bank lines of credit                                         $8     $26,830
     Current portion of long-term debt                           357       1,970
     Current portion of capital lease obligations                 98         280
     Accounts payable                                         28,041      18,968
     Accrued expenses and other current liabilities           38,195      29,350
     Income taxes payable                                     14,113       9,158
     Deferred income taxes                                       754          44
     Deferred service revenue                                 16,240      11,112
                                                              ------      ------
          Total current liabilities                           97,806      97,712

Long-term debt, net of current portion                         5,368       4,074
Capital lease obligations, net of current portion                325       3,466
Deferred income taxes, non-current                             8,098       6,682
Minority interests                                             1,260         944
                                                               -----         ---
          Total liabilities                                  112,857     112,878
                                                             -------     -------

Commitments and contingencies
Shareholders' equity:
     Common stock, $.025 par; authorized 50,000 shares
       in 1999 and 30,000 shares in 1998; issued and
       outstanding 16,207 shares in 1999 and 16,101
       shares in 1998                                            405         403
     Capital in excess of par                                 22,298      20,097
     Retained earnings                                       102,860      75,566
     Accumulated other comprehensive income                  (6,290)     (4,333)
                                                             -------     -------
          Total shareholders' equity                         119,273      91,733
                                                             -------      ------
Total liabilities and shareholders' equity                  $232,130    $204,611
                                                            ========    ========
</TABLE>

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

                                       30

<PAGE>   31


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                for the years ended June 30, 1999, 1998 and 1997
                     (in thousands, except per share data)

<TABLE>
<CAPTION>
                                                   1999        1998       1997
                                                  ------      ------     ------
<S>                                             <C>          <C>        <C>
Revenue:
     Hardware and software                       $216,569    $183,045   $148,801
     Service                                      118,525      97,200     79,368
                                                  -------      ------     ------
          Total revenue                           335,094     280,245    228,169
                                                  -------     -------    -------
Costs and expenses:
     Cost of sales

          Hardware and software                   113,761      91,863     72,070
          Service                                  57,158      50,745     39,921
                                                   ------      ------     ------
              Total cost of sales                 170,919     142,608    111,991

     Selling, general and administrative
       expenses                                    90,845      78,640     69,685
     Research and development expenses             14,406      13,966     11,170
     Office closure costs                             427       2,245         --
     Depreciation and amortization                  9,852       8,709      7,487
                                                    -----       -----      -----
          Total costs and expenses                286,449     246,168    200,333
                                                  -------     -------    -------

Income from operations                             48,645      34,077     27,836

Non-operating income (expense):
    Interest income                                   531         292        461
    Interest expense                              (2,545)     (1,758)    (1,445)
    Other income, net                                 690         604        774
                                                      ---         ---        ---

Income before taxes, minority interests,
     equity in net earnings of
     affiliates and cumulative effect of
     accounting change                             47,321      33,215     27,626

Income tax expense                                 19,307      12,894     10,616
                                                   ------      ------     ------
Income before minority interests, equity in net    28,014      20,321     17,010
     earnings of affiliates and cumulative
     effect of accounting change

Minority interests and equity in net earnings
     of affiliates                                  (720)       (268)      (678)
                                                    -----       -----      -----
Net income before cumulative effect of
     accounting change                             27,294      20,053     16,332
Cumulative effect of change in accounting
   principle, net of tax benefit of $274               --       (412)         --
                                                     ----       -----       ----
Net income                                        $27,294     $19,641    $16,332
                                                  =======     =======    =======

Basic net income per common share:
   Income before cumulative effect of
   accounting change                                $1.69      $ 1.25     $ 1.03
   Cumulative effect of change in accounting
     principle                                         --      (0.02)         --
                                                     ----      ------       ----
   Basic net income per common share               $ 1.69      $ 1.23     $ 1.03
                                                   ======      ======     ======

Diluted net income per common share:
   Income before cumulative effect of
     accounting change                             $ 1.60      $ 1.20     $ 1.01
   Cumulative effect of change in accounting
     principle                                         --      (0.02)         --
                                                     ----      ------       ----
   Diluted net income per common share             $ 1.60      $ 1.18     $ 1.01
                                                   ======      ======     ======

Weighted-average number of shares outstanding:

   Basic                                           16,140      16,027     15,918
                                                   ======      ======     ======

   Diluted                                         17,034      16,690     16,101
                                                   ======      ======     ======
</TABLE>

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

                                       31

<PAGE>   32


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                for the years ended June 30, 1999, 1998 and 1997
                                 (in thousands)

<TABLE>
<CAPTION>

                                                                                      Accumulated
                                         Common Stock        Capital                      Other
                                       ------------------   in Excess    Retained     Comprehensive
                                        Shares    Amount     of Par      Earnings        Income         Total
                                       --------  --------  -----------  ----------  ----------------   -------
<S>                                    <C>       <C>       <C>          <C>         <C>                <C>
Balance, June 30, 1996                   7,944      $199      $16,253      $39,794           $(51)      $56,195

Stock issued upon exercise of options       48         1          760           --              --          761
Non-refundable stock option deposit         --        --          583           --              --          583
Income tax benefit from stock options
  exercised                                 --        --          146           --              --          146
Capital contribution from
  Westinghouse                              --        --          361           --              --          361
Comprehensive income
  Net income for the year                   --        --           --       16,332              --           --
  Foreign currency translation
    adjustments                             --        --           --           --         (2,651)           --
Total comprehensive income                  --        --           --           --              --       13,681
                                           ---       ---          ---          ---             ---       ------
Balance, June 30, 1997                   7,992       200       18,103       56,126         (2,702)       71,727
Stock issued upon exercise of options       70         2        1,558           --              --        1,560
Two-for-one stock split effected in
  the form of a stock dividend           8,039       201           --        (201)              --           --
Income tax benefit from stock options
  exercised                                 --        --          436           --              --          436
Comprehensive income
  Net income for the year                   --        --           --       19,641              --           --
  Foreign currency translation
    adjustments                             --        --           --           --         (1,631)           --
Total comprehensive income                  --        --           --           --              --       18,010
                                           ---       ---          ---          ---             ---       ------
Balance, June 30, 1998                  16,101       403       20,097       75,566         (4,333)       91,733
Stock issued upon exercise of options      106         2        1,758           --              --        1,760
Income tax benefit from stock options
  exercised                                 --        --          443           --              --          443
Comprehensive income
  Net income for the year                   --        --           --       27,294              --           --
  Foreign currency translation
    adjustments                             --        --           --           --         (1,957)           --
Total comprehensive income                  --        --           --           --              --       25,337
                                           ---       ---          ---          ---             ---       ------
Balance, June 30, 1999                  16,207      $405      $22,298     $102,860        $(6,290)     $119,273
                                        ======      ====      =======     ========        ========     ========
</TABLE>

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

                                       32

<PAGE>   33


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                for the years ended June 30, 1999, 1998 and 1997
                                 (in thousands)

<TABLE>
<CAPTION>

                                                      1999        1998        1997
                                                      ----        ----        ----
<S>                                                 <C>          <C>         <C>
Cash flows from operating activities:
     Net income                                      $27,294       $19,641    $16,332
                                                     -------       -------    -------
     Adjustments to reconcile net income to net
       cash provided by operating activities:
          Depreciation and amortization                9,852         8,709      7,487
          Amortization of capitalized software         2,150         1,976      1,723
          Provision for losses on accounts
             receivable                                2,577           967      1,279
          Provision for inventory obsolescence         2,870         1,140        621
          Undistributed earnings from equity
             investment and minority interests           720           268        678
          Provision for deferred income taxes          1,662         2,197      1,203
          Gain on sale of assets and investment,
             net                                       (137)         (263)         --
          Cumulative effect of change in
             accounting principle, net                    --           412         --
          Changes in assets and liabilities:
              Increase in accounts receivable       (20,441)      (22,900)    (17,070)
              Increase in inventories                (4,036)       (9,483)     (9,996)
              Increase in prepaid expenses and
                 other assets                        (3,574)       (2,992)     (1,557)
              Increase in accounts payable             9,648         2,312       4,299
              Increase (decrease) in accrued
                 expenses and other current
                 liabilities                           9,646       (1,298)       4,828
              Increase in income taxes payable         4,955         4,054       4,412
              Increase in deferred service revenue     4,407           981       2,168
                                                       -----           ---       -----
              Total adjustments                       20,299      (13,920)          75
                                                      ------      --------          --

