SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549



                                    FORM 10-K

(Mark One)

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

For the fiscal year ended September 30, 1999
                          ------------------

/ /               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 0-24928

                           THE SOLOMON-PAGE GROUP LTD.
--------------------------------------------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)

         Delaware                                 51-0353012
--------------------------------------------------------------------------------
(State or other jurisdiction of             (IRS Employer Identification Number)
incorporation or organization

              1140 Avenue of the Americas, New York, New York 10036
--------------------------------------------------------------------------------
               (Address of Principal Executive Offices)     (Zip Code)

       Registrant's telephone number, including area code: (212) 403-6100

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

                                      None

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

                     Common Stock, par value $.001 per share

         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 / /


<PAGE>

         Check if there is no  disclosure  of  delinquent  filers in response to
Item 405 of  Regulation  S-K contained in this form,  and no disclosure  will be
contained,  to the best of the  Registrant's  knowledge,  in definitive proxy or
information  statements  incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. /X/

         The aggregate  market value of the voting stock held by  non-affiliates
of the Registrant  computed by reference to the closing price at which the stock
was sold on December  17,  1999 was  approximately:  $5,093,064.  Solely for the
purposes of this  calculation,  shares  held by  directors  and  officers of the
Registrant  have  been  excluded.   Such  exclusion   should  not  be  deemed  a
determination  or an admission by the Registrant that such  individuals  are, in
fact, affiliates of the Registrant.

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common  stock,  as of the latest  practicable  date:  At December 17,
1999, there were outstanding  4,153,948 shares of the Registrant's Common Stock,
$.001 par value.

                       DOCUMENTS INCORPORATED BY REFERENCE

         Certain portions of the  Registrant's  definitive proxy statement to be
filed  not  later  than  January  28,  2000  pursuant  to  Regulation   14A  are
incorporated  by  reference  in Items 10 through  13 of Part III of this  Annual
Report on Form 10-K. /X/


                                       -2-

<PAGE>
                                     PART I


ITEM 1.       DESCRIPTION OF BUSINESS

General

         The  Company  is  a  specialty  niche  provider  of  staffing  services
organized into two primary operating  divisions:  temporary  staffing/consulting
and   executive   search/full-time   contingency   recruitment.   The  temporary
staffing/consulting division provides services to companies seeking personnel in
the  information  technology,  accounting,  human  resources and legal areas and
generated  approximately  58%  of the  Company's  revenue  for  the  year  ended
September  30, 1999.  The  executive  search/full-time  contingency  recruitment
division  comprises  ten lines of business,  including  five  industry  (capital
markets,  publishing and new media,  healthcare,  fashion services and banking),
and five functional (information technology,  accounting, human resources, legal
and  administrative   support).  The  executive   search/full-time   contingency
recruitment  division  generated  approximately 42% of the Company's revenue for
the year ended September 30, 1999.

         In the executive search and full time contingency recruitment division,
fees usually range between 20% and 33% of the placed employee's guaranteed first
year's  compensation.  In the executive  search  sector,  the Company  generally
obtains a non-refundable  retainer of  approximately  one-third of the estimated
fee at the  inception of an  engagement,  with the balance of the fee payable on
terms negotiated with the client. A substantial  portion of the deferred payment
is usually contingent on the successful completion of the placement. In the full
time  contingency   recruitment  sector,  the  entire  fee  is  contingent  upon
successful  completion of the placement,  although under certain circumstances a
non-refundable  retainer  payment of a portion of the fee may be received at the
outset.  In  the  temporary  staffing  and  consulting  division,   its  clients
compensate  the Company for services  provided by temporary  employees on a time
and materials basis. The Company's primary costs, in addition to its fixed costs
such as rental expense,  salaries of support personnel and advertising,  are the
variable  costs of  compensation  relating to temporary  staffing  requirements,
commissions of sales and recruiting personnel and employee benefits.

         The Solomon-Page  Group Ltd. is a Delaware  corporation  formed in June
1993 that succeeded to the business of a predecessor New York  corporation  with
the same name  through a merger that was effected in May 1994.  The  predecessor
commenced operations in 1990.  References herein to the "Company" are references
to The  Solomon-Page  Group Ltd.  and its wholly owned  subsidiary,  Information
Technology Partners, Inc. ("ITP").

INDUSTRY OVERVIEW

         According to the Staffing  Industry Report,  the staffing industry grew
from  approximately $43 billion in revenue in 1993 to approximately $102 billion
in 1998, a compound annual growth rate of approximately 19%. Temporary help, the
largest staffing  services  segment,  had estimated revenue of approximately $62
billion in 1998 and has grown at an average  annual  rate of  approximately  17%
over the past five years.  Information technology services has become one of the
fastest growing segments to the staffing services industry, as the increased use
of  technology  has led to a  dramatic  rise in  demand  for  technical  project
support,   software  development  and  other   computer-related   services.  The
information  technology services segment had estimated revenues of approximately
$18 billion for 1998 and had a compounded  annual  growth rate of  approximately
26% since  1993.  The  placement  and  search  sector of the  staffing  industry
consists  of  three  segments,  retained  search,  contingency  recruitment  and
temp-to-perm.  The  placement  and  search  sector  had  estimated  revenues  of
approximately $13 billion in 1998 and had a compounded annual growth rate of 22%
since 1993.



                                       -3-

<PAGE>
SCOPE OF STAFFING SERVICES PROVIDED

         The Company provides its services to clients  primarily in the New York
metropolitan  area, but increasingly on a nationwide and global basis to certain
of the industries and functional  areas that it serves.  The Company's  retained
executive search and contingency  recruitment business is currently divided into
ten divisions.

         RETAINED EXECUTIVE SEARCH

         Capital Markets (Sales and  Trading/Investment  Banking). The Company's
capital  markets   division   primarily   services  global   financial   service
institutions  in North America,  Europe and Asia.  This division places traders,
institutional  sales  people,  investment  bankers,  research  and  quantitative
analysts  and  portfolio  managers,  and  focuses  on middle  and  senior  level
positions.

         Health Care.  The Company's  health care division  services  hospitals,
managed  care firms,  group  health  insurance  companies  and other health care
related  companies.  This  division  fills  primarily  middle  to  senior  level
executive positions in various functional areas of the health care industry such
as sales, marketing, operations, financial management and medical management.

         Publishing  and New  Media and  Technology.  The  Company's  publishing
division  provides  executive search services to businesses  engaged in consumer
and business magazine publishing, educational publishing, professional reference
and trade book publishing,  and information services on a nationwide basis. This
division  handles  primarily  retained  senior  executive level searches in such
functional  areas as editorial,  marketing,  sales,  circulation and product and
technology  development.  One of the fastest  growth areas within the publishing
industry is New Media and Technology. The marketplaces serviced within this area
include  educational  and  consumer  software  publishers,  internet and website
developers, on-line services, CD-ROM producers and distance learning companies.

         CONTINGENCY RECRUITMENT

         Information  Technology.  The Company's information technology division
conducts search  assignments  for a diverse client base,  including those in the
investment  banking,  financial  services,   communications,   retail  and  high
technology  industries.  This  division  fills  positions  at  many  levels  and
functions,  such as Chief Information  Officers and Directors,  project managers
and programmers,  as well as less technical  positions such as systems liaisons,
business systems analysts and help-desk personnel.

         Banking. The Company's banking division, which operates under the trade
name "The Bankers  Register,"  is engaged in the  recruitment  of personnel in a
variety of job categories which include credit, lending,  accounting,  auditing,
branch, trading, securities clearance, operations, risk management, and mortgage
banking.  This division services  candidates at all levels,  from entry level to
management. The division's client base includes money-center and regional banks,
thrift  institutions,  foreign banks,  commercial  finance lending companies and
mortgage lending companies in New York, New Jersey and Connecticut.

         Legal Professionals.  The Company's legal professional  division serves
primarily  the New York  metropolitan  area,  providing  attorneys to law firms,
financial  institutions  and public and privately held companies.  In law firms,
the division fills positions at the associate, of counsel and partner level. For
corporations, lawyers are provided for all positions under the direction of such
corporation's  general  counsel.  Specialty  practice areas are also serviced by
this division, including corporate law, banking, real estate, ERISA and tax law,
labor and  employment,  environmental  law,  trusts  and  estates,  intellectual
property and litigation.

         Human  Resources.  The Company's  human resources  division  undertakes
search  assignments  for a diverse  client base,  from Fortune 1000 companies to
mid-size companies,  in various industries such as financial services,  consumer
products,  manufacturing,  publishing,  telecommunications  and high technology.
This division fills positions

                                       -4-

<PAGE>
for such  human  resources  areas as  management  and  organizational  planning,
compensation  and benefits,  labor  relations and  training.  In addition,  this
division  recruits  communications   professionals  with  backgrounds  in  areas
including marketing communications, internal communications, investor relations,
public relations, media relations, writing and editing.

         Accounting and Finance.  The Company's  accounting and finance division
specializes  in  providing  financial  and  accounting  personnel  such as chief
financial  officers,  controllers,  treasurers,  financial  analysts,  financial
systems  managers,  bookkeepers  and other  related  personnel  to a variety  of
corporate  employers  in  industries  such as  publishing,  investment  banking,
advertising,  insurance,  healthcare,  apparel  and  real  estate.  Within  this
division,   the  Company  has  recently  added  a  concentration  in  management
consulting. This division also focuses on addressing the needs of clients in the
areas of business  and  strategic  planning,  corporate  development  and change
management.

         Fashion Services.  The Company's fashion services division  specializes
in providing  management,  design and other  professionals to clients engaged in
the fashion services and retail industries,  including manufacturers,  specialty
and department stores, chains, mass merchandisers and catalogue companies.  This
division  fills  positions  at the  middle  to  senior  executive  level in many
functional areas such as buyers, designers, sales and production.

         Administrative  Support. The Company's  administrative support division
serves primarily the New York metropolitan  area,  providing services in various
industries such as financial services, consumer products, publishing, insurance,
entertainment  and  telecommunications  and  technology.   This  division  fills
positions at the  administrative  support level within all functional  areas and
hierarchy of a client's organization.

         TEMPORARY STAFFING AND CONSULTING

         Information Technology.  The Company's information technology temporary
staffing and consulting business provides services on a time and materials basis
to clients within the financial services, consumer products, telecommunications,
consulting   and   insurance   industries.   This  division   supplies   skilled
professionals in the areas of application development, business analysis, help -
desk support, networking, project management and quality assurance.

         Legal,  Accounting  and  Human  Resources.  The  Company  expanded  its
existing  presence  within its full time legal,  accounting and human  resources
specialty  niches by providing  temporary  staffing and  consulting  services to
existing as well as new clients through dedicated teams of experienced  staffing
and industry personnel.

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

         The  Company   concentrates  on  establishing  and  maintaining  strong
relationships  with its clients in each  industry or functional  group.  In this
way, it is able to become  familiar with and sensitive to its clients'  specific
needs, thereby facilitating its ability to provide high-quality services,  which
in turn enhances client loyalty and repeat business.  In addition,  although the
Company's  divisional  structure causes its employees to concentrate on specific
areas, they are trained and compensated to recognize cross-selling opportunities
when they exist.

         The  Company  recruits  its  candidates   primarily   through  targeted
telephone  solicitation and referrals by past and current candidates and through
advertising in local and national media and on the Internet.

         One  customer  of  the  Company,  Deutsche  Bank  A.G.,  accounted  for
approximately  10% of  the  Company's  revenue  during  the  fiscal  year  ended
September 30, 1999.


                                       -5-

<PAGE>
BUSINESS STRATEGY

         During the past year,  the Company  accomplished  its goal of primarily
increasing profitability while continuing to build revenues.

         The Company is now in the strategic phase of developing and launching a
new web site. The site will be community-driven  and will focus on institutional
brand-building,  as well as client development and recruitment.  Through content
and an aggressive  marketing  strategy to draw traffic to the site,  the Company
intends to attract  the passive as well as the active job seeker and to maintain
a highly  interactive  environment  with portals for all industry and functional
lines of business in which the Company presently operates. The initial phases of
this launch are currently  scheduled to take place during the second  quarter of
fiscal 2000.

