<PAGE>   1
                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549



              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED JULY 31, 2001

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

             For the transition period from ________ to ___________

                         COMMISSION FILE NUMBER: 0-18553


                                 ASHWORTH, INC.


              DELAWARE                                      84-1052000
   (State or other jurisdiction of                       (I.R.S. Employee
   incorporation or organization)                       Identification No.)

                             2765 LOKER AVENUE WEST
                               CARLSBAD, CA 92008
                    (Address of Principal Executive Offices)

                                 (760) 438-6610
                       (Telephone No. Including Area Code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X]  No [ ]


Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.

            Title                              Outstanding at September 10, 2001

$.001 par value Common Stock                               13,198,308



<PAGE>   2

                                      INDEX

<TABLE>
<CAPTION>
                                                                              PAGE
<S>                                                                            <C>
Part I.  Financial Information

Item 1.  Financial Statements

               Condensed Consolidated Balance Sheets                            1
               Condensed Consolidated Statements of Income                      2
               Condensed Consolidated Statements of Cash Flows                  3
               Notes to Condensed Consolidated Financial Statements             4

Item 2.  Management's Discussion and Analysis of
               Financial Condition and Results of Operations                    8

Item 3.  Quantitative and Qualitative Disclosures About Market Risk            12

Part II. Other Information                                                     12

Item 1.  Legal Proceedings                                                     12

Item 2.  Changes in Securities and Use of Proceeds                             13

Item 3.  Defaults Upon Senior Securities                                       13

Item 4.  Submission of Matters to a Vote of Security Holders                   13

Item 5.  Other Information                                                     14

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

               Signatures                                                      17
</TABLE>


<PAGE>   3

ASHWORTH, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS


<TABLE>
<CAPTION>
                                                            July 31,          October 31,
                                                              2001               2000
                                                         -------------       ------------
                                                          (UNAUDITED)
<S>                                                      <C>                 <C>
ASSETS

Current assets:
     Cash and cash equivalents                           $   2,610,000       $  1,231,000
     Accounts receivable - trade, net                       37,149,000         25,578,000
     Accounts receivable - other                             3,198,000          2,221,000
     Inventories, net                                       32,930,000         37,526,000
     Income tax refund receivable                                   --            582,000
     Other current assets                                    2,979,000          1,891,000
     Deferred income tax asset                               1,614,000          1,614,000
                                                         -------------       ------------
       Total current assets                                 80,480,000         70,643,000
                                                         -------------       ------------

Property, plant and equipment, at cost                      36,300,000         30,452,000
     Less accumulated depreciation and amortization        (17,118,000)       (15,604,000)
                                                         -------------       ------------
                                                            19,182,000         14,848,000
                                                         -------------       ------------

Other assets                                                 1,550,000          1,880,000
                                                         -------------       ------------
      Total Assets                                       $ 101,212,000       $ 87,371,000
                                                         =============       ============


LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
     Note payable                                        $  11,075,000       $  1,490,000
     Current portion of long-term debt                         727,000            692,000
     Accounts payable - trade                                2,850,000          4,477,000
     Income taxes payable                                      851,000                 --
     Accrued liabilities                                     3,906,000          3,988,000
                                                         -------------       ------------
         Total current liabilities                          19,409,000         10,647,000
                                                         -------------       ------------

Long-term debt, net of current portion                       3,253,000          3,293,000
Deferred income tax liability                                  742,000            742,000
Other long term liabilities                                    617,000            715,000

Stockholders' equity:
     Common stock                                               13,000             13,000
     Capital in excess of par value                         38,097,000         37,698,000
     Retained earnings                                      40,248,000         35,241,000
     Accumulated other comprehensive loss                   (1,167,000)          (978,000)
                                                         -------------       ------------
       Total stockholders' equity                           77,191,000         71,974,000
                                                         -------------       ------------
        Total liabilities and stockholders' equity       $ 101,212,000       $ 87,371,000
                                                         =============       ============
</TABLE>




                                       1
<PAGE>   4

ASHWORTH, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)


<TABLE>
<CAPTION>
                                          Three months ended July 31,         Nine months ended July 31,
                                             2001             2000              2001             2000
                                         ------------     ------------     -------------     ------------
<S>                                      <C>              <C>              <C>               <C>
Net revenue                              $ 29,765,000     $ 35,004,000     $ 104,379,000     $ 98,775,000

Cost of goods sold                         18,344,000       21,637,000        63,759,000       60,487,000
                                         ------------     ------------     -------------     ------------
  Gross profit                             11,421,000       13,367,000        40,620,000       38,288,000

Selling, general and
  administrative expenses                  10,022,000        9,803,000        31,139,000       27,876,000
                                         ------------     ------------     -------------     ------------
  Income from operations                    1,399,000        3,564,000         9,481,000       10,412,000

Other income (expense):
  Interest income                               5,000           18,000            14,000           58,000
  Interest expense                           (377,000)        (184,000)       (1,157,000)        (499,000)
  Other income (expense)                       (2,000)        (344,000)            7,000         (773,000)
                                         ------------     ------------     -------------     ------------
  Total other expense                        (374,000)        (510,000)       (1,136,000)      (1,214,000)
                                         ------------     ------------     -------------     ------------

  Income before provision for income
     tax expense                            1,025,000        3,054,000         8,345,000        9,198,000

Provision for income tax expense              410,000        1,234,000         3,338,000        3,661,000

                                         ------------     ------------     -------------     ------------
  Net income                             $    615,000     $  1,820,000     $   5,007,000     $  5,537,000
                                         ============     ============     =============     ============

