<PAGE>   1
EXHIBIT 13

PORTIONS OF ANNUAL REPORT

SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES
SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
         Year Ended December 31,            1999 (1)            1998 (2)           1997 (3)             1996          1995 (4)
                                            --------            --------           --------           --------        --------
         (in thousands, except per
         share data)
<S>                                         <C>                 <C>                <C>                <C>             <C>
         Statement of Operations

         Revenues                           $ 65,736            $ 73,593           $ 45,527           $ 34,625        $ 26,179
         Income (loss) before taxes          (19,191)              2,278              1,563                453          (8,038)
         Net income (loss)                   (12,648)              1,053                534                 39          (5,014)

         Net Income (loss) per share

         Basic
         Earnings (loss) per share          $  (0.81)           $   0.07           $   0.04           $   0.00        $  (0.73)
         Shares used in per share
         calculation                          15,678              14,956             14,040             11,071           6,851

         Diluted
         Earnings (loss) per share          $  (0.81)           $   0.07           $   0.04           $   0.00        $  (0.73)
         Shares used in per share
         calculation                          15,678              15,906             14,437             13,117           6,851
</TABLE>


<TABLE>
<CAPTION>
         ---------------------------------------------------------------------------------------------------------------------------
         December 31,                                 1999                1998               1997               1996            1995
         ---------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>                 <C>                <C>                <C>             <C>
         Balance Sheet Data:
         Cash and cash equivalents               $ 14,304             $ 13,047           $  5,026           $ 36,397        $  1,774
         Working capital                            53,617              59,134             54,885             52,444           3,061
         Total assets                               89,717             105,314             85,997             78,301          23,450
         Long-term obligations                          11                 151                300                387           2,703
         Redeemable convertible preferred stock         --                  --                 --                 --             750
         Stockholders' equity                       72,553              78,922             65,646             63,347           9,169
</TABLE>

(1)   On March 11, 1999, the Company acquired all of the outstanding stock of
      HedgeWare, Inc. ("HedgeWare") for 685,683 shares of the Company's common
      stock in a business combination accounted for as a pooling-of-interests.
      Accordingly, the selected financial data for all periods prior to the
      combination have been restated to reflect the combined operations. See
      Notes 2 and 13 of Notes to the Company's Consolidated Financial
      Statements.

(2)   On March 20, 1998, the Company purchased substantially all of the assets
      of Quantra Corporation for an aggregate purchase price of 546,019
      unregistered shares of the Company's common stock, $2.3 million in cash
      and the assumption of certain liabilities of approximately $4.1 million.
      On April 9, 1998, the Company purchased all the stock of Savid
      International Inc. and The Savid Group, Inc. for a purchase price of
      $861,000. See Notes 2 and 13 of Notes to the Company's Consolidated
      Financial Statements.

(3)   On November 14, 1997, the Company purchased all the stock of Mabel Systems
      BV for $2.5 million. On December 31, 1997, the Company purchased all the
      outstanding stock of Shepro Braun Systems, Inc. for 1.0 million shares of
      the Company's common stock in a business combination accounted for as a
      pooling-of-interests. Accordingly, the selected financial data for all
      periods prior to the combination have been restated to reflect the
      combined operations. See Notes 2 and 13 of Notes to the Company's
      Consolidated Financial Statements.

(4)   On March 31, 1995, the Company purchased substantially all of the assets
      of Chalke Incorporated for a purchase price of $12.7 million.


                                     Page 1
<PAGE>   2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

OVERVIEW

    The Company is a leading provider of client/server-based software solutions,
and related consulting services, designed to improve the efficiency and
effectiveness of the investment management function within a broad range of
organizations in the financial services industry. The Company was founded in
1986 to provide consulting services to support the investment management
functions of financial service organizations. In 1989, as a result of a joint
development arrangement, the Company introduced its first product, CAMRA
("Complete Asset Management, Reporting and Accounting"), a DOS-based program
designed to address the management of asset portfolios by mid- and large-size
financial institutions. In 1993, the Company released its first Windows-based
version of CAMRA and has continued to enhance the level of CAMRA's functionality
each year thereafter. In 1996, the Company released CAMRA 2000, a fully
functional 32-bit Windows-based version of CAMRA. A majority of the Company's
revenues historically have been derived from sales of the CAMRA system. In 1993,
the Company introduced its FILMS ("Fully Integrated Loan Management System")
product, enabling mortgage professionals to process, analyze and report on a
comprehensive basis, information regarding their loan portfolios.

    On November 14, 1997, the Company acquired all of the outstanding capital
stock of Mabel Systems BV ("Mabel"), a Netherlands based supplier of investment
management software to the financial services industry. Mabel's software product
provides accounting, reporting, performance measurement and net asset value
calculations for mutual funds and support for stock brokering and custodial
services. On December 31, 1997, the Company acquired all of the outstanding
stock of Shepro Braun Systems, Inc. ("Shepro"), a provider of software and
consulting services to the investment management and financial services
marketplace. Shepro's primary product, Total Return, is a portfolio management
and partnership accounting system oriented toward the hedge fund and private
wealth markets.

    On March 20, 1998, the Company acquired substantially all of the assets of
the Quantra Corporation ("Quantra"). The Quantra products support loan and real
estate management systems. On April 9, 1998, the Company purchased all the stock
of Savid International Inc. and The Savid Group, Inc. (together, "Savid"). The
Savid products are designed to process and analyze all activities related to
debt and derivative portfolios.

    On May 1, 1998, the Company invested approximately $2.2 million in cash plus
an exclusive distribution agreement for the CAMRA product in exchange for a 24%
ownership interest in Caminus Corporation (formerly known as "Caminus Energy
Ventures, LLC" ("Caminus"), a limited liability company organized to provide
comprehensive consulting services and software technology to the power and gas
trading business. The exclusive distribution agreement allows Caminus to sell
the Company's software products within energy-related markets over a five-year
period based on certain terms and conditions. The Company commenced the
reporting of its share of Caminus' earnings on a two-month lag beginning in the
quarter ended September 30, 1998. In the third quarter of fiscal 1998, the
Company recognized a $0.5 million non-operating loss, net of taxes, including
its proportionate share of a write-off of in-process research and development
attributable to Caminus's acquisition of two companies as well as the operating
results of Caminus for the three-month period ended July 31, 1998. In the fourth
quarter of 1998, the Company sold its interest in Caminus for $2.3 million and
retained a warrant to purchase 4.5% of Caminus. The Company recorded a gain of
$0.5 million on this sale in the fourth quarter of 1998. In addition, the
Company entered into a distributor agreement with Caminus. This agreement
enables Caminus to distribute SS&C's products to the energy markets throughout
the world. Caminus underwent an initial public offering on January 28, 2000, at
$16. Under its option, the Company paid $1.8 million for 277,052 shares of
Caminus common stock and sold 27,705 shares in the initial public offering.

    On March 11, 1999, the Company acquired all of the outstanding stock of
HedgeWare, Inc. ("HedgeWare"), a provider of portfolio, financial, partnership
and tax accounting software and service support to hedge fund managers and
traders, for 685,683 shares of common stock of the Company in a business
combination accounted for as a pooling-of-interests. On March 31, 1999, the
Company acquired all of the outstanding stock of the Brookside Corporation, a
Rhode Island corporation ("Brookside") for 27,600 shares of common stock of the
Company.

    The Company enters into license, maintenance and professional service
contracts to provide software and services to its clients. License fees for the
Company's products are priced based on either assets under management, or on a
per-CPU, or per-site basis, or on the number of current users. The Company
recognizes revenue from sales of software or products including proprietary
software upon product shipment and upon receipt of a signed contract, provided
that collection is probable and all other revenue recognition criteria of SOP
97-2 are met. Maintenance is provided on an annually renewable basis for
approximately 20% of the underlying software license fee, and is recognized
ratably over the life of the contract. Professional service revenues are
provided on a time and materials basis and are recognized as the services are
performed.

    The Company's results of operations for 1997 reflect the acquisition of
Mabel for a purchase price of $475,000 in cash plus 72,816 shares of Common
Stock of the Company with a value of $750,000, the assumption of liabilities of
$623,000 and $661,000 due to former Mabel shareholders (the "Mabel
Acquisition"). In connection with the Mabel Acquisition, which was accounted for
under the purchase method, the Company incurred a charge to operations of $0.9
million associated with the write-off of purchased in-process research and
development related to Mabel products that were under development at the time of
acquisition but had not yet reached technological feasibility. The balance of
the purchase price was allocated to goodwill of


                                     Page 2
<PAGE>   3
$0.3 million, purchased completed software of $0.6 million and net operating
assets of $0.7 million. The operating results of Mabel have been included in the
Company's operating results since the date of acquisition.

    The Company's results of operations for all years presented reflect the
acquisition of Shepro for 1.0 million shares of common stock of the Company (the
"Shepro Acquisition"). As a result of the Shepro Acquisition, which was
accounted for under the pooling-of-interests method, the Company has included
Shepro's operating results with the Company's operating results for each period
presented.

    The Company's results of operations for 1998 reflect the acquisitions of
Quantra and Savid (the "Quantra Acquisition" and "Savid Acquisition",
respectively). Both acquisitions were accounted for under the purchase method of
accounting. In connection with the Quantra Acquisition, the Company paid
consideration of 546,019 unregistered shares of the Company's Common Stock,
valued at $8.8 million, $2.3 million in cash, and the assumption of certain
liabilities of approximately $4.1 million plus transaction costs. The Company
incurred a charge to operations of $5.4 million associated with the write-off of
purchased in-process research and development related to Quantra products that
were under development at the time of acquisition but had not yet reached
technological feasibility. The balance of the purchase price was allocated to
purchased completed software of $5.3 million and net operating assets of $4.6
million. In connection with the Savid Acquisition, the Company paid
consideration of $0.7 million in cash and the assumption of certain liabilities
of $0.1 million. A future cash payment $0.8 million shall be paid provided the
aggregate revenues for the period from and including April 15, 1998 through
April 14, 2001 are greater than or equal to $3.0 million. The Company incurred a
charge to operations of $0.5 million associated with the write-off of purchased
in-process research and development related to Savid products that were under
development at the time of acquisition but had not yet reached technological
feasibility. The balance of the purchase price was allocated to purchased
completed software of $0.3 million and net operating assets of $30,000. The
operating results of Quantra and Savid have been included in the Company's
operating results since their respective dates of acquisition.

    The Company's results of operations for all years presented reflect the
acquisition of HedgeWare for 685,683 shares of common stock of the Company (the
"HedgeWare Acquisition"). The HedgeWare Acquisition was accounted for under the
pooling-of-interests method, and thus the Company has included HedgeWare in the
Company's operating results for each period presented.

    The Company's results of operations for 1999 reflect the acquisition of
Brookside for 27,600 shares of common stock of the Company (the "Brookside
Acquisition"). The Brookside Acquisition was accounted for under the
pooling-of-interests method. The consolidated results of operations for 1999
include the results of Brookside for the twelve months ended December 31, 1999,
but the prior periods have not been restated since the impact of such
restatement would not be material.

YEARS ENDED DECEMBER 31, 1997, 1998 AND 1999

REVENUES

    The Company's revenues are derived from software licenses and related
maintenance and professional services. Software licenses include hardware and
third-party software that are delivered as part of certain contracts. The
hardware and third-party software account for less than 5% of software license
revenues and less than 2.5% of total revenues in any year presented. Total
revenues increased 62% from $45.5 million in 1997 to $73.6 million in 1998, and
decreased 11% to $65.7 million in 1999. The increase in 1998 revenues of $28.1
million was due partially to the acquisitions of Quantra, Savid and Mabel which
contributed $12.8 million of revenue, in addition to an increase in domestic and
international sales of CAMRA 2000 and an increase in the number of clients
contracting for maintenance and professional services. The decrease in 1999
revenues of $7.9 million was due to a decrease in license revenue offset by
increases in maintenance and professional services revenue. The Company believes
the decrease in license revenue was primarily attributable to customer deferral
of purchases while resolving their Y2K issues.

    Software Licenses. Software license revenues increased 52% from $23.0
million in 1997 to $34.9 million in 1998, and decreased 46% to $18.7 million in
1999. The increase from 1997 to 1998 of $11.9 million was due to a $5.0 million
increase in sales of CAMRA 2000 in North America, Europe, and the Asia-Pacific
region and sales from the Quantra, Savid, and Mabel Acquisitions of $6.5
million. The decrease from 1998 to 1999 of $16.2 million was due mainly to a
$17.6 million decrease in sales of CAMRA 2000, Total Return 2000 and Antares
2000 products, offset by an increase in the sales of AdvisorWare product.

    Maintenance and Other Recurring Revenue. Maintenance and other recurring
revenue increased 65% from $13.4 million in 1997 to $22.2 million in 1998, and
increased 27% to $28.2 million in 1999. The increase in maintenance and other
recurring revenues from 1997 to 1998 of $8.7 million was primarily due to $5.0
million in growth in the Company's installed base of clients and Quantra, Savid,
and Mabel Acquisitions of $3.8 million. The increase in maintenance and other
recurring revenues from 1998 to 1999 of $6.0 million was primarily due to an
increase in the Company's installed base of clients.