         The  Company  is  also  initiating  a  dedicated  focus  on  e-business
companies  by  establishing  a specific  practice  area that will  service  this
rapidly growing sector and a task force of members from various divisions within
the  Company.  The Company  will seek to offer a one-stop  staffing  solution to
companies in this entrepreneurial phase of their evolution. We believe that this
will be an area of rapid  growth  during the next  several  years.  The  Company
currently  believes  that its  diversified  capabilities  in retained  executive
search,  contingency  recruitment  and temporary  staffing and  consulting  will
enable it to capture  market share with clients in need of senior and  mid-level
resources quickly and in volume as they evolve from start-up status.

         The Company  recently  augmented its expanding  presence in San Jose by
adding an information  technology  consulting group to complement its efforts in
the accounting and financial areas.

         The Company is actively seeking to add experienced  search  consultants
and  temporary  staffing  account  executives  and  recruiters  in  all  of  our
divisions.  The  Company  is  rolling  out a  cross-selling  initiative  that it
believes will enhance brand  identity and create  increased  client  penetration
across a multi-faceted  platform of services. The Company is also increasing its
focus  on  training  and  development  in both  traditional  as well as  on-line
recruitment.

         The Company  believes that as a result of a continuation  of its talent
acquisition  strategy,  retention of existing staff,  retention of its placement
staff, its web initiative,  its new e-business  practice and its increased focus
on cross-  selling,  training  and  development,  the Company is  positioned  to
capitalize on certain current trends in the economy,  since management  believes
that attracting and retaining human capital is critical to the attainment of its
success, as well as that of its clients. The Company believes that its goals can
be accomplished  without a corresponding  increase in general and administrative
expenses as a percentage of revenues.

MARKETING AND SALES

         Marketing efforts are currently focused on providing the Company's full
complement of services  across a broad range of functional  specialties  in both
the  full-time  and  temporary and  consulting  areas  (information  technology,
accounting, human resources, legal and administrative support) in specific major
geographic  markets  (New  York,  New  Jersey,  Connecticut)  as well as certain
capabilities (information technology,  accounting and healthcare) in Atlanta and
California.  By  developing a "brand  identity"  identifying  the Company with a
consistent  level of quality  services in each  specialty  niche it covers,  the
Company  is  positioned  as  a  value-added  resource  serviced  by  experienced
personnel in every area of its expertise.  Management has implemented an ongoing
emphasis  on cross - selling of services  and  compensates  employees  for their
efforts in selling customers the Company's diversified capabilities.

COMPETITION

         The Company  believes  that the  staffing  services  industry is highly
competitive  and that the services  provided by the Company are also provided by
many other companies  ranging from local,  small operations to large recruitment
and placement and temporary personnel  agencies,  many of which are national and
international in scope. Some of the

                                       -6-

<PAGE>

Company's  competitors,  including all of the national and international  firms,
are substantially larger and have greater financial resources than the Company.

         The Company  believes  that many  clients  generally  use more than one
company to satisfy their personnel requirements, and the major factors affecting
competition in the industry are customer service,  the availability of qualified
personnel,  reputation  for  integrity  and, to varying  degrees,  pricing.  The
Company  believes  that  it  has  a  favorable   competitive  position  that  is
attributable  to its  firm-wide  dedication  to client  service,  integrity  and
knowledge  of the markets it serves,  which  enables it to fulfill its  clients'
needs expeditiously and effectively. In addition, the diverse number of industry
categories and functional  areas of placement  provided by the Company creates a
number of cross-selling  opportunities,  which enhance the potential for account
penetration and increased revenues.

         The Company has several  competitors in its retained  executive  search
and  contingency  recruitment  businesses.  These include  Romac  International,
Robert  Half  International  and  Winston  Resources.   Further,  the  Company's
competitors in its temporary  staffing and consulting  business  include Interim
Services, Computer Horizons, Kelly Services, Select Appointments and Staff Mark,
Inc.

EMPLOYEES

         As of September 30, 1999, the Company employed 161 full-time employees,
including the Company's four executive  officers,  110 recruitment and placement
counselors  and 47  administrative  and  support  staff.  None of the  Company's
employees is represented by a labor organization and the Company is not aware of
any activity seeking such organization.  The Company considers its relationships
with its employees to be excellent.

REGULATION

         The Company's operations are subject to state laws and regulations that
may require  employment  agencies  and/or other  personnel  services firms to be
licensed.   The  principal   requirements  of  such  laws  and  regulations  are
satisfactory  prior  experience  and  good  moral  character.  Requirements  for
licensing vary from state to state in those states that mandate  licensing.  The
Company believes that it has obtained all licenses and registrations material to
the conduct of its business.

TRADEMARKS AND SERVICE MARKS

         The Company does not own any  registered  trademarks,  service marks or
trademarks, but may seek the registration of its logo, trade name or domain name
in the future.


ITEM 2.       DESCRIPTION OF PROPERTY

         The Company leases its corporate headquarters in New York City, as well
as space for its other  locations.  The  aggregate  area of space under lease is
approximately  47,000 square feet.  The Company's  lease terms run from month to
month to seven years and the  aggregate  rent paid for the year ended  September
30, 1999 was  approximately  $1,231,000.  The Company  believes that its current
facilities  are  adequate  for its needs and does not expect to have  difficulty
leasing additional office space to satisfy anticipated future needs.


ITEM 3.       LEGAL PROCEEDINGS

         On November 5, 1998,  ITP filed a complaint and an  application  for an
order to show cause  against a former  employee of ITP,  Anthony J.  Allen,  Jr.
("Allen") and a competing company,  C.A.P.  Consulting,  Inc. ("CCI") in the New
Jersey Superior Court, Chancery Division, Middlesex County (the "Court"). In its
complaint, ITP seeks temporary,


                                       -7-

<PAGE>
preliminary and permanent restraints,  as well as damages, against Allen and CCI
as a result of Allen's  alleged acts of  disloyalty  while  employed by ITP as a
sales  representative.  ITP has also asserted causes of action against Allen for
breach  of  duty  of  loyalty,  misappropriation,   tortious  interference  with
prospective  economic advantage and unfair competition and has asserted the same
causes of action against CCI, except for the breach of duty of loyalty.

         On November  10,  1998,  the Court  entered an order to show cause with
temporary  restraints  that required  Allen and CCI,  inter alia, to (1) refrain
from  using any of ITP's  information  not  otherwise  available  in the  public
domain;  (2) refrain from making any  disparaging,  negative or false statements
about ITP; and (3) turn over all of ITP's confidential documents to be described
by ITP in a document request.

         On December 28, 1998,  Allen filed an answer and  counterclaim  against
ITP,  and a third party  complaint  against the  Company.  Allen's  counterclaim
against ITP included a slander claim,  several breach of contract claims related
to his employment  compensation  and alleged  violations of certain  unspecified
statutes as a result of ITP's  refusal to pay Allen  certain  wages.  In a third
party complaint, Allen asserted a slander claim against the Company. The Company
and ITP have denied various  allegations in the answer and  counterclaim  and in
the third party complaint and have asserted various affirmative defenses.

         The parties have  exchanged  written  discovery  responses  and several
depositions  have been taken.  A trial in the matter is currently  scheduled for
January  19,  2000,  but  counsel  for both  parties  currently  plan to seek an
adjournment of at least several months in order to complete discovery.

         The Company does not believe that this  proceeding will have a material
effect on its financial condition or results of operations.


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

              Not Applicable.


                                       -8-

<PAGE>
                                     PART II

ITEM 5.       MARKET FOR COMMON EQUITY AND RELATED
              STOCKHOLDER MATTERS

         The  Company's  Common Stock is traded on the National  Association  of
Securities Dealers Automated Quotation (NASDAQ) SmallCap market under the symbol
"SOLP".  The table below sets forth the range of bid prices of the Common  Stock
as reported by NASDAQ for the fiscal periods specified.

                                                              Common Stock
                                                            High          Low

Fiscal 1999

First Quarter...............................................$2.469      $1.438
Second Quarter..............................................$1.875      $1.344
Third Quarter...............................................$2.938      $1.563
Fourth Quarter .............................................$3.375      $1.938

Fiscal 1998

First Quarter...............................................$4.594      $2.875
Second Quarter..............................................$3.688      $2.625
Third Quarter...............................................$4.875      $3.125
Fourth Quarter .............................................$3.688      $1.438


         As of December 17, 1999,  there were 35 record holders of the Company's
Common Stock. The Company believes that there are approximately 1,143 beneficial
owners of its Common Stock additional to such record holders.

         The Company has never paid any  dividends  on its Common Stock and does
not  intend  to pay  such  dividends  in the  foreseeable  future.  The  Company
currently  intends to retain any future  earnings for the development and growth
of the Company.



                                       -9-

<PAGE>
ITEM 6.        SELECTED FINANCIAL DATA

         The  following  summary of the  Company's  consolidated  financial  and
operating data for the years ended September 30, 1999, 1998, 1997, 1996 and 1995
were derived from the audited consolidated financial statements:

                (Amounts in thousands except for per share data)

<TABLE>
<CAPTION>

                                                                 Fiscal Year Ended September 30,
                                                    -------------------------------------------------------------------------
Statements of Operations Data:                        1999         1998              1997               1996           1995
-----------------------------                         ----         ----              ----               ----           ----
<S>                                                 <C>         <C>               <C>                <C>             <C>
Revenue                                             56,329      $44,639           $28,996            $17,166         $7,331
Income (Loss) from Operations                        3,759        1,622             1,691                509         (2,094)
Net Income (Loss)                                    1,999          823             1,282                710         (1,928)
Primary Income (Loss) Per Common Share                $.44         $.16              $.25               $.14          $(.39)
Fully Diluted Income (Loss) Per Common Share           .41          .14               .23                .13           (.39)

                                                                          September 30,
                                                    ------------------------------------------------------------------------
Balance Sheet Data:                                  1999          1998              1997               1996           1995
------------------                                   -----         ----              ----               ----           ----
Working Capital                                     $4,130       $3,794            $4,921             $5,530         $5,402
Total Assets                                        18,348       16,735            12,815              9,613          7,642
Total Liabilities                                   10,494        8,696             4,484              2,548          1,287
Stockholders' Equity                                 7,854        8,039             8,331              7,065          6,355
</TABLE>


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

         The  following  discussion  of the  Company's  financial  condition and
results  of  operations  should  be  read in  conjunction  with  the  historical
financial statements and notes thereto appearing elsewhere in this document.

OVERVIEW

         The  Company  is  a  specialty  niche  provider  of  staffing  services
organized into two primary operating  divisions:  temporary  staffing/consulting
and   executive   search/full-time   contingency   recruitment.   The  temporary
staffing/consulting division provides services to companies seeking personnel in
the  information  technology,  accounting,  human  resources and legal areas and
generated  approximately  58%  of the  Company's  revenue  for  the  year  ended
September  30, 1999.  The  executive  search/full-time  contingency  recruitment
division  comprises  ten lines of business,  including  five  industry  (capital
markets,  publishing and new media,  healthcare,  fashion services and banking),
and five functional (information technology,  accounting, human resources, legal
and  administrative   support).  The  executive   search/full-time   contingency
recruitment  division  generated  approximately 42% of the Company's revenue for
the year ended September 30, 1999.


                                      -10-

<PAGE>
RESULTS OF OPERATIONS

         FISCAL 1999 COMPARED TO FISCAL 1998

         Revenue  increased to $56.3 million for the fiscal year ended September
30, 1999 from $44.6  million for the fiscal year ended  September  30, 1998,  an
increase of $11.7 million or 26%.  These  increases were comprised of $6 million
in temporary  staffing and consulting,  and $5.7 million in executive search and
full time  contingency  and  recruitment for the fiscal year ended September 30,
1999, and were the result of factors further described below.

         Revenues from the Company's  temporary staffing and consulting business
were $32.9  million for the fiscal  year ended  September  30, 1999  compared to
$26.9 million for the same period in 1998, an increase of $6 million or 22%. The
increase in temporary  staffing revenue for the year ended September 30, 1999 as
compared to the same period in 1998 is  attributable  to  increases  in both the
number of hours  billed and  average  bill rates in the  information  technology
division.  In addition,  the Company's  expansion to provide temporary  staffing
services  to  companies  seeking  personnel  in the legal,  human  resource  and
accounting fields contributed to the increase in revenue.