Net income per share
Basic:
  Weighted average shares outstanding      13,155,000       13,320,000        13,149,000       13,490,000
  Net income per share                   $       0.05     $       0.14     $        0.38     $       0.41
Diluted:
  Weighted average shares outstanding      13,370,000       13,370,000        13,470,000       13,520,000
  Net income per share                   $       0.05     $       0.14     $        0.37     $       0.41
</TABLE>




                                       2
<PAGE>   5

ASHWORTH, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)


<TABLE>
<CAPTION>
                                                             Nine months ended July 31,
                                                              2001               2000
                                                          ------------       ------------
<S>                                                       <C>                <C>
Cash flows from operating activities:

NET CASH USED IN OPERATING ACTIVITIES                     $ (1,954,000)      $    (64,000)

Cash flows from investing activities:

     Purchases of property and equipment                    (6,303,000)        (2,232,000)
     Proceeds from sale of property and equipment                8,000             18,000
                                                          ------------       ------------

NET CASH USED IN INVESTING ACTIVITIES                       (6,295,000)        (2,214,000)

Cash flows from financing activities:

     Principal payments on capital
       lease obligations                                       (12,000)           (32,000)
     Borrowings on line of credit                           43,550,000         29,198,000
     Payments on line of credit                            (33,965,000)       (29,198,000)
     Proceeds from long-term borrowing                       3,000,000          1,441,000
     Principal payments on notes payable
       and long-term debt                                   (3,155,000)          (626,000)
     Payments for repurchase of common stock                  (217,000)        (2,556,000)
     Proceeds from issuance of common stock                    616,000                 --
                                                          ------------       ------------
 NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES         9,817,000         (1,773,000)


EFFECT OF EXCHANGE RATE CHANGES ON CASH                       (189,000)          (586,000)
                                                          ------------       ------------

Net increase (decrease) in cash and cash equivalents         1,379,000         (4,637,000)

Cash and cash equivalents, beginning of period               1,231,000          6,507,000

                                                          ------------       ------------
Cash and cash equivalents, end of period                  $  2,610,000       $  1,870,000
                                                          ============       ============
</TABLE>




                                       3
<PAGE>   6

ASHWORTH, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JULY 31, 2001



NOTE 1 - BASIS OF PRESENTATION.

      In the opinion of management, the accompanying condensed consolidated
      balance sheets and related interim condensed consolidated statements of
      income and cash flows include all adjustments (consisting only of normal
      recurring items) necessary for their fair presentation. The preparation of
      financial statements in conformity with generally accepted accounting
      principles requires management to make estimates and assumptions that
      affect the reported amounts of assets, liabilities, revenues, and expenses
      and the disclosure of contingent assets and liabilities. Actual results
      could differ from those estimates. Interim results are not necessarily
      indicative of results to be expected for the full year.

      Certain information in footnote disclosures normally included in financial
      statements has been condensed or omitted in accordance with the rules and
      regulations of the Securities and Exchange Commission. The information
      included in this Form 10-Q should be read in conjunction with Management's
      Discussion and Analysis of Financial Condition and Results of Operations,
      and consolidated financial statements and notes thereto included in the
      annual report on Form 10-K for the year ended October 31, 2000 filed with
      the Securities and Exchange Commission.

NOTE 2 - INVENTORIES.

      Inventories consisted of the following at July 31, 2001 and October 31,
      2000:

<TABLE>
<CAPTION>
                                             July 31,            October 31,
                                               2001                 2000
                                           -----------           -----------
                <S>                        <C>                   <C>
                Raw materials              $   528,000           $   811,000
                Finished goods              32,402,000            36,715,000
                                           -----------           -----------
                Total inventories, net     $32,930,000           $37,526,000
                                           ===========           ===========
</TABLE>




                                       4
<PAGE>   7


NOTE 3 - NET INCOME PER SHARE INFORMATION.

      Basic net income per share has been computed based on the weighted average
      number of common shares outstanding during the period. Diluted net income
      per share has been computed based on the weighted average number of common
      shares outstanding plus the dilutive effects of common shares potentially
      issuable from the exercise of stock options. Common stock options are
      excluded from the computation of net income per share if their effect is
      anti-dilutive. The following table sets forth the computation of basic and
      diluted net income per share based upon the requirements of SFAS No. 128:


<TABLE>
<CAPTION>
                                           Three months ended July 31,   Nine months ended July 31,
                                               2001           2000           2001           2000
                                           -----------    -----------    -----------    -----------
<S>                                        <C>            <C>            <C>            <C>
NUMERATOR:

Net income
  numerator for basic and diluted
  net income per share - net income
  available to common shareholders         $   615,000    $ 1,820,000    $ 5,007,000    $ 5,537,000
                                           ===========    ===========    ===========    ===========

DENOMINATOR:

Denominator for basic net income
  per share - weighted average shares       13,155,000     13,320,000     13,149,000     13,490,000

Effect of dilutive securities:
  stock options                                215,000         50,000        321,000         30,000
                                           -----------    -----------    -----------    -----------

Denominator for diluted net income
  per share - adjusted weighted average
  shares and assumed conversions            13,370,000     13,370,000     13,470,000     13,520,000
                                           ===========    ===========    ===========    ===========

BASIC NET INCOME PER SHARE                 $      0.05    $      0.14    $      0.38    $      0.41

DILUTED NET INCOME PER SHARE               $      0.05    $      0.14    $      0.37    $      0.41
</TABLE>


      For the three months ended July 31, 2001 and 2000, the diluted weighted
      average shares outstanding computation excludes 1,672,000 and 2,400,000
      options whose impact would have an anti-dilutive effect, respectively. For
      the nine months ended July 31, 2001 and 2000, the diluted weighted average
      shares outstanding computation excludes 1,178,000 and 2,551,000 options
      whose impact would have an anti-dilutive effect, respectively.