          Net cash provided by operating
             activities                               47,593         5,721      16,407
                                                      ------         -----      ------

Cash flows from investing activities:
    Purchases of property, plant and equipment       (6,204)       (9,262)     (8,100)
    Proceeds from dispositions of property, plant
       and equipment                                   3,289            57         160
    Capitalized software development costs           (7,949)       (9,095)     (4,319)
    Purchase of third party software                   (880)            --     (1,250)
    Dividends paid to minority shareholders            (101)         (351)          --
    Proceeds from sale of affiliates                      --           100         600
    Net cash paid for acquisitions, minority
       interests and contingent earn-out payments    (1,675)       (1,806)     (2,407)
                                                     -------       -------     -------
         Net cash used in investing activities      (13,520)      (20,357)    (15,316)
                                                    --------      --------    --------

Cash flows from financing activities:
    Principal payments on line of credit            (30,893)       (5,481)     (1,924)
    Principal payments on long-term debt             (2,854)       (2,744)     (4,761)
    Principal payments on capital lease
        obligations                                    (193)         (205)       (198)
    Proceeds from issuance of stock                    1,760         1,560         760
    Proceeds from non-refundable stock option
        deposit                                           --            --         583
    Proceeds from long-term debt                       2,995         2,790          --
    Proceeds from line of credit                       3,898        21,300          --
    Income tax benefit from stock options
        exercised                                        443           436         146
    Capital contributions from Westinghouse and
        other                                             --            --         361
                                                          --            --         ---
         Net cash (used in) provided by financing
         activities                                 (24,844)        17,656     (5,033)
                                                    --------        ------     -------
</TABLE>

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

                                       33

<PAGE>   34


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
                for the years ended June 30, 1999, 1998 and 1997
                                 (in thousands)

<TABLE>
<CAPTION>
                                                            1999     1998     1997
                                                            ----     ----     ----
      <S>                                                <C>       <C>      <C>
      Effect of exchange rate changes on cash                (15)    (292)     (425)
                                                             ----    -----     -----
      Net increase(decrease) in cash and cash
         equivalents                                       $9,214   $2,728  $(4,367)
      Cash and cash equivalents at beginning of year       13,592   10,864    15,231
                                                           ------   ------    ------
      Cash and cash equivalents at end of year            $22,806  $13,592   $10,864
                                                          =======  =======   =======

      Supplemental disclosures of cash flow information:

           Cash paid during the year for:
                Interest                                   $2,377   $2,913    $1,329
                                                           ======   ======    ======
                Income taxes                               $9,159   $6,220    $6,410
                                                           ======   ======    ======
</TABLE>

Supplemental schedule of noncash financing and investing activities (in
thousands):

     In February 1999, MICROS entered into an amendment to a capital lease for
     one of the corporate headquarters buildings. In connection with this
     transaction, the carrying values of the combined land and building of $3.5
     million along with the capital lease obligation of $3.2 million were
     removed from the balance sheet.

     In June 1997, the Company purchased, through its wholly-owned Australian
     MICROS-Fidelio subsidiary located in Brisbane, certain assets from Ausdata
     Pty Limited ("Ausdata"), an Australian company (see Note 2 of Notes to
     Consolidated Financial Statements).

     In October 1996, the Company purchased the remaining 30% interest in one
     of its majority-owned subsidiaries for $399, payable $80 at closing and
     $319 in equal annual installments over the next four years, beginning
     October 1, 1997. The note bears interest at the prime rate and is adjusted
     annually each October 1st.

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

                                       34

<PAGE>   35


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

1.   Description of business and summary of significant accounting policies:

     Description of business

     MICROS is a leading worldwide designer, manufacturer, supplier and
     servicer of point-of-sale ("POS") systems, property management systems
     ("PMS"), central reservation systems ("CRS") and customer information
     systems ("CIS") software for hospitality providers, including table
     service and quick service restaurants, restaurants located in hotels and
     other lodging establishments, casinos, sports arenas, theme parks, hotels,
     motels and resorts. (References to "MICROS" or the "Company" herein
     include the operations of MICROS Systems, Inc. and its subsidiaries on a
     consolidated basis.)

     Basis of preparation

     The consolidated financial statements are prepared in accordance with
     generally accepted accounting principles. Inherent in this process are
     estimates and assumptions made by management that affect the amounts
     reported in the Company's financial statements and accompanying notes.
     Although these estimates are based on management's knowledge of current
     events and actions it may undertake in the future, actual results may
     ultimately differ from estimates.

     Principles of consolidation

     The consolidated financial statements include the accounts of the Company
     and its majority-owned subsidiaries. The earnings in consolidated MICROS
     subsidiaries are recorded net of minority interests. Investments in
     20%-through 50%-owned affiliated companies in which the Company exercises
     significant influence over operating and financial affairs are included
     under the equity method. Otherwise, investments are included at cost. All
     significant intercompany accounts and transactions have been eliminated.

     Foreign currency translation

     The financial statements of MICROS's non-U.S. operations are translated
     into U.S. dollars for financial reporting purposes. The assets and
     liabilities of non-U.S. operations whose functional currencies are other
     than the U.S. dollar are translated at rates of exchange at fiscal
     year-end, and revenues and expenses are translated at average exchange
     rates for the fiscal year. The cumulative translation effects are
     reflected in shareholders' equity. Gains and losses on transactions
     denominated in other than the functional currency of an operation are
     reflected in other income (expense).

     Comprehensive income

     On July 1, 1998, the Company adopted Statement of Financial Accounting
     Standard ("SFAS") No. 130, "Reporting Comprehensive Income." Total
     comprehensive income is reported in the consolidated statements of
     shareholders' equity and includes net income and foreign currency
     translation adjustments.

     Revenue recognition

     Revenue from hardware sales is recognized at the time of shipment with a
     provision for estimated returns and allowances. Revenue from licensed
     software sales is recognized when shipped, with an appropriate deferral
     for post-contract customer support. This deferral is earned when
     significant obligations no longer exist. Revenue from the installation of
     products is recognized as the installation of the product is performed.
     Service contract revenue is initially recorded as deferred service revenue
     and is reflected in operating income on a pro rata basis over the contract
     term.

                                       35

<PAGE>   36


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

1.   Description of business and summary of significant accounting policies,
     continued:

     Cash equivalents

     The Company considers all highly liquid investments purchased with
     original maturities of three months or less to be cash equivalents.

     Inventories

     Inventories are stated at the lower of cost or market. Cost is determined
     principally by the first-in, first-out method.

     Property, plant and equipment

     Property, plant and equipment are stated at cost. Maintenance and repairs
     are charged to expense as incurred, and the costs of additions and
     improvements are capitalized. Depreciation is provided in amounts which
     amortize costs over the useful lives of the related assets, generally
     three to ten years for equipment and forty years for building and building
     improvements, utilizing the straight-line method. Leasehold improvements
     are amortized over the terms of the respective leases or useful lives of
     the improvements, whichever is shorter.

     Warranties

     A majority of the Company's products are under warranty for defects in
     material and workmanship for a one-year period. The Company establishes an
     accrual for estimated warranty costs at the time of sale.

     Capitalized software development costs

     Software development costs incurred prior to establishing technological
     feasibility are charged to operations and included in research and
     development costs. Software development costs incurred after establishing
     technological feasibility, and purchased software costs, are capitalized
     and amortized on a product-by-product basis when the product is available
     for general release to customers. Annual amortization, charged to cost of
     sales, is the greater of the amount computed using the ratio that current
     gross revenues for a product bear to the total of current and anticipated
     future gross revenues for that product, or the straight-line method over
     the remaining estimated economic life of the product.

     Research and development costs

     Expenditures for research and development not capitalized as described
     above are charged to operations as incurred.

     Goodwill and intangible assets

     Goodwill represents the excess of purchase price over the fair value of
     the net assets of acquired subsidiaries and investees. Goodwill and
     intangible assets are stated on the basis of cost and are amortized on a
     straight line basis over their estimated periods of benefit, none of which
     exceeds 10 years. Recoverability is assessed whenever adverse events and
     changes in circumstances indicate that undiscounted cash flows previously
     anticipated warrant reassessment.