         Revenues from the Company's  executive search and full time contingency
recruitment  business were $23.4 million for the fiscal year ended September 30,
1999  compared to $17.7  million for the same period in 1998, a increase of $5.7
million or 32%. The increase in revenues from the Company's executive search and
full time contingency  recruitment  division was primarily due to an increase in
demand for services  within the capital  markets.  In addition,  the information
technology,  accounting  and  healthcare  businesses  experienced  increases  in
placements  made in the fiscal year ended  September  30,  1999  compared to the
fiscal year ended  September  30,  1998.  In  addition,  during 1999 the Company
expanded its temporary  staffing/consulting division to include the placement of
legal  services   personnel  within  the  New  York  metropolitan   area,  which
contributed to the increase in revenue.

         Selling  expenses for the fiscal year ended  September 30, 1999 totaled
$44.1 million (78% of revenues)  compared with $35 million (78% of revenues) for
the fiscal year ended  September 30, 1998.  The increase in selling  expenses is
primarily  related to  compensation  expense of temporary  personnel  within the
Company's  temporary  staffing  and  consulting  division  as well as  increased
expenses  related  to  certain  employee  benefits.   Selling  expenses  consist
primarily   of   temporary   staffing/consulting   compensation,   salaries  and
commissions of revenue - generating personnel,  employee benefits, telephone and
advertising.

         General and Administrative expenses were $7.8 million (14% of revenues)
for the fiscal year ended  September  30, 1999  compared to $7.5 million (17% of
revenues) for the same period in 1998.  For the fiscal year ended  September 30,
1999 compared to the same period in 1998,  general and  administrative  expenses
have remained relatively constant, but have decreased as a percentage of revenue
primarily as a result of an increase in revenue.

         Depreciation  and  Amortization  expense  for  the  fiscal  year  ended
September 30, 1999 totaled $660,000  compared to $516,000 for the same period in
1998.  Depreciation  expense  increased  principally  as  a  result  of  capital
expenditures  made during fiscal 1998.  The  amortization  of intangible  assets
associated with certain acquisitions also contributed to this increase.

         Income  from  operations  was $3.8  million  for the fiscal  year ended
September 30, 1999 compared to $1.6 million for the fiscal year ended  September
30, 1998,  primarily due to the factors  mentioned in the first three paragraphs
of this section.

         Other Income and  (Expenses)  for the fiscal year ended  September  30,
1999  totaled  $156,000  of expense  compared to $89,000 of expense for the same
period in 1998. The increases in other  expenses  primarily were due to interest
expense charged for borrowings under the Company's line of credit and term loan.

         Income Tax  Expense for the fiscal  year ended  September  30, 1999 was
$1,604,000  (44.5% effective tax rate) compared with $710,000 (46% effective tax
rate) for the same period in 1998.  The decrease in the Company's  effective tax
rate was due to a decrease  in the amount of  certain  non-deductible  expenses,
including a portion of meals,  entertainment  and  provisions on key person life
insurance policies.

         Net income was $1,999,000 for the fiscal year ended  September 30, 1999
compared to $823,000 for the fiscal year ended  September  30, 1998,  due to the
factors set forth in the first three paragraphs of this section.

                                      -11-

<PAGE>
         FISCAL 1998 COMPARED TO FISCAL 1997

         Revenue  increased to  approximately  $44.6 million for the fiscal year
ended  September  30, 1998 from $29 million for the fiscal year ended  September
30, 1997, an increase of approximately  $15.6 million or 54%.  Revenues from the
Company's  temporary  staffing/consulting  division  were $26.9  million for the
fiscal  year ended  September  30, 1998  compared to $14.5  million for the same
period in 1997, an increase of approximately $12.4 million or 86%. Revenues from
the  Company's  executive  search/full-time   contingency  recruitment  division
experienced an increase of 22% to approximately  $17.7 for the fiscal year ended
September 30, 1998 compared to  approximately  $14.5 million for the same period
in 1997

         The increase in revenues for the fiscal year ended  September  30, 1998
compared to the fiscal year ended  September  30, 1997 was  primarily due to the
expansion of the Company's  temporary  staffing/consulting  division  within the
areas of accounting,  human resource and information  technology.  The Company's
information  technology  temporary   staffing/consulting   business  experienced
significant  increases  in  revenue  to $22.8  million  for  fiscal  year  ended
September  30,  1998  compared  to $13.4  million  the same  period in 1997,  an
increase of $9.4 million or 70%. The increase in revenues can also be attributed
to  the   hiring  of  revenue   generating   personnel   within  the   executive
search/full-time contingency recruitment division, which increased the number of
search placements made during fiscal 1998 compared with the same period in 1997.
In addition, during fiscal 1998 the Company expanded its contingency recruitment
division by providing  administrative support services to clients within the New
York metropolitan area, which contributed to the increase in revenue.

         Selling  expenses for the fiscal year ended  September 30, 1998 totaled
$35 million (78% of  revenues)  compared  with $22.4 (77% of  revenues)  for the
fiscal year ended  September  30,  1997.  The  increase  in selling  expenses is
primarily  related to  compensation  expense of temporary  personnel  within the
Company's  temporary  staffing/consulting  division.  This  increase can also be
attributed to payroll,  commissions  and benefits  associated with the hiring of
revenue-generating  personnel within the executive search/full-time  contingency
recruitment   division.   Selling  expenses   consist   primarily  of  temporary
staffing/consulting compensation, salaries and commissions of revenue generating
personnel, employee benefits, telephone and advertising.

         General and  Administrative  expenses increased to $7.5 million (17% of
revenues) for the fiscal year ended September 30, 1998 compared to approximately
$4.6 million  (16% of  revenues),  for the same period in 1997.  The increase in
general  and  administrative  expenses  is  primarily  a  result  of  additional
infrastructure costs related to business expansion,  including additional office
space  and  the  hiring  of  additional   support   personnel  within  corporate
accounting, information systems and administration.

         Depreciation  and  Amortization  expense  increased to $516,000 for the
fiscal year ended  September  30, 1998  compared to $337,000  for same period in
1997. The increase is primarily related to a full year  depreciation  expense on
$800,000 of capital expenditures  incurred during fiscal 1997. In addition,  the
Company began  depreciating  $1,100,000  of property and  equipment  acquired in
fiscal 1998. In addition,  the amortization of intangible assets  contributed to
this increase.

         Other  Income and  (Expenses)  for the year ended  September  30,  1998
totaled $89,000 of expense compared to $143,000 of income for the same period in
1997.  The increase in other  expenses was due primarily to interest  expense of
$219,000, charged for borrowings under the Company's line of credit.

         Income  from  operations  was  $1,622,000  for the  fiscal  year  ended
September 30, 1998 compared to  $1,691,000  for the fiscal year ended  September
30, 1997 primarily due to the above mentioned factors.

         Income Tax  Expense for the fiscal  year ended  September  30, 1998 was
$710,000  (46%  effective tax rate)  compared  with $552,000 (30%  effective tax
rate) for the same period in 1997.  The increase in the Company's  effective tax
rate was due to increased  state and local taxes and because  certain  expenses,
including a portion of meals,


                                      -12-

<PAGE>
entertainment   and  premiums  on   keyperson   life   insurance   policies  are
non-deductible for income tax purposes. In addition,  the Company received a tax
benefit for net operating loss carryforwards utilized in fiscal 1997.

         Net income was  $823,000 for the fiscal year ended  September  30, 1998
compared to $1,282,000 for the fiscal year ended September 30, 1997.

LIQUIDITY AND CAPITAL RESOURCES

         As of September 30, 1999, the Company's  sources of liquidity  included
$1.4  million  in cash and cash  equivalents  and  short-term  investments.  The
Company's  working  capital was $4.1 million at September  30, 1999  compared to
$3.8 million at September 30, 1998. In addition,  the Company spent $2.2 million
during fiscal 1999 relating to the repurchase of its Common Stock,  as discussed
below. The Company has available  $686,000 of long-term  investments as a source
of liquidity if required.

         In  February  1999,  the Company  entered  into a $6.5  million  credit
facility  agreement  with The Dime Savings Bank. The credit  facility  agreement
consists of a $5 million  working capital line of credit and a term loan of $1.5
million,  which are  collateralized by all of the Company's  assets.  The credit
facility  agreement  provides for borrowings  under the working  capital line of
credit at 1% above the Dime Reference Rate and expires on February 28, 2002. The
term loan is to be paid in 12 quarterly installments commencing May 31, 1999 and
ending on February 28, 2002 and bears interest at 1.25% above the Dime Reference
Rate. The Dime Reference Rate at September 30, 1999 was 8.50%.  At September 30,
1999, there was $350,000 of borrowings under the working capital line of credit,
and $1.25  million  was  outstanding  under the term loan.  The credit  facility
agreement contains various covenants among which are minimum working capital and
tangible net worth requirements and a provision restricting payment of dividends
in excess of 50% of net profits.

         Net cash  provided by  operating  activities  for the fiscal year ended
September  30,  1999  improved  to $4.4  million  compared  to net cash  used by
operating  activities  of $468,000 for the same period in 1998.  The increase in
net cash  provided by operating  activities  was due  primarily to increased net
income, as well as increases in certain liability  categories.  Net cash used in
financing  activities  for the fiscal  year ended  September  30,  1999 was $3.7
million,  which was primarily due to net repayment of $1.5 million of borrowings
under  the line of  credit  and $2.2  million  used  for the  repurchase  of the
Company's Common Stock.

         The Company  believes  that its current cash  position  and  investment
balances,  together with financing available under its working capital facility,
will be sufficient to support current working capital  requirements for the next
twelve months.


YEAR 2000 COMPLIANCE

         Many computer  systems in use today were  designed and developed  using
two digits,  rather than four, to specify years,  and as a result,  such systems
will recognize the year 2000 as 1900. This is commonly  referred to as the "Year
2000  Issue".  As a result,  computer  systems and software  used by  government
agencies, utility companies, providers of telecommunication services, suppliers,
and other  third  parties  may need to be upgraded to comply with such Year 2000
requirements or risk system failure or  miscalculations  causing  disruptions of
normal business activities.

         State of Readiness

         The  Company  utilizes  software  and  related  information  technology
systems in the course of its operations that are essential to its business.  The
Company has reviewed its current software and information technology systems for
compliance  with the  potential  hazards  of the Year 2000  Issue and  currently
believes  its  software  and  information   technology  systems  are  Year  2000
compliant.  The  Company  does not expect  any  material  adverse  impact on its
financial  position or results of operations to arise from Year 2000 failures of
its software and information technology systems.


                                      -13-

<PAGE>

         Ultimately, the potential impact of the Year 2000 Issue will depend not
only on the  Company's  internal  Year 2000  compliance,  but also on the way in
which the Year 2000 is addressed by the Company's  customers,  vendors,  banking
institutions and service utilities.  The Company is working with key third party
vendors to understand their ability to continue to provide services and products
through the change to 2000. The Company  intends to continue to partner with its
key third party vendors to avoid any business interruptions in 2000. The Company
is dependent upon its customers for sales and cash flow.  The Company  currently
does not believe that it is subject to significant business risks related to its
customers' and suppliers' Year 2000 efforts; however, if the Company's customers
or vendors  experience Year 2000 problems,  the Company's  results of operations
could be materially adversely affected.

         COSTS TO DATE

         The Company has not incurred any material costs and does not anticipate
any material  future costs relating to its software and  information  technology
systems due to the Year 2000 Issue.  The  Company  cannot  estimate at this time
whether  it will  incur  any  material  costs due to the  failure  of any of its
service providers or clients to be Year 2000 compliant.

         The foregoing discussion  regarding Year 2000 contains  forward-looking
statements, which are based on management's best estimates derived using various
assumptions.   These  forward-looking  statements  involve  inherent  risks  and
uncertainties,   and  actual   results  could  differ   materially   from  those
contemplated by such statements.  Factors that might cause material  differences
include,  but not  limited to (i) the  Company's  ability to obtain  alternative
sources of financing or cash should its current sources  operations be disrupted
due to Year 2000  complications,  (ii) the  Company's  ability  to  respond to a
potential loss of revenue of a major client due to Year 2000 complications,  and
(iii)  the   Company's   ability  to  respond  to  any   unforeseen   Year  2000
complications.  Such material  differences could result in business  disruption,
operational problems and financial loss.