                                       5
<PAGE>   8

NOTE 4 - COMPREHENSIVE INCOME.

      The Company includes the cumulative foreign currency translation
      adjustment as a component of the comprehensive income in addition to net
      income for the period. For the quarters ended July 31, 2001 and 2000,
      total comprehensive income was $582,000 and $1,596,000, respectively. For
      the nine-month periods ended July 31, 2001 and 2000, total comprehensive
      income was $4,818,000 and $4,951,000, respectively.

NOTE 5 - LEGAL PROCEEDINGS.

      On January 22, 1999, Milberg Weiss Bershad Hynes & Lerach LLP filed a
      class action in the United States District Court for the Southern District
      of California ("U.S. District Court") on behalf of purchasers of the
      Company's common stock during the period between September 4, 1997 and
      July 15, 1998 alleging violations of the Securities Exchange Act of 1934
      by the Company and certain of its officers and directors. The complaint
      alleged that, during the class period, Company executives made positive
      statements about the Company's business including statements concerning
      product demand, offshore production and inventories. The complaint further
      alleged that the defendants knew these statements to be false and
      concealed adverse conditions and trends in the Company's business during
      the class period. The complaint sought to recover unspecified damages on
      behalf of all purchasers of the Company's common stock during the period
      September 4, 1997 to July 15, 1998. The Company was served a copy of the
      complaint on January 26, 1999. Subsequently, two other suits were served
      upon the Company making similar allegations. The three actions have been
      consolidated by order of the United States District Court and lead counsel
      for the plaintiffs has been appointed. Per order of the Court, Plaintiffs
      filed their Amended and Consolidated Complaint on December 17, 1999. On
      February 18, 2000, the Company filed a motion to dismiss. On May 22, 2000,
      the Court heard the motion to dismiss and took it under submission. On
      July 18, 2000, the U.S. District Court granted the motion to dismiss the
      Amended and Consolidated Complaint as to all defendants. The Court granted
      plaintiffs sixty days to amend the complaint if they chose to do so. On
      September 18, 2000, plaintiffs served their Second Consolidated Amended
      Complaint ("Second Amended Complaint") making allegations and seeking
      remedies similar to those in the prior complaint. On November 6, 2000, the
      Company filed its motion to dismiss the Second Amended Complaint. The
      motion to dismiss was heard before the U.S. District Court in February
      2001. The matter is currently under submission. No discovery has taken
      place in this matter to date.

      In October 2000, former Ashworth sales representatives Regional Sales,
      Inc. and Susan Stanley filed a complaint in San Diego Superior Court. They
      filed a first amended complaint on November 29, 2000 and on July 9, 2001,
      a second amended complaint. By their second amended complaint, the
      plaintiffs allege, among other things, that the Company failed to pay
      commissions and/or provide discounts on various sales, failed to honor an
      agreement for plaintiffs to develop a corporate sales division, interfered
      with certain alleged relationships and will not provide credit for the
      return of certain goods. Plaintiffs seek an accounting and an unspecified
      amount of compensatory and punitive damages. On January 19, 2001, the
      Company filed an answer to the first amended complaint denying the claims
      and asserting a number of defenses. On the same date, the Company filed a
      cross-complaint against plaintiffs for failure to pay for goods. Discovery
      in this case has commenced. In July 2001, the Company's motion for summary
      adjudication was granted in part and denied in part. A




                                       6
<PAGE>   9

      trial on the remaining issues is set for October 2001.

      The Company is party to other claims and litigation proceedings arising in
      the normal course of business. Although the legal responsibility and
      financial impact with respect to such other claims and litigation cannot
      currently be ascertained, the Company does not believe that these other
      matters will result in payment by the Company of monetary damages, net of
      any applicable insurance proceeds, that, in the aggregate, would be
      material in relation to the consolidated financial position or results of
      operations of the Company.


NOTE 6 - SEGMENT INFORMATION

      The Company defines its operating segments as components of an enterprise
      for which separate financial information is available and regularly
      reviewed by the Company's senior management. The Company has the following
      two reportable segments: Domestic and International. Management evaluates
      segment performance based primarily on revenue and earnings from
      operations. Interest income and expense is evaluated on a consolidated
      basis and is not allocated to the Company's business segments. Segment
      information is summarized (for the dates or periods presented below):

<TABLE>
<CAPTION>
                                            Three           Three             Nine            Nine
                                            months          months           months          months
                                            ended           ended            ended           ended
                                           7/31/01         07/31/00         07/31/01        07/31/00
                                        ------------     ------------     ------------    -----------
      <S>                               <C>              <C>              <C>             <C>
      Net revenue:
         Domestic                       $ 25,472,000     $ 31,062,000     $ 89,878,000    $84,688,000

         International                     4,293,000        3,942,000       14,501,000     14,087,000
                                        ------------     ------------     ------------    -----------
                    Total               $ 29,765,000     $ 35,004,000     $104,379,000    $98,775,000
                                        ============     ============     ============    ===========

      Income (loss) from operations:
         Domestic                       $  1,691,000     $  3,948,000     $  9,409,000    $ 9,991,000

