SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM 10-Q

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

                  For the quarterly period ended March 31, 1999
                           Commission File No. 0-20943

                               Intelligroup, Inc.
             ------------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)

           New Jersey                                  11-2880025
----------------------------------          ------------------------------------
 (State or Other Jurisdiction of            (I.R.S. Employer Identification No.)
  Incorporation or Organization)

499 Thornall Street, Edison, New Jersey                       08837
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                   (Zip Code)

                                 (732) 590-1600
                         -------------------------------
                           (Issuer's Telephone Number,
                              Including Area Code)

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

                   Yes:     X                     No:
                         ----                        ----

     Indicate  the  number of  shares  outstanding  of each of the  Registrant's
classes of common  stock,  as of April 30, 1999:  

          Class                                Number of Shares
          -----                                ----------------

Common Stock, $.01 par value                      15,558,751



<PAGE>
                       INTELLIGROUP, INC. AND SUBSIDIARIES

                                TABLE OF CONTENTS
                                -----------------

                                                                          Page
PART I.  FINANCIAL INFORMATION
        Item 1.  Consolidated Financial Statements.....................     1

                 Consolidated Balance Sheets
                 as of March 31, 1999 (unaudited)
                 and December 31, 1998 (unaudited).....................     2

                 Consolidated Statements of Income and Comprehensive
                 Income (Loss) for the Three Months Ended March 31,
                 1999 and 1998 (unaudited).............................     3

                 Consolidated Statements of Cash Flows
                 for the Three Months Ended
                 March 31, 1999 and 1998 (unaudited)...................     4

                 Notes to Consolidated Financial Statements
                 (unaudited)...........................................     5

        Item 2.  Management's Discussion and Analysis of
                 Financial Condition and Results of Operations.........     7

PART II.  OTHER INFORMAATION

        Item 1.  Legal Proceedings.....................................    15

        Item 2.  Changes in Securities and Use of Proceeds.............    16

        Item 5.  Other Information.....................................    17

        Item 6.  Exhibits and Reports on Form 8-K......................    19

SIGNATURES.............................................................    20






                                      - i -
<PAGE>


                          PART I. FINANCIAL INFORMATION

                    Item 1. Consolidated Financial Statements



                                      - 1 -
<PAGE>

                       INTELLIGROUP, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                      MARCH 31, 1999 AND DECEMBER 31, 1998
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                        March 31,       December 31,
                                                                          1999              1998
                                                                        --------        ------------
                          ASSETS
<S>                                                                    <C>               <C>        
Current Assets:
    Cash and cash equivalents........................................  $ 3,923,000       $ 4,245,000
    Accounts receivable, less allowance for doubtful accounts
       of $1,060,000 at March 31, 1999 and $1,053,000 at
       December 31, 1998.............................................   36,169,000        33,622,000
    Unbilled services................................................   14,385,000        10,842,000
    Deferred income taxes............................................      823,000           808,000
    Other current assets.............................................    4,429,000         4,197,000
                                                                       -----------       -----------
           Total current assets......................................   59,729,000        53,714,000

Property and equipment, net .........................................   10,270,000         9,506,000
Costs in excess of fair value of net assets acquired, net............    7,130,000         5,629,000
Other assets.........................................................      844,000           716,000
                                                                       -----------       -----------
                                                                       $77,973,000       $69,565,000
                                                                       ===========       ===========
           LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
    Accounts payable.................................................  $ 4,694,000       $ 5,347,000
    Accrued payroll and related taxes................................    6,620,000         6,254,000
    Accrued expenses and other liabilities...........................    6,860,000         2,999,000
    Accrued acquisition costs........................................    1,014,000         3,302,000
    Income taxes payable.............................................    2,575,000         3,160,000
    Line of credit...................................................    7,300,000                --
    Current portion of long-term debt and obligations under
       capital leases................................................      131,000            11,000
                                                                       -----------       -----------
           Total current liabilities.................................   29,194,000        21,073,000
                                                                       -----------       -----------