    Professional Services. Professional services revenue increased 82% from $9.1
million in 1997 to $16.6 million in 1998,


                                     Page 3
<PAGE>   4
and increased 14% from 1998 to $18.9 million in 1999. The increase in 1998 was
primarily due to the increased demand for the Company's implementation,
conversion, and training services. The acquisitions of Quantra, Savid and Mabel
contributed $2.2 million of the increase from 1997 to 1998. The increase in the
professional services revenue in 1999 was primarily due to the increased license
revenue experienced in 1998. The professional services revenues will continue to
be affected by the overall license revenue levels.


COST OF REVENUES

    The total cost of revenues increased 94% from $12.6 million in 1997 to $24.5
million in 1998, and increased 14% from 1998 to $28.0 million in 1999. The gross
margin decreased from 72% in 1997 to 67% in 1998 and to 57% in 1999. The
decrease in margins from 1997 to 1998 was primarily due to amortization expense
of completed technology related to the Quantra, Savid and Mabel Acquisitions.
The decrease in margins from 1998 to 1999 was primarily due to the decrease in
the license revenue sales.

    Cost of Software Licenses. Cost of software license revenues consists
primarily of amortization expense of completed technology, royalties, the costs
of product media, packaging, documentation and labor involved in the
distribution of the Company's software. Included in the cost of software license
revenues is the cost of certain hardware and third-party software that are
delivered as part of certain contracts. The cost of software license revenues
increased from $1.4 million in 1997 to $3.8 million in 1998 and to $4.2 million
in 1999. The cost of software license revenues as a percentage of these revenues
was 6%, 11% and 22% in 1997, 1998 and 1999, respectively. The increase in costs
from 1997 to 1998 and 1998 to 1999 was primarily due to the amortization expense
of completed technology related to the Quantra, Savid and Mabel Acquisitions.
The increase in completed technology amortization was $3.0 million and $0.2
million in 1998 and 1999, respectively.

    Cost of Maintenance and Other Recurring Revenue. Cost of maintenance and
other recurring revenues primarily consists of technical customer support and
other services for recurring revenues and the engineering costs associated with
product and regulatory updates. These costs increased from $5.7 million in 1997
to $8.7 million in 1998, and to $9.4 million in 1999, representing 43%, 39% and
33% of maintenance and other recurring revenues, respectively. These costs
increased each year due to the increased staffing required to support a larger
installed customer base. Maintenance and recurring revenue margins have improved
primarily due to the leveraging of fixed costs as revenues have increased.

    Cost of Professional Services. Cost of professional services revenues
consists primarily of the cost related to personnel utilized to provide
implementation, conversion and training services to the Company's software
licensees, as well as system integration, custom programming and actuarial
consulting services. These costs increased from $5.5 million in 1997 to $11.9
million in 1998, and to $14.4 million in 1999, representing 60%, 72% and 76% of
professional services revenues in those years, respectively. These increases are
due to the expansion of the Company's professional services resources, including
consulting, training and account management staff. The Company has made a
significant investment in its professional consulting services organization in
the past two years in response to customer demand.


OPERATING EXPENSES

    Selling and Marketing. Selling and marketing expenses consist primarily of
the cost of personnel associated with the selling and marketing of the Company's
products, including salaries, commissions, and travel and entertainment. Such
expenses also include the cost of branch sales offices, advertising, trade
shows, marketing and promotional materials. Selling and marketing expenses
increased 24% from $12.0 million in 1997 to $14.9 million in 1998, and increased
18% to $17.7 million in 1999, representing 26%, 20% and 27%, respectively, of
total revenues in those years. The increases in selling and marketing expenses
were largely attributable to costs associated with the hiring of additional
sales and marketing personnel, including recruiting fees, the expansion of
international operations including a dedicated international sales and marketing
operation, and higher marketing, advertising, and promotional costs.

    Research and Development. Research and development expenses consist
primarily of personnel costs attributable to the development of new software
products and the enhancement of existing products. Research and development
expenses increased 68% from $12.0 million in 1997 to $20.1 million in 1998, and
increased 3% to $20.7 million in 1999, representing 26%, 27% and 31%,
respectively, of total revenues in those years. Research and development
expenses have remained relatively comparable in absolute dollars from 1998 to
1999 but increased as a percentage of revenue due to the 1999 reduction in
license revenues. The dollar increase from 1997 to 1998 was mainly due to
additional hiring of sub-contracted personnel required for various software
releases.

                                     Page 4
<PAGE>   5
    General and Administrative. General and administrative expenses are
primarily comprised of personnel costs related to management, accounting, human
resources and administration and associated overhead costs, as well as fees for
professional services. General and administrative expenses decreased 5% from
$8.6 million in 1997 to $8.2 million in 1998 and increased 49% to $12.2 million
in 1999, representing 19%, 11% and 19%, respectively, of total revenues in those
years. During 1997, the Company recorded a one-time charge of $1.2 million for
the closing of its Virginia office facility and the announced move of its
corporate headquarters. The expense increase from 1997 to 1998 after adjusting
1997 for the one-time charge of $1.2 million was $0.8 million. This increase was
primarily due to additional personnel and related expenses necessary to support
the revenue growth. An increase in bad debt expense, additions to administrative
personnel, increase in depreciation expense and an increase in professional fees
contributed to the increase in general and administrative expenses in 1999.

    Write-off of Purchased In-Process Research and Development. In the fourth
quarter of 1997, the Company expensed $0.9 million of purchased in-process
research and development associated with the Mabel products acquired in November
1997. In the first quarter of 1998, the Company expensed $5.4 million of
purchased in-process research and development associated with the Quantra
products acquired in March 1998. In the second quarter of 1998, the Company
expensed $0.5 million of purchased in-process research and development
associated with the Savid products acquired in April 1998. Because these
products had not yet reached technological feasibility at the time of the
respective acquisitions and, in the Company's judgment, there was no alternative
use for the related research and development, such in-process research and
development was charged to expense.

    For the Quantra and Savid acquisitions, the Company determined the value of
the completed technologies and in-process research and development using a
risk-adjusted, discounted cash flow approach.

    For the Quantra and Savid Acquisitions, the Company developed revenue
projections over a five- to six-year period in three categories: license,
maintenance, and consulting. License revenue projections were based on expected
unit sales over the projected lives of the respective product lines. The other
categories of revenues were generally estimated as a percentage of total license
revenues and ranged from 15% to 20% for maintenance and from 10% to 20% for
consulting, depending on the product. Savid consulting revenues were projected
to be insignificant. Expense assumptions were based on the imposition of the
Company's cost structure on the acquired technologies and products. The discount
rates for the Quantra in-process research and development projects were 23% and
28%; the discount rate for the Savid in-process research and development
projects was 20%. The discount rates for these projects were higher than the
Company's implied weighted average cost of capital due to the inherent
uncertainties surrounding the successful development of the in-process research
and development and the related risk of realizing cash flows from products that
have not yet reached technological feasibility, among other factors.

    The Company believes that the assumptions used in the forecasts were
reasonable. The Company cannot be assured, however, that the underlying
assumptions used to estimate expected product sales, development costs or
profitability, or the events associated with such projects, will transpire as
estimated. Accordingly, actual results may vary from the projected results.

    Interest Income Net. Net interest income was $2.2 million, $1.9 million and
$2.3 million in 1997, 1998 and 1999, respectively. Interest income, net consists
of interest income and interest expense. The increase in 1999 was due to higher
returns on investments compared to 1998 results.

    Provision (Benefit) for Income Taxes. The Company had effective tax rates of
approximately 66%, 54% and 34% in 1997, 1998 and 1999, respectively. The higher
tax rates in 1997 and 1998 were higher than the expected rate of 34% due to the
non-deductability of S corporation losses and the rate differential of foreign
operations. The Company recorded a tax benefit of $2.3 million or 25% on the
$9.3 million litigation settlement costs for 1999. It was determined that a
portion of the litigation settlement costs were not tax-deductible. The Company
recorded an additional $4.8 million of deferred tax assets in 1999. In future
years, the Company expects to return to profitability levels sufficient to
realize the deferred tax assets at December 31, 1999.


LIQUIDITY AND CAPITAL RESOURCES

      The Company's cash, cash equivalents and marketable securities at December
31, 1999 were $50.3 million, decreasing by $6.2 million from the $56.5 million
at December 31, 1998.

    The net cash used in operating activities was $4.4 million in 1999. Cash
used in operating activities was primarily due to the net loss of $12.6 million
offset by a $9.5 million reduction in accounts receivables. Included in the cash
used in operating activities is the litigation settlement payment of $7.5
million.


                                     Page 5
<PAGE>   6
    Investing activities provided $2.9 million in cash. Capital expenditures
totaled $5.6 million in 1999 as the Company continued to invest in property and
equipment comprised of purchases of computer and networking equipment and
facility expansion. This was off-set by the payment of the note receivable
associated with the Caminus Corporation transaction and net sales of $6.1
million of marketable securities.

    Financing activities provided $2.8 million in cash. This was primarily due
to the $1.2 million release of escrow funds associated with the Quantra
acquisition, $1.0 million from the exercise of stock options and $0.9 million of
stock issued for the Employee Stock Purchase Plan.

    As of December 31, 1999, the Company had $14.3 million in cash and $36.0
million of highly liquid marketable securities. The Company believes that its
current cash and marketable securities balances and anticipated cash flow from
operations will be sufficient to meet its working capital and capital
expenditure requirements for at least the next twelve months.

    The Share Purchase Agreement in connection with the Mabel Acquisition
provides for a payment in 2001 by the Company to the former Mabel shareholders,
contingent on their continued employment by the Company, and based on revenues
generated by the Mabel division from 1998 through 2000. The payment can range
from $0 to $1.9 million.

    The Share Purchase Agreement in connection with the Savid Acquisition
provides for a further cash payment of $750,000 as additional consideration
provided that the aggregate revenues for the period from April 15, 1998 through
April 14, 2001 are greater than or equal to $3 million.

YEAR 2000 COMPLIANCE

    The Company has not experienced any problems with its computer systems and
the products that we currently license relating to the inability of such systems
to recognize appropriate dates associated with the year 2000. The Company is
also not aware of any material year 2000 problems with its clients or vendors.
Accordingly, the Company does not anticipate incurring material expenses or
experiencing any material disruptions as a result of any year 2000 problems.


RECENT ACCOUNTING PRONOUNCEMENTS

   In November 1999, the Securities and Exchange Commission ("SEC") issued Staff
Accounting Bulletin ("SAB") No. 100. Restructuring and Impairment Charges ("SAB
100"). In December 1999, the SEC issued SAB No. 101, Revenue Recognition in
Financial Statements ("SAB 101"). SAB No. 100 expresses views of the SEC staff
regarding the accounting for and disclosure of certain expenses not commonly
reported in connection with exit activities and business combinations. The
Company does not expect the provisions of SAB No. 100 to have a material impact
on its financial statements. SAB No. 101 expresses the views of the SEC staff in
applying generally accepted accounting principles to certain revenue recognition
issues. The Company does not currently expect the provisions of SAB No. 101 to
have a material impact on its financial statements.

   In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivatives Instruments
and Hedging Activities". This statement establishes accounting and reporting
standards for derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities. As issued, this
statement is effective for all fiscal quarters of all fiscal years beginning
after June 15, 1999, with earlier application encouraged. In May 1999, the
Financial Accounting Standards Board delayed the effective date of this
statement for one year, to all fiscal quarters of all fiscal years beginning
after June 15, 2000. The Company does not currently nor intends in the future to
use derivative instruments and therefore does not expect that the adoption of
Statement of Accounting Standards No. 133 will have any impact on its financial
position or results of operations.


CERTAIN FACTORS THAT MAY AFFECT FUTURE OPERATING RESULTS

    Fluctuations in Quarterly Performance. The Company's revenues and operating
results historically have varied substantially from quarter to quarter. The
Company's quarterly operating results may continue to fluctuate due to a number
of factors, including the timing, size, and nature of the Company's individual
license transactions; the timing of the introduction and the market acceptance
of new products or product enhancements by the Company or its competitors; the
relative proportions of revenues derived from license fees, maintenance,
consulting, and other recurring revenues and professional services; changes in
the Company's operating expenses; personnel changes; and fluctuations in
economic and financial market conditions. The timing, size, and nature of
individual license transactions are important factors in the Company's quarterly
operating results. Many such license transactions involve large dollar amounts,
and the sales cycles for these transactions are often lengthy and unpredictable.
There can be no assurance that the Company will be successful in closing large
license transactions on a timely basis or at all.