IMPACT OF INFLATION

         Inflation has not been a major factor in the Company's  business  since
inception. There can be no assurances that this will continue.


NEW AUTHORITATIVE ACCOUNTING PRONOUNCEMENTS

         The Financial  Accounting  Standards  Board["FASB]  issued SFAS No. 137
"Accounting  for  Derivative  Instruments  and  Hedging  Activities-Deferral  of
Effective Date of FASB  Statements No. 133." This statement  defers for one year
the effective date of FASB Statement No. 133, "Accounting Derivative Instruments
and Hedging  Activities."  The rule now will apply to all fiscal quarters of all
fiscal years  beginning  after June 15, 2000. In June 1998, the FASB issued SFAS
No. 133,  "Accounting for Derivative  Instruments and Hedging Activities," which
is required to be adopted in years beginning after June 15, 1999. This statement
permits  early  adoption as of the  beginning  of any fiscal  quarter  after its
issuance.  This statement will require the Company to recognize all  derivatives
on the  balance  sheet at fair  value.  Derivatives  that are not hedges must be
adjusted to fair value through income.  If the derivative is a hedge,  depending
on the nature of the hedge, changes in the fair value of derivatives will either
be offset against the change in fair value of the hedged assets, liabilities, or
firm commitments  through earnings or recognized in other  comprehensive  income
until the hedged item is recognized in earnings.  The  ineffective  portion of a
derivative's  change in fair value will be  immediately  recognized in earnings.
The  Company has not yet  determined  what the effect of SFAS No. 133 will be on
the earnings and financial position of the Company.


                                      -14-

<PAGE>

ITEM 7A.      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

         Certain financial  instruments held by the Company,  such as cash, cash
equivalents and accounts  receivable arising in the ordinary course of business,
may subject the Company to concentrations of credit risk.

         While the  Company  seeks to place its cash and cash  equivalents  with
high  credit-quality  financial  institutions,  the Company is still  exposed to
credit risk for  uninsured  amounts held by such  institutions.  Such  uninsured
amounts subject to credit risk totaled  approximately  $370,000 on September 30,
1999.  The Company  does not expect its  exposure to such credit risk to cause a
material adverse effect on its financial condition or results of operation.

         The Company believes that credit risk related to accounts receivable is
limited  due to the large  number  of  Fortune  1000  companies  comprising  the
Company's  customer  base and the  diversified  industries  in which the Company
operates.  While the Company does not require collateral on accounts  receivable
or other financial instruments,  it does not believe that its exposure to credit
risk  relating to its  accounts  receivable  will  result in a material  adverse
effect on its financial condition or results of operations.


ITEM 8.       FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

              See Index to Financial Statements.

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

              None.



                                      -15-

<PAGE>
                                    PART III

ITEM 10.      DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
              PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

              The information required by this item is incorporated by reference
from the Company's definitive proxy statement to be filed not later than January
28, 2000 pursuant to Regulation 14A of the General Rules and  Regulations  under
the Securities Exchange Act of 1934 ("Regulation 14A").

ITEM 11.      EXECUTIVE COMPENSATION

              The information required by this item is incorporated by reference
from the Company's definitive proxy statement to be filed not later than January
28, 2000 pursuant to Regulation 14A.

ITEM 12.      SECURITY OWNERSHIP OF CERTAIN
              BENEFICIAL OWNERS AND MANAGEMENT

              The information required by this item is incorporated by reference
from the Company's definitive proxy statement to be filed not later than January
28, 2000 pursuant to Regulation 14A.

ITEM 13.      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

              The information required by this item is incorporated by reference
from the Company's definitive proxy statement to be filed not later than January
28, 2000 pursuant to Regulation 14A.



                                      -16-

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

(a)        Exhibits

Exhibit
Number                Exhibits

3.1         (a)       Certificate   of   Incorporation,   as  amended,   of  The
                      Solomon-Page  Group Ltd.  (Incorporated  by  reference  to
                      Exhibit 3.1(a) to Registration Statement on Form SB-2, No.
                      33-81026)
            (b)       Certificate of Amendment to  Certificate of  Incorporation
                      of The Solomon-Page  Group Ltd  (Incorporated by reference
                      to Exhibit 3.1(b) to Registration  Statement on Form SB-2,
                      No. 33-81026)
3.2                   Amended and Restated By-Laws of the Company  (Incorporated
                      by reference to Exhibit 3 to the Company's  Current Report
                      on Form 8-K dated June 8, 1995)
4.1                   Specimen  Common  Stock   Certificate   (Incorporated   by
                      reference to Exhibit 4.1 to Registration Statement on Form
                      SB-2, No. 33-81026)
4.2                   Specimen Warrant  Certificates  (Incorporated by reference
                      to Exhibit 4.2 to Registration Statement on Form SB-2, No.
                      33-81026)
10.1                  1993 Long Term Incentive Plan  (Incorporated  by reference
                      to Exhibit  10.2 to  Registration  Statement on Form SB-2,
                      No. 33-81026)
10.2                  1995   Directors'   Stock   Option  Plan  of  the  Company
                      (Incorporated   by   reference  to  Exhibit  99.1  to  the
                      Company's Current Report on Form 8-K dated June 8, 1995)
10.3                  Employment  Agreement  dated June 14,  1993,  as  amended,
                      between the Company and Herbert Solomon  (Incorporated  by
                      reference  to Exhibit  10.3 to  Registration  Statement on
                      Form SB-2, No. 33-81026)
10.4                  Employment  Agreement  dated June 14,  1993,  as  amended,
                      between  the Company and Lloyd  Solomon  (Incorporated  by
                      reference  to Exhibit  10.4 to  Registration  Statement on
                      Form SB-2, No. 33-81026)
10.5                  Amendment  dated June 8, 1995 to that  certain  Employment
                      Agreement  dated as of June 14,  1993,  by and between the
                      Company and Lloyd  Solomon  (Incorporated  by reference to
                      Exhibit 99.4 to the Company's  Current  Report on Form 8-K
                      dated June 8, 1995)
10.6                  Employment  Agreement  dated June 14,  1993,  as  amended,
                      between  the  Company  and  Scott  Page  (Incorporated  by
                      reference  to Exhibit  10.5 to  Registration  Statement on
                      Form SB-2, No. 33-81026)
10.7                  Amendment  dated June 8, 1995 to that  certain  Employment
                      Agreement  dated as of June 14,  1993,  by and between the
                      Company  and Scott  Page  (Incorporated  by  reference  to
                      Exhibit 99.5 to the Company's  Current  Report on Form 8-K
                      dated June 8, 1995)
10.8                  1996 Stock  Option  Plan,  (Incorporated  by  reference to
                      Exhibit 10.8 to the  Company's  Form 10-KSB for the fiscal
                      year ended September 30, 1996)
10.9                  Form of Indemnification  Agreement between the Company and
                      its officers and directors  (Incorporated  by reference to
                      Exhibit 10.13 to the Company's  Form 10-KSB for the fiscal
                      year ended September 30, 1995)
10.10                 Charter of the Audit  Committee  of the Board of Directors
                      of the Company  (Incorporated by reference to Exhibit 99.2
                      to the Company's  Current Report on Form 8-K dated June 8,
                      1995)
10.11                 The Company's Policy on Transactions in Company Securities
                      by Company Officers, Directors and Employees (Incorporated
                      by  reference  to Exhibit  99.3 to the  Company's  Current
                      Report on Form 8-K dated June 8, 1995)
*10.12                Form of Amended  and  Restated  Indemnification  Agreement
                      between the Company and its officers and directors
*23                   Consent of Moore Stephens P.C. dated December __, 1999
*27                   Financial Data Schedule
--------------------
*   Filed herewith.


                                      -17-

<PAGE>



            (b)       Reports on Form 8-K

                      None.



                                      -18-

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

                           THE SOLOMON-PAGE GROUP LTD.

Dated: December 28, 1999                     By:  /s/ Lloyd Solomon
                                                  ------------------------------
                                                  Lloyd Solomon
                                                  Vice Chairman of the Board
                                                  and Chief Executive Officer

                                POWER OF ATTORNEY

         The  Solomon-Page  Group,  Ltd. and each of the  undersigned  do hereby
appoint Lloyd Solomon, Scott Page and Eric Davis and each of them severally, its
or his true and lawful attorney to execute on behalf of The Solomon-Page  Group,
Ltd. and the  undersigned  any and all  amendments to this Annual Report on Form
10-K and to file the same  with all  exhibits  thereto  and other  documents  in
connection therewith, with the Securities and Exchange Commission;  each of such
attorneys shall have the power to act hereunder with or without the other.

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


Signature                          Title                       Date


/s/ Herbert Solomon           Chairman of the Board and        December 28, 1999
--------------------          Director
Herbert Solomon


/s/ Lloyd Solomon             Vice Chairman of the Board,      December 28, 1999
--------------------          Chief Executive Officer and
Lloyd Solomon                 Director (Principal
                              Executive Officer)


/s/ Scott Page                President and Director           December 28, 1999
--------------------
Scott Page


/s/ Eric M. Davis             Vice President-Finance,          December 28, 1999
--------------------          Chief Financial Officer and
Eric M. Davis                 Director (Principal Financial
                              and Accounting Officer)


/s/ Edward Ehrenberg          Director                         December 28, 1999
--------------------
Edward Ehrenberg


/s/ Joel A. Klarreich         Director                         December 28, 1999
---------------------
Joel A. Klarreich

                                      -19-

<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY

INDEX TO FINANCIAL STATEMENTS



                                                                            Page


Independent Auditor's Report ...............................................F-2

Consolidated Balance Sheets as of September 30, 1999 and 1998...............F-3

Consolidated Statements of Operations for the years ended
September 30, 1999, 1998 and 1997...........................................F-5

Consolidated Statements of Stockholders' Equity for the years ended
September 30, 1999, 1998 and 1997...........................................F-6

Consolidated Statements of Cash Flows for the years ended
September 30, 1999, 1998 and 1997...........................................F-7

Notes to Consolidated Financial Statements .................................F-9


<PAGE>

                          INDEPENDENT AUDITOR'S REPORT


To the Stockholders and Board of Directors of
   The Solomon-Page Group Ltd.



         We have audited the  accompanying  consolidated  balance  sheets of The
Solomon-Page  Group Ltd. and  subsidiary as of September 30, 1999 and 1998,  and
the related  consolidated  statements of operations,  stockholders'  equity, and
cash flows for each of the three fiscal years in the period ended  September 30,
1999. These  consolidated  financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
consolidated financial statements based on our audits.

         We conducted our audits in accordance with generally  accepted auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable  assurance about whether the  consolidated  financial  statements are
free of material  misstatement.  An audit includes  examining,  on a test basis,
evidence  supporting the amounts and disclosures in the  consolidated  financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
consolidated  financial  statement  presentation.  We  believe  that our  audits
provide a reasonable basis for our opinion.

         In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position of
The  Solomon-Page  Group Ltd. and  subsidiary as of September 30, 1999 and 1998,
and the  consolidated  results of their operations and their cash flows for each
of the three fiscal years in the period ended  September 30, 1999, in conformity
with generally accepted accounting principles.






                                                   MOORE STEPHENS, P. C.
                                                   Certified Public Accountants.

Cranford, New Jersey
November 16, 1999

                                      F-2
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY


CONSOLIDATED BALANCE SHEETS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]

<TABLE>
<CAPTION>

                                                                                                                 September 30,
                                                                                                           1 9 9 9          1 9 9 8
Assets:
Current Assets:
<S>                                                                                                       <C>                <C>
   Cash and Cash Equivalents                                                                              $   580            $   935
   Investments                                                                                                849                603
   Accounts Receivable - [Net of Allowances of $280 and $200,
      Respectively]                                                                                        11,416             10,161
   Other Current Assets                                                                                       391                246
                                                                                                          -------            -------
   Total Current Assets                                                                                    13,236             11,945
                                                                                                          -------            -------
Property and Equipment:
   Equipment                                                                                                2,022              1,727
   Furniture and Fixtures                                                                                     797                563
   Leasehold Improvements                                                                                   1,103                938
                                                                                                          -------            -------
   Totals - At Cost                                                                                         3,922              3,228
   Less: Accumulated Depreciation                                                                           1,659              1,113
                                                                                                          -------            -------
   Property and Equipment -Net                                                                              2,263              2,115
                                                                                                          -------            -------
Other Assets:
   Investments                                                                                                686              1,112
   Intangible Assets - [Net of Accumulated Amortization of $310 and
      $195, Respectively]                                                                                   1,444              1,019
   Deferred Tax Asset                                                                                         324                177
   Due from Related Parties                                                                                   135                136
   Other Assets                                                                                               260                231
                                                                                                          -------            -------
   Total Other Assets                                                                                       2,849              2,675
                                                                                                          -------            -------
   Total Assets                                                                                           $18,348            $16,735
                                                                                                          =======            =======
</TABLE>

The  Accompanying  Notes are an Integral  Part of these  Consolidated  Financial
Statements.