         International                      (292,000)        (384,000)          72,000        421,000
                                        ------------     ------------     ------------    -----------
                    Total               $  1,399,000     $  3,564,000     $  9,481,000    $10,412,000
                                        ============     ============     ============    ===========
</TABLE>


<TABLE>
<CAPTION>
                                             July 31,          October 31,
                                               2001               2000
                                           ------------        -----------
      <S>                                  <C>                 <C>
      Total assets:
         Domestic                          $ 87,825,000        $74,847,000

         International                       13,387,000         12,524,000
                                           ------------        -----------
                    Total                  $101,212,000        $87,371,000
                                           ============        ===========
</TABLE>




                                       7
<PAGE>   10

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

RESULTS OF OPERATIONS

THIRD QUARTER 2001 COMPARED TO THIRD QUARTER 2000

Consolidated net revenue for the third quarter of fiscal 2001 decreased 15.0% to
$29,765,000 from $35,004,000 for the same period in 2000. Net revenue for the
domestic segment decreased 18.0% to $25,472,000 from $31,062,000 in the third
quarter of 2000, primarily due to lower revenue from the Company's corporate and
golf related distribution channels resulting from the general economic downturn
and fewer rounds played. Net revenue for the international segment increased
8.9% to $4,293,000 from $3,942,000 for the same period of the prior year. The
increase was primarily due to growth in the Company's European subsidiary and
Canadian division. This increase was partially offset by the decline in net
revenue from the Pacific Rim countries.

As a percent of revenue, consolidated gross profit for the quarter increased to
38.4% as compared to 38.2% a year earlier. This was primarily due to improved
sourcing.

Consolidated selling, general and administrative ("SG&A") expenses increased
2.2% to $10,022,000. SG&A expenses were 33.7% of net revenue for the third
quarter of fiscal 2001, as compared to 28.0% for the third quarter of fiscal
2000, reflecting lower revenue together with start up costs associated with the
new line of Callaway Golf Company branded sportswear.

Net other expenses were $374,000 for the third quarter of fiscal 2001 compared
to $510,000 in the third quarter of fiscal 2000. This was due primarily to a
lower currency transaction loss by Ashworth UK Ltd. in its transactions with
Ashworth, Inc. and its European customers, partially offset by higher interest
expense on the increased borrowing on the Company's line of credit.

The effective income tax rate for the third quarter of fiscal 2001 was 40.0% of
pre-tax income compared with 40.4% in the third quarter of fiscal 2000.

NINE MONTHS ENDED JULY 31, 2001 COMPARED TO NINE MONTHS ENDED JULY 31, 2000

Consolidated net revenue for the first nine months of fiscal 2001 increased 5.6%
to $104,379,000 from $98,775,000 for the same period in fiscal 2000. Domestic
revenue increased 6.1% to $89,878,000 from $84,688,000 in the first nine months
of fiscal 2000, primarily due to higher revenues in the Company's retail, golf
related and corporate distribution channels. Net revenue for the international
segment increased 2.9% to $14,501,000 from $14,087,000 for the same period of
the prior year. The increase was primarily due to the improvement in revenue in
the Company's European subsidiary, as well as in Australia and the Pacific Rim
countries offset by lower net revenue in Canada.

As a percent of revenue, consolidated gross profit for the nine months increased
to 38.9% as compared to 38.8% for the same period a year earlier, primarily due
to improved sourcing.

Consolidated SG&A expenses increased 11.7% to $31,139,000. As a percentage of
revenue, SG&A expenses increased to 29.8% of net revenue for the first nine
months of fiscal 2001 compared to 28.2% for the same period in fiscal 2000
primarily due to increased investment in the Company's infrastructure in
anticipation of higher revenues than realized in the third quarter of fiscal
2001. In addition start up




                                       8
<PAGE>   11

costs incurred in the current quarter associated with the new line of Callaway
Golf Company branded sportswear contributed to the increase in SG&A expenses.

Net other expenses decreased to $1,136,000 for the first nine months of fiscal
2001 from $1,214,000 in the first nine months of fiscal 2000, due primarily to a
lower currency transaction loss by Ashworth UK Ltd. in its transactions with
Ashworth, Inc. and its European customers, partially offset by higher interest
expense on the increased borrowing on the Company's line of credit.

The effective income tax rate in the first nine months of fiscal 2001 was 40.0%
of pre-tax income as compared to 39.8% in the first nine months of fiscal 2000.

CAPITAL RESOURCES AND LIQUIDITY

The Company's primary sources of liquidity are expected to be its working
capital line of credit with its bank and other financial alternatives such as
leasing. The Company requires cash for expansion of its domestic and
international sales, capital expenditures and for general working capital
purposes. The Company has a $25,000,000 working capital line of credit with Bank
of America. The Company negotiated an amendment to the line of credit agreement
effective January 31, 2001. The amendment provides for a seasonal increase in
the line of credit to $35,000,000 for the periods from March 1, 2001 to June 1,
2001 and again from March 1, 2002 to May 1, 2002. At July 31, 2001, the Company
had $11,075,000 outstanding against the line of credit as compared to $0
outstanding at July 31, 2000. The increase in borrowings was due to higher
working capital requirements as well as increased capital expenditures

Trade receivables-net were $37,149,000 at July 31, 2001, an increase of
$11,571,000 over the balance at October 31, 2000. Because the Company's business
is seasonal, the receivables balance may more meaningfully be compared to the
balance of $31,802,000 at July 31, 2000, rather than the year-end balance. The
latter shows an increase of 16.8% in net trade receivables. This increase is
primarily due to many of our green grass customers delaying their seasonal
re-openings due to adverse weather conditions resulting in later shipping dates
during the quarter.