                                     Page 6
<PAGE>   7
    Dependence on the Financial Services Industry. The Company's clients include
a range of organizations in the financial services industry, and the success of
such clients is intrinsically linked to the health of the financial markets. In
addition, because of the capital expenditures required in connection with an
investment in the Company's products, the Company believes that demand for its
products could be disproportionately affected by fluctuations, disruptions,
instability, or downturns in the financial markets, which may cause clients and
potential clients to exit the industry or delay, cancel, or reduce any planned
expenditures for investment management systems and software products. Any
resulting decline in demand for the Company's products could have a material
adverse effect on the Company's business, financial condition, and results of
operations.

    Product Concentration. To date, substantially all of the Company's revenues
have been attributable to the licensing of its CAMRA 2000, AdvisorWare 2000,
Total Return 2000, LMS 2000 and SKYLINE software and the provision of
maintenance and consulting services in connection therewith. The Company
currently expects that the licensing of CAMRA 2000, AdvisorWare 2000, Total
Return 2000, LMS 2000, SKYLINE, and Antares 2000 software products will account
for a substantial portion of its revenues for the foreseeable future. As a
result, factors adversely affecting the pricing of or demand for such products
and services, such as competition or technological change, could have a material
adverse effect on the Company's business, financial condition, and results of
operations.

    Management of Growth. The Company's business has grown significantly in size
and complexity over the past several years. The growth in the size and
complexity of the Company's business as well as its client base has placed, and
is expected to continue to place, a significant strain on the Company's
management and operations. The Company's ability to compete effectively and to
manage future growth, if any, will depend on its ability to continue to
implement and improve operational, financial, and management information systems
on a timely basis and to expand, train, motivate, and manage its work force.
There can be no assurance that the Company's personnel, systems, procedures, and
controls will be adequate to support the Company's operations. If the Company's
management is unable to manage growth effectively, the quality of the Company's
products and its business, financial condition, and results of operations could
be materially adversely affected.

    Integration of Operations. The Company's success is dependent in part on its
ability to complete its integration of the operations of its recent
acquisitions, including HedgeWare, in an efficient and effective manner. The
successful integration in a rapidly changing financial services industry may be
more difficult to accomplish than in other industries. The combination of these
acquired companies will require, among other things, integration of the acquired
companies' respective product offerings and coordination of their sales and
marketing and research and development efforts. There can be no assurance that
such integration will be accomplished smoothly or successfully. The difficulties
of such integration may be increased by the necessity of coordinating
geographically separated organizations. The integration of certain operations
will require the dedication of management resources that may temporarily
distract attention from the day-to-day business of the combined Company. The
inability of management to successfully integrate the operations of acquired
companies could have a material adverse effect on the business, financial
condition, and results of operations of the Company.

    Competition. The market for financial service software is competitive,
rapidly evolving, and highly sensitive to new product introductions and
marketing efforts by industry participants. Although the Company believes that
none of its competitors currently competes against the Company in all of the
markets served by the Company, there can be no assurance that such competitors
will not compete against the Company in the future in additional markets. In
addition, many of the Company's current and potential future competitors have
significantly greater financial, technical and marketing resources, generate
higher revenues, and have greater name recognition than does the Company.

    Rapid Technological Change. The market for the Company's products and
services is characterized by rapidly changing technology, evolving industry
standards, and new product introductions. The Company's future success will
depend in part upon its ability to enhance its existing products and services
and to develop and introduce new products and services to meet changing client
requirements. The process of developing software products such as those offered
by the Company is extremely complex and is expected to become increasingly
complex and expensive in the future with the introduction of new platforms and
technologies. There can be no assurance that the Company will successfully
complete the development of new products in a timely fashion or that the
Company's current or future products will satisfy the needs of the financial
markets.

    Dependence on Database Supplier. The relational database design in many of
the Company's software products incorporates PFXplus, a "C"-based database
management system licensed to the Company by POWERflex Corporation Proprietary
Limited, an Australian vendor ("Powerflex"). If Powerflex were to increase its
fees under the license agreement, the Company's results of operations could be
materially adversely affected. Moreover, if Powerflex were to terminate the
license agreement, the Company would have to seek an alternative relational
database for its software products. While the Company believes that it could
migrate its products to an alternative database, there can be no assurance that
the Company would be able to license in a timely fashion a database with similar
features and on terms acceptable to the Company.


                                     Page 7
<PAGE>   8
    Dependence on Proprietary Technology. The Company's success and ability to
compete is dependent in part upon its proprietary technology. The Company relies
on a combination of trade secret, copyright, and trademark law, nondisclosure
agreements and technical measures to protect its proprietary technology. There
can be no assurance that the steps taken by the Company to limit access to its
proprietary technology will be adequate to deter misappropriation or independent
third-party development of such technology.

    Product Defects and Product Liability. The Company's software products are
highly complex and sophisticated and could, from time to time, contain design
defects or software errors that could be difficult to detect and correct.
Errors, bugs, or viruses may result in loss of or delay in market acceptance or
loss of client data. Although the Company has not experienced material adverse
effects resulting from any software defects or errors, there can be no assurance
that, despite testing by the Company and its clients, errors will not be found
in new products, which errors could result in a delay in or inability to achieve
market acceptance and thus could have a material adverse impact upon the
Company's business, financial condition, and results of operations.

    Key Personnel. The Company's success is dependent in part upon its ability
to attract, train, and retain highly skilled technical, managerial, and sales
personnel. The loss of services of one or more of the Company's key employees
could have a material adverse effect on the Company's business, financial
condition and results of operations. Over the last 12 months, three Senior Vice
Presidents terminated their employment with the Company. The Company continues
to hire a significant number of additional sales, service, and technical
personnel. Competition for the hiring of such personnel in the software industry
is intense. Locating candidates with the appropriate qualifications,
particularly in the desired geographic location, can be difficult. Although the
Company expects to continue to attract and retain sufficient numbers of highly
skilled employees for the foreseeable future, there can be no assurance that the
Company will do so.

    Risks Associated with International Operations. The Company intends to
continue to expand its international sales activity as part of its business
strategy. To accomplish such continued expansion, the Company must establish
additional foreign operations and hire additional personnel requiring
significant management attention and financial resources that could materially
adversely affect the Company's business, financial condition, or results of
operations. An increase in the value of the U.S. dollar relative to foreign
currencies could make the Company's products more expensive and, therefore,
potentially less competitive in those foreign markets. A portion of the
Company's international sales is denominated in foreign currency. The Company
occasionally hedges some of this risk; however, significant fluctuations in the
value of foreign currencies could have an adverse effect on the earnings of the
Company. In addition, the Company's international business may be subject to a
variety of risks, including difficulties in obtaining U.S. export licenses,
potentially longer payment cycles, increased costs associated with maintaining
international marketing efforts, the introduction of non-tariff barriers and
higher duty rates, and difficulties in enforcement of contractual obligations
and intellectual property rights. There can be no assurance that such factors
will not have a material adverse effect on the Company's business, financial
condition, or results of operations.

    Because of these and other factors, past financial performance should not be
considered an indication of future performance. The Company's quarterly
operating results may vary significantly, depending on factors such as the
timing, size, and nature of licensing transactions and new product introductions
by the Company or its competitors. Investors should not use historical trends to
anticipate future results and should be aware that the trading price of the
Company's common stock may be subject to wide fluctuations in response to
quarterly variations in operating results and other factors, including those
discussed above.


MARKET RISKS

    The Company purchases from time to time forward contracts to attempt to
minimize the impact of exchange rate gains or losses from foreign currency
transactions. The Company generally places its marketable security investments
in high credit quality instruments, primarily U.S. Government and Federal Agency
obligations, tax-exempt municipal obligations and corporate obligations. The
Company does not expect any material loss from its marketable security
investments and therefore believes that its potential interest rate exposure is
not material.

    The Company invoices customers primarily in U.S. dollars and in local
currency in those countries in which the Company has branch and subsidiary
operations. The Company is exposed to foreign exchange rate fluctuations from
when customers are invoiced in local currency until collection occurs. Through
December 31, 1999, foreign currency fluctuations have not had a material impact
on the Company's financial position or results of operation, and therefore the
Company believes that its potential foreign currency exchange rate exposure is
not material.


                                     Page 8
<PAGE>   9
    The foregoing risk management discussion and the effect thereof are
forward-looking statements. Actual results in the future may differ materially
from these projected results due to actual developments in global financial
markets. The analytical methods used by the Company to assess and mitigate risk
discussed above should not be considered projections of future events or losses.


                                     Page 9
<PAGE>   10
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

SS&C Technologies, Inc. and Subsidiaries
Consolidated Financial Statements

<TABLE>
<CAPTION>
                                                                       Page
                                                                       ----
<S>                                                                    <C>
Report of Independent Accountants                                       11

Consolidated Financial Statements

Consolidated Balance Sheets as of
  December 31, 1999 and 1998 .......................................    12

Consolidated Statements of Operations for the years
  ended December 31, 1999, 1998 and 1997............................    13

Consolidated Statements of Cash Flows for the years ended
  December 31, 1999, 1998 and 1997..................................    14

Consolidated Statements of Changes in Stockholders' Equity for
the years ended December 31, 1999, 1998 and 1997....................    15

Notes to Consolidated Financial Statements..........................    16-32
</TABLE>


                                    Page 10
<PAGE>   11
                        REPORT OF INDEPENDENT ACCOUNTANTS


To the Board of Directors and Stockholders of
SS&C Technologies, Inc. and Subsidiaries

In our opinion, the consolidated financial statements listed in the accompanying
index present fairly, in all material respects, the financial position of SS&C
Technologies, Inc. and its subsidiaries at December 31, 1999 and 1998, and the
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with auditing standards generally
accepted in the United States 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.


/s/ PricewaterhouseCoopers LLP


Hartford, Connecticut
February 10, 2000


                                    Page 11
<PAGE>   12
                             SS&C TECHNOLOGIES, INC.
                                AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                      (in thousands except per share data)

<TABLE>
<CAPTION>
                                                                              December 31,
                                                                          1999              1998
                                                                       ---------         ---------
<S>                                                                    <C>               <C>
ASSETS
Current assets
    Cash and cash equivalents                                          $  14,304         $  13,047
    Restricted cash                                                           --             1,230
    Investments in marketable securities (Note 3)                         36,034            42,263
    Accounts receivable, net of allowance for doubtful accounts           11,079            24,442
       of $4,341 and $3,411, respectively  (Note 4)
    Note receivable (Note 15)                                                 --             2,250
    Income taxes receivable                                                2,722                --
    Prepaid expenses and other current assets                              2,360             1,709
    Deferred income taxes (Note 7)                                         4,271               434
                                                                       ---------         ---------
Total current assets                                                      70,770            85,375
                                                                       ---------         ---------
Property and equipment:
    Land                                                                      --               106
    Building and leasehold improvements                                    3,214             2,748
    Equipment, furniture and fixtures                                     13,803            10,754
                                                                       ---------         ---------
                                                                          17,017            13,608
    Less accumulated depreciation                                         (7,105)           (5,814)
                                                                       ---------         ---------
     Net property and equipment                                            9,912             7,794
                                                                       ---------         ---------

Accounts receivable (Note 4)                                                 301               549
Deferred income taxes (Note 7)                                             7,211             6,266
Goodwill, net of accumulated amortization of $1,838 and $1,412,              296               722
    respectively
Intangible and other assets, net of accumulated amortization of            1,227             4,608
    $6,372 and $3,674, respectively
                                                                       ---------         ---------
Total assets                                                           $  89,717         $ 105,314
                                                                       =========         =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
    Current portion of long-term debt (Note 5)                         $     131         $     321
    Accounts payable                                                       1,503             2,124
    Income taxes payable                                                      --             1,059
    Accrued employee compensation and benefits                             1,695             6,201
    Other accrued expenses                                                 2,418             3,234
    Accrued litigation costs                                                  30                --
    Deferred maintenance and other revenue                                11,376            13,302
                                                                       ---------         ---------
Total current liabilities                                                 17,153            26,241

    Long-term debt (Note 5)                                                   11               151
                                                                       ---------         ---------
Total liabilities                                                         17,164            26,392
                                                                       ---------         ---------

Commitments and contingencies (Note 8 and 14)

Stockholders' equity:
    Common stock, $0.01 par value, 25,000 shares authorized;                 161               153
       16,044 and 15,286 shares issued and outstanding,
       respectively
    Additional paid in capital                                            88,119            81,485
    Accumulated other comprehensive income                                  (461)             (121)
    Accumulated deficit                                                  (15,266)           (2,595)
                                                                       ---------         ---------
Total stockholders' equity                                                72,553            78,922
                                                                       ---------         ---------

Total liabilities and stockholders' equity                             $  89,717         $ 105,314
                                                                       =========         =========
</TABLE>

The accompanying notes are an integral part of these financial statements


                                    Page 12
<PAGE>   13
                             SS&C TECHNOLOGIES, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      (in thousands, except per share data)