Long-term debt and obligations under capital leases, less
 current portion.....................................................      708,000            60,000
                                                                       -----------       -----------

Deferred income taxes ...............................................      533,000           483,000
                                                                       -----------       -----------

Commitments and contingencies

Shareholders' Equity
    Preferred stock, $.01 par value, 5,000,000 shares authorized,
        none issued or outstanding...................................           --                --
    Common stock, $.01 par value,  25,000,000 shares authorized;
        15,559,000 and 13,572,000 shares issued and outstanding
        at March 31, 1999 and December 31, 1998, respectively........      154,000           154,000
    Additional paid-in capital.......................................   35,272,000        35,263,000
    Retained earnings ...............................................   12,986,000        13,077,000
    Currency translation adjustment..................................     (874,000)         (545,000)
                                                                       -----------       -----------
           Total shareholders' equity ...............................   47,538,000        47,949,000
                                                                       -----------       -----------
                                                                       $77,973,000       $69,565,000
                                                                       ===========       ===========
</TABLE>

           The accompanying notes to consolidated financial statements
                  are an integral part of these balance sheets.

                                            - 2 -
<PAGE>
                             INTELLIGROUP, INC. AND SUBSIDIARIES

              CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE  INCOME (LOSS)
                      For the Three Months Ended March 31, 1999 and 1998
                                         (unaudited)

<TABLE>
<CAPTION>
                                                              Three Months Ended March 31,
                                                              ----------------------------
                                                                  1999            1998
                                                              ------------   ------------
<S>                                                            <C>            <C>        
Revenue..................................................      $46,795,000    $33,633,000
Cost of sales............................................       31,175,000     21,173,000
                                                               -----------    -----------
       Gross profit......................................       15,620,000     12,460,000
                                                               -----------    -----------

Selling, general and administrative expenses.............       12,931,000      7,977,000
Acquisition expenses.....................................        2,115,000             --
                                                               -----------    -----------
    Total selling, general and administrative expenses...       15,046,000      7,977,000
                                                               -----------    -----------

    Operating income.....................................          574,000      4,483,000
Other income (expense), net..............................          (61,000)         1,000
Interest income (expense), net...........................          (60,000)        66,000
                                                               -----------    -----------

Income before provision for income taxes.................          453,000      4,550,000

Provision for income taxes...............................          544,000        804,000
                                                               -----------    -----------

Net (loss) income........................................      $   (91,000)   $ 3,746,000
                                                               ===========    ===========

Earnings per share:
    Basic earnings per share:
        Net (loss) income per share......................      $     (0.01)   $      0.25
                                                               ===========    ===========

        Weighted average number of common shares - Basic.       15,548,000     15,247,000
                                                               ===========    ===========

    Diluted earnings per share:
        Net (loss) income per share......................      $     (0.01)   $      0.24
                                                               ===========    ===========

        Weighted average number of common shares -
         Diluted.........................................       15,548,000     15,669,000
                                                               ===========    ===========


Comprehensive Income (Loss)
---------------------------

Net income (loss)........................................      $   (91,000)   $ 3,746,000

Other comprehensive income -
         Currency translation adjustments................         (329,000)      (251,000)
                                                               -----------    -----------

Comprehensive income (loss)..............................      $  (420,000)   $ 3,495,000
                                                               ===========    ===========
</TABLE>

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

                                      - 3 -
<PAGE>
                       INTELLIGROUP, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
               For the Three Months Ended March 31, 1999 and 1998
                                   (unaudited)
<TABLE>
<CAPTION>
                                                                          March 31,         March 31,
                                                                            1999              1998
                                                                        -----------      -------------
<S>                                                                     <C>              <C>         
Cash flows from operating activities:
    Net income ....................................................     $  (91,000)      $  3,746,000
    Adjustments to reconcile net income to net cash used in
        operating activities:
        Depreciation and amortization..............................        773,000            195,000
        Provision for doubtful accounts............................        344,000            250,000
        Deferred income taxes......................................        (15,000)                --
    Changes in assets and liabilities:
        Accounts receivable........................................     (1,980,000)        (4,693,000)
        Unbilled services..........................................     (3,543,000)        (1,502,000)
        Other current assets.......................................       (175,000)          (500,000)
        Other assets...............................................       (128,000)          (863,000)
        Accounts payable...........................................       (658,000)         1,009,000
        Accrued payroll and related taxes..........................        293,000            324,000
        Accrued expenses and other liabilities.....................      1,175,000             69,000
        Income taxes payable.......................................       (773,000)          (302,000)
                                                                        ----------       ------------
            Net cash used in operating activities..................     (4,778,000)        (2,267,000)
                                                                        ----------       ------------