Inventories decreased to $32,930,000 from $37,526,000 at October 31, 2000, a
decrease of 12.3%. Compared to the inventory of $30,377,000 at July 31, 2000,
inventory has increased by 8.4%. This increase is due primarily to the Company's
efforts to build Basic inventory as well as increasing international levels to
support anticipated sales growth.

During the first nine months of fiscal 2001, the Company incurred capital
expenditures of $6,303,000 primarily for leasehold improvements and furniture
and fixtures for the new corporate office facilities, warehouse automation and
computer equipment. The Company consolidated its corporate offices into a new
facility in February 2001.

Based on current levels of operations, the Company expects sufficient cash flow
will be generated from operations so that, combined with other financing
alternatives available, including cash on hand, bank credit facilities, and
leasing alternatives, the Company will be able to meet all of its debt service,
capital expenditure, and working capital requirements during the next twelve
months.

During the first nine months of fiscal 2001, share capital and capital in excess
of par value increased by $399,000. An increase of $616,000 due to the issuance
of 116,000 shares on exercise of options was offset by a decrease of $217,000 as
a result of the Company repurchasing 35,000 shares of its common




                                       9
<PAGE>   12

stock in the open market at an average price of $6.18 per share.

DERIVATIVES

From time to time, the Company enters into short-term foreign exchange contracts
with its bank to hedge against the impact of currency fluctuations between the
U.S. dollar and the British pound. The contracts provide that, on specified
dates, the Company will sell the bank a specified number of British pounds in
exchange for a specified number of U.S. dollars. Additionally, the Company's
subsidiary in England enters into similar contracts with its bank to hedge
against currency fluctuations between the British pound and other European
currencies. Realized gains and losses on these contracts are recognized in the
same period as the hedged transactions. These contracts have maturity dates that
do not normally exceed 12 months. As of July 31, 2001, the Company was not a
party to any outstanding foreign exchange contracts.

NEW ACCOUNTING STANDARDS

Effective November 1, 2000, the Company adopted Statement of Financial
Accounting Standards ("SFAS") No. 133, Accounting for Derivative Instruments and
Hedging Activities, which establishes accounting and reporting standards for
derivative instruments and hedging activities. SFAS No. 133 requires that an
entity recognize all derivatives as either assets or liabilities in the
statement of financial position and measure those instruments at fair value.
Accounting for changes in the fair value of a derivative depends on the intended
use and resulting designation of the derivative. For derivatives designated as
hedges, changes in the fair value are either offset against the change in fair
value of the assets or liabilities through earnings or recognized in other
comprehensive income in the balance sheet until the hedged item is recognized
into earnings. For the nine months ended July 31, 2001, the Company did not
engage in any hedging activities and was not a party to any derivative
instruments.

In June 2001, the Financial Accounting Standards Board issued SFAS No. 143,
Accounting for Asset Retirement Obligations, which addresses financial
accounting and reporting for obligations associated with the retirement of
tangible long-lived assets and the associated asset retirement costs. The
standard applies to legal obligations associated with the retirement of
long-lived assets that result from the acquisition, construction, development
and/or normal use of the asset.

SFAS No. 143 requires that the fair value of a liability for an asset retirement
obligation be recognized in the period in which it is incurred if a reasonable
estimate of fair value can be made. The fair value of the liability is added to
the carrying amount of the associated asset and this additional carrying amount
is depreciated over the life of the asset. The liability is accreted at the end
of each period through charges to operating expense. If the obligation is
settled for other than the carrying amount of the liability, the Company will
recognize a gain or loss on settlement.

The Company is required and plans to adopt the provisions of SFAS No. 143 for
the quarter ending January 31, 2003. To accomplish this, the Company must
identify all legal obligations for asset retirement obligations, if any, and
determine the fair value of these obligations on the date of adoption. The
determination of fair value is complex and will require the Company to gather
market information and develop cash flow models. Additionally, the Company will
be required to develop processes to track and monitor these obligations. Because
of the effort necessary to comply with the adoption of SFAS No. 143, it is not
practicable for management to estimate the impact of adopting this statement at
the date of this report.




                                       10
<PAGE>   13

In July 2001, the Financial Accounting Standards Board issued SFAS No. 141,
Business Combinations, and SFAS No.142, Goodwill and Other Intangible Assets,
which supersede Accounting Principles Board Opinion No. 17, Intangible Assets.
SFAS No.141 requires that all business combinations be accounted for under the
purchase method. The statement further requires separate recognition of
intangible assets that meet one of the two criteria, as defined in the
statement. This statement applies to all business combinations initiated after
June 30, 2001. Under SFAS No.142, goodwill and intangible assets with indefinite
lives are no longer amortized but are tested at least annually for impairment.
Separable intangible assets with defined lives will continue to be amortized
over their useful lives. The provisions of SFAS No.142 will apply to goodwill
and intangible assets acquired before and after the statement's effective date.
As permitted by SFAS No. 142, we plan to adopt the new standard in the first
quarter of the fiscal year 2002. We are currently evaluating the effect that
adoption of the provisions of SFAS No. 142 will have on our results of
operations and financial position.