<TABLE>
<CAPTION>
                                                        1999             1998             1997
                                                      --------         --------         --------
<S>                                                   <C>              <C>              <C>
Revenues:
  Software licenses                                   $ 18,700         $ 34,878         $ 22,990
  Maintenance and other recurring revenue               28,182           22,157           13,443
  Professional services                                 18,854           16,558            9,094
                                                      --------         --------         --------
     Total revenues                                     65,736           73,593           45,527
                                                      --------         --------         --------
Cost of revenues:
  Software licenses                                      4,206            3,840            1,443
  Maintenance and other recurring revenue                9,432            8,736            5,720
  Professional services                                 14,368           11,944            5,481
                                                      --------         --------         --------
     Total cost of revenues                             28,006           24,520           12,644
                                                      --------         --------         --------
Gross profit                                            37,730           49,073           32,883
                                                      --------         --------         --------
Operating expenses:
  Selling and marketing                                 17,665           14,948           12,043
  Research and development                              20,651           20,126           11,997
  General and administrative                            12,166            8,163            8,624
  Write-off of purchased in-process
     Research and development (Note 13)                     --            5,878              861
  Litigation settlement costs (Note 14)                  9,330               --               --
                                                      --------         --------         --------
     Total operating expenses                           59,812           49,115           33,525
                                                      --------         --------         --------
Operating loss                                         (22,082)             (42)            (642)
                                                      --------         --------         --------

Interest income, net                                     2,345            1,944            2,176
Other income, net (Note 15)                                546              376               29
                                                      --------         --------         --------

Income (loss) before income taxes                      (19,191)           2,278            1,563
Provision (benefit) for income taxes (Note 7)           (6,543)           1,225            1,029
                                                      --------         --------         --------
Net income (loss)                                     $(12,648)        $  1,053         $    534
                                                      ========         ========         ========

Basic earnings (loss) per share                       $  (0.81)        $   0.07         $   0.04
                                                      ========         ========         ========

Basic weighted average number of common shares
outstanding                                             15,678           14,956           14,040
                                                      ========         ========         ========

Diluted earnings (loss) per share                     $  (0.81)        $   0.07         $   0.04
                                                      ========         ========         ========

Diluted weighted average number of  common and
common equivalent shares outstanding                    15,678           15,906           14,437
                                                      ========         ========         ========
</TABLE>


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


                                    Page 13
<PAGE>   14
                      SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (in thousands)

<TABLE>
<CAPTION>
                                                                                         Year Ended December 31,
                                                                              ---------------------------------------------
                                                                                 1999              1998              1997
                                                                              ---------         ---------         ---------
<S>                                                                           <C>               <C>               <C>
Cash flow from operating activities:
       Net income (loss)                                                      $ (12,648)        $   1,053         $     534
                                                                              ---------         ---------         ---------
Adjustments to reconcile net income (loss) to net cash
provided by (used in)
operating activities
        Depreciation and amortization                                             6,998             5,038             2,087
        Gain on sale of property and equipment                                      (62)
        Common stock issued for litigation settlement (Note 14)                   1,300                --                --
        Equity-based compensation                                                   123               141                --
        Deferred income taxes                                                    (4,784)           (2,722)              (44)
        Income tax benefit related to exercise of stock                             281               482               221
        options
        Purchased in-process research and development                                --             5,878               861
        Provision for doubtful accounts                                           3,921             1,717             1,606
        Changes in operating assets and liabilities, excluding effects
        from acquisitions:
             Accounts receivable                                                  9,482            (7,960)           (1,035)
             Prepaid expenses and other current assets                             (371)              (56)             (556)
             Taxes receivable                                                    (2,722)              384               (31)
             Accounts payable                                                      (705)             (868)              884
             Accrued expenses                                                    (2,235)            1,160             3,074
             Taxes payable                                                       (1,059)              684                --
             Deferred maintenance and other revenues                             (1,926)            1,177             1,982
                                                                              ---------         ---------         ---------
                    Total adjustments                                             8,241             5,055             9,049
                                                                              ---------         ---------         ---------
       Net cash provided by (used in) operating activities                       (4,407)            6,108             9,583
                                                                              ---------         ---------         ---------

Cash flow from investing activities
       Additions to property and equipment                                       (5,611)           (4,723)           (1,853)
       Proceeds from sale of property and equipment                                 485                --                --
       Cash paid for business acquisitions (Note 13)                                 --            (3,021)              (72)
       Proceeds from note receivable (Note 15)                                    2,250                --                --
       Purchase of investment                                                      (250)               --                --
       Additions to capitalized software and other intangibles                      (71)             (797)             (365)
       Cash paid for Caminus acquisition                                             --            (2,226)               --
       Purchases of marketable securities                                       (24,903)          (89,127)           (8,453)
       Sales of marketable securities                                            31,009           100,581             5,623
                                                                              ---------         ---------         ---------
       Net cash provided by (used in) investing activities                        2,909               687            (5,120)
                                                                              ---------         ---------         ---------

Cash flow from financing activities:
       Repayment of debt                                                           (354)           (1,175)           (2,318)
       Proceeds from note payable                                                    --               673               470
       Issuance of common stock                                                     896               651               269
       Exercise of options                                                          983             2,307               547
       Transfer of cash from restricted cash equivalents                          1,230            (1,230)              505
                                                                              ---------         ---------         ---------
       Net cash provided by (used in) financing activities                        2,755             1,226              (527)
                                                                              ---------         ---------         ---------

Net increase in cash and cash equivalents                                         1,257             8,021             3,936
Cash and cash equivalents, beginning of period                                   13,047             5,026             1,090
                                                                              ---------         ---------         ---------
Cash and cash equivalents, end of period                                      $  14,304         $  13,047         $   5,026
                                                                              =========         =========         =========

Supplemental disclosure of cash flow information
   Cash paid for
         Interest                                                             $       3         $       9         $     152
         Income taxes                                                         $   1,726         $   2,013         $     677
</TABLE>

Supplemental disclosure of non-cash investing activities

As more fully described in Note 13, effective March 11, 1999, the Company
   acquired all the outstanding stock of HedgeWare, Inc. for 685,683
   shares of the Company's common stock.

As more fully described in Note 13, effective March 20, 1998, the Company
   purchased substantially all the assets of Quantra Corporation for $15.3
   million.

As more fully described in Note 13, effective April 9, 1998, the Company
   purchased all the stock of Savid International Inc. and The Savid Group,
   Inc. for $0.9 million.

As more fully described in Note 13, effective November 14, 1997, the Company
   purchased all the outstanding stock of Mabel Systems BV for $2.5 million.

As more fully described in Note 13, effective December 31, 1997, the Company
   purchased all the outstanding stock of Shepro Braun Systems, Inc. for 1.0
   million shares of the Company's common stock.

As more fully described in Note 15, the Company sold its investment in Caminus
   Corporation for a $2.3 million note receivable.

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


                                    Page 14
<PAGE>   15
                             SS&C TECHNOLOGIES, INC.
                                AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
              FOR THE YEARS ENDED DECEMBER 31, 1997, 1998 AND 1999
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                             Common Stock
                                                                                     Accumulated    Accumulated
                                                                      Additional       Deficit         Other           Total
                                        Number of                       Paid-in                     Comprehensive   Stockholders'
                                         Shares         Amount          Capital                        Income          Equity
                                         -----------------------------------------------------------------------------------------
<S>                                    <C>           <C>             <C>            <C>             <C>             <C>
Balance at December 31, 1996             13,888        $    139        $ 67,366       $ (4,182)             --        $ 63,323
  Exercise of options                       230               2             545             --              --             547
  Issuance of common stock                  127               1           1,018             --              --           1,019
  Income tax benefit related to              --              --             221             --              --             221
   exercise of stock options
  Net income                                 --              --              --            534              --             534
                                         ------        --------        --------       --------        --------        --------
Balance at December 31, 1997             14,245             142          69,150         (3,648)             --          65,644
  Exercise of options                       428               4           2,444             --              --           2,448
  Issuance of common stock                  613               7           9,409             --              --           9,416
  Income tax benefit related to              --              --             482             --              --             482
   exercise of stock options
Comprehensive Income:
  Net income                                 --              --              --          1,053              --           1,053
  Foreign exchange translation               --              --              --             --        $   (121)           (121)
   adjustment
                                         ------        --------        --------       --------        --------        --------
Balance at December 31, 1998             15,286             153          81,485         (2,595)           (121)         78,922
  Exercise of options                       195               2           1,104                                          1,106
  Issuance of common stock                  325               4           3,951                                          3,955
  Issuance of common stock for the
   litigation settlement                    211               2           1,298                                          1,300
  Income tax benefit related to
   exercise of stock options                                                281                                            281
  Other                                      27              --              --            (23)                            (23)
Comprehensive Income:
  Net loss                                                                             (12,648)                        (12,648)
  Foreign exchange translation                                                                            (217)           (217)
   adjustment
  Change in unrealized loss on                                                                            (123)           (123)
   investments
                                         ------        --------        --------       --------        --------        --------
Balance, at December 31, 1999            16,044        $    161        $ 88,119       $(15,266)       $   (461)       $ 72,553
                                         ======        ========        ========       ========        ========        ========
</TABLE>


The accompanying notes are an integral part of the financial statements


                                    Page 15
<PAGE>   16
     SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements


1.  Organization

   SS&C Technologies, Inc. and Subsidiaries ("SS&C" or the "Company") is a
leading provider of client/server-based software solutions, and related
consulting services, designed to improve the efficiency and effectiveness of a
broad range of organizations in the financial services industry. The Company has
developed a family of software products that provides a full-range of
mission-critical information management and analysis, accounting, reporting and
compliance tools to help high-level investment professionals make informed
real-time decisions and automate many operational functions in today's
increasingly complex and fast-moving financial markets. The Company's products
are focused on improving the effectiveness of decision making through open,
fully integrated access to the quantitative analysis of transactions-based data,
allowing investment professionals to manage and analyze large amounts of data in
the aggregate and in detail on a timely basis.

   The Company operates in one business segment and currently derives
substantially all of its revenue from the licensing of its CAMRA 2000,
AdvisorWare 2000, Total Return 2000, LMS 2000, and SKYLINE applications software
to the financial services industry and the provision of related maintenance,
consulting and training services in the areas of investments, investment
accounting and software development. The Company expects that the licensing of
these products and the related services will account for a substantial portion
of its revenues in the future. The Company's clients include a range of
organizations that manage investment portfolios, including asset managers,
insurance companies, banks, mutual funds, public and private pension funds,
hedge funds, corporate treasuries, property managers, real estate investment
trusts and government agencies. The success of many of the Company's clients is
intrinsically linked to the health of the financial markets. Demand for its
products could be affected by fluctuations or downturns in the financial
markets, which may cause clients and potential clients to exit the industry or
delay, cancel or reduce any planned expenditures for investment management
systems and software products.

2.  Summary of Significant Accounting Policies

Use of Estimates

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

Principles of Consolidation

   The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiaries: SS&C Ventures, Inc.; SS&C
Technologies, Limited; SS&C Technologies Australia, Pty. Ltd.; SS&C
Technologies, KK; SS&C Pacific, Inc.; SS&C Technologies, Sdn. Bhd.; SS&C
Technologies PTE, Ltd.; SSC Direct.com, Inc.; Shepro Braun Systems, Inc.; Mabel
Systems BV, and Financial Automation, Ltd., the 1999 acquisitions of HedgeWare,
Inc. and The Brookside Corporation, and the 1998 acquisitions of Quantra
Corporation, Savid International, Inc. and The Savid Group, Inc. All
intercompany activity has been eliminated in preparing the consolidated
financial statements. The Company's 1998 investment in Caminus is accounted for
under the equity method (see Note 15).

Revenue Recognition

   Effective January 1, 1998, the Company adopted the guidelines of Statement of
Position (SOP) No. 97-2, "Software Revenue Recognition" ("SOP 97-2"), which
provides guidance on applying generally accepted accounting principles in
recognizing revenue on software transactions. SOP 97-2 requires that revenue
recognized from software transactions be allocated to each element of the
transaction based on the relative fair values of the elements, such as software
products, specific upgrades, enhancements, post contract customer support,
installation or training. The determination of fair value is based upon vendor
specific objective evidence. Under SOP 97-2, the Company recognizes software
license revenue allocated to software products, specified upgrades and
enhancements generally upon delivery of each of the related products, upgrades
or enhancements. Revenue allocated to post contract customer support is
generally recognized ratably over the term of the support, and revenue allocated
to service elements is generally recognized as the services are performed.


                                    Page 16
<PAGE>   17
   The Company recognizes revenue from sales of software or products including
proprietary software upon product shipment and upon receipt of a signed
contract, provided that collection is probable and all other revenue recognition
criteria of SOP 97-2 are met. The Company's products generally do not require
significant modification or customization of software. Installation of the
products is generally routine and is not essential to the functionality of the
product. In 1997, the Company recognized revenue in accordance with AICPA
Statement of Position (SOP) No. 91-1, "Software Revenue Recognition".