                                      F-3
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY


CONSOLIDATED BALANCE SHEETS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]

<TABLE>
<CAPTION>

                                                                                         September 30,
                                                                                 1 9 9 9           1 9 9 8
<S>                                                                             <C>           <C>
Liabilities and Stockholders' Equity:
Current Liabilities:
   Accrued Payroll and Commissions                                              $  4,607      $       3,498
   Accounts Payable and Accrued Expenses                                           1,276                968
   Income Taxes Payable                                                            1,417                298
   Line of Credit                                                                    350              3,100
   Term Loan Payable                                                                 500                 --
   Deferred Revenue                                                                  380                131
   Other Current Liabilities                                                         576                156
                                                                                --------      -------------
   Total Current Liabilities                                                       9,106              8,151
                                                                                --------      -------------
Long-Term Liabilities:
   Term Loan Payable - Net of Current Portion                                        750                 --
   Deferred Credit                                                                   638                545
                                                                                --------      -------------
   Total Long-Term Liabilities                                                     1,388                545
                                                                                --------      -------------
Commitments and Contingencies                                                         --                 --
                                                                                --------      -------------
Stockholders' Equity:
   Preferred Stock - Par Value $.001 Per Share; Authorized
      2,000,000 Shares, None Issued or Outstanding                                    --                 --

   Common Stock - Par Value $.001 Per Share;
      Authorized 20,000,000 Shares, 5,163,948 and 5,162,282 Shares
      Issued and 4,153,948 and 5,121,282 Shares Outstanding
      at September 30, 1999 and 1998, Respectively                                     5                  5

   Additional Paid-in Capital                                                      7,428              7,426

   Accumulated Other Comprehensive Income                                             (7)                11

   Treasury Stock - At Cost; 1,010,000 and 41,000 Common Shares
      at September 30, 1999 and 1998, Respectively                                (2,248)               (80)

   Retained Earnings                                                               2,676                677
                                                                                --------      -------------
   Total Stockholders' Equity                                                      7,854              8,039
                                                                                --------      -------------
   Total Liabilities and Stockholders' Equity                                   $ 18,348      $      16,735
                                                                                ========      =============
</TABLE>

The  Accompanying  Notes are an Integral  Part of these  Consolidated  Financial
Statements.

                                      F-4
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY


CONSOLIDATED STATEMENTS OF OPERATIONS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]

<TABLE>
<CAPTION>

                                                                                 Y e a r s   e n d e d
                                                                                S e p t e m b e r  30,
                                                                   1 9 9 9              1 9 9 8                1 9 9 7

<S>                                                            <C>                   <C>                   <C>
Revenue                                                        $    56,329           $    44,639           $    28,996
                                                               -----------           -----------           -----------
Operating Expenses:
   Selling Expenses                                                 44,139                35,015                22,413
   General and Administrative                                        7,771                 7,486                 4,555
   Depreciation and Amortization                                       660                   516                   337
                                                               -----------           -----------           -----------
   Total Operating Expenses                                         52,570                43,017                27,305
                                                               -----------           -----------           -----------
   Income from Operations                                            3,759                 1,622                 1,691
                                                               -----------           -----------           -----------
Other Income [Expenses]:
   Interest and Dividend Income                                        110                   128                   133
   Interest Expense                                                   (269)                 (219)                  (27)
   Realized Gain on Investments                                          3                     2                    37
                                                               -----------           -----------           -----------
   Total Other [Expenses] Income                                      (156)                  (89)                  143
                                                               -----------           -----------           -----------
   Income Before Income Tax Expense                                  3,603                 1,533                 1,834

Income Tax Expense                                                   1,604                   710                   552
                                                               -----------           -----------           -----------
   Net Income                                                  $     1,999           $       823           $     1,282
                                                               ===========           ===========           ===========
Basic Earnings Per Common Share                                $       .44           $       .16           $       .25
                                                               ===========           ===========           ===========

Diluted Earnings Per Common Share                              $       .41           $       .14           $       .23
                                                               ===========           ===========           ===========

Basic Weighted Average Shares                                    4,517,298             5,134,122             5,131,751
                                                               ===========           ===========           ===========

Diluted Weighted Average Shares                                  4,885,699             5,985,319             5,633,806
                                                               ===========           ===========           ===========
</TABLE>


The  Accompanying  Notes are an Integral  Part of these  Consolidated  Financial
Statements.

                                      F-5
<PAGE>
THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]
<TABLE>
<CAPTION>
                                                                                                                         Additional
                                                          Preferred Stock                 Common Stock                    Paid-in
                                                     Shares         Amount       Shares                   Amount          Capital
<S>                                                       <C>      <C>              <C>                <C>               <C>
Balance - October 1, 1996                                 --       $     --         5,139,285          $     5           $    8,488

   Treasury Shares
      Purchased                                           --             --                --               --                   --

   Net Income                                             --             --                --               --                   --
                                                      ------       --------         ---------          -------           -----------
Balance - September 30, 1997                              --             --         5,139,285                5                8,488

   Repurchase of 1,000,000
      Class A Warrants                                    --             --                --               --               (1,054)

   Costs Associated with
      Registering Class A
      Warrants                                            --             --                --               --                  (37)

   Exercise of Options                                    --             --            22,997               --                   29

   Treasury Shares Purchased                              --             --                --               --                   --

   Unrealized Gain on Available
      for Sale Securities - Net                           --             --                --               --                   --

   Net Income                                             --             --                                 --                   --
                                                      ------       --------         ---------          -------           -----------
Balance - September 30, 1998                              --             --         5,162,282                5                7,426

   Exercise of Options                                    --             --             1,666               --                    2

   Treasury Shares Purchased                              --             --                --               --                   --

   Unrealized [Loss] on Available
      for Sale Securities - Net                           --             --                --               --                   --

   Net Income                                             --             --                                 --                   --
                                                      ------       --------         ---------          -------           -----------
Balance - September 30, 1999                              --       $     --         5,163,948          $     5           $    7,428
                                                      ======       ========         =========          =======           ===========
</TABLE>
<TABLE>
<CAPTION>
                                             Accumulated
                                                 Other                                               Retained           Total
                                             Comprehensive            Treasury Stock                 Earnings        Stockholders'
                                                Income           Shares            Amount            [Deficit]          Equity
<S>                                           <C>                <C>      <C>                     <C>                <C>
Balance - October 1, 1996                     $     --               --   $      --               $  (1,428)         $   7,065

   Treasury Shares
      Purchased                                     --           10,000         (16)                     --                (16)

   Net Income                                       --               --          --                   1,282              1,282
                                              --------           ------   ---------               ---------         ----------
Balance - September 30, 1997                        --           10,000         (16)                   (146)             8,331

   Repurchase of 1,000,000
      Class A Warrants                              --               --          --                      --             (1,054)

   Costs Associated with
      Registering Class A
      Warrants                                      --               --          --                      --                (37)

   Exercise of Options                              --               --          --                      --                 29

   Treasury Shares Purchased                        --           31,000         (64)                     --                (64)

   Unrealized Gain on Available
      for Sale Securities - Net                     11               --          --                      --                 11

   Net Income                                       --               --          --                     823                823
                                              --------           ------   ---------               ---------         ----------
Balance - September 30, 1998                        11           41,000         (80)                    677              8,039

   Exercise of Options                              --               --          --                     --                   2

   Treasury Shares Purchased                        --          969,000      (2,168)                    --              (2,168)

   Unrealized [Loss] on Available
      for Sale Securities - Net                    (18)              --          --                     --                 (18)

   Net Income                                       --               --          --                  1,999               1,999
                                              --------        ---------   ---------               ---------         ----------
Balance - September 30, 1999                  $     (7)       1,010,000   $  (2,248)              $  2,676             $ 7,854
                                              ========        =========   =========               =========         ==========
</TABLE>
The  Accompanying  Notes are an Integral  Part of these  Consolidated  Financial
Statements.

                                      F-6
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY


CONSOLIDATED STATEMENTS OF CASH FLOWS
[AMOUNTS IN THOUSANDS]
<TABLE>
<CAPTION>


                                                                                                    Y e a r s   e n d e d
                                                                                                   S e p t e m b e r  30,
                                                                                           1 9 9 9          1 9 9 8          1 9 9 7
Operating Activities:
<S>                                                                                       <C>              <C>              <C>
   Net Income                                                                             $ 1,999          $   823          $ 1,282
                                                                                          -------          -------          -------
   Adjustments to Reconcile Net Income to
      Net Cash Provided by [Used for] Operating Activities:
      Depreciation and Amortization                                                           660              516              337
      Deferred Credit                                                                          93              161              118
      Provision for Losses on Accounts Receivable                                              80               75               35
      Net Realized Gain on Investments                                                         (3)              (2)             (37)
      Deferred Taxes                                                                         (297)             (79)             (84)

   Changes in Assets and Liabilities:
      [Increase] Decrease in:
         Accounts Receivable                                                               (1,335)          (2,858)          (3,253)
         Other Assets                                                                         (27)             (49)             (32)

      Increase [Decrease] in:
         Accounts Payable, Accrued Expenses,
            Accrued Payroll and Commissions                                                 1,417            1,004            1,492
         Income Tax Payable                                                                 1,119               31              290
         Deferred Revenue                                                                     249              155             --
         Other Current Liabilities                                                            448             (245)              36
                                                                                          -------          -------          -------
      Total Adjustments                                                                     2,404           (1,291)          (1,098)
                                                                                          -------          -------          -------
   Net Cash - Operating Activities                                                          4,403             (468)             184
                                                                                          -------          -------          -------
Investing Activities:
   Capital Expenditures                                                                      (693)          (1,089)            (791)
   Purchases of Investments                                                                  (602)            (800)          (2,845)
   Proceeds from Sales of Investments                                                         750            1,249            2,042
   Acquisitions of and Additions to Trade Names                                              (540)            (350)            (265)
   Cash Received from Related Parties                                                           1               55               10
   Increase in Cash Surrender Value of Officer
      Life Insurance                                                                           (8)             (46)             (23)
                                                                                          -------          -------          -------
   Net Cash - Investing Activities                                                         (1,092)            (981)          (1,872)
                                                                                          -------          -------          -------
Financing Activities:
   Borrowings Under Term Loan and Line of Credit                                            4,164            3,100             --
   Repayments Under Term Loan and Line of Credit                                           (5,664)            --               --
   Purchase of Treasury Stock and Warrants                                                 (2,168)          (1,118)             (16)
   Warrant Registration Costs                                                                --                (37)            --
   Proceeds from Exercise of Stock Options                                                      2               29             --
                                                                                          -------          -------          -------
   Net Cash - Financing Activities                                                         (3,666)           1,974              (16)
                                                                                          -------          -------          -------
   Net [Decrease] Increase in Cash and
      Cash Equivalents - Forward                                                          $  (355)         $   525          $(1,704)
</TABLE>

The  Accompanying  Notes are an Integral  Part of these  Consolidated  Financial
Statements.


                                      F-7
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY


CONSOLIDATED STATEMENTS OF CASH FLOWS
[AMOUNTS IN THOUSANDS

<TABLE>
<CAPTION>

                                                                                               Y e a r s   e n d e d
                                                                                               S e p t e m b e r  30,
                                                                                       1 9 9 9            1 9 9 8           1 9 9 7
<S>                                                                                    <C>                <C>               <C>
   Net [Decrease] Increase in Cash and
      Cash Equivalents - Forwarded                                                     $  (355)           $   525           $(1,704)

Cash and Cash Equivalents - Beginning of Years                                             935                410             2,114
                                                                                       -------            -------           -------
   Cash and Cash Equivalents - End of Years                                            $   580            $   935           $   410
                                                                                       =======            =======           =======
Supplemental Disclosures of Cash Flow Information:
   Cash paid during the years for:
      Interest                                                                         $   269            $   219           $    27
      Income Taxes                                                                     $   861            $   777           $   422

</TABLE>


The  Accompanying  Notes are an Integral  Part of these  Consolidated  Financial
Statements.