CAUTIONARY STATEMENTS AND RISK FACTORS

This report on Form 10-Q contains certain forward-looking statements, including
without limitation those regarding the Company's plans and expectations for
revenue growth, product lines, designs and seasonal collections, marketing
programs, foreign sourcing, cost controls, inventory levels and availability of
working capital. These forward looking statements may contain the words
"believe," "anticipate," "expect," "estimate," "project," "will be," "will
continue," "will likely result," or other similar words and phrases. Forward
looking statements and the Company's plans and expectations are subject to a
number of risks and uncertainties that could cause actual results to differ
materially from those anticipated, and the Company's business in general is
subject to certain risks that could affect the value of the Company's stock.
These risks include, but are not limited to, the following:

-   Demand for the Company's products may decrease significantly if the economy
    weakens or if the popularity of golf decreases.

-   Like other apparel manufacturers, the Company must correctly anticipate and
    help direct fashion trends within its industry. The Company's results of
    operations could suffer if it fails to develop fashions and styles that are
    well received in any season.

-   The market for golf apparel and sportswear is extremely competitive. While
    the Company is currently a leader in the core green grass market, it has
    several strong competitors that are better capitalized and have stronger
    distribution systems. Outside the green grass market, the Company's market
    share is not significant. Price competition or industry consolidation could
    weaken the Company's competitive position.

-   Certain of the Company's competitors may be better positioned to capitalize
    on the opportunities provided by e-commerce (i.e., revenues and marketing
    over the Internet). This could weaken the Company's competitive position.

-   The Company relies on domestic and foreign contractors to manufacture
    various products. If these contractors deliver goods late or fail to meet
    the Company's quality standards, the Company could lose sales.

-   There can be no assurance that the Company's future revenues will not
    decline due to various factors, including potential consolidation of the
    Company's core green grass market, which could




                                       11
<PAGE>   14

    result in discounting, as well as possible general declines in economic
    conditions from the levels recently experienced.

-   Fluctuations in foreign currency exchange rates could affect the Company's
    ability to sell its products in foreign markets and the value in U.S.
    dollars of revenues made in foreign currencies.

-   The Company maintains high levels of inventory to support its Basics
    program. Additional products, greater sales volume, and customer trends
    toward increased "at-once" ordering may require increased inventory.
    Disposal of excess prior season inventory is an ongoing part of the
    Company's business, and writedowns of inventories may materially impair the
    Company's financial performance in any period. Particular inventories may be
    subject to multiple writedowns if the Company's initial reserve estimates
    for inventory obsolescence or lack of throughput prove to be too low. These
    risks increase as inventory grows.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's long-term debt consists of notes payable with a total balance of
$3,980,000 at July 31, 2001. The debt bears interest at fixed rates ranging from
7.3% to 11.0%, which approximates fair value based on current rates offered for
debt with similar risks and maturities. The Company also has $11,075,000
outstanding on its revolving line of credit with interest charged at the bank's
reference (prime) rate minus one-half of one percentage point. A hypothetical
10% increase in interest rates during the quarter ended July 31, 2001 would have
resulted in a $17,000 change in net income.

The Company's ability to sell its products in foreign markets and the value of
the U.S. dollars of sales made in foreign currencies can be significantly
influenced by foreign currency fluctuations. A decrease in the value of foreign
currencies relative to the U.S. dollar could result in downward price pressure
for the Company's products or losses from currency exchange rates. From time to
time, the Company enters into short-term foreign exchange contracts with its
bank to hedge against the impact of currency fluctuations between the U.S.
dollar and the British pound. The contracts provide that, on specified dates,
the Company would sell the bank a specified number of British pounds in exchange
for a specified number of U.S. dollars. Additionally, the Company's subsidiary
in England enters into similar contracts with its bank to hedge against currency
fluctuations between the British pound and other European currencies. Realized
gains and losses on these contracts are recognized in the same period as the
hedged transaction. These contracts have maturity dates that do not normally
exceed 12 months. The Company will continue to assess the benefits and risks of
strategies to manage the risks presented by currency exchange rate fluctuations.
There is no assurance that any strategy will be successful in avoiding losses
due to exchange rate fluctuations, or that the failure to manage currency risks
effectively would not have a material adverse effect on the Company's results of
operations. As of July 31, 2001, the Company had no outstanding foreign currency
forward exchange contracts.


                                     PART II

                                OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On January 22, 1999, Milberg Weiss Bershad Hynes & Lerach LLP filed a class
action in the United States District Court for the Southern District of
California ("U.S. District Court") on behalf of




                                       12
<PAGE>   15

purchasers of the Company's common stock during the period between September 4,
1997 and July 15, 1998 alleging violations of the Securities Exchange Act of
1934 by the Company and certain of its officers and directors. The complaint
alleged that, during the class period, Company executives made positive
statements about the Company's business including statements concerning product
demand, offshore production and inventories. The complaint further alleged that
the defendants knew these statements to be false and concealed adverse
conditions and trends in the Company's business during the class period. The
complaint sought to recover unspecified damages on behalf of all purchasers of
the Company's common stock during the period September 4, 1997 to July 15, 1998.
The Company was served a copy of the complaint on January 26, 1999.
Subsequently, two other suits were served on the Company making similar
allegations. The three actions have been consolidated by order of the United
States District Court and lead counsel for the plaintiffs has been appointed.
Per order of the Court, Plaintiffs filed their Amended and Consolidated
Complaint on December 17, 1999. On February 18, 2000, the Company filed a motion
to dismiss. On May 22, 2000, the Court heard the motion to dismiss and took it
under submission. On July 18, 2000, the U.S. District Court granted the motion
to dismiss the Amended and Consolidated Complaint as to all defendants. The
Court granted plaintiffs sixty days to amend the complaint if they chose to do
so. On September 18, 2000, plaintiffs served their Second Consolidated Amended
Complaint ("Second Amended Complaint") making allegations and seeking remedies
similar to those in the prior complaint. On November 6, 2000, the Company filed
its motion to dismiss the Second Amended Complaint. The motion to dismiss was
heard before the U.S. District Court in February 2001. The matter is currently
under submission. No discovery has taken place in this matter to date.