                                       36

<PAGE>   37

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

1.   Description of business and summary of significant accounting policies,
     continued:

     Financing costs related to long-term debt

     Costs associated with obtaining long-term debt are deferred and amortized
     over the term of the related debt.

     Advertising costs

     The Company's policy for accounting for advertising is to expense costs as
     incurred. Advertising expenses for fiscal 1999, 1998 and 1997, were
     $1,948, $2,474 and $2,070, respectively.

     Income taxes

     Deferred tax liabilities and assets are recognized for the expected future
     tax consequences of temporary differences between the carrying amounts and
     the tax basis of assets and liabilities.

     Net income per share

     Basic net income per common share is computed by dividing net income by
     the weighted-average number of shares outstanding. Diluted net income per
     share includes the dilutive effect of stock options. The Company adopted
     SFAS No. 128, "Earnings per Share", in fiscal 1998 and prior periods were
     restated to reflect this adoption.

     A reconciliation of the weighted average number of common shares
     outstanding assuming dilution is as follows:

<TABLE>
<CAPTION>

                                                            1999       1998         1997
                                                          --------  ---------    --------
     <S>                                                  <C>       <C>          <C>
     Average common shares outstanding                      16,140     16,027      15,918
     Dilutive effect of outstanding stock options              894        663         183
                                                               ---        ---         ---
     Average common shares outstanding assuming dilution    17,034     16,690      16,101
                                                            ======     ======      ======
</TABLE>

     All stock options outstanding as of June 30, 1999 were included in the
     computation of earnings per share assuming dilution since all of the
     options' exercise prices were below the average market price of the common
     shares.

     Common Stock

     On April 29, 1998, the Company's Board of Directors approved a two-for-one
     stock split to be effected in the form of a stock dividend payable to
     shareholders of record as of May 22, 1998. On June 23, 1998, the Company
     effected the two-for-one stock split. Shares presented in the Consolidated
     Balance Sheets and Consolidated Statements of Shareholders' Equity reflect
     the actual shares outstanding for each period presented. All share, per
     share, common stock and stock option amounts contained elsewhere in the
     consolidated financial statements and related footnotes for all periods
     presented have been restated to reflect the effect of this split.

     In addition, on November 20, 1998, the Company's shareholders approved an
     amendment to the Company's Articles of Incorporation which increased the
     Company's authorized shares of Common Stock to 50,000 from 30,000 shares.

                                       37

<PAGE>   38

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

1.   Description of business and summary of significant accounting policies,
     continued:

     Stock-based compensation

     Stock-based compensation is recognized using the intrinsic value method.
     For disclosure purposes, pro forma net income and net income per share
     impacts are provided as if the fair value method had been applied.

     Fair value of financial instruments

     The carrying amounts of the Company's financial instruments reflected in
     the consolidated balance sheet at June 30, 1999 approximate their
     respective fair values.

     New Accounting Standards

     On November 20, 1997, the Emerging Issues Task Force ("EITF") of the
     Financial Accounting Standards Board issued consensus ruling 97-13 which
     requires certain business re-engineering and information technology
     implementation costs that have previously been capitalized to now be
     expensed as incurred. In addition, any previously capitalized costs which
     are addressed by EITF 97-13 must also have been written off as a
     cumulative adjustment in the quarter containing November 20, 1997.

     The cumulative effect of this change in accounting principle represented a
     one-time after-tax charge of $412, or $0.02 per common share recorded in
     the second quarter of fiscal 1998. Additionally, all such future costs are
     to be expensed as incurred. The charge represents the business process
     re-engineering costs capitalized through December 31, 1997 relating to
     MICROS's installation of a new management information system. Prior to
     this ruling, these costs had been capitalized and were to be amortized
     over the useful life of the system.

     In June 1997, the Financial Accounting Standard Board issued SFAS No. 131
     "Disclosures about Segments of an Enterprise and Related Information." SFAS
     No. 131 establishes standards for reporting information about operating
     segments and related disclosures about products, geographic information and
     major customers.  SFAS No. 131 requires segments to be determined based on
     how management measures performance and makes decisions about allocating
     resources.  The Company adopted SFAS No. 131 in fiscal 1999.  As a result,
     the Company will separately report information based on U.S. and
     International operations.  See further discussion in Note 14.

     Reclassifications

     Certain balances have been reclassified to conform to fiscal 1999
     presentation.

2.   Acquisitions:

     Retail Business Systems, Inc.

     In September 1998, the Company acquired all of the stock of Retail
     Business Systems, Inc. ("RBS") by exercising its right under a Call Option
     Agreement entered into on July 24, 1998. The consideration paid for this
     right of $750 was applied to the purchase price under the purchase
     agreement. The purchase price for RBS outlined in the purchase agreement,
     including exclusivity and earn-out payments, could range from $750 to
     $8,000. As of June 30, 1999, $1,250 has been paid under the purchase
     agreement. In August 1999, an additional $500 was paid. Goodwill related to
     this acquisition is $1,084 at June 30, 1999, and is being amortized over
     five years. The pro forma effects of this acquisition are immaterial and
     are not presented herein.

                                       38

<PAGE>   39

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

2.   Acquisitions, continued:

     Ausdata

     On June 3, 1997, the Company, through its wholly-owned Australian
     MICROS-Fidelio subsidiary located in Brisbane, acquired certain assets
     from Ausdata Pty Limited ("Ausdata"), an Australian company. The purchased
     assets relate to the distribution of MICROS POS products in Australia. As
     part of the transaction, MICROS assumed all distribution rights in
     Australia, and hired approximately 24 Ausdata employees. The purchase
     price consisted of a base payment in the amount of approximately
     Australian $4,800 (equal to U.S. $3,600 at exchange rates at the time of
     the acquisition), of which Australian $1,400 (equal to U.S. $1,100 at
     exchange rates at the time of the acquisition) was paid at closing and the
     remainder was paid in fiscal 1998, and an earn-out payment, earnable over
     three years if certain financial targets are exceeded. Goodwill and other
     intangible assets as a result of this transaction were Australian $4,800
     (U.S. $3,600 at the exchange rate in effect at the date of purchase) which
     are being amortized over a period of seven and six years, respectively.
     The Company has consolidated MICROS and Fidelio operations in Sydney and
     continues to maintain a presence in Melbourne and Brisbane. The pro forma
     effects of this acquisition are immaterial and are not presented herein.

     Minority Interest

     During the third quarter of fiscal 1999, the Company increased its
     interest in its Scandinavian MICROS-Fidelio subsidiary group from 75% to
     85% at a cost of approximately $198. Negative goodwill approximated $66
     and is being amortized over ten years.

3.   Inventories:

     The components of inventories are as follows:

<TABLE>
<CAPTION>
                                       1999         1998
                                       ----         ----
     <S>                             <C>          <C>
     Raw materials                   $4,784       $5,415
     Work-in-process                  2,053        1,762
     Finished goods                  25,768       25,055
                                     ------       ------
                                    $32,605      $32,232
                                     ======       ======
</TABLE>

4.   Property, plant and equipment:

     The components of property, plant and equipment are as follows:

<TABLE>
<CAPTION>
                                                               1999        1998
                                                               ----        ----
          <S>                                              <C>          <C>
          Land                                                    $0      $1,583
          Buildings                                              285       5,069
          Building improvements                                    0         355
          Machinery and equipment                             31,258      26,768
          Furniture and fixtures                               6,188       6,086
          Leasehold improvements                               1,676       1,796
                                                               -----       -----
                                                              39,407      41,657

          Accumulated depreciation and amortization         (23,720)    (19,893)
                                                            --------    --------
               Net property, plant and equipment             $15,687     $21,764
                                                             =======     =======
</TABLE>

                                       39

<PAGE>   40

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

5.   Line of credit:

     The Company has a $45,000 multi-currency unsecured committed line of
     credit with Bank of America expiring on December 31, 1999. Prior to this
     upcoming expiration date, the Company anticipates that it will renew this
     line of credit for an additional one-year period. This line of credit was
     increased from $35,000 to $45,000 pursuant to an amendment entered into on
     December 15, 1998. The Company has the one-time option to convert the line
     of credit into a three-year secured term loan upon expiration of the line
     of credit. Interest due under the line of credit will be calculated as
     follows: (i) in the event the advance is in U.S. dollars, at the option of
     the Company, either the bank's prime rate minus one half of one percent
     (.50%) per annum, or the LIBOR rate plus one and one eighth percent
     (1.125%) per annum; or (ii) in the event the advance is made in a currency
     other than the U.S. dollar, the LIBOR rate for the applicable denominated
     currency selected, plus one and one eighth percent (1.125%) per annum.
     Interest due under the three-year secured term loan shall be, at the option
     of the Company, the prime rate or the treasury bill rate (adjusted to a
     constant maturity of three years) plus two and one quarter percent (2.25%).
     Under the terms of the current loan agreement, the Company may borrow up to
     $45,000 less the amount of outstanding letters of credit. Amounts
     outstanding under the line are payable on demand and are not secured by the
     assets of the Company. The agreement requires the Company to satisfy
     certain financial covenants. In addition, the agreement limits the
     assumption of additional indebtedness and restricts the Company's payment
     of dividends other than stock dividends.