   The Company occasionally enters into license agreements requiring significant
customization of the Company's software. The Company accounts for these
agreements on a percentage of completion basis. This method requires estimates
to be made for costs to complete the agreement utilizing an estimate of
development man-hours remaining. Due to uncertainties inherent in the estimation
process, it is at least reasonably possible that completion costs may be
revised. Such revisions are recognized in the period in which the revisions are
determined. Provisions for estimated losses on uncompleted contracts are
determined on a contract-by-contract basis, and are made in the period in which
such losses are first estimated or determined.

   The Company's software license agreements include a short-term, generally
six-month, warranty period that the Company does not consider to be a
cancellation privilege.

   Revenues from maintenance agreements are recognized ratably over the term of
the agreement. Unbilled accounts receivable principally reflect revenues
recognized pursuant to license agreements for which such amounts are not
contractually billable. Unbilled accounts receivable, including those related to
lease agreements, which are not contractually billable in one year have been
classified as noncurrent.

   Professional services revenues include consulting and training provided to
customers, generally on a time and materials basis. Professional service
revenues are recognized as the services are performed.

   The Company records an allowance for doubtful accounts based on individual
customer analyses. Write-offs of accounts receivable were $2,991,000, $558,000
and $822,000 for the years ended December 31, 1999, 1998 and 1997, respectively.

Recent Accounting Pronouncements

   In November 1999, the Securities and Exchange Commission ("SEC") issued Staff
Accounting Bulletin ("SAB") No. 100. Restructuring and Impairment Charges ("SAB
100"). In December 1999, the SEC issued SAB No. 101, Revenue Recognition in
Financial Statements ("SAB 101"). SAB No. 100 expresses views of the SEC staff
regarding the accounting for and disclosure of certain expenses not commonly
reported in connection with exit activities and business combinations. The
Company does not expect the provisions of SAB No. 100 to have a material impact
on its financial statements. SAB No. 101 expresses the views of the SEC staff in
applying generally accepted accounting principles to certain revenue recognition
issues. The Company does not expect the provisions of SAB No. 101 to have a
material impact on its financial statements.

   In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, Accounting for Derivatives Instruments
and Hedging Activities. This statement establishes accounting and reporting
standards for derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities. As issued, this
statement is effective for all fiscal quarters of all fiscal years beginning
after June 15, 1999, with earlier application encouraged. In May 1999, the
Financial Accounting Standards Board delayed the effective date of this
statement for one year, to all fiscal quarters of all fiscal years beginning
after June 15, 2000. The Company does not currently nor intends in the future to
use derivative instruments and therefore does not expect that the adoption of
Statement of Accounting Standards No. 133 will have any impact on its financial
position or results of operations.


Impairment of Long-Lived Assets

The Company evaluates the recoverability of its long-lived assets in accordance
with Statement of Financial Accounting Standards ("SFAS") No. 121, "Accounting
for the Impairment of Long-Lived Assets to be Disposed of." The Company assesses
potential impairments to its long-lived assets when there is evidence that
events or changes in circumstances have made recovery of the assets carrying
value unlikely. An impairment loss would be recognized when the sum of the
expected future undiscounted net cash flows is less than the carrying amount of
the asset. The Company has identified no such impairment losses. Substantially
all of the Company's long-lived assets are located in the United States.

Research and Development

   Research and development costs associated with computer software are charged
to expense as incurred. In accordance with Statement of Financial Accounting
Standards No. 86 ("SFAS 86") "Accounting for the Costs of Computer Software to
be Sold,


                                    Page 17
<PAGE>   18
Leased, or Otherwise Marketed", capitalization of internally developed computer
software costs begins upon the establishment of technological feasibility based
on a working model. Capitalized software costs of $806,000 and $999,000 are
included in the December 31, 1999 and 1998 balance sheets, respectively, under
"Intangible and other assets."

   The Company's policy is to amortize these costs upon a product's general
release to the customer. Amortization of capitalized software costs is
calculated by the greater of (a) the ratio that current gross revenues for a
product bear to the total of current and anticipated future gross revenues for
that product or (b) the straight-line method over the remaining estimated
economic life of the product including the period being reported on, typically
two to six years. It is reasonably possible that those estimates of anticipated
future gross revenues, the remaining estimated economic life of the product, or
both could be reduced significantly due to competitive pressures. Amortization
expense related to capitalized software for 1999, 1998 and 1997 was $193,000,
$36,000 and 0, respectively. There was no amortization expense related to
capitalized software in 1997.

Cash and Cash Equivalents and Marketable Securities

   The Company considers all highly liquid marketable securities with original
maturities of three months or less at the date of acquisition to be cash
equivalents. Debt securities with original maturities of more than three months
at the date of acquisition are classified as marketable securities. The Company
classifies its entire investment portfolio, consisting of debt securities issued
by state and local governments of the United States and by corporations, as
available for sale securities. The cost basis, using specific indentification
method, approximates fair market value and an unrealized gain or loss is
recognized.

Restricted Cash

   The Company entered into an escrow agreement as a result of the Quantra
acquisition (see Note 13). The agreement expired on March 20, 1999 and all the
escrowed monies were returned to the Company.

Hedging Transactions

   The Company purchases from time to time forward contracts to attempt to
minimize the impact of exchange rate gains or losses from foreign currency
transactions. The forward contracts entered into are for periods of less than
six months. The Company had one forward contract outstanding at December 31,
1997 which liquidated in February 1998. There were no outstanding forward
contracts at December 31, 1998 and December 31, 1999.

Property and Equipment

   Property and equipment are stated at cost. Depreciation of property and
equipment is calculated using a combination of straight-line and accelerated
methods over the estimated useful lives of the assets as follows:

<TABLE>
<CAPTION>
          Description
          ------------------------
<S>                                       <C>
          Building                        31.5 years
          Equipment                       3-5 years
          Furniture and fixtures          7-10 years
          Leasehold improvements          shorter of lease term or estimated
                                          useful life
</TABLE>

   Maintenance and repairs are expensed as incurred. The costs of sold or
retired assets are removed from the related asset and accumulated depreciation
accounts and any gain or loss is included in operations.

Goodwill and Intangible Assets

   Goodwill resulting from acquisitions is amortized on a straight-line basis
over its estimated life of five years. The carrying amount of goodwill is
evaluated for future recoverability on a periodic basis, relying on a number of
factors, including the estimated life of the customer base under the annual
maintenance agreements, operating results for each division, business plans,
budgets and economic projections and undiscounted cash flows. In addition, the
Company's evaluation considers non-financial data such as market trends, product
development cycles and changes in management's market emphasis. Amortization
expense associated with goodwill was $426,000, $412,000 and $369,000 for the
years ended December 31, 1999, 1998 and 1997, respectively.

   Other intangible assets, excluding complete technology, are being amortized
on a straight-line basis over their estimated lives of two to three years.
Complete technology is amortized over approximately two to four years based on
the ratio that


                                    Page 18
<PAGE>   19
current gross revenues of the product bear to the total of current and
anticipated future gross revenues of the product or on a straight-line method,
whichever is shorter. Amortization expense associated with completed technology
for the years ended December 31, 1999, 1998 and 1997 was $3,299,000, $2,974,000,
and $290,000, respectively.

Concentration of Credit Risk

   Financial instruments which potentially subject the Company to concentrations
of credit risk consist principally of cash, cash equivalents, marketable
securities and trade receivables. The Company invests its cash in deposits with
commercial banks or in municipal bond and bond funds with broker/dealers.
Concentrations of credit risk, with respect to trade receivables, are limited
due to the large number of customers comprising the Company's customer base and
their dispersion across many geographies. As of December 31, 1999 and 1998, the
Company had no significant concentrations of credit risk and the carrying value
of these assets approximates fair value.

Income Taxes

   The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes." Under SFAS 109, an asset and liability approach
is used to recognize deferred tax assets and liabilities for the future tax
consequences of items that have already been recognized in its financial
statements and tax returns. A valuation allowance is established against net
deferred tax assets if, based on the weight of available evidence, it is more
likely than not that some or all of the net deferred tax assets will not be
realized.

International Operations and Foreign Currency

   The functional currency of each foreign subsidiary is the local currency.
Accordingly, assets and liabilities of foreign subsidiaries are translated to
U.S. dollars at period end exchange rates and stockholders' equity is translated
at historical rates. Revenues and expenses are translated using the average
rates during the period. The resulting translation adjustments are excluded from
net earnings and accumulated as a separate component of stockholders' equity.
Foreign currency transaction gains and losses are included in the results of
operations in the periods in which they occur and are immaterial for all periods
presented.

Basic and Diluted Earnings Per Share

   Earnings per share is calculated in accordance with SFAS No. 128, "Earnings
Per Share." The standard requires the presentation of basic and diluted earnings
per share. Basic earnings per share includes no dilution and is computed by
dividing income available to common stockholders by the weighted average number
of common shares outstanding for the period. Diluted earnings per share is
computed by dividing net income by the weighted average number of common shares
and common equivalent shares outstanding during the period. Common equivalent
shares consist of stock options using the treasury stock method. Common
equivalent shares from stock options are excluded from the computation if their
effect is antidilutive.

   Income available to stockholders is the same for basic and diluted earnings
per share. A reconciliation of the shares outstanding is as follows (in
thousands):

<TABLE>
<CAPTION>
                                                                1999         1998         1997
                                                               ------       ------       ------
<S>                                                            <C>          <C>          <C>
    Weighted average common shares outstanding                 15,678       14,956       14,040
    Weighted average common stock equivalents -- options           --          950          397
                                                               ------       ------       ------
    Weighted average common and common equivalent shares
    outstanding                                                15,678       15,906       14,437
                                                               ======       ======       ======
</TABLE>

   Options to purchase 2,920,180, 297,500 and 1,000,000 shares were outstanding
at December 31, 1999, 1998 and 1997, respectively, but were not included in the
computation of diluted earnings per share because the effect of including the
options would be antidilutive.

Comprehensive Income

   The Company adopted Statement of Financial Accounting Standards No. 130 (SFAS
130), Reporting Comprehensive Income, effective January 1, 1998. SFAS 130
requires that items defined as comprehensive income, such as foreign currency
translation adjustments and unrealized gains (losses) on marketable securities,
be separately classified in the financial


                                    Page 19
<PAGE>   20
statements and that the accumulated balance of other comprehensive income be
reported separately from retained earnings and additional paid-in capital in the
equity section of the balance sheet. Total comprehensive income is comprised of
net income and other accumulated comprehensive income disclosed in the equity
section of the balance sheet. For the year ended December 31, 1999, total
comprehensive loss was $12.9 million. For the year ended December 31, 1998,
total comprehensive income was $0.9 million. There were no differences between
net income and comprehensive income for the year ended December 31, 1997.

Reclassification

   Certain amounts in the 1998 consolidated financial statements have been
reclassified to be comparable with the 1999 presentation. These classifications
have had no effect on net income, working capital or net equity.


3.  Marketable Securities

   The following table summarizes marketable securities at December 31, 1999 (in
thousands):

<TABLE>
<CAPTION>
                                                                             Gross
                                                           Amortized      Unrealized         Fair
                                                              Cost          Losses          Value
                                                         -------------------------------------------
<S>                                                      <C>               <C>             <C>
          State, municipal and county
            government bonds                             $ 26,141          $  (58)         $ 26,083
          US government securities                          2,642             (30)            2,612
          Corporate bonds                                   3,374             (19)            3,355
          Floating rate notes                               4,000             (16)            3,984
                                                         ---------         --------        ---------
                 Total                                   $ 36,157          $ (123)         $ 36,034
                                                         ---------         --------        ---------
</TABLE>

   The following table summarizes marketable securities at December 31, 1998 (in
thousands):

<TABLE>
<CAPTION>
                                                                           Gross
                                                        Amortized        Unrealized      Fair
                                                           Cost            Losses        Value
                                                        ---------------------------------------
<S>                                                     <C>               <C>          <C>
          State, municipal and county
            government bonds                             $ 37,945         $     --     $ 37,945
          Corporate bonds                                   4,318               --        4,318
                                                         ---------        -------      --------
                 Total                                   $ 42,263         $     --     $ 42,263
                                                         ---------        -------      --------
</TABLE>


   The following table summarizes the maturities of marketable securities at
December 31 (in thousands):


<TABLE>
<CAPTION>
                                                                      1999
                                                                    ---------
<S>                                                                 <C>
          Less than one year                                        $ 29,321
          Due in 1-2 years                                             6,713
                                                                    ---------
                Total                                               $ 36,034
                                                                    =========
</TABLE>


In 1998, the cost basis, using the specific identification method, approximated
fair market value and no unrealized gain or loss had been recognized. In 1999,
the Company reduced its marketable securities by $123,000 with a corresponding
unrealized loss recorded in stockholders' equity to reflect the securities'
lower market value. The Company did not have any material realized gains or
losses during 1999 and 1998.