In October 2000, former Ashworth sales representatives Regional Sales, Inc. and
Susan Stanley filed a complaint in San Diego Superior Court. They filed a first
amended complaint on November 29, 2000 and on July 9, 2001, a seconded amended
complaint. By their second amended complaint, the plaintiffs allege, among other
things, that the Company failed to pay commissions and/or provide discounts on
various sales, failed to honor an agreement for plaintiffs to develop a
corporate sales division, interfered with certain alleged relationships and will
not provide credit for the return of certain goods. Plaintiffs seek an
accounting and an unspecified amount of compensatory and punitive damages. On
January 19, 2001, the Company filed an answer to the first amended complaint
denying the claims and asserting a number of defenses. On the same date, the
Company filed a cross-complaint against plaintiffs for failure to pay for goods.
Discovery in this case has commenced. In July 2001, the Company's motion for
summary adjudication was granted in part and denied in part. A trial on the
remaining issues is set for October 2001.

The Company is party to other claims and litigation proceedings arising in the
normal course of business. Although the legal responsibility and financial
impact with respect to such other claims and litigation cannot currently be
ascertained, the Company does not believe that these other matters will result
in payment by the Company of monetary damages, net of any applicable insurance
proceeds, that, in the aggregate, would be material in relation to the
consolidated financial position or results of operations of the Company.


ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS - NONE

ITEM 3. DEFAULTS UPON SENIOR SECURITIES - NONE

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - NONE




                                       13
<PAGE>   16

ITEM 5. OTHER INFORMATION - NONE

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

3(a)       Certificate of Incorporation as filed March 19, 1987 with the
           Secretary of State of Delaware, Amendment to Certificate of
           Incorporation as filed August 3, 1987 and Amendment to Certificate of
           Incorporation as filed April 26, 1991 (filed as Exhibit 3(a) to
           Registrant's Registration Statement dated February 21, 1992 (File No.
           33-45078) and incorporated herein by reference) and Amendment to
           Certificate of Incorporation as filed April 6, 1995 (filed as Exhibit
           3(a) to the Registrant's Form 10-K for year ended October 31, 1994
           (File No. 0-18553) and incorporated herein by reference).

3(b)       Amended and Restated Bylaws of the Registrant (filed as Exhibit 3.1
           to Registrant's Current Report on Form 8-K filed on February 23, 2000
           (File No. 0-18553) and incorporated herein by reference).

4(a)       Specimen certificate for Common Stock, par value $.001, of the
           Registrant (filed as Exhibit 4(a) to Registrant's Registration
           Statement dated November 4, 1987 (File No. 33-16714-D) and
           incorporated herein by reference).

4(b)(1)    Specimen certificate for Options granted under the Amended and
           Restated Nonqualified Stock Option Plan dated March 12, 1992 (filed
           as Exhibit 4(b) to Registrant's Form 10-K for the year ended October
           31, 1993 (File No. 0-18553) and incorporated herein by reference).

4(b)(2)    Specimen certificate for Options granted under the Founders Stock
           Option Plan dated November 6, 1992 (filed as Exhibit 4(b)(2) to
           Registrant's Form 10-K for the year ended October 31, 1993 (File No.
           0-18553) and incorporated herein by reference).

4(c)       Specimen certificate for Options granted under the Incentive Stock
           Option Plan dated June 15, 1993 (filed as Exhibit 4(c) to
           Registrant's Form 10-K for the year ended October 31, 1993 (File No.
           0-18553) and incorporated herein by reference).

4(d)       Rights Agreement dated as of October 6, 1998 as amended on February
           22, 2000 by and between Ashworth, Inc. and American Securities
           Transfer & Trust, Inc. (filed as Exhibit 4.1 to Registrant's Form 8-K
           filed on March 14, 2000 (File No. 0-18553) and incorporated herein by
           reference).

10(a)*     Personal Services Agreement and Acknowledgement of Termination of
           Executive Employment effective December 31, 1998 by and between
           Ashworth, Inc. and Gerald W. Montiel (filed as Exhibit 10(b) to
           Registrant's Form 10-K for the year ended October 31, 1998 (File No.
           0-18553) and incorporated herein by reference).

10(b)*     Amendment to Personal Services Agreement effective January 1, 1999 by
           and between Ashworth, Inc. and Gerald W. Montiel (filed as Exhibit
           10(c) to Registrant's Form 10-K for the year ended October 31, 1998
           (File No. 0-18553) and incorporated herein by reference).

10(c)*     Promotion Agreement effective June 1, 1998 by and among Ashworth,
           Inc., James W. Nantz, III and Nantz Communications, Inc. (filed as
           Exhibit 10(d) to Registrant's Form 10-K for the year ended October
           31, 1998 (File No. 0-18553) and incorporated herein by reference).




                                       14
<PAGE>   17

10(d)*     First Amended and Restated Executive Employment Agreement effective
           February 22, 1999 by and between Ashworth, Inc. and Randall L.
           Herrel, Sr. (filed as Exhibit 10(a) to Registrant's Form 10-Q for the
           quarter ended April 30, 1999 (File No. 0-18553) and incorporated
           herein by reference).