     During fiscal 1997 MICROS maintained three unsecured committed lines of
     credit with BHF Bank, Hypobank and Commerzbank. The Company no longer
     maintains lines of credit with BHF Bank and Hypobank, effective May 31,
     1997. It has retained its credit relationship with Commerzbank and during
     fiscal 1998 amended and increased its credit facility with this bank so
     that the Company's borrowing limit was increased from DM 7,000 to DM
     15,000 (approximately $7,900 at the June 30, 1999 exchange rate) and the
     Company may borrow in the form of either a line of credit or term debt.
     Under the Commerzbank credit facility, the Company has a balance of DM
     10,000 (approximately $5,300 at the June 30, 1999 exchange rate) in the
     form of balloon debt and has no line of credit borrowings.

     The Company initially borrowed DM 30,000 under the Bank of America line of
     credit in connection with the Company's acquisition of Fidelio in
     November, 1995. During fiscal 1997, 1998 and 1999, the Company reduced its
     Bank of America balance by borrowing on three occasions from Commerzbank.
     As of June 30, 1999, the Company had discharged in full all amounts
     borrowed under the Bank of America line of credit. The Company has
     approximately $47,600 available under these credit agreements.

     Certain MICROS foreign subsidiaries maintain additional lines of credit,
     none of which is considered material.

                                       40

<PAGE>   41

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

6.   Long-term debt:

     The components of long-term debt are as follows:

<TABLE>
<CAPTION>
                            June 30, 1999
                           Interest Rates      Maturities       1999      1998
                           --------------      ----------       ----      ----
     <S>                   <C>              <C>             <C>         <C>
     Term loan                      5.30%       April 1999    $     --   $ 1,382
     Balloon loan                   5.30%     October 2000       2,644     2,765
     Balloon loan                   4.70%   September 2001       2,644        --
     Variable rate note             4.50%             2006          --       941
     Notes payable             8.25-8.75%        1999-2000         437       956
                                                              --------   -------
                                                                 5,725     6,044
     Less current portion                                          357     1,970
                                                              --------   -------
                                                              $  5,368   $ 4,074
                                                              ========   =======
</TABLE>

     On October 1, 1997, the Company amended its credit agreement with
     Commerzbank and increased its borrowing level from DM 7,000 to DM 15,000
     (approximately $7,900 at the June 30, 1999 exchange rate). On March 29,
     1996, the Company acquired a DM 10,000 term loan which was fully paid in
     April 1999.

     On October 1, 1997, the Company acquired a balloon loan in the amount of
     DM 5,000 (approximately $2,644 at the June 30, 1999 exchange rate) from
     Commerzbank. Under the loan, payments of interest at a fixed rate of 5.3%
     are due at the beginning of each quarter, beginning October, 1997, for the
     next 12 quarters. The full amount of the principal is due October 1, 2000.
     The Company used the full proceeds to reduce its DM-denominated borrowings
     under the Bank of America line of credit.

     On September 1, 1998, the Company acquired an additional balloon loan in
     the amount of DM 5,000 (approximately $2,644 at the June 30, 1999 exchange
     rate) from Commerzbank. Under the loan, payments of interest at a fixed
     rate of 4.7% are due at the beginning of each quarter, beginning
     September, 1998, for the next 12 quarters. The full amount of the principal
     is due September 1, 2001. The Company used the full proceeds to reduce its
     DM-denominated borrowings under the Bank of America line of credit.

     The variable rate note relates to the Company's Industrial Revenue Bond
     obligation used to purchase one of the buildings it occupies in
     Beltsville, Maryland. The note was paid in full on June 1, 1999 when the
     building was sold.

     The notes payable relate to obligations incurred by the Company in
     connection with various strategic acquisitions. The notes carry interest
     rates ranging from 8.25% to 8.75%, with varying installment payments
     through October 2000. The aggregate unamortized discount on these notes,
     based on their respective imputed interest rates, is $4 at June 30, 1999.

                                       41

<PAGE>   42


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

6.   Long-term debt, continued:

     Annual maturities of all long-term debt are as follows:

<TABLE>
<CAPTION>
          Year ended June 30,                           Amount
          -------------------                           -------
          <S>                                           <C>
          2000                                          $   357
          2001                                            2,724
          2002                                            2,644
          2003                                               --
          2004                                               --
          2005 and thereafter                                --
                                                        -------
                                                        $ 5,725
                                                        =======
</TABLE>

7.   Accrued expenses and other current liabilities:

     The components of accrued expenses and other current liabilities are as
follows:

<TABLE>
<CAPTION>
                                                        1999            1998
                                                      --------         -------
     <S>                                              <C>              <C>
     Compensation and related taxes                    $10,163          $8,493
     Commissions                                         5,915           3,842
     Volume rebates and credits due customers            3,982           4,639
     Deposits received from customers                   10,422           4,168
     VAT and sales taxes                                 1,975           1,605
     Payments due for acquisitions                          --             196
     Accrued payables and other                          5,738           6,407
                                                         -----           -----
                                                       $38,195         $29,350
                                                       =======         =======
</TABLE>

8.   Commitments and contingencies:

     Office Closure

     On April 1, 1998, MICROS announced the permanent closure of its facility
     in Munich, Germany and recorded a charge of $2,245 associated with this
     action. The decision was made to reduce costs and consolidate operations.
     The Munich office had served primarily as a service and development center
     for MICROS-Fidelio hotel products. The office closure costs are comprised
     of severance benefits, relocation expenses and lease reserves.

     As part of the Munich office closure, the Company terminated approximately
     72 of the 123 employees. In accordance with German labor law and practice,
     and in accordance with an agreement achieved with the Munich office
     workers council, MICROS has paid during fiscal 1999, one-time severance
     benefits to all terminated Munich employees in the aggregate amount of
     approximately $1,360. The balance of the employees accepted relocation
     offers to other sites in Germany, the U.K. and Florida and, as a result,
     the Company has incurred relocation expenses in the amount of
     approximately $124 in fiscal 1998 and $427 in fiscal 1999.

     The Company and its subsidiaries lease office space and equipment under
     operating leases expiring at various dates through 2010. Rent expense
     under these leases for fiscal 1999, 1998 and 1997 was $5,329, $5,584, and
     $4,852, respectively.

     In anticipation of its move to new corporate headquarters, MICROS entered
     into an amendment to a capital lease for one of the corporate headquarters
     buildings located at 12050 Baltimore Avenue, Beltsville,

                                       42

<PAGE>   43

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

8.   Commitments and contingencies, continued:

     Maryland. As part of a comprehensive agreement, MICROS agreed to waive
     certain purchase rights of the facility embodied in the original capital
     lease, including the right to purchase the facility in 2009 for $10.00.
     MICROS also entered into a standard operating lease with the owner of the
     facility pursuant to which MICROS agreed to continue to rent portions of
     the facility until March 31, 2000. In consideration of MICROS' entering
     into the agreements, MICROS received a one-time cash payment of $625 from
     the owner of the facility. In accordance with sale-leaseback accounting
     requirements, the calculated gain of $275 has been deferred and is being
     amortized over the term of the new operating lease arrangement. During the
     third quarter of fiscal 1999, the Company removed the carrying values of
     the combined land and building along with the capital lease obligation of
     $3,470 and $3,205, respectively.