                                      F-8

<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]



[1] Nature of Operations

The  Solomon-Page  Group Ltd. and its  wholly-owned  subsidiary  [the "Company"]
provides staffing services  comprised of two primary  operating  divisions:  (i)
temporary  staffing and  consulting,  which  provides  approximately  58% of the
Company's revenue and (ii) retained  executive search and full-time  contingency
search which provides  approximately 42% of the Company's  revenue.  The Company
provides its services  principally in the New York metropolitan area through its
offices located in New York and New Jersey.  The Company also provides  services
in California and Georgia through its offices located in those areas.

[2] Summary of Significant Accounting Policies

Principles of Consolidation - The consolidated  financial statements include the
accounts of the Company and its subsidiary.  All material  intercompany accounts
and transactions are eliminated.

Revenue  Recognition - Search  revenues are recognized in full-time  contingency
search  engagements  upon the  successful  completion  of the  assignment.  In a
retained executive search engagement,  the non-refundable retainer is recognized
according to the terms of the search contract, with the unearned portions of the
retainer  reflected  as  deferred  revenue.  The  balance  of  the  contract  is
recognized  upon  successful  completion of the search.  Temporary  staffing and
consulting  revenue is  recognized  when the  temporary  personnel  provide  the
service.

Receivable   Allowances  -  The  Company  records  allowances  against  accounts
receivable,  based on  historical  experience  to estimate  losses due to placed
candidates not fulfilling the terms of the search  agreement or not remaining in
employment for the Company's  guarantee period which generally ranges from 30 to
120 days but may  extend up to one year.  Losses  from bad debts are  charged to
expense and losses related to contract fulfillment are charged to revenue.

Investments - The Company  accounts for investments in accordance with Statement
of Financial  Accounting  Standards  ["SFAS"] No. 115,  "Accounting  for Certain
Investments  in  Debt  and  Equity   Securities."   Management   determines  the
appropriate  classification  of its investments in debt and equity securities at
the time of purchase and reevaluates  such  determination  at each balance sheet
date. Equity securities, and debt securities which the Company does not have the
intent to hold to maturity,  are  classified  as trading or available  for sale.
Securities  available  for sale are carried at fair value,  with any  unrealized
holding  gains and  losses,  net of tax,  reported  in a separate  component  of
stockholders'  equity until  realized.  Trading  securities  are carried at fair
value with any unrealized gains or losses included in earnings. Held to maturity
securities are carried at amortized cost.  Marketable debt and equity securities
available for current  operations,  and maturing within one year, are classified
in the balance sheet as current  assets while  securities  held for  non-current
uses, and maturing after one year, are classified as long-term assets.  Realized
gains and losses are  calculated  utilizing the specific  identification  method
[See Note 3].

Depreciation  -  Depreciation  of furniture,  fixtures and equipment is computed
utilizing the straight-line  method based on estimated useful lives ranging from
5 to 7 years.  Depreciation of leasehold  improvements is computed utilizing the
straight-line  method  over the  lesser  of the life of the  improvement  or the
remaining lease term. Depreciation expense was $545, $431 and $273 for the years
ended September 30, 1999, 1998 and 1997, respectively.


                                      F-9
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]



[2] Summary of Significant Accounting Policies [Continued]

Deferred  Income  Taxes - The Company  accounts  for  deferred  income  taxes in
accordance  with SFAS No. 109,  "Accounting  for Income  Taxes."  The  statement
requires that deferred income taxes reflect the tax consequences on future years
of  differences  between  the tax  bases of  assets  and  liabilities  and their
financial reporting amounts.

Deferred  Credit - The  Company's  lease on its  premises  provides for periodic
increases over the lease term. Pursuant to SFAS No. 13, "Accounting for Leases,"
the Company records rent expense on a straight-line  basis.  The effect of these
differences is recorded as a deferred credit.

Cash and Cash  Equivalents - Cash  equivalents  are comprised of certain  highly
liquid investments with a maturity of three months or less when purchased.

Earnings Per Common Share - Basic  earnings per share  represents  the amount of
earnings  for the period  available  to each share of common  stock  outstanding
during the reporting  period.  Diluted earnings per share reflects the amount of
earnings  for the period  available  to each share of common  stock  outstanding
during the  reporting  period,  while giving  effect to all  dilutive  potential
common  shares that were  outstanding  during the period,  such as common shares
that could result from the potential  exercise or conversion of securities  into
common stock.

The  computation  of diluted  earnings  per share  does not  assume  conversion,
exercise,  or contingent  issuance of securities that would have an antidilutive
effect on earnings per share.  The dilutive  effect of  outstanding  options and
warrants and their equivalents is reflected in diluted earnings per share by the
application  of the treasury  stock method which  recognizes the use of proceeds
that could be  obtained  upon  exercise of options  and  warrants  in  computing
diluted  earning  per  share.  It  assumes  that any  proceeds  would be used to
purchase common stock at the average market price during the period. Options and
warrants will have a dilutive  effect only when the average  market price of the
common  stock  during the period  exceeds  the  exercise  price of the option or
warrants.

Potential future dilutive securities include 2,050,000,  2,050,000 and 3,050,000
shares  issuable under  outstanding  warrants and 350,500,  225,500 and 0 shares
issuable  under  outstanding  options as of September  30, 1999,  1998 and 1997,
respectively.

Intangibles  - Intangibles  which consist of trade names and customer  lists are
recorded  at cost and are  amortized  utilizing  the  straight-line  method over
periods ranging from 4 to 15 years.  When changing  circumstances  warrant,  the
Company  evaluates the carrying value and the periods of  amortization  based on
the current and expected  future  non-discounted  cash flows from  operations to
determine  whether  revised  estimates  of  carrying  value or  useful  lives is
required.  Amortization  expense  was  $115,  $85 and $64  for the  years  ended
September 30, 1999, 1998 and 1997, respectively [See Note 9].

Accumulated Other Comprehensive  Income - Accumulated other comprehensive income
consists  entirely  of  unrealized  gains  and  losses  on  available  for  sale
securities.  The financial statement and footnote  disclosures  required by SFAS
130 have not been presented as they are not material.

                                      F-10
<PAGE>


THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[2] Summary of Significant Accounting Policies [Continued]

Concentrations of Credit Risk - Financial  instruments that potentially  subject
the Company to  concentrations of credit risk include cash, cash equivalents and
accounts  receivable  arising from its normal business  activities.  The Company
places  its  cash  and cash  equivalents  with  high  credit  quality  financial
institutions.   The  Company  had  approximately  $370  and  $561  in  financial
institutions  that is subject to normal  credit risk beyond  insured  amounts at
September 30, 1999 and 1998, respectively.

The Company believes that credit risk related to accounts  receivable is limited
due to the large  number of Fortune  1000  companies  comprising  the  Company's
customer base and the diversified  industries in which the Company operates. The
Company does not require  collateral on accounts  receivable or other  financial
instruments.

Use of Estimates - 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 and liabilities and
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.

Advertising  -  The  Company  expenses  advertising  costs  as  incurred.  Total
advertising  costs charged to expense amounted to  approximately  $410, $430 and
$207 for the years ended September 30, 1999, 1998 and 1997, respectively.

Stock  Based  Compensation  - The  Company  accounts  for  employee  stock-based
compensation  under the intrinsic value based method as prescribed by Accounting
Principles  Board ["APB"]  Opinion No. 25. The Company applies the provisions of
SFAS No.  123,  "Accounting  for  Stock  Based  Compensation,"  to  non-employee
stock-based  compensation  and  the  pro  forma  disclosure  provisions  of that
statement to employee stock-based compensation.

Reclassifications  -  Certain  amounts  in prior  years  consolidated  financial
statements have been reclassified to conform with the current year presentation.

[3] Investments in Debt and Equity Securities

At September 30, 1999 and 1998,  the Company's  securities  consisted of certain
highly liquid debt  securities  which were  classified as available for sale and
held to maturity.  A summary of the Company's  investments in debt securities is
as follows:
<TABLE>
<CAPTION>

                                            September 30, 1999            September 30, 1998
Financial Statement Caption               Cost        Fair Value        Cost        Fair Value
---------------------------               ----        ----------        ----        ----------

Available for Sale:
<S>                                     <C>           <C>             <C>           <C>
   Investments                          $  1,550      $    1,535      $   1,695     $   1,715

Held to Maturity:
   Restricted Investment - Noncurrent   $     --      $       --      $      34     $      34
</TABLE>

Gross proceeds from sale of available for sale  securities was $750,  $1,249 and
$2,042  and  realized  gains on sales  was $3,  $2 and $37 for the  years  ended
September 30, 1999, 1998 and 1997, respectively.

                                      F-11
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[3] Investments in Debt and Equity Securities [Continued]

At September 30, 1999 and 1998, gross unrealized [losses] gains on available for
sale securities was $(15) and $20 and is included in stockholders' equity net of
taxes of $8 and $(9), respectively.

Contractual  maturities of debt securities  classified as available for sale and
held to maturity are as follows:
<TABLE>
<CAPTION>

                              September 30, 1999                 September 30, 1998
                    Available for Sale  Held to Maturity  Available for Sale  Held to Maturity
                    ------------------  ----------------  ------------------  ----------------

<S>                      <C>            <C>               <C>                 <C>
Within 1 year            $   850        $    --           $     600           $       36
Between 1 and 5 years    $   700        $    --           $   1,100           $       --
</TABLE>

[4] Due From Related Parties

At  September  30, 1999 and 1998,  the  Company  had a balance due from  various
officers of the Company  aggregating $135 and $136,  respectively.  The advances
bear interest at 8%.  Interest  income on the advances was $10, $13, and $12 for
the years ended September 30, 1999, 1998 and 1997, respectively. No interest was
receivable at September 30, 1999 and 1998.

[5] Line of Credit

In February 1999, the Company entered into a $6,500 credit  facility  agreement.
The facility agreement consists of a $5,000 working capital line of credit under
which up to $250 can be borrowed under standby letters of credit at a commitment
rate of 2%, and a term loan of $1,500.  The facility agreement is collateralized
by all of the Company's assets.  The agreement provides for borrowings under the
working  capital line of credit at 1% above the bank  reference rate and expires
on February 28, 2002. The bank's  reference rate at September 30, 1999 was 8.5%.
At September 30, 1999,  there was $350 of borrowings  under the working  capital
line of credit and $161 under standby letters of credit leaving $4,489 of credit
available.  The agreement  contains  various  covenants  among which are minimum
working  capital  and  tangible  net worth  requirements  and a  provision  that
restricts the payment of dividends in excess of 50% of net profits.

In February  1998,  the Company  entered  into a one year $4,000  demand line of
credit facility agreement, which was collateralized by all the Company's assets.
The agreement provided for borrowing at 1% above the bank's reference rate (8.5%
at September  30,  1998).  Borrowings  were limited to 80% of eligible  accounts
receivable and expired in February 1999, on which date the outstanding principal
amount was repaid. As of September 30, 1998, the full balance under the line was
available  and the  Company  borrowed  approximately  $3,100  under  the  credit
facility,  of which  approximately  $1,118  was used for the  repurchase  of the
Company's  common stock, and Class A redeemable  common stock purchase  warrants
with the balance used to fund current working capital requirements.

The weighted  average interest rate on short-term  borrowings  outstanding as of
September 30, 1999 and 1998 was 9.3% and 9.5%, respectively.