10(e)*     Personal Services Agreement and Acknowledgement of Termination of
           Executive Employment effective May 31, 1999 by and between Ashworth,
           Inc. and A. John Newman (filed as Exhibit 10(b) to Registrant's Form
           10-Q for the quarter ended April 30, 1999 (File No. 0-18553) and
           incorporated herein by reference).

10(f)*     Employment Agreement effective December 15, 2000 by and between
           Ashworth, Inc. and Terence W. Tsang. (filed as Exhibit 10(f) to
           Registrant's Form 10-Q for the quarter ended January 31, 2001 (File
           No. 0-18553) and incorporated herein by reference).

10(g)*     Offer and Acceptance of Executive Employment effective June 1, 1999
           by and between Ashworth, Inc. and Suzi Chauvel (filed as Exhibit
           10(a) to Registrant's Form 10-Q for the quarter ended July 31, 1999
           (File No. 0-18553) and incorporated herein by reference).

10(h)*     Founders Stock Option Plan dated November 6, 1992 (filed as Exhibit
           10(g) to Registrant's Form 10-K for the year ended October 31, 1993
           (File No. 0-18553) and incorporated herein by reference).

10(i)*     Amended and Restated Nonqualified Stock Option Plan dated November 1,
           1996 (filed as Exhibit 10(i) to Registrant's Form 10-K for the year
           ended October 31, 2000 (File No. 0-18553) and incorporated herein by
           reference).

10(j)*     Amended and Restated Incentive Stock Option Plan dated November 1,
           1996 (filed as Exhibit 10(j) to Registrant's Form 10-K for the year
           ended October 31, 2000 (File No. 0-18553) and incorporated herein by
           reference).

10(k)*     Amended and Restated 2000 Equity Incentive Plan dated December 14,
           1999 adopted by the stockholders on March 24, 2000 (filed as Exhibit
           4.1 to Registrant's Form S-8 filed on December 12, 2000 (File No.
           333-51730) and incorporated herein by reference).

10(l)(1)*  Business Loan Agreement dated June 1, 2000, between Ashworth, Inc.,
           Ashworth Store I, Inc., Ashworth Store II, Inc., Ashworth
           International, Inc., Ashworth U.K. Ltd. and Bank of America, N. A.
           expiring May 1, 2002. (filed as Exhibit 10(m) to Registrant's Form
           10-Q for the quarter ended April 30, 2000 (File No. 0-18553) and
           incorporated herein by reference).

10(l)(2)*  Amendment to the Business Loan Agreement dated June 1, 2000,
           effective January 31, 2001, between Ashworth, Inc., Ashworth Store I,
           Inc., Ashworth Store II, Inc., Ashworth International, Inc., Ashworth
           U.K. Ltd. and Bank of America, N. A. expiring May 1, 2002. (filed as
           Exhibit 10(l)(2) to Registrant's Form 10-Q for the quarter ended
           January 31, 2001 (File No. 0-18553) and incorporated herein by
           reference).

10(m)*     Change in Control Agreement dated November 1, 2000 by and between
           Ashworth, Inc. and Randall L. Herrel, Sr. (filed as Exhibit 10(m) to
           Registrant's Form 10-K for the year ended October 31, 2000 (File No.
           0-18553) and incorporated herein by reference).




                                       15
<PAGE>   18

10(n)*     Change in Control Agreement dated November 1, 2000 by and between
           Ashworth, Inc. and Terence W. Tsang (filed as Exhibit 10(n) to
           Registrant's Form 10-K for the year ended October 31, 2000 (File No.
           0-18553) and incorporated herein by reference).

10(o)*     Promotion Agreement effective November 1, 1999 by and between
           Ashworth, Inc. and Fred Couples (filed as Exhibit 10(o) to
           Registrant's Form 10-K for the year ended October 31, 2000 (File No.
           0-18553) and incorporated herein by reference).

10(p)*     Amended and Restated Offer and Acceptance of Executive Employment
           effective February 1, 2000 by and between Ashworth, Inc. and
           Nicoletta Larucci-Miele. (filed as Exhibit 10(p) to Registrant's Form
           10-Q for the quarter ended January 31, 2001 (File No. 0-18553) and
           incorporated herein by reference).

10(q)*     Offer and Acceptance of Executive Employment effective November 29,
           1999 by and between Ashworth, Inc. and Anthony Wilkinson. (filed as
           Exhibit 10(q) to Registrant's Form 10-Q for the quarter ended January
           31, 2001 (File No. 0-18553) and incorporated herein by reference).

(b)        Reports on Form 8-K. - NONE.

*   Compensation plan, contract or agreement required to be filed as an Exhibit
    pursuant to applicable rules of the Securities and Exchange Commission.




                                       16
<PAGE>   19

                                   SIGNATURES



Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                                      ASHWORTH, INC
                                                       (Registrant)



Date: September 14, 2001                       By: /s/ Randall L. Herrel, Sr.
      -----------------------                  ---------------------------------
                                               Randall L. Herrel, Sr.
                                               Chairman, President and
                                               Chief Executive Officer



Date: September 14, 2001                       By: /s/ Terence W. Tsang
      -----------------------                  ---------------------------------
                                               Terence W. Tsang
                                               Executive Vice-President,
                                               Chief Operating Officer,
                                               Chief Financial Officer and
                                               Treasurer




                                       17