     Also, in anticipation of the move, MICROS consummated a sale of its
     corporate headquarters building located at 12000 Baltimore Avenue,
     Beltsville, Maryland. MICROS has signed an agreement to lease the building
     from the time of sale in June 1999 through January 31, 2000, renewable on
     a month-to-month basis. MICROS received proceeds of $2,930 for the sale of
     the land and building. The calculated gain on the sale of the land and
     building is $505. In accordance with sale-leaseback accounting
     requirements, $368 was deferred and will be amortized over the term of the
     new operating lease arrangement and $137 was recognized as profit in the
     month the sale occurred. The Company removed the combined carrying values
     of $2,236.

     Future minimum lease commitments at June 30, 1999 for those leases having
     an initial or remaining non-cancelable lease term in excess of one year
     are as follows:

<TABLE>
<CAPTION>
                                                     Operating          Capital
     Year ending June 30,                             Leases             Leases
     --------------------                           ----------          -------
     <S>                                            <C>                <C>
     2000                                               $4,952              $98
     2001                                                3,455               65
     2002                                                1,828               66
     2003                                                  970               34
     2004                                                  382               21
     2005 and thereafter                                    57              139
                                                            --              ---
                                                       $11,644              423
                                                       =======

     Current portion                                                         98
                                                                             --
     Long-term obligation under capital lease                              $325
                                                                           ====
</TABLE>

     In July 1998, MICROS entered into a construction agreement and a lease
     agreement (collectively, the "Orix Agreements") with Orix Columbia, Inc.
     ("Orix"), a wholly-owned subsidiary of Orix USA Corporation. In accordance
     with the terms of the Orix Agreements, Orix shall construct and own a
     250,000 square foot building located on a 20 acre parcel in Columbia,
     Maryland. Construction of the new facility commenced in November 1998; it
     is anticipated that construction of the new facility will be completed in
     March 2000. The new facility shall serve as the new worldwide corporate
     headquarters for MICROS. MICROS will nonetheless maintain certain
     warehouse space in Maryland. MICROS may also maintain in Maryland a
     separate customer service center.

     The Agreements commit MICROS to lease the full building from Orix, for a
     ten-year period commencing upon completion of the facility. In addition to
     the above table, these new lease commitments are expected to be
     approximately $32,715. The Agreements also provide MICROS with the right
     to demand construction of a new building adjacent to the new facility,
     which would provide additional expansion space. MICROS has not exercised
     that option as of the date hereof.

                                       43

<PAGE>   44

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

8.   Commitments and contingencies, continued:

     The cost per square foot on a fully operational basis of the new facility
     is approximately 15% greater than the average cost per square foot of the
     existing Beltsville facilities. Total lease expenditures for Maryland
     offices will increase, as the aggregate amount of space to which the
     Company has committed has increased. The amount of required space has
     increased (and it is anticipated will continue to increase) as a result of
     the growth the Company has and expects to continue to experience. Moreover,
     as actual lease liabilities for the new facility are computed on the basis
     of the actual costs of the construction of the facility, the final cost of
     the rent may vary from current projections. Finally, MICROS anticipates
     incurring certain one-time expenses associated with its relocation to the
     new facility. These one-time relocation expenses may range between $800 and
     $1,300.

     Legal proceedings

     MICROS is and has been involved in legal proceedings arising in the normal
     course of business. The Company is of the opinion, based upon presently
     available information and the advice of counsel concerning pertinent legal
     matters, that any resulting liability should not have a material adverse
     effect on the Company's results of operations or financial position.

     On March 25, 1997, Budgetel Inns, Inc. ("Budgetel") filed suit against
     MICROS in the United States Federal District Court in the Eastern District
     of Wisconsin. Budgetel alleges, among other things, that MICROS breached a
     March 1993 software support agreement by failing to provide full support
     to this software package licensed to Budgetel in 1993. MICROS filed its
     answer to the complaint in September of 1999. MICROS also filed a
     counterclaim against Budgetel, alleging breach of contract and defamation.
     While the ultimate outcome of litigation is uncertain, and while
     litigation is inherently difficult to predict, the Company is of the
     opinion, based upon presently available information and the advice of
     counsel concerning pertinent legal matters, that resulting liability, if
     any, should not have a material adverse effect on the Company's results of
     operations or financial position.

9.   Stock options:

     The Company has incentive and non-qualified stock options outstanding
     which were granted to a director, officers and other employees pursuant to
     authorization by the Board of Directors. The exercise price of all options
     equals the market value on the date of the grant. Substantially all of the
     options granted are exercisable pursuant to a three-year vesting schedule
     whereby one-third of the options vest upon the first anniversary of the
     grant, the second third of the options vest upon the second anniversary of
     the grant, and the final third of the options vest upon the third
     anniversary of the grant. All options expire either five or ten years from
     the date of grant. The Company applies the intrinsic value based method of
     accounting prescribed by Accounting Principles Board Opinion No. 25,
     "Accounting for Stock Issued to Employees," in accounting for the stock
     option awards. Accordingly, the Company has not recognized any related
     compensation expense in the consolidated statements of operations.

                                       44

<PAGE>   45

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

9.   Stock options, continued:

     The following table summarizes the status of, and changes in, the
     Company's stock option plans during the past three years:

<TABLE>
<CAPTION>
                                      Stock      Weighted-average    Options     Weighted-average
                                      Options     Exercise Price    Exercisable   Exercise Price
                                      -------    ----------------   -----------  ----------------
     <S>                              <C>        <C>                <C>          <C>
     Balance, June 30, 1996               658              $13.21         218           $11.10

          Options granted               1,435               15.70
          Options canceled               (63)               13.14
          Options exercised              (96)                7.91
                                         ----

     Balance, June 30, 1997             1,934               15.32         293           $14.25

          Options granted                 865               23.13
          Options canceled               (79)               17.83
          Options exercised             (116)               13.45
                                        -----

     Balance, June 30, 1998             2,604               17.92         803           $15.22

          Options granted                1010               26.49
          Options canceled               (64)               22.24
          Options exercised             (105)               16.59
                                        -----

     Balance, June 30, 1999             3,445              $20.40       1,525           $16.92
                                        =====
</TABLE>

     Additional information regarding stock options outstanding at June 30,
     1999 is as follows:

<TABLE>
<CAPTION>

                                           Options Outstanding               Options Exercisable
                                     ------------------------------------    -------------------
                                                              Weighted
                                                               Average
                                               Weighted       Remaining                 Weighted
                                                Average      Contractual                Average
     Range of Exercise Prices        Shares      Price     Life (in years)   Shares      Price
     ------------------------        ------    --------    ---------------   ------     --------
     <S>                             <C>       <C>         <C>               <C>        <C>
     $11.1250 to $14.78125              1,045      $13.94             5.67       722        $13.91
     $14.7813 to $23.09375              1,413       20.89             6.00       802         19.62
     $24.8750 to $26.81250                962       26.40             9.35        --            --
     $27.0000 to $37.62500                 25       31.65             9.66         1         29.63
                                           --                                      -

     $11.1250 to $37.62500              3,445      $20.40             6.86     1,525        $16.92
                                        =====                                  =====
</TABLE>

     SFAS No. 123, "Accounting for Stock-Based Compensation," requires the
     Company to make certain disclosures as if the fair value based method of
     accounting had been applied to the Company's stock option grants made
     subsequent to fiscal 1995. Accordingly, the Company estimated the
     grant-date fair value of each option awarded in fiscal years 1999, 1998
     and 1997 using the Black-Scholes option-pricing model with the following
     weighted-average assumptions:

<TABLE>
<CAPTION>

                                      1999          1998           1997
                                   ----------    ----------       -------
<S>                                <C>           <C>            <C>
     Risk-free interest rate               4.8%         5.7%          6.1%
     Expected life                    7.0 years    7.0 years     4.5 years
     Expected volatility                    47%          45%           50%
     Expected dividend yield                 0%           0%            0%
</TABLE>

                                       45

<PAGE>   46

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

9.   Stock options, continued:

     Had fiscal 1999, 1998 and 1997 compensation cost been determined including
     the weighted-average estimate of the fair value of each option granted of
     $14.71, $12.78 and $14.50 in fiscal 1999, 1998 and 1997, respectively, the
     Company's net income would be reduced to pro forma amounts as follows:

<TABLE>
<CAPTION>

                                             Year ended June 30,
                                        ------------------------------
                                        1999         1998         1997
                                        ----         ----         ----
    <S>                                <C>          <C>         <C>
     Net income
       As reported                       $27,294      $19,641    $16,332
       Pro forma                         $19,666      $15,288    $14,859