                                      F-12

<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]

[6] Long-Term Debt

At September 30, 1999 and 1998, long-term debt consisted of the following:
<TABLE>
<CAPTION>

                                                                                                   1 9 9 9     1  9 9 8

<S>                                                                                                <C>         <C>
Note payable  under credit  facility  agreement  [See Note 5],  payable in equal
   quarterly principal  installments of $125 plus interest at 1.25% above bank's
   reference rate per annum through February 2002                                                  $1,250      $    --

Less:  Current Portion                                                                                500           --
                                                                                                   ------      -------
   Totals                                                                                          $  750      $    --
                                                                                                   ======      =======
</TABLE>

<TABLE>
<CAPTION>

Long-term debt at September 30, 1999 matures as follows:

<S>                                                                                                <C>
2000                                                                                               $  500
2001                                                                                                  500
2002                                                                                                  250
                                                                                                   ------
   Total                                                                                           $1,250
                                                                                                   ======
</TABLE>

[7] Leases

Operating  Leases - The  Company  leases  office  space under  operating  leases
expiring  through  September  2006.

Minimum  future rental  payments  under  noncancelable  operating  leases having
remaining  terms in excess of one year as of September  30, 1999 for each of the
next five years and in the aggregate are:

Year ending
September 30,
   2000                                                  $  1,111
   2001                                                     1,137
   2002                                                     1,151
   2003                                                     1,057
   2004                                                       993
   Subsequent to 2004                                       1,776
                                                         --------
   Total Minimum Future Rental Payments                  $  7,225
                                                         ========

In addition,  the Company is liable for its pro-rata  share of increases in real
estate taxes and escalations as provided in the lease agreements.

Rent  expense  was  approximately  $1,231,  $1,017 and $617 for the years  ended
September 30, 1999, 1998 and 1997, respectively.

                                      F-13
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[8] Capital Stock

On  September  11,  1998,  the  Company's  Board  of  Directors  authorized  the
repurchase of 1,000,000 shares of the Company's common stock, from time to time,
in the open  market or in  privately  negotiated  transactions.  During the year
ended September 30, 1999,  969,000 shares were  repurchased at a cost of $2,168.
During the year ended  September 30, 1998,  31,000 shares were  repurchased at a
cost of $64.

On December 18, 1996, the Company's Board of Directors authorized the repurchase
of up to 500,000 shares of the Company's common stock, from time to time, in the
open market or in privately  negotiated  transactions.  The Company  repurchased
10,000  shares  during the year ended  September  30, 1997, at a cost of $16. On
October 31, 1997, the Company's  Board of Directors  terminated the December 18,
1996 common stock repurchase plan.

[9] Commitments and Contingencies

Litigation - The Company is party to  litigation  arising from the normal course
of business. In managements' opinion, this litigation will not materially affect
the Company's financial position, results of operations or cash flows.

Intangibles  - In  connection  with  certain  acquisitions,  the Company will be
required to pay purchase price  adjustments  through September 2004 based on the
achievement  of various  criteria.  These  additional  payments  are  charged to
intangibles  and are amortized over the then  remaining life of the  intangible.
Purchase price  adjustments  amounted to approximately  $190 and $350 during the
years ended  September 30, 1999 and 1998,  respectively.  During the fiscal year
ending  September 30, 1999,  the Company  acquired two trade names for $350. The
acquisitions also include potential purchase price adjustments.

[10] Options and Warrants

On April 1, 1994,  the Company issued 175,000 Class A warrants and 175,000 Class
B warrants in  connection  with  certain  bridge  financing  which was repaid on
October 20,  1994.  The Class A warrants  are  identical  to those issued in the
Company's  initial  public  offering.  The Class B warrants are identical to the
Class A warrants except that the exercise price is $6.00 per share.

On October 20, 1994, in connection  with its initial public offering the Company
issued 2,300,000 Class A redeemable common stock purchase warrants. Each Class A
warrant  entitles  the holder to purchase one share of common stock at $4.50 per
share commencing October 20, 1995 and expired on October 20, 1999.
The Class A warrants are redeemable at $.05 per warrant based on the achievement
of certain criteria.

On October 20, 1994, in connection with its initial public offering, the Company
granted to its  underwriter  an option to purchase an aggregate of 200,000 units
of Company  securities  [consisting of one share of common stock and one Class A
redeemable  common  stock  purchase  warrant]  exercisable  at  $6.60  per  unit
commencing October 20, 1995 and expired on October 20, 1999.

On October 31, 1997, the Company's Board of Directors  authorized the repurchase
of up to 1,000,000 of the  Company's  Class A redeemable  common stock  purchase
warrants in open market or privately  negotiated  transactions.  On February 12,
1998,  the Company  completed  the  repurchase  of 1,000,000  Class A redeemable
common stock purchase warrants at a cost of $1,054.


                                      F-14

<PAGE>
THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[10] Options and Warrants [Continued]

On August 17, 1995, the Company  adopted the 1995  Director's  Stock Option Plan
[the "Director's  Plan"].  The Director's Plan provides for the grant of options
to  purchase  up to  100,000  shares of common  stock to  Directors  who are not
employees of the Company.  Options  granted  under the  Director's  Plan will be
exercisable commencing a minimum of 6 months from the date of grant for a period
of 10 years from the date of grant at an  exercise  price which is not less than
the fair market value of the common stock on the date of the grant. Options vest
at a rate of 50% after one year and 50% after two years.

On August 6, 1993,  the Company  adopted the 1993 Long Term  Incentive Plan [the
"1993 Plan"], which was amended on June 24, 1994. The 1993 Plan provides for the
issuance of  incentive  awards in the form of but not limited to stock  options,
stock appreciation  rights,  restricted stock and performance grants to purchase
up to  1,500,000  shares  of  common  stock and  provides  that all  individuals
performing  services for the Company are eligible to receive  incentive  awards.
The  1993  Plan is  administered  by a  committee  designated  by the  Board  of
Directors. The selection of participants,  allotment of shares, determination of
price and other  conditions of purchase of any awards granted will be determined
by such  committee  at its sole  discretion.  The purpose of the 1993 Plan is to
attract and retain persons instrumental to the success of the Company. Incentive
stock options granted under the 1993 Plan will be exercisable for a period of up
to 10 years from the date of grant at an  exercise  price which is not less than
the fair market value of the common stock on the date of the grant,  except that
the  term  of an  incentive  stock  option  granted  under  the  1993  Plan to a
stockholder  owning more than 10% of the outstanding  shares of the common stock
may not exceed  five years and its  exercise  price may not be less than 110% of
the  fair  market  value  of  the  common  stock  on  the  date  of  the  grant.
Non-executive  officer  options vest at a rate of 33 1/3% after three years,  33
1/3% after four years and 33 1/3% after five years.  Options to purchase 450,000
shares of common  stock have been  granted to  executive  officers and vest at a
rate of 33 1/3% upon grant,  33 1/3% after six months and 33 1/3% after thirteen
months.

On September 17, 1996, the Company adopted the 1996 Stock Option Plan [the "1996
Plan"].  The 1996 Plan  provides  for  awards of  incentive  stock  options  and
non-qualified  options to purchase  up to  1,000,000  shares of common  stock to
employees   and   directors  of  the  Company.   The  1996  Plan  provides  that
non-qualified  options must be granted at not less than 80% of fair market value
on the date  granted.  No  options  at less than  fair  market  value  have been
awarded.  Non-executive  officer  options  vest at a rate of 33 1/3% after three
years, 33 1/3% after four years and 33 1/3% after five years. Executive officers
vest at a rate of 33 1/3%  after one year,  33 1/3%  after two years and 33 1/3%
after three years.

A summary of the activity in the option plans is as follows:
<TABLE>
<CAPTION>

                                                                                      Weighted Average
                                                                     Shares            Exercise Price

<S>                                                                <C>                    <C>
Outstanding at October 1, 1996                                     1,773,500              $  1.71
   Granted                                                           246,750                 2.33
   Exercised                                                             --
   Expired/Canceled                                                  (55,000)                1.43
                                                                   ---------
   Outstanding at September 30, 1997                               1,965,250                 1.80
   Granted                                                           355,500                 2.70
   Exercised                                                         (22,997)                1.27
   Expired/Canceled                                                 (128,169)                1.85
                                                                   ---------
   Outstanding at September 30, 1998                               2,169,584                 1.95
   Granted                                                           190,000                 2.13
   Exercised                                                          (1,666)                1.25
   Expired/Canceled                                                  (94,000)                2.35
                                                                   ---------
   Outstanding at September 30, 1999                               2,263,918                 1.95
                                                                   =========
   Exercisable at September 30, 1999                               1,429,888              $  1.80
                                                                   =========
</TABLE>


                                      F-15
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[10] Options and Warrants [Continued]

No  compensation  cost was charged to earnings  during the years ended September
30, 1999,  1998 and 1997.  If  compensation  cost for the stock option plans had
been determined  based on the fair value at the grant dates for awards under the
plans,  consistent with the alternative method set forth under SFAS No. 123, the
Company's  net  income,  basic and  diluted  earnings  per share would have been
reduced on a pro forma basis as indicated below:
<TABLE>
<CAPTION>

                                                           1 9 9 9      1 9 9 8             1 9 9 7
Year ended September 30:
Net Income:
<S>                                                      <C>           <C>                <C>
   As Reported                                           $  1,999      $    823           $      1,282
   Pro Forma                                             $  1,888      $    500           $        953

Basic Earnings Per Common Share:
   As Reported                                           $    .44      $    .16           $        .25
   Pro Forma                                             $    .42      $    .10           $        .19

Diluted Earnings Per Common Share:
   As Reported                                           $    .41      $    .14           $        .23
   Pro Forma                                             $    .40      $    .09           $        .17

</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 the grants awarded in 1999 and 1998, respectively:

                                               S e p t e m b e r  30,
                                       1 9 9 9         1 9 9 8       1 9 9 7

Dividend Yields                          0.00%           0.00%        0.00%
Expected Volatility                     88.86%         131.54%      105.29%
Risk-Free Interest Rate                  5.41%           4.32%        5.99%
Expected Lives                          4 Years        5.5 Years    4 Years

The  weighted-average  fair value of options granted was $1.42,  $2.40 and $1.73
for the years ended September 30, 1999, 1998 and 1997, respectively.

The following table summarizes  information about stock options at September 30,
1999:
<TABLE>
<CAPTION>

                                 Outstanding                                      Exercisable
                                   Weighted          Weighted                     Weighted
  Range of                         Remaining         Average                      Average
Exercise Prices       Shares     Contractual Life  Exercise Price    Shares     Exercise Price
---------------       ------     ----------------  --------------    ------     --------------

<S>     <C>         <C>              <C>          <C>              <C>            <C>
$0.56 - $2.00       1,157,918        4.2 Years    $    1.47        717,988        $   1.35
$2.01 - $3.69       1,106,000        6.3 Years    $    2.45        712,000        $   2.25
                    ---------                                    ---------
                    2,263,918        4.9 Years    $    1.95      1,429,988        $   1.80
                    =========                                    =========
</TABLE>


                                      F-16
<PAGE>
THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[11] Income Taxes Expense

The provision for income tax expense consists of the following:
<TABLE>
<CAPTION>

                                                                                                 S e p t e m b e r  30,
                                                                                      1 9 9 9            1 9 9 8             1 9 9 7
                                                                                      -------            -------             -------
Current:
<S>                                                                                   <C>                <C>                <C>
   Federal                                                                            $ 1,283            $   524            $   836
   Utilization of Net Operating Loss Carryforward                                          (5)               (13)              (423)
   State and City                                                                         623                278                453
   Utilization of Net Operating Loss Carryforward                                        --                 --                 (230)
                                                                                      -------            -------            -------
   Total Current                                                                        1,901                789                636
                                                                                      -------            -------            -------
Deferred [Benefit]:
   Federal                                                                               (200)               (50)               (61)
   State and City                                                                         (97)               (29)               (23)
                                                                                      -------            -------            -------
   Total Deferred                                                                        (297)               (79)               (84)
                                                                                      -------            -------            -------
   Total Income Tax Expense                                                           $ 1,604            $   710            $   552
                                                                                      =======            =======            =======
</TABLE>

Income tax at the federal  statutory rate reconciled to the Company's  effective
rate is as follows:
<TABLE>
<CAPTION>

                                                                                      S e p t e m b e r  30,
                                                                          1 9 9 9          1 9 9 8          1 9 9 7
                                                                          -------          -------          -------

<S>                                                                         <C>              <C>              <C>
Federal Statutory Rate                                                      34.0%            34.0%            34.0%
Non Deductible Expenses                                                      2.2              1.9              4.4
Benefit of Net Operating Loss Carryforward                                   (.1)             (.9)           (23.1)
Change in Deferred Tax Asset Valuation Allowance                              --               --              7.8
State and City Income Taxes [Net of Federal Tax Benefit]                    11.5             12.0              8.1
Other                                                                       (3.1)             (.7)            (1.1)
                                                                           -----             ----             ----
   Effective Rate                                                           44.5%            46.3%            30.1%
                                                                           =====             ====             ====
</TABLE>

The major  components  of  deferred  income tax assets  and  liabilities  are as
follows:
                                                 September 30,
                                           1 9 9 9           1 9 9 8
Deferred Tax Liabilities:
   Cash Basis Adjustments                $      --          $    (89)
   Accelerated Depreciation                    (65)              (90)
   Other                                        --                (9)
                                         ---------          --------
   Total Deferred Tax Liabilities              (65)             (188)
                                         ---------          --------
Deferred Tax Assets:
   Rent Deferrals                              276               240
   Net Operating Loss                           --                 5
   Reserves                                    121                79
   Other                                        47                --
   Deferred Revenue                             72                27
                                         ---------          --------
   Total Deferred Tax Assets                   516               351
                                         ---------          --------
Net Deferred Tax Asset                   $     451          $    163
                                         =========          ========

                                      F-17
<PAGE>
THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[11] Income Taxes Expense [Continued]

The provision for income tax expense consists of the following:

                                                    September 30,
                                                 1 9 9 9      1 9 9 8
                                                 -------      -------

Net Current Deferred Tax Asset [Liability]      $    127    $    (14)
Net Noncurrent Deferred Tax Asset                    324         177
                                                --------    --------
   Net Deferred Tax Asset                       $    451    $    163
                                                ========    ========

As of  September  30,  1999,  the net current  deferred tax asset is included in
other current assets in the accompanying balance sheet.