                                    Page 20
<PAGE>   21
4.  Accounts Receivable

   Accounts receivable are as follows (in thousands):

<TABLE>
<CAPTION>
                                                        December 31,
                                                   ---------------------
                                                     1999          1998
                                                   -------       -------
<S>                                                <C>           <C>
    Current
    -------
    Accounts receivable, net of allowance
         for doubtful accounts of $3,861 and
         $2,758, respectively                      $ 7,741       $17,226
    Unbilled accounts receivable, net of
         allowance for doubtful accounts of
         $479 and $653, respectively                 3,338         7,216
                                                   -------       -------
    Total current accounts receivable               11,079        24,442

    Noncurrent
    ----------
    Unbilled accounts receivable                       301           549
                                                   -------       -------
    Total accounts receivable                      $11,380       $24,991
                                                   =======       =======
</TABLE>

At December 31, 1998 and December 31, 1999 amounts receivable from related
parties was $474,000 and $52,500, respectively.


5.  Long-Term Debt

   Long-term debt consists of the following (in thousands):

<TABLE>
<CAPTION>
                                                                 December 31,
                                                              ------------------
                                                               1999         1998
                                                              -----        -----
<S>                                                           <C>          <C>
    Note payable to former Mabel shareholders,  at no
         interest, due in three equal annual installments     $ 125        $ 250
    8.75% revolving credit line with a bank,  paid in
         full upon HedgeWare merger,  March 1999                 --          150
    9.75% note payable to a bank, paid in full upon
         HedgeWare merger March 1999                             --           21
    9% note payable to a bank, paid in full upon
         HedgeWare merger, March 1999                            --           22
    Capitalized lease obligations for office equipment,
         through September 2002                                  17           29
                                                              -----        -----
                                                                142          472
                                                                           -----
    Less current portion                                       (131)        (321)
                                                              -----        -----
    Long-term debt                                            $  11        $ 151
                                                              =====        =====
</TABLE>

      The note payable to former Mabel shareholders was issued in connection
with the Company's acquisition of Mabel Systems BV ("Mabel") (See Note 13). The
terms of the purchase agreement are for the Company to pay $375,000 in three
equal installments of $125,000 on the first, second and third anniversary of the
closing date of the acquisition. Each payment is conditional on the continued
employment of the former shareholders with the Company as of the date of the
payment.

      The bank debt as of December 31, 1998 is a result of pooling HedgeWare's
balance sheet with SS&C's. Those notes were paid off in March 1999.

6.  Common Stock

   At December 31, 1999, 25,000,000 shares were authorized and 16,044,203 shares
were outstanding. At December 31, 1998, 25,000,000 shares of common stock were
authorized and 15,285,622 shares were outstanding.

   On March 11, 1999, the Company issued 685,683 shares of the Company's common
stock in connection with the Company's acquisition of HedgeWare, Inc. On March
31, 1999, the Company issued 27,500 shares of the Company's common stock in
connection with the acquisition of the Brookside Corporation.


                                    Page 21
<PAGE>   22
7.  Income Taxes

   The sources of income (loss) before income taxes were as follows:


<TABLE>
<CAPTION>
     (In thousands):                            Year Ended December 31,
                                          -------------------------------------
                                            1999          1998          1997
                                          --------        ------       -------
<S>                                       <C>             <C>          <C>
    U.S                                   $(18,884)       $  150       $ 2,337
    Foreign                                   (307)        2,128          (774)
                                          --------        ------       -------
    Income (loss) from consolidated
    companies before taxes                $(19,191)       $2,278       $ 1,563
                                          ========        ======       =======
</TABLE>


   The income tax provision (benefit) for the years ended December 31, 1999,
1998 and 1997 consists of the following:

<TABLE>
<CAPTION>
       (in thousands)                   Year Ended December 31,
                            -----------------------------------------------
                             1999                 1998                1997
                            -------             -------             -------
<S>                         <C>                 <C>                 <C>
    Current:
         Federal            $(1,955)            $ 2,192             $ 1,080
         Foreign                101               1,026                  63
         State                   95                 729                 283
    Deferred:
         Federal             (3,826)             (2,161)               (280)
         State                 (958)               (561)               (117)
                            -------             -------             -------
    Total                   $(6,543)            $1, 225             $ 1,029
                            =======             =======             =======
</TABLE>

   The effective tax rates were 34.1%, 53.8%, and 65.8% for the years ended
December 31, 1999, 1998 and 1997, respectively. The reconciliation between the
effective tax rates and the expected tax expense is computed by applying the
U.S. federal corporate income tax rate of 34% to income before income taxes as
follows:


<TABLE>
<CAPTION>
     (in thousands)                                                       Year Ended December 31,
                                                             -----------------------------------------------
                                                               1999                1998                1997
                                                             -------             -------             -------
<S>                                                          <C>                 <C>                 <C>
    Computed "expected" tax expense (benefit)                $(6,525)            $   775             $   531
    Increase (decrease) in income taxes resulting
    from:
         State income taxes (net of Federal
         income tax benefit)                                    (570)                103                 110
         Tax exempt interest income                             (369)               (680)               (553)
         Foreign operations rate differential                    206                 324                 326
         Litigation settlement                                 1,086                  --                  --
         Meals and entertainment                                  84                  75                  50
         Research and development credit                        (200)                 --                  --
         S Corporation (earnings) loss not
           (taxable) beneficial to the Company                   (88)                614                 429
         Other                                                  (167)                 14                 136
                                                             -------             -------             -------
    Income tax expense                                       $(6,543)            $ 1,225             $ 1,029
                                                             =======             =======             =======
</TABLE>


                                    Page 22
<PAGE>   23
       The components of the net deferred tax asset at December 31, 1999 and
1998 are as follows:

<TABLE>
<CAPTION>
                                                       December 31,
                                               ----------------------------
    (in thousands)                               1999                1998
                                               --------             -------
<S>                                            <C>                  <C>
         Deferred tax assets                   $ 12,911             $ 7,807
         Deferred tax liabilities                (1,040)             (1,107)
         Valuation allowance                       (389)
                                               --------             -------
             Net deferred tax asset            $ 11,482             $ 6,700
                                               ========             =======
</TABLE>


   The components of deferred income taxes at December 31, 1999 and 1998 are as
follows:

<TABLE>
<CAPTION>
                                                                         December 31,
                                                 ---------------------------------------------------------------
     In thousands:                                         1999                               1998
                                                 ---------------------------        ----------------------------
                                                 Deferred          Deferred         Deferred         Deferred
                                                   Tax                Tax              Tax              Tax
                                                  Assets          Liabilities         Assets         Liabilities
                                                  ------          -----------         ------         -----------
<S>                                              <C>              <C>                <C>             <C>
     Purchased in-process research and
          development                             $4,402            $   --            $4,747           $   --
     Net operating loss carryforward               3,440                --                 -               --
     Acquired technology                           2,456                --             1,329               --
     Accounts receivable                           1,270               386             1,104              591
     Tax credit carryforwards                        821                --                --                -
     Accrued expenses                                298                --               228              118
     Accounting method change - advance
          payments                                   144                --               293               --
     Capitalized software                              -               315                --              398
     Other                                            80               339               106               --
                                                 -------            ------            ------           ------
     Total                                       $12,911            $1,040            $7,807           $1,107
                                                 =======            ======            ======           ======
</TABLE>

   At December 31, 1999, no deferred taxes have been provided on the unremitted
earnings of the Company's foreign subsidiaries, which have been, or intend to
be, permanently reinvested. Undistributed earnings amounted to approximately
$1,365,000.

   At December 31, 1999, the Company had available federal net operating loss
carryforwards of $7,173,000 that expire in 2019 and state net operating loss
carryforwards of $12,159,000 that expire between 2004 through 2019. The foreign
net operating loss carryforwards other than Japan of $761,000 are available to
offset foreign income on an indefinite carryforward basis. Japan's net operating
loss of $462,000 expires in 2005.

   Alternative minimum tax credits of $344,000 are available to offset U.S.
federal taxable income on an indefinite carryforward basis. The company also has
research and development credit of $286,000, and foreign tax credit of $191,000
that will expire at various dates through 2014.


                                    Page 23
<PAGE>   24
8.  Leases

   The Company is obligated under noncancelable operating leases for office
space and office equipment. Total rental expense for the years ended December
31, 1999, 1998 and 1997 was $3,046,000, $2,155,000, and $1,203,000,
respectively. The Corporate facility in Windsor, Connecticut has an initial
lease term of ten years and the Company has the right to extend the lease for an
additional term of five years. Future minimum lease payments under these
operating leases are as follows (in thousands):

<TABLE>
<CAPTION>
                    Year Ended December 31,
<S>                 <C>
   2000                           $  3,447
   2001                              3,200
   2002                              2,017
   2003                              1,826
   2004                              1,837
   Thereafter                        3,602
                                  ---------
                                  $ 15,929
                                  ---------
</TABLE>


   The Company subleases office space under noncancelable leases. The Company
received rental income under these leases of $479,000, $212,000, and $99,000 for
the years ended December 31, 1999, 1998 and 1997, respectively. Minimum future
lease receipts under these leases are as follows (in thousands):

<TABLE>
<CAPTION>
              Year Ended December 31,
<S>                           <C>
   2000                       $   533
   2001                           451
   2002                            67
                              -------
                              $ 1,051
                              -------
</TABLE>

9.  Relocation Expenses

   The Company closed its Virginia office facility in 1997. The Company expensed
$0.5 million related to the office facility closing and severance packages. All
amounts were paid by December 31, 1998. Under the lease, the Company is
obligated to continue making payments through February 2002. The Company has
sublet this facility through February 2002.

   In 1997, the Company announced plans to relocate its corporate facilities. In
connection with the relocation, and in accordance with Statement of Financial
Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to be Disposed of" (SFAS No. 121) and EITF No.
94-3, the Company recognized in general and administrative expense an impairment
loss on the building and furniture it previously occupied and used of $0.5
million for the year ended December 31, 1997. In 1999, the Company sold its
previous corporate facility in Bloomfield, Connecticut.

10. License and Royalty Agreements

   The Company has non-exclusive rights to integrate certain third-party
software into certain of the Company's products. Under the terms of the
agreement, the licenser of the software is paid minimum monthly royalties and
additional royalties based on a percentage of the related license fee revenues
collected by the Company. Under this agreement, the Company is obligated to pay
on a cumulative basis at least $25,000 per quarter. The total royalty expense
under these agreements for the years ended December 31, 1999, 1998 and 1997 was
$487,000, $527,000, and $425,000, respectively.


                                    Page 24
<PAGE>   25
   In connection with the Savid acquisition, the Company has agreed to pay 10%
of license fees with respect to sales and/or licensing of the Savid system
during the period commencing on April 15, 1998 and ending on April 14, 2003.
Royalty expense for the years ended December 31, 1999 and December 31, 1998 was
$93,250 and $44,650, respectively.

      In connection with the Quantra acquisition in 1998, the Company is a party
to three royalty agreements as a result of utilities that interface with the
Company's SKYLINE for Windows product. The royalties are paid based on either
annual guaranteed total unit sales of the product at a rate of $15 per user, or
as a percentage of the utility list price, which is typically 33.33 %. Royalty
expense for the periods ended December 31, 1999, and December 31, 1998 was
$100,196 and $19,166, respectively.

11. Defined Contribution Plans

   The Company has a 401(k) Retirement Plan (the "Plan"), which covers
substantially all employees. Each employee may elect to contribute to the Plan,
through payroll deductions, up to 15% of his or her salary, subject to certain
limitations. The Plan provides for a Company match of employees' contributions
in an amount equal to 50% of an employee's contributions up to $1,000.

   In connection with the acquisition of Shepro, the Company assumed the
pre-existing deferred compensation plan for Shepro employees, which was
established in January 1995. Since the December 1997 acquisition, Shepro
employees may elect to contribute to the SS&C plan. The Shepro plan has been
frozen for any additional contributions.

   During the years ended December 31, 1999, 1998 and 1997, the Company incurred
$371,000, $286,000 and $158,000, respectively, of expenses related to these
plans.

12. Stock Option and Purchase Plans

   During 1993, the Board of Directors approved an employee stock option plan
("1993 Plan") and reserved 1,000,000 shares of common stock for issuance under
this plan. As of December 31, 1997, 25,500 options were outstanding and fully
vested under the 1993 Plan. No options were granted in 1997 or 1998, and all
outstanding options had been exercised as of December 31, 1998. In accordance
with the 1993 Plan document, the 1993 Plan terminated in 1998.

   During 1994, the Board of Directors approved a new plan ("1994 Plan"),
effective January 1, 1995, for which 1,000,000 shares of common stock were
reserved. The 1994 Plan was amended in October 1995 and April 1996 to reserve
additional shares of common stock for issuance under the plan, bringing the
total shares of common stock reserved for issuance to 3,000,000. Options under
the 1994 Plan generally vest ratably over four years and expire ten years
subsequent to the grant. The Board of Directors, as of April 30, 1998, decided
that no further options shall be granted under the 1994 plan. There were options
to purchase 1,704,223, 2,110,719, and 2,231,700 shares of common stock
outstanding as of December 31, 1999, 1998, and 1997, respectively. Options to
purchase 896,714, 856,709, and 515,236 shares of common stock were exercisable
as of December 31, 1999, 1998 and 1997, respectively.