     Basic net income per share
       As reported                         $1.69        $1.23      $1.03
       Pro forma                           $1.22        $0.95      $0.93

     Diluted net income per share
       As reported                         $1.60        $1.18      $1.01
       Pro forma                           $1.15        $0.92      $0.92
</TABLE>

10.  Income taxes:

     Pretax accounting income for the years ended June 30 was taxed under
the following jurisdictions:

<TABLE>
<CAPTION>

                            1999          1998          1997
                         ----------    ----------    ---------
          <S>            <C>           <C>           <C>
          United States    $18,083       $16,302       $12,511
          Non-U.S.          29,238        16,913        15,115
                            ------        ------        ------
                           $47,321       $33,215       $27,626
                           =======       =======       =======
</TABLE>

     The components of income tax expense are:

<TABLE>
<CAPTION>

                           1999         1998           1997
                        ----------   ----------     -------
     <S>                <C>          <C>            <C>
     Current:
         Federal            $5,692       $2,949      $3,802
         State                 584          298         339
         Foreign            11,369        7,450       5,272
                            ------        -----       -----
                            17,645       10,697       9,413
                            ------       ------       -----
     Deferred:
         Federal               461        2,565        (27)
         State                  87          482         (4)
         Foreign             1,114        (850)       1,234
                             -----        -----       -----
                             1,662        2,197       1,203
                             -----        -----       -----
                           $19,307      $12,894     $10,616
                           =======      =======     =======
</TABLE>

                                       46

<PAGE>   47


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

10.  Income taxes, continued:

     The total tax provision is different from the amount that would have been
     recorded by applying the U.S. statutory federal income tax rate to income
     before taxes. The reconciliation of these differences is as follows:

<TABLE>
<CAPTION>

                                                              1999         1998        1997
                                                              ----         ----        ----
<S>                                                          <C>          <C>         <C>
     At statutory rate                                        35.0%       35.0%       35.0%
          Increase (decrease) resulting from:
              U.S. federal surtax reduction                   (0.2)       (0.3)       (0.4)
              State taxes, net of federal tax
                benefit                                         1.0         1.1          .8
              Research tax credits                            (1.1)       (1.5)       (1.5)
              Foreign Sales Corporation tax benefit           (1.6)       (1.8)       (1.7)
              Effect of tax rates in foreign
                jurisdictions                                   4.8         1.8         5.6
              Permanent differences                             1.7         2.3         1.0
              Other                                             1.2         2.2        (.4)
                                                                ---         ---        ----
     Effective tax rate                                       40.8%       38.8%       38.4%
                                                              =====       =====       =====
</TABLE>

     Appropriate U.S. taxes have been provided for earnings of subsidiary
     companies that are expected to be remitted to the parent company. The
     cumulative amount of unremitted earnings from international subsidiaries
     that is expected to be indefinitely reinvested is approximately $26,482
     and $12,738 at June 30, 1999 and 1998, respectively.

     Deferred income taxes reflect the net tax effects of temporary differences
     between the carrying amounts of assets and liabilities for financial
     reporting purposes and the amounts used for income tax purposes. At June
     30, 1999 and 1998, the Company had potential tax benefits of $255 and
     $295, respectively, related to U.S. net operating loss carryforwards for
     income tax purposes. The tax loss carryforwards (if not utilized against
     taxable income) expire beginning 2005 and continue through 2009. A
     valuation allowance of $255 and $295 has been provided at June 30, 1999
     and 1998, respectively, to offset the related deferred tax assets due to
     uncertainty of realizing the benefit of the loss carryforwards. The
     operating loss carryforwards were acquired as part of a purchase of a
     subsidiary, and any realization of the operating loss carryforwards will
     result in a reduction of goodwill recorded as part of that acquisition.
     The following summarizes the significant components of the Company's
     deferred tax assets and liabilities:

<TABLE>
<CAPTION>

                                                                         1999           1998
                                                                      ----------       -------
     <S>                                                              <C>             <C>
     Bad debt                                                             $1,373          $997
     Accruals not currently deductible for tax                             2,510         2,132
     Inventory                                                             1,628         1,437
     Net operating loss carryforward                                         255           295
     Purchased in-development software technology write-off                3,956         4,428
     Other                                                                   356           365
                                                                             ---           ---
     Total deferred tax assets                                            10,078         9,654
                                                                          ------         -----

     Depreciation                                                          (177)         (383)
     Capitalized software development costs                              (7,504)       (6,000)
     Other                                                               (1,171)         (343)
                                                                         -------         -----

     Total deferred tax liabilities                                      (8,852)       (6,726)
                                                                         -------       -------

     Net operating loss carryforward valuation allowance                   (255)         (295)
                                                                           -----         -----

     Net deferred tax asset                                                 $971        $2,633
                                                                            ====        ======
</TABLE>

                                       47

<PAGE>   48

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

11.  Other income (expense), net:

     Other income (expense) is comprised of the following items:

<TABLE>
<CAPTION>
                                              1999             1998         1997
                                           ---------        ---------    -------
     <S>                                   <C>              <C>          <C>
     Foreign exchange gain (loss), net        $1,047           $(126)       $256
     Gain on sale of investment                   --              345        219
     Gain on sale of land & building             137               --         --
     Other, net                                (494)              385        299
                                               -----              ---        ---
     Total other income (expense), net          $690             $604       $774
                                                ====             ====       ====
</TABLE>

12.  Related party transactions:

     During fiscal year 1997, Mr. Cohen, a Director of the Company, was a
     full-time employee of the Company and was compensated $208. During fiscal
     1998, Mr. Cohen was compensated $97 in consideration for his provision of
     consulting services to the Company. Mr. Cohen's employment with the
     Company terminated on June 30, 1997, and his consultant agreement with the
     Company terminated on June 30, 1998. Additionally, pursuant to the terms
     of the Purchase Agreement dated August 25, 1995 under which the Company
     purchased from Mr. Cohen and his family the remaining 77% of D.A.C.
     Systemes/MICROS France and AD-Maintenance Informatique ("ADMI") the
     Company did not already own, the Company owes as of the end of each fiscal
     year to Mr. Cohen approximately $408, $466 and $223 for fiscal 1999, 1998
     and 1997, respectively. The payments are made during the first fiscal
     quarter of the following year per the agreement.

     During fiscal years 1999, 1998 and 1997, the Company compensated Louis M.
     Brown, Jr., Chairman of the Board, $241, $230 and $226, respectively, for
     consulting services provided to the Company. Effective June 30, 1995, the
     Company and Mr. Brown entered into a Consulting Agreement terminating June
     30, 2000, pursuant to which Mr. Brown is to provide on the average 20
     hours per week of consulting services to the Company in exchange for a
     base consulting fee commencing at $150 plus a target bonus of $70, with
     annual adjustments.

13.  Employee benefit plan:

     The Company sponsors an employee savings plan which conforms to the
     provisions of Section 401(k) of the Internal Revenue Code. The Plan covers
     substantially all full-time employees and allows employees to voluntarily
     defer a certain percentage of their income through contributions to the
     Plan. The Company matches fifty percent of the first five percent of each
     participating employee's voluntary contributions. Furthermore, the Company
     may elect to make additional contributions, at its discretion. Company
     contributions were made during the years ended June 30, 1999, 1998 and 1997
     totaling $725, $596 and $487, respectively.

     The Company does not have any obligations to past or present employees
     related to post employment benefits.

14.  Segment reporting data:

     The Company develops, manufactures, sells and services point-of-sale
     computer systems, property management systems, central reservation and
     central information systems products for the hospitality industry. MICROS
     is organized and operates in two segments: U.S. and International. The
     international segment is primarily in Europe and the Pacific Rim. For
     purposes of applying SFAS No. 131, we consider the U.S. and International
     products and services to be similar; however management views them
     separately

                                       48

<PAGE>   49

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

14.  Segment reporting data, continued:

     in operating the business. The accounting policies of the segments are the
     same as those described in the summary of significant accounting policies.
     The following information is presented in accordance with the requirements
     of SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
     Information." Prior period amounts have been restated in accordance with
     the requirements of the new standard.