As of September 30, 1998, the net current  deferred tax liability is included in
other current liabilities in the accompanying balance sheet.

[12] Earnings Per Share

The  following  is a  reconciliation  of basic  earnings  per  share to  diluted
earnings per share for the years ended September 30, 1999, 1998 and 1997:
<TABLE>
<CAPTION>

                                                               S e p t e m b e r  30,
                                                    1 9 9 9           1 9 9 8         1 9 9 7
                                                    -------           -------         -------

<S>                                               <C>               <C>             <C>
Basic Earnings Per Common Share                   $        .44      $      .16      $       .25
                                                   ===========       =========       ==========

Weighted Average Shares Outstanding - Basic          4,517,298       5,134,122        5,131,751
Dilutive Options                                       368,401         851,197          502,055
                                                   -----------       ---------       ----------

Weighted Average Shares Outstanding - Diluted        4,885,699       5,985,319        5,633,806
                                                   ===========       =========       ==========

   Diluted Earnings Per Common Share              $        .41      $      .14      $       .23
                                                   ===========       =========       ==========
</TABLE>

[13] Retirement Plan

The Company  maintains a 401[k]  savings  plan which  covers  substantially  all
employees.  Under  the  plan,  employees  may  elect to defer up to 15% of their
salary,  subject to the Internal  Revenue  Code  limits.  The Company may make a
discretionary  match as well as a discretionary  contribution.  No discretionary
match or contribution was made, and no amount was charged to operations,  during
the years ended September 30, 1999, 1998 or 1997.

[14] Segment Information

Significant  Customers - For the year ended  September  30,  1999,  one customer
accounted for 10% of revenues  from  continuing  operations.  For the year ended
September  30,  1998,  another  customer  accounted  for  14% of  revenues  from
continuing operations.  For the year ended September 30 1997, two customers each
accounted for 11% of revenues from continuing operations.

Geographic  Information - For the years ended September 31, 1999, 1998 and 1997,
the Company derived substantially all of its revenues from businesses located in
the  United  States,  and no other  country  accounted  for more than 10% of the
Company's revenues.

                                      F-18
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[14] Segment Information [Continued]

Business Segments - The Company is provider of staffing services  organized into
two primary operating divisions: temporary staffing and consulting and executive
search  and  full-time  contingency  recruitment.  The  temporary  staffing  and
consulting  division  provides  services to companies  seeking  personnel in the
information  technology,  accounting,  human  resources  and  legal  areas.  The
executive search and full-time  contingency  recruitment  division comprises ten
lines of business,  including five industry [capital markets, publishing and new
media,  healthcare  and  fashion  services  and  banking],  and five  functional
[information technology,  accounting,  human resources, legal and administrative
support].

The Company evaluates  performance based on the segments' profit from operations
before unallocated corporate overhead. The accounting policies of the reportable
segments  are  the  same  as  those  described  in the  summary  of  significant
accounting policies [see Note 2].
<TABLE>
<CAPTION>

                                                  Temporary      Executive
                                                  Staffing and   Search and
                                                  Consulting     Full-Time         Corporate                     Total
                                                  ----------     ---------         ---------                     -----

Year ended September 30, 1999:
<S>                                             <C>            <C>               <C>              <C>
   Revenues                                     $     32,894   $     23,435      $      --        $     56,329
   Income from Operations                       $      2,424   $      2,328      $    (993)       $      3,759
   Capital Expenditures                         $        235   $        354      $     104        $        693
   Total Assets                                 $      6,401   $      7,508      $   4,439        $     18,348
   Depreciation and Amortization                $        253   $        210      $     197        $        660

Year ended September 30, 1998:
   Revenues                                     $     26,865   $     17,774      $      --        $     44,639
   Income from Operations                       $      1,206   $      1,159      $    (743)       $      1,622
   Capital Expenditures                         $        185   $        740      $     164        $      1,089
   Total Assets                                 $      6,268   $      6,643      $   3,824        $     16,735
   Depreciation and Amortization                $        209   $        162      $     145        $        516

Year ended September 30, 1997:
   Revenues                                     $     14,479   $     14,517      $      --        $     28,996
   Income from Operations                       $      1,129   $      1,085      $    (523)       $      1,691
   Capital Expenditures                         $        201   $        471      $     119        $        791
   Segment Assets                               $      5,064   $      3,980      $   3,771        $     12,815
   Depreciation and Amortization                $        122   $        113      $     102        $        337

Reconciliation to Net Income:
</TABLE>

                                                       Ye a r s  e n d e d
                                                     S e p t e m b e r  30,
                                               1 9 9 9    1 9 9 8      1 9 9 7

Segment Income from Operations             $    3,759   $   1,622    $   1,691
Unallocated Amounts:
   Interest and Dividend Income                   110         128          133
   Interest Expense                              (269)       (219)         (27)
   Realized Gain on Investments                     3           2           37
                                           ----------   ---------    ---------
   Income Before Income Tax Expense        $    3,603   $   1,533    $   1,834
                                           ==========   =========    =========

                                      F-19
<PAGE>

THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
[AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS]


[15] Fair Value of Financial Instruments

Effective  October 1, 1995, the Company adopted SFAS No. 107,  "Disclosure about
Fair Value of Financial  Instruments,"  which requires  disclosing fair value to
the  extent  practicable  for  financial  instruments  which are  recognized  or
unrecognized in the balance sheet.  The fair value of the financial  instruments
disclosed herein is not necessarily  representative  of the amount that could be
realized  or  settled,   nor  does  the  fair  value  amount  consider  the  tax
consequences  of  realization or settlement.  Carrying value  approximates  fair
value for amounts  classified  as due from  related  parties as the  receivables
carry market rates of interest. For certain instruments, including cash and cash
equivalents,  trade  receivables  and trade payables and line of credit,  it was
estimated that the carrying amount  approximates  fair value for the majority of
these instruments because of their short maturities.

[16] Quarterly Information [Unaudited]
<TABLE>
<CAPTION>

                                                   Q u a r t e r  E n d e d
                                     December 31,    March 31,   June 30,     September 30,
Fiscal 1999:
<S>                                  <C>            <C>         <C>            <C>
   Revenues                          $   11,516     $ 12,779    $  16,151      $  15,928
   Income from Operations                   342          733        1,768            926
   Net Income                               165          372          929            533
   Net Income per Share - Basic             .03          .08          .21            .12
   Net Income per Share - Diluted           .03          .08          .20            .11
</TABLE>

[17] New Authoritative Accounting Pronouncements

The  Financial   Accounting  Standards  Board  ["FASB"]  issued  SFAS  No.  137,
"Accounting  for  Derivative  Instruments  and  Hedging  Activities-Deferral  of
Effective Date of FASB  Statements  No. 133." The Statement  defers for one year
the  effective  date of FASB  Statement  No.  133,  "Accounting  for  Derivative
Instruments  and  Hedging  Activities".  The rule now will  apply to all  fiscal
quarters of all fiscal years  beginning  after June 15, 2000. In June 1998,  the
FASB issued SFAS No. 133,  "Accounting  for Derivative  Instruments  and Hedging
Activities,"  which is required to be adopted in years  beginning after June 15,
1999.  The Statement  permits  early  adoption as of the beginning of any fiscal
quarter after its issuance.  The Statement will require the Company to recognize
all  derivatives  on the balance sheet at fair value.  Derivatives  that are not
hedges must be adjusted to fair value  through  income.  If the  derivative is a
hedge,  depending  on the  nature of the  hedge,  changes  in the fair  value of
derivatives will either be offset against the change in fair value of the hedged
assets, liabilities, or firm commitments through earnings or recognized in other
comprehensive  income  until the hedged  item is  recognized  in  earnings.  The
ineffective  portion of a derivative's  change in fair value will be immediately
recognized in earnings.  The Company has not yet  determined  what the effect of
SFAS No. 133 will be on the earnings and financial position of the Company.


                                      F-20
<PAGE>
              INDEPENDENT AUDITOR'S REPORT ON SUPPLEMENTAL SCHEDULE


To the Stockholders and Board of Directors of
   The Solomon-Page Group Ltd.


         Our report on the consolidated financial statements of The Solomon-Page
Group Ltd. and  subsidiary as of September 30, 1999 and 1998 is included in this
Form 10-K. In connection with our audits of such financial  statements,  we have
also audited the related accompanying financial statement Schedule II -Valuation
and Qualifying Accounts.

         In our opinion,  the financial  statement  schedule  referred to above,
when considered in relation to the basic financial  statements taken as a whole,
presents  fairly,  in all  material  respects,  the  information  required to be
included therein.







                                             MOORE STEPHENS, P. C.
                                             Certified Public Accountants.
Cranford, New Jersey
November 16, 1999


<PAGE>
THE SOLOMON-PAGE GROUP LTD. AND SUBSIDIARY


SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
SEPTEMBER 30, 1999

<TABLE>
<CAPTION>


                                                                       Additions
                                                    Balance at    Charged     Charged to              Balance at
                                                    Beginning   to Costs and  Other                      End
Description                                         of Period    Expenses     Accounts    Deductions  of Period
-----------                                         ---------    --------     --------    ----------  ---------

<S>                                                 <C>         <C>         <C>           <C>    <C>  <C>
Year Ended September 30, 1999:
   Deducted from Assets Accounts:
   Allowance for Doubtful Accounts                  $   25      $  257      $     --      $  222[1]   $   60
   Receivable Allowances                               175          --         1,178       1,133[2]      220
                                                    ------      ------      --------      ------      ------
                                                    $  200      $  257      $  1,178      $1,355      $  280
                                                    ======      ======      ========      ======      ======
Year Ended September 30, 1998:
   Deducted from Assets Accounts:
   Allowance for Doubtful Accounts                  $   25      $   97      $     --      $   97[1]   $   25
   Receivable Allowances                               100          --           753         678[2]      175
                                                    ------      ------      --------      ------      ------
                                                    $  125      $   97      $    753      $  775      $  200
                                                    ======      ======      ========      ======      ======
Year Ended September 30, 1997:
   Deducted from Assets Accounts:
   Allowance for Doubtful Accounts                  $   --      $   25      $     --      $   --      $   25
   Receivable Allowances                                90          --           590         580[2]      100
                                                    ------      ------      --------      ------      ------
                                                    $   90      $   25      $    590      $  580      $  125
                                                    ======      ======      ========      ======      ======
</TABLE>

[1] Uncollectible accounts written-off.
[2] Charges to revenue in connection  with  candidates not  satisfying  terms of
search contract.