   In April 1996, the Company adopted the 1996 Director Stock Option Plan, which
provides for non-employee directors to receive options to purchase common stock
of the Company at an exercise price equal to the fair market value of the common
stock at the date of grant. The Company has reserved a total of 150,000 shares
of common stock for issuance under this plan. The Board of Directors, as of May
5, 1999, amended the 1996 Director Stock Option Plan to make each option granted
under the 1996 Plan fully vested immediately upon the Option Grant Date.
Previously, options under the 1996 plan were fully vested after one year and
expire ten years from the grant date. At December 31, 1999, 1998, and 1997,
there were 70,000, 90,000, and 120,000 shares, respectively, available for
director option grants. There were options to purchase 65,000, 45,000 and 30,000
shares of common stock outstanding as of December 31, 1999, 1998, and 1997,
respectively. Options to purchase 65,000 and 15,000 shares of common stock were
exercisable as of December 31, 1999 and 1998, respectively. There were no
options exercisable as of December 31, 1997.

   During 1998, the Board of Directors approved the 1998 Stock Incentive Plan
("1998 Plan"), which has 1,500,000 shares of common stock reserved for issuance.
Generally, options under the 1998 Plan vest ratably over four years and expire
ten years subsequent to the grant. Shares available for option grants under the
1998 Plan were 554,043 and 1,204,542 at December 31, 1999 and 1998,
respectively. There were options to purchase 945,957 and 295,458 shares of
common stock outstanding at December 31, 1999 and 1998, respectively of which
options to purchase 81,561 and 1,583 shares were exercisable.


                                    Page 25
<PAGE>   26
On October 19, 1999, the Board of Directors approved the Company's 1999
Non-Officer Employee Stock Incentive Plan ("1999 Plan") and reserved 1,250,000
shares of Common Stock for issuance under the 1999 Plan. All the Company's
employees, consultants, and advisors other than the Company's executive officers
and directors are eligible to participate in the 1999 Plan. Only non-statutory
stock options, restricted stock awards and other stock-based awards may be
granted under the 1999 Plan. Shares available for option grants under the 1999
Plan were 1,045,000 at December 31, 1999. There were options to purchase 205,000
shares of common stock outstanding at December 31, 1999, of which options to
purchase 66,667 shares were exercisable.

   The following table summarizes stock option transactions for the years ended
December 31, 1999, 1998 and 1997.

<TABLE>
<CAPTION>
                                                                 Weighted Average
                                                 Shares           Exercise Price
                                               ----------           --------
<S>                                            <C>               <C>
Outstanding at December 31, 1996               1,274,208            $  4.49
   Granted                                     1,526,500               8.60
    Canceled                                   (283,208)               5.12
    Exercised                                  (230,300)               2.38
                                               ----------           --------
Outstanding at December 31, 1997               2,287,200               7.37

    Granted                                    1,360,500              14.30
    Canceled                                   (768,077)               8.96
    Exercised                                  (428,446)               4.87
                                               ----------           --------
Outstanding at December 31, 1998               2,451,177            $ 10.97

    Granted                                    1,259,965              12.23
    Cancelled                                  (410,381)              12.36
    Exercised                                  (380,581)              11.07
                                               ----------           --------
Outstanding at December 31, 1999               2,920,180            $ 11.32
                                               ==========           ========
</TABLE>


   The following table summarizes information about stock options outstanding at
December 31, 1999:

<TABLE>
<CAPTION>
                                                      Options Outstanding                 Options Exercisable
                                           Weighted Average                                              Weighted
        Range of              Number          Remaining              Weighted             Number          Average
       Exercise           Outstanding at   Contractual Life           Average          Exercisable at    Exercise
         Price               12/31/99          (years)             Exercise Price         12/31/99         Price
-------------------------------------------------------------------------------------------------------------------
<S>                       <C>               <C>                    <C>                 <C>               <C>
     $ 4.00-$ 6.00             580,954           7.7                   $  5.03            335,674          $ 4.81
         6.13-9.00             363,042           7.7                   $  7.57            216,150          $ 7.88
        9.38-14.00             958,978           8.4                   $ 11.13            352,408          $10.38
       14.38-19.13             874,499           5.9                   $ 15.32            134,633          $15.64
       21.88-23.63             142,707           8.3                   $ 23.13             71,078          $23.03
</TABLE>

   The exercise price for each of the above grants was determined by the Board
of Directors of the Company to be equal to the fair market value of the
Company's common stock on the date of grant

   In April 1996, the Company adopted the 1996 Employee Stock Purchase Plan
which permits employees of the Company to purchase shares of common stock
pursuant to payroll deductions at a price equal to 85% of the fair market value
of the Company's common stock on either the first or last day of the purchase
period, whichever is lower. The Company has adopted semiannual purchase periods
of October through March and April through September. As of December 31, 1999,
employees had deposited with the Company, through payroll deductions, $186,000
to purchase shares through the stock purchase plan at March 31, 2000. In May
1999, the Company amended the Plan to increase the reserved shares from 200,000
to 400,000 shares of common stock.

   At December 31, 1999, 1998 and 1997, 4,839,000, 3,990,000, and 2,985,000
shares, respectively, were reserved for the stock option and Employee Stock
Purchase plans.

Stock-based compensation


                                    Page 26
<PAGE>   27
   The Company has elected to follow Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" ("APB 25"), and related
interpretations in accounting for its stock options. Under APB 25, because the
exercise price of employee stock options equals the market price of the
underlying stock on the date of grant, no compensation expense is recorded.

   The Company has adopted the disclosure-only provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation." Accordingly, no compensation cost has
been recognized for the stock option plans and employee stock purchase plan. Had
compensation cost for the Company's stock option plans and employee stock
purchase plan been determined consistent with SFAS No. 123, the Company's net
income (loss) and earnings (loss) per share would have been adjusted to the pro
forma amounts (in thousands, except per share data) indicated in the table below
for the periods ending December 31:

<TABLE>
<CAPTION>
(in thousands except per share):                      1999            1998             1997
                                                      ----            ----             ----
<S>                                                <C>              <C>                   <C>
Net income (loss) as reported                      $ (12,648)       $ 1,053               $534
Net income (loss) pro forma                          (17,690)       (3,444)              (498)
Basic earnings per share, as reported                  (0.81)          0.07               0.04
Basic earnings per share, pro forma                    (1.13)        (0.23)             (0.04)
Diluted earnings per share, as reported                (0.81)          0.07               0.04
Diluted earnings per share, pro forma                  (1.13)        (0.23)             (0.04)
</TABLE>

   The fair value of each option grant is estimated on the date of grant using
the Black-Scholes option-pricing model with the following weighted-average
assumptions used for grants in 1999, 1998 and 1997: dividend yield of 0%;
expected volatility of 70%, 70% and 66% in 1999, 1998 and 1997, respectively;
risk-free interest rate of 5.2%, 5.4% and 6.1% in 1999, 1998 and 1997,
respectively; and expected lives of 4.26 for 1999, and 5 for 1998 and 1997. The
weighted-average fair value of options granted using this option-pricing model
in 1999, 1998 and 1997 was $6.04, $8.65 and $3.91, respectively.

   The fair value of each estimated stock grant under the employee stock
purchase plan is based on the price of the stock at the beginning of the
offering period using the Black-Scholes option-pricing model with the following
weighted average assumptions used for grants in 1999, 1998 and 1997,
respectively: dividend yield of 0%; expected volatility of 70%, 70% and 66%;
risk-free interest rate of 4.96%, 4.81% and 5.33% in 1999, 1998 and 1997,
respectively, and expected lives of six months.

13. Acquisitions:

   On December 31, 1997, the Company acquired all of the outstanding stock of
Shepro Braun Systems, Inc. ("Shepro"), a provider of software and consulting
services to the investment management and financial services marketplace, for
1,000,000 shares of Common Stock of the Company in a business combination
accounted for as a pooling-of-interests. Accordingly, the financial statements
for all periods prior to the combination have been restated to reflect the
combined operations. The results of operations presented below for the year
ended December 31, 1997 present the Company and Shepro as stand-alone entities.
There were no intercompany transactions and no adjustments to net assets of the
combining companies to adopt the same accounting practices.

<TABLE>
<CAPTION>
                                                          Total
                               Company      Shepro       Company
                              ------------------------------------
<S>                             <C>          <C>          <C>
   1997 (in thousands)
   Revenues                     $36,485      $5,665       $42,150
   Net income (loss)            $ 1,917      $ (121)      $ 1,796
</TABLE>

   Shepro had elected to be treated as a Subchapter S Corporation for income tax
purposes and, as such, no income taxes have been provided related to the results
of Shepro's operations in the statement of operations presented.

   On November 14, 1997, the Company acquired all of the outstanding stock of
Mabel for $2.5 million, which included $100,000 of direct costs associated with
the acquisition. The purchase was paid in the form of cash for $475,000, 72,816
shares of common stock of the Company valued at $750,000, $375,000 due in three
equal annual installments of $125,000 on the anniversary date of the
transaction, $286,000 of notes payable to the former Mabel shareholders, and the
assumption of liabilities of $623,000. The agreement also calls for a contingent
payment to be made in 2001. The payment is contingent on the continued
employment of the former Mabel shareholders and is based on the revenues
generated by the Mabel division. The


                                    Page 27
<PAGE>   28
payment can range from $0.2 million for revenues generated over $6 million in
the three-year period of 1998-2000 to $1.9 million for revenues over $12
million. The acquisition was accounted for as a purchase and, accordingly, the
net assets and results of operations of Mabel have been included in the
consolidated financial statements from the acquisition date. The purchase price
was first allocated to tangible assets based on their net realizable value or
fair market value on the date of the acquisition. The remaining portion of the
purchase price was allocated to identified intangible assets, goodwill and
in-process research and development.

   On March 20, 1998, the Company completed its acquisition (the "Quantra
Acquisition") of substantially all of the assets of Quantra Corporation
("Quantra") pursuant to an Asset Purchase Agreement, among the Company, Quantra
and AEGON USA Realty Advisors, Inc., the sole stockholder of Quantra. The
purchase price for the Quantra Acquisition consisted of 546,019 shares of the
Company's common stock valued at $8.8 million, $2.3 million in cash and the
assumption of certain liabilities of Quantra of approximately $4.1 million, plus
the costs of effecting the transaction. The Company and Quantra also entered
into an Escrow Agreement pursuant to which an additional $1.2 million will be
held in escrow to reimburse the Company in connection with certain acquisition
costs and breaches of representations, warranties and covenants, if any, by
Quantra (see Note 2).

   The acquisition was accounted for as a purchase and, accordingly, the net
assets and results of operations of Quantra have been included in the
consolidated financial statements from the acquisition date. The purchase price
was allocated to tangible and intangible assets and liabilities based on their
fair market value on the date of the acquisition.

   On April 9, 1998, the Company completed its acquisition (the "Savid
Acquisition") of the outstanding shares of Savid International Inc. and The
Savid Group, Inc. (together "Savid") pursuant to a Stock Purchase Agreement
between the Company, Savid and the sole stockholder ("Stockholder") of Savid.
The purchase price of the Savid acquisition consisted of $739,000 in cash, net
of cash received of $82,500, and the assumption of certain liabilities of Savid
of $118,000, plus the costs of effecting the transaction. A further cash payment
of $750,000 shall be paid as additional consideration provided that the
aggregate revenues for the period from and including April 15, 1998 through and
including April 14, 2001 are greater than or equal to $3,000,000. The Company
shall pay to the Stockholder an aggregate of 10% of the license fees with
respect to sales and/or licensing of the Savid product during the period
commencing on April 15, 1998 and ending on April 14, 2003. The acquisition was
accounted for as a purchase and, accordingly, the net assets and results of
operations of Savid have been included in the consolidated condensed financial
statements from the acquisition date. The purchase price was allocated to
tangible and intangible assets, liabilities, and in-process research and
development based on their fair market value on the date of the acquisition.

      On March 11, 1999, the Company acquired all of the outstanding stock of
HedgeWare, Inc. ("HedgeWare"), a provider of portfolio, financial, partnership
and tax accounting software and service support to hedge fund managers and
traders, for 685,683 shares of Common Stock of the Company in a business
combination accounted for as a pooling-of-interests. Accordingly, the financial
statements for all periods prior to the combination have been restated to
reflect the combined operations. The Company, HedgeWare and the former
stockholders of HedgeWare have entered into an Escrow Agreement providing, among
other things, that 89,139 shares of Common Stock will be held in escrow to
reimburse the Company in connection with breaches of representations, warranties
or covenants, if any, as well as potential rental obligations and sales tax
liabilities of HedgeWare. The results of operations presented below for the
years ended December 31, 1997 and 1998 present the Company and HedgeWare as
stand-alone entities. There were no intercompany transactions and no adjustments
to net assets of the combining companies to adopt the same accounting practices.