     A summary of the Company's operating segments is as follows (in
     thousands):

<TABLE>
<CAPTION>

                                                                Year Ended June 30,
                                              ---------------------------------------------------
                                                  1999               1998              1997
                                              -----------        -----------         --------
     <S>                                      <C>                <C>                 <C>
     Revenues (1):
        United States                             $170,294           $136,117          $115,873
        International                              208,419            185,180           141,243
        Intersegment eliminations                 (43,619)           (41,052)          (28,947)
                                                  --------           --------          --------
          Total revenues                          $335,094           $280,245          $228,169
                                                  ========           ========          ========

     Income before taxes, minority interests,
        equity in net earnings of affiliates
        and cumulative effect of accounting
        change (1):
        United States                              $13,648             $9,108           $13,519
        International                               62,927             50,904            33,336
        Intersegment eliminations                 (29,254)           (26,797)          (19,229)
                                                  --------           --------          --------
          Total income before taxes,
            minority interests, equity
            in net earnings of affiliates
            and cumulative effect of
            accounting change                      $47,321            $33,215           $27,626
                                                   =======            =======           =======

     Indentifiable assets (2):
        United States                             $142,235           $125,854          $108,566
        International                               89,895             78,757            53,039
        Intersegment eliminations                       --                 --                --
                                                      ----               ----              ----
          Total identifiable assets               $232,130           $204,611          $161,605
                                                  ========           ========          ========

     Capital expenditures (2):
        United States                               $4,357             $6,691            $5,486
        International                                1,847              2,571             2,614
        Intersegment eliminations                       --                 --                --
                                                      ----               ----              ----
          Total capital expenditures                $6,204             $9,262            $8,100
                                                    ======             ======            ======

     Depreciation and amortization (2):
        United States                               $5,370             $4,569            $3,385
        International                                4,482              4,140             4,102
        Intersegment eliminations                       --                 --                --
                                                      ----               ----              ----
          Total depreciation and amortization       $9,852             $8,709            $7,487
                                                    ======             ======            ======
</TABLE>

(1)  Amounts based on the location of the customer.
(2)  Amounts based on the location of the selling entity.

     MICROS products are distributed in the U.S. and internationally, primarily
     in Europe and the Pacific Rim, through subsidiaries, independent
     Dealers/Distributors and company-owned sales and service offices. The
     Company's principal customers are lodging and food service-related
     businesses. No single customer accounts for 10% or more of the Company's
     consolidated revenues.


                                       49

<PAGE>   50

                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     (in thousands, except per share data)

14.  Segment reporting data, continued:

     Geographic revenue information for the three years ended June 1999 is
     based on the location of the selling entity. Long-lived assets shown by
     geographic location represent property, plant, and equipment and are
     based on the physical location of the assets at the end of each fiscal
     year. Substantially all intangible assets do not have a physical or
     geographic location; therefore, intangible assets are not included below.

     Revenues from unaffiliated customers by geographic location are as
     follows:

<TABLE>
<CAPTION>

                                                  1999               1998                1997
                                              -----------        -----------         --------
     <S>                                      <C>                <C>                 <C>
     United States                              $169,222            $135,154          $113,130
     International                               165,872             145,091           115,039
                                                 -------             -------           -------
     Net revenue                                $335,094            $280,245          $228,169
                                                ========            ========          ========

     Significant countries included above:
         Germany                                $ 50,559            $ 41,860          $ 25,696
         United Kingdom                           24,439              20,963            13,539
         France                                   11,640              10,666             9,760


     Long-lived assets by geographic
         location are as follows:
<CAPTION>
                                                    1999               1998                1997
                                                -----------        -----------         --------
     <S>                                      <C>                <C>                 <C>
     United States                               $12,211             $17,963           $15,693
     International                                 3,476               3,801             3,604
                                                   -----               -----             -----
     Total long-lived assets                     $15,687             $21,764           $19,297
                                                 =======             =======           =======

     Significant countries included above:

         Germany                                 $   866             $ 1,136           $ 1,143
         United Kingdom                              338                 306               202
         France                                       93                 209               251

</TABLE>

                                       50

<PAGE>   51


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                     (in thousands, except per share data)

15.  Quarterly financial information (unaudited):

     Quarterly financial information for fiscal 1999 and 1998 is presented in
the following tables:

<TABLE>
<CAPTION>

                                      First     Second      Third       Fourth
1999                                 Quarter    Quarter    Quarter     Quarter
----                                 -------    -------    -------     -------
<S>                                  <C>        <C>        <C>         <C>
Revenue                                $66,639    $80,594     $85,121   $102,740
                                       =======    =======     =======   ========

Gross margin                           $33,183    $39,757     $43,222    $48,013
                                       =======    =======     =======    =======

Income from operations                  $6,849    $11,435     $13,093    $17,268
                                        ======    =======     =======    =======

Net income                              $3,508     $6,213      $7,688     $9,885
                                        ======     ======      ======     ======

Basic net income per common share        $0.22      $0.39       $0.48      $0.61
                                         =====      =====       =====      =====

Diluted net income per common share      $0.21      $0.37       $0.45      $0.58
                                         =====      =====       =====      =====

Stock Prices (in dollars)
-------------------------

High                                    38-7/8     32-7/8     33-5/16         35

Low                                   23-15/16    22-1/16      27-5/8     29-1/2

</TABLE>

================================================================================

                                       51

<PAGE>   52


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                     (in thousands, except per share data)

15.  Quarterly financial information (unaudited), continued:

<TABLE>
<CAPTION>

                                                    First       Second        Third        Fourth
1998                                               Quarter      Quarter      Quarter      Quarter
----                                               -------      -------      -------      -------
<S>                                                <C>          <C>          <C>          <C>
Revenue                                              $59,588      $66,267       $71,081     $83,309
                                                     =======      =======       =======     =======

Gross margin                                         $29,287      $34,537       $33,731     $40,082
                                                     =======      =======       =======     =======

Income from operations                                $5,388       $8,815        $9,109     $10,765
                                                      ======       ======        ======     =======

Net income before cumulative effect of
  change in accounting principle                      $3,015       $5,028        $5,849      $6,161

Cumulative effect of change in accounting
  principle, net of tax                                   --        (412)            --          --
                                                        ----        -----          ----        ----
Net income                                            $3,015       $4,616        $5,849      $6,161
                                                      ======       ======        ======      ======

Basic net income per common share before
cumulative effect of change in accounting
principle                                              $0.19        $0.31         $0.37       $0.38
Cumulative effect of change in accounting
  principle, net of tax                                   --       (0.02)            --          --
                                                         ---        -----           ---         ---
Basic net income per common share                      $0.19        $0.29         $0.37       $0.38
                                                       =====        =====         =====       =====

Diluted net income per common share
before cumulative effect of change in
accounting principle                                   $0.18        $0.30         $0.35       $0.36
Cumulative effect of change in accounting
  principle, net of tax                                   --       (0.02)            --          --
                                                         ---        -----           ---         ---
Diluted net income per common share                    $0.18        $0.28         $0.35       $0.36
                                                       =====        =====         =====       =====

Stock Prices (in dollars)
-------------------------

High                                                      25       27-3/4      30-11/32      33-1/2

Low                                                  20-5/16       21-1/4       22-3/16          27
</TABLE>

================================================================================

The Company has never paid a cash dividend. Its current policy is to retain
earnings and use funds for the operation and expansion of its business. In
addition, certain indebtedness restricts the amount of cash dividends which may
be payable.

                                       52

<PAGE>   53


                     MICROS SYSTEMS, INC. AND SUBSIDIARIES
          SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
        for the years ended June 30, 1999, 1998 and 1997 (in thousands)

<TABLE>
<CAPTION>

                                     Balance at    Charged                                     Balance
                                      beginning      to                                        at end
               Description            of period   expenses    Deductions         Other (1)    of period
   -----------------------------   -------------  ---------   ----------         -----       ----------
   <S>                            <C>             <C>         <C>                <C>        <C>
   Year ended June 30, 1999:
       Allowance for doubtful
         accounts                        $2,298      $2,577          $633            $(624)       $3,618
       Reserve for inventory
         obsolescence                     2,099       2,870           834  (2)          154        4,289
                                          -----       -----           ---               ---        -----
                                         $4,397      $5,447        $1,467            $(470)       $7,907
                                         ======      ======        ======            ======       ======

   Year ended June 30, 1998:
       Allowance for doubtful
         accounts                        $2,508        $967        $1,022            $(155)       $2,298
       Reserve for inventory
         obsolescence                     1,651       1,140           688  (2)          (4)        2,099
                                          -----       -----           ---               ---        -----
                                         $4,159      $2,107        $1,710            $(159)       $4,397
                                         ======      ======        ======            ======       ======

   Year ended June 30, 1997:
       Allowance for doubtful
         accounts                        $2,016      $1,279          $933              $146       $2,508
       Reserve for inventory
         obsolescence                     1,605         621           544  (2)         (31)        1,651
                                          -----         ---           ---              ----        -----
                                         $3,621      $1,900        $1,477              $115       $4,159
                                         ======      ======        ======              ====       ======
</TABLE>

(1)  Primarily related to foreign currency translation.
(2)  Material scrapped or otherwise disposed.