<TABLE>
<CAPTION>
                                                                                Total
                                                   Company       HedgeWare     Company
                                                   -----------------------------------
<S>                                               <C>            <C>          <C>
     1997 (in thousands)
     Revenues                                     $ 42,150       $  3,377     $ 45,527
     Net income (loss)                            $  1,796       $ (1,262)    $    534
     ----------------------------------------------------------------------------------

     1998 (in thousands)
     Revenues                                     $ 69,413       $  4,180     $ 73,593
     Net income (loss)                             $ 2,862       $ (1,809)    $  1,053
     ----------------------------------------------------------------------------------

     1999 (in thousands)
     Revenues                                      $63,067       $  2,669      $65,736
     Net income (loss)                             (14,044)         1,396      (12,648)
</TABLE>


                                    Page 28
<PAGE>   29
   HedgeWare had elected to be treated as a Subchapter S Corporation for income
tax purposes and, as such, income taxes are provided from March 11, 1999 for
HedgeWare's results of operations. During the quarter ended March 31, 1999, the
Company issued stock valued at $3.1 million in satisfaction of certain
shareholder and employee-related accrued expenses of HedgeWare that existed as
of the effective date of the merger. All periods prior to 1999 have been
restated to include HedgeWare, Inc., as a March 11, 1999 pooling of interests
acquisition.


   On March 31, 1999, the Company acquired all of the outstanding stock of The
Brookside Corporation. Pursuant to the Purchase Agreement, all of the
outstanding shares of common stock of Brookside held by the Stockholder were
exchanged for an aggregate of 27,600 shares of Common Stock of the Company. The
consolidated results of operations for the year ended December 31, 1999 include
the results of operations of Brookside from the beginning of the year. The
consolidated financial statements for prior periods have not been restated since
the impact of such restatement would not be material.

   For the Mabel, Quantra and Savid acquisitions, the allocation to complete
technology is based on future risk-adjusted discounted cash flows. Complete
technology has been capitalized and included within Intangible and other assets.
Amortization expense associated with complete technology for the Mabel, Quantra
and Savid acquisitions for the years ended December 31, 1998 and 1999 were
$2,973,000 and $3,299,000 respectively.

   The Company believes that the amounts recorded as in-process research and
development (IPR&D) charges at the dates of the acquisitions of Quantra and
Savid were measured in a manner consistent with widely recognized appraisal
practices that were being utilized at the time of the acquisitions. Subsequent
to the acquisitions, in a letter dated September 15, 1998 to the American
Institute of Certified Public Accountants, the Chief Accountant of the
Securities and Exchange Commission (SEC) expressed views of the SEC staff that
took issue with certain appraisal practices employed in the determination of the
fair value of IPR&D that was the basis of the Company's measurement of its IPR&D
charge. Accordingly, the Company has resolved to adjust the amount originally
allocated to acquired IPR&D in a manner to reflect the SEC staff's. This revised
allocation was completed March 24, 1999. The effect of this revised allocation
was to increase the allocation of the purchase price to completed technology and
decreased the allocation of the purchase price to purchased in-process
technology as reported in the table below.

<TABLE>
<CAPTION>
                                                        As             As
                                                     Reported       Restated
                                                     --------       --------
     (in thousands)
<S>                                                  <C>            <C>
     Tangible net assets                             $  4,667       $  4,667
     Purchased in-process research and
     development                                        7,980          5,878
     Purchased complete technology                      3,505          5,607
                                                     --------       --------
                                                     $ 16,152       $ 16,152
                                                     ========       ========
</TABLE>


   Other factors considered in the allocation of the purchase price to
in-process research and development include the estimated net cash flows
generated from such projects, discounting the net cash flows back to their
present values, and adjusting values to reflect the contribution of completed
and core technologies. For the Quantra and Savid acquisitions, the Company
developed revenue projections over a five to six year period in three
categories: license, maintenance and consulting. License revenue projections
were based on expected unit sales over the projected lives of the respective
product lines. The other categories of revenue were generally estimated as a
percentage of total license revenues and ranged from 15% to 20% for maintenance
and from 10% to 30% for consulting, depending on the product. Savid consulting
revenues were projected to be insignificant. Expense assumptions were based on
the imposition of the Company's cost structure on the acquired technologies and
products. The discount rates for the Quantra in-process research and development
projects were 23% and 28%; the discount rate for the Savid in-process research
and development projects was 20%.

   For the Mabel acquisition, the Company developed revenue projections based on
unit sales estimates over the projected lives of the Mabel product lines.
Expense assumptions were based on Mabel's past experience and had not been
adjusted for expected cost synergies with SS&C. The discount rate for the Mabel
in-process research and development was 22%.


                                    Page 29
<PAGE>   30
      The following summarizes the allocation of the purchase price (in
thousands) for the Mabel, Quantra and Savid acquisitions:

<TABLE>
<CAPTION>
                                                      1998              1997
                                                   -------------------------
<S>                                                <C>                <C>
    Cash                                           $    --            $  403
    Accounts receivable                              1,481               260
    Unbilled accounts  receivable                    2,694                --
    Other assets                                        63                46
    Equipment and furniture                            429                21
    Complete technology                              5,607               588
    Incomplete technology                            5,878               861
    Goodwill                                            --               330
                                                   -------------------------
                                                   $16,152            $2,509
                                                   =========================
</TABLE>

    The unaudited pro forma condensed consolidated results of operations
presented below for the years ended December 31, 1997 and 1998, assumes the
Mabel, Quantra and Savid acquisitions occurred at the beginning of 1997. The
unaudited pro forma condensed consolidated statement of operations for the year
ended December 31, 1998 excludes the $5.9 million write-off of purchased in-
process research and development related to the Quantra and Savid acquisitions.
The unaudited pro forma condensed consolidated statement of operations for the
year ended December 31, 1997 excludes the $861,000 write-off of purchased in-
process research and development related to the Mabel acquisition.

<TABLE>
<CAPTION>
                                                    1998          1997
                                                    ----          ----
    (in thousands, except per share data)
<S>                                               <C>          <C>
    Total revenues                                $ 76,299     $ 58,948
    Operating income (loss)                          2,618     (24,475)
    Net income (loss)                                1,571     (14,966)
    Basic earnings per share                          0.11       (1.07)
    Diluted earnings per share                         .10       (1.07)
</TABLE>

   These pro forma results are not necessarily indicative of results of
operations that would have actually occurred had the acquisition taken place at
the beginning of each period, or of future operations of the combined companies.

14. Commitments and Contingencies

      On May 7, 1999, the Company announced that it had entered into an
agreement that provides for the settlement of the consolidated securities class
action lawsuit pending against the Company. The settlement provides that all
claims against the Company, certain of its officers and directors and
underwriters will be dismissed. Under the terms of the settlement, in exchange
for the dismissal and release of all claims, the Company paid to the class $7.5
million in cash, together with shares of Common Stock of the Company valued at
$1.3 million. The Company recorded a charge for the settlement of approximately
$9.3 million, including legal fees, in the quarter ended June 30, 1999.


                                    Page 30
<PAGE>   31
      From time to time, the Company is subject to certain legal proceedings and
claims that arise in the normal course of its business. In the opinion of
management, the Company is not a party to any other litigation that it believes
could have a material effect on the Company or its business.

15. Related Party Transactions:

   In 1996, the Company licensed its CAMRA and FILMS applications software and
certain other programs to a related party for a total purchase price of
$2,055,000, including a five-year maintenance program beginning in February
1996. The purchase price was allocated to license fees of $1,544,000,
maintenance fees over the five-year period of $375,000 and deferred interest of
$136,000 resulting from an extended payment plan. Terms include $900,000 payable
upon execution of the agreement and quarterly installments of $53,000 for five
years. All outstanding receivables and payables between the parties as of
January 27, 1996 were forgiven, resulting in an additional $105,000 allocated to
the purchase price. Interest was imputed at 9% for payments on the license fee.
The amount collected from the related party during the year ended December 31,
1998 was $160,000, including sales tax and other products not related to this
agreement.

   The Company has long-term debt with the former Mabel shareholders. (see
Note 5)

   On May 1, 1998, the Company invested approximately $2.2 million in cash plus
an exclusive distribution agreement for the CAMRA product in exchange for a 24%
ownership interest in Caminus Energy Ventures, LLC, a limited liability company
organized to provide comprehensive consulting services and software technology
to the power and gas trading business. The exclusive distribution agreement
allows Caminus to sell the Company's software products within energy-related
markets over a five-year period based on certain terms and conditions. The
Company commenced the reporting of its share of Caminus' earnings on an equity
basis.

   In the fourth quarter of 1998, the Company sold its interest in Caminus for
$2,250,000 and retained a warrant to purchase 4.5% of Caminus at a price of $2.3
million and the Company recorded a gain of $0.5 million on this sale. In
addition, the Company entered into a distributor agreement with Caminus. This
agreement enables Caminus to distribute the Company's products to the energy
markets throughout the world. The distributor agreement requires Caminus to
purchase a minimum of $3.4 million of software licenses through the fourth
quarter of 2000. In 1999, Caminus purchased $1,250,000 of software under the
agreement.

     AEGON USA Realty Advisors, Inc. ("Aegon") is the parent company of QSC
Holding Inc. (formerly known as Quantra Corporation), which sold substantially
all of its assets to the Company in March 1998. The president of Aegon retains a
seat on the board of directors of the Company. During the quarter ended March
1999 Aegon licensed certain of the Company's products for $1.68 million. This
amount was paid in full.

16. International sales and geographic information

   During fiscal 1999, the Company adopted SFAS No. 131, Disclosures about
Segments of an Enterprise and Related Information. There were no sales to any
individual customers during the years in the three year period ended 1999 that
represented 10% or more of net sales. The Company attributes net sales to an
individual country based upon location of the customer.

    The Company manages its business primarily on a geographic basis. The
Company reportable segments are comprised of the Americas and Europe. The
Americas segment includes both North and South America. The European segment
includes European countries as well as the Middle East and Africa. Other
operating segments include Asia Pacific and Japan.

     Revenues by geography for the years ended December 31, were (in thousands):
<TABLE>
<CAPTION>
                                1999               1998               1997
                              -------            -------            -------
<S>                           <C>                <C>                <C>
    Americas                  $53,471            $63,661            $42,629
    Europe                     11,557              9,127              2,010
    Other Segments                708                805                888
                              -------            -------            -------
                               65,736             73,593             45,527
                              =======            =======            =======
</TABLE>

     Long-lived assets by geography for the years ended December 31, were
(in thousands):

<TABLE>
                                1999               1998
                              -------            -------
<S>                           <C>                <C>
    Americas                  $10,547            $12,606
    Europe                        720                448
    Other Segments                168                 70
                              -------            -------
                               11,435             13,124
                              =======            =======
</TABLE>



                                    Page 31
<PAGE>   32
17. Selected Quarterly Financial Data (Unaudited)

<TABLE>
<CAPTION>
                                                     First          Second             Third           Fourth
                                                    Quarter         Quarter           Quarter          Quarter
                                                    -------         -------           -------          -------
<S>                                                  <C>             <C>               <C>              <C>
    (in thousands, except per share data)
    1999
    Revenue                                          $ 19,447        $ 16,621          $ 15,228         $ 14,440
    Gross profit                                       12,831           9,143             8,165            7,591
    Operating income (loss)                             1,126        (13,299)           (4,948)          (4,961)
    Net income (loss)                                   1,481        (11,838)           (2,113)            (178)
    Basic earnings (loss) per share                       .10           (.76)             (.14)            (.01)
    Diluted earnings (loss) per share                     .09           (.76)             (.14)            (.01)

    1998
    Revenue                                          $ 12,568        $ 19,067          $ 19,227         $ 22,731
    Gross profit                                        8,953          12,873            12,443           14,805
    Operating income (loss)                           (5,060)             391             1,498            3,129
    Net income (loss)                                 (2,925)             467               374            3,137
    Basic earnings (loss) per share                     (.20)             .03               .02              .21
    Diluted earnings (loss) per share                   (.20)             .03               .02              .20
</TABLE>


   The second quarter of 1999 includes the $9.3 million settlement of the
lawsuit related to the Company's initial public offering. The first quarter of
1998 includes the write-off of purchased in-process research & development
expenses of $5.4 million related to the Quantra acquisition. The second quarter
of 1998 includes the write-off of purchased in-process research and development
expenses of $0.5 million related to the Quantra and Savid acquisitions. The
third quarter of 1998 includes a non-operating loss of $0.5 million, net of
taxes, for the Company's proportionate share of a write-off of in-process
research and development attributable to Caminus' acquisitions. The fourth
quarter of 1998 includes a gain of $0.5 million related to the sale of the
Company's equity interest in Caminus.


                                    Page 32