                                       53

<PAGE>   54


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

<TABLE>
<CAPTION>

                                                                 MICROS SYSTEMS, INC.
<S>                   <C>                                   <C>
Date:                 9-28-99                               By:  /s/Gary C. Kaufman
                      -------                               ---  ------------------
                                                                 Gary C. Kaufman
                                                                 Executive Vice President, Finance
                                                                 and Administration/Chief Financial
                                                                 Officer

Date:                 9-28-99                               By:  /s/Roberta J. Watson
                      -------                               ---  -------------------
                                                                 Roberta J. Watson
                                                                 Vice President and Controller
</TABLE>

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant, and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>

         Name                                 Title
----------------------               ------------------------
<S>                                 <C>                                       <C>
/s/Louis M. Brown, Jr.                                                          9-28-99
------------------------                     Director and                       -------
Louis M. Brown, Jr.                     Chairman of the Board

/s/A. L. Giannopoulos                    Director and President                 9-28-99
------------------------               Chief Executive Officer                  -------
A. L. Giannopoulos

/s/Ronald J. Kolson                     Executive Vice President                9-28-99
------------------------               Procurement & Logistics                  -------
Ronald J. Kolson

/s/Gary C. Kaufman                      Executive Vice President                9-28-99
------------------------              Finance and Administration                -------
Gary C. Kaufman                        Chief Financial Officer

/s/Daniel Cohen                                                                 9-28-99
------------------------                       Director                         -------
Daniel Cohen

/s/John G. Puente                                                               9-28-99
----------------------                         Director                         -------
John G. Puente

/s/F. Suzanne Jenniches                                                         9-28-99
------------------------                       Director                         -------
F. Suzanne Jenniches

/s/Dwight S. Taylor                                                             9-28-99
------------------------                       Director                         -------
Dwight S. Taylor

</TABLE>


                                       54
<PAGE>   55


                                 EXHIBIT INDEX

     3(i).      Articles of Incorporation of the Company are incorporated
                herein by reference to Exhibit 3 to the Annual Report on Form
                10-K of the Company for the Fiscal Year ended June 30, 1990.

     3(i)(a).   Articles of Amendment to Articles of Incorporation are
                incorporated herein by reference to Exhibit 3(i) to the
                Quarterly Report on Form 10-Q of the Company for the period
                ended December 31, 1997.

     3(i)(b).   Articles of Amendment to Articles of Incorporation are
                incorporated herein by reference to Exhibit 3(i) to the
                Quarterly Report on Form 10-Q of the Company for the period
                ended December 31, 1998.

     3(ii).     By-laws of the Company as in effect on the date hereof is
                incorporated herein by reference to Exhibit 3 to the Annual
                Report on Form 10-K of the Company for the Fiscal Year ended
                June 30, 1990.

     10a1.      Amendment and Restatement of MICROS Systems, Inc. Stock Option
                Plan is incorporated herein by reference to Exhibit 4.1 to the
                Registration Statement on Form S-8 of the Company filed on
                February 16, 1990.

     10a2.      First Amendment to the Amendment and restatement of MICROS
                Systems, Inc. Stock Option Plan constituting Exhibit 10a1
                hereto is incorporated herein by reference to Exhibit 4.2 to
                the Registration Statement on Form S-8 of the Company filed on
                February 16, 1990.

     10b1.      MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                incorporated herein by reference to Exhibit A to the Proxy
                Statement of the Company for the 1993 Annual Meeting of
                Shareholders.

     10b2.      MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                incorporated herein by reference to Exhibit A to the Proxy
                Statement of the Company for the 1995 Annual Meeting of
                Shareholders.

     10b3.      MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                incorporated herein by reference to Exhibit A to the Proxy
                Statement of the Company for the 1996 Annual Meeting of
                Shareholders.

     10b4.      MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                incorporated herein by reference to Exhibit A to the Proxy
                Statement of the Company for the 1997 Annual Meeting of
                Shareholders.

     10b5.      MICROS Systems, Inc. 1991 Stock Option Plan as amended, is
                incorporated herein by reference to Exhibit A to the Proxy
                Statement of the Company for the 1998 Annual Meeting of
                Shareholders.

     10c.       Underwriting Agreement dated July 6, 1995 by and among MICROS
                Systems, Inc., Westinghouse Electric Corporation, Westinghouse
                Holdings Corporation, J.P. Morgan Securities, Inc., Morgan
                Stanley & Co. Incorporated and Smith Barney, Inc. is
                incorporated herein by reference to Exhibit 10d to the Annual
                Report on Form 10-K of the Company for the Fiscal Year ended
                June 30, 1995.

     10d.       Employment Agreement dated June 1, 1995 between MICROS Systems,
                Inc. and A. L. Giannopoulos is incorporated herein by reference
                to Exhibit 10e to the Annual Report on Form 10-K of the Company
                for the Fiscal Year ended June 30, 1995.

     10e.       First Amendment to Employment Agreement dated February 6, 1997
                between MICROS Systems, Inc. and A. L. Giannopoulos is
                incorporated herein by reference to Exhibit 10 to the Quarterly
                Report on Form 10-Q of the Company for the period ended
                December 31, 1996.

                                       55

<PAGE>   56

     10f.       Second Amendment to Employment Agreement dated February 1, 1998
                between MICROS Systems, Inc. and A. L. Giannopoulos is
                incorporated herein by reference to Exhibit 10 to the Quarterly
                Report on Form 10-Q of the Company for the period ended
                December 31, 1997.

     10g.       Third Amendment to Employment Agreement dated September 8, 1999
                between MICROS Systems, Inc. and A. L. Giannopoulos.

     10h.       Consulting Agreement dated June 30, 1995 between MICROS
                Systems, Inc. and Louis M. Brown, Jr. is incorporated herein by
                reference to Exhibit 10 to the Annual Report on Form 10-K of
                the Company for the Fiscal Year ended June 30, 1995.

     10i.       First Amendment to Consulting Agreement dated February 1, 1999
                between MICROS Systems, Inc. and Louis M. Brown, Jr. is
                incorporated herein by reference to Exhibit 10 to the Quarterly
                Report on Form 10-Q of the Company for the period ended
                December 31, 1998.

     10j.       MICROS Systems, Inc. Bonus and Incentive Plan is incorporated
                herein by reference to Exhibit 10 to the Quarterly Report on
                Form 10-Q of the Company for the period ended September 30,
                1994.

     10k.       Employment Agreement dated May 28, 1997 between MICROS Systems,
                Inc. and Gary C. Kaufman is incorporated herein by reference to
                Exhibit 10 to the Annual Report on Form 10-K of the Company for
                the Fiscal Year ended June 30, 1997.

     10l.       First Amendment to Employment Agreement dated October 1, 1998
                between MICROS Systems, Inc. and Gary C. Kaufman is
                incorporated herein by reference to Exhibit 10 to the Quarterly
                Report on Form 10-Q of the Company for the period ended
                December 31, 1998.

     10m.       Employment Agreement dated May 28, 1997 between MICROS Systems,
                Inc. and Ronald J. Kolson is incorporated herein by reference
                to Exhibit 10 to the Annual Report on Form 10-K of the Company
                for the Fiscal Year ended June 30, 1997.

     10n.       Consulting Agreement dated July 1, 1997 between MICROS Systems,
                Inc. and Daniel Cohen is incorporated herein by reference to
                Exhibit 10 to the Annual Report on Form 10-K of the Company for
                the Fiscal Year ended June 30, 1997.

     11.        Statement Regarding Computation of Earnings Per Share.

     21.        Subsidiaries of the Company.

     23.        Consent of Independent Accountants.

     27.        Financial Data Schedule.

                                       56