Cash flows from investing activities:
    Purchase of equipment..........................................       (791,000)        (2,081,000)
    Acquisition of businesses......................................     (1,682,000)                --
                                                                        ----------       ------------
            Net cash used in investing activities..................     (2,473,000)        (2,081,000)
Cash flows from financing activities:
    Proceeds from the exercise of stock options....................          9,000            302,000
    Proceeds from line of credit borrowings, net...................      7,300,000                 --
    Principal payments under capital leases........................         (3,000)                --
    Repayments of other loans......................................        (48,000)          (307,000)
                                                                        ----------       ------------
            Net cash provided by (used in) financing activities....      7,258,000             (5,000)
                                                                        ----------       ------------

    Effect of foreign currency exchange rate changes on cash.......       (329,000)          (251,000)
                                                                        ----------       ------------
            Net decrease in cash and cash equivalents .............       (322,000)        (4,604,000)
                                                                        ----------       ------------
Cash and cash equivalents at beginning of period...................      4,245,000          8,825,000
                                                                        ----------       ------------
Cash and cash equivalents at end of period.........................     $3,923,000       $  4,221,000
                                                                        ==========       ============

Supplemental disclosures of cash flow information:
        Cash paid for income taxes.................................     $  650,000       $    933,000
                                                                        ==========       ============
        Cash paid for interest.....................................     $   88,000       $         --
                                                                        ==========       ============
</TABLE>



                The accompanying notes to consolidated financial
              statements are an integral part of these statements.
                                      - 4 -
<PAGE>
                       INTELLIGROUP, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)


(1) BASIS OF PRESENTATION

     The   consolidated   financial   statements  and   accompanying   financial
information  as of March 31, 1999 and for the three  months ended March 31, 1999
and  1998  are  unaudited  and,  in  the  opinion  of  management,  include  all
adjustments  (consisting only of normal recurring adjustments) which the Company
considers  necessary for a fair  presentation  of the financial  position of the
Company  at such  dates  and the  operating  results  and cash  flows  for those
periods.  The  financial  statements  included  herein  have  been  prepared  in
accordance with generally accepted accounting principles and the instructions of
Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and
footnote  disclosures  normally  included in  financial  statements  prepared in
accordance with generally accepted accounting  principles have been condensed or
omitted.  These  financial  statements  should be read in  conjunction  with the
Company's  audited  financial  statements  for the year ended December 31, 1998,
which were included as part of the Company's Form 10-K.

     The Company's 1998 Financial  Statements  have been restated to include the
results of the acquisitions of each of (i) CPI Resources  Limited;  (ii) Azimuth
Consulting Limited,  Azimuth Holdings Limited,  Braithwaite Richmond Limited and
Azimuth Corporation Limited; and (iii) Empower Solutions,  LLC and its affiliate
Empower,  Inc. (the "Empower Companies") in accordance with pooling of interests
accounting.

     Results for interim periods are not  necessarily  indicative of results for
the entire year.

(2) EARNINGS PER SHARE

     Basic earnings per share is computed by dividing income available to common
shareholders by the weighted average number of common stock  outstanding for the
period.  Diluted  earnings per share reflects the potential  dilution that could
occur if securities or other  contracts to issue common stock were  exercised or
converted into common stock, unless they are antidilutive.



                                      - 5 -
<PAGE>

     A reconciliation of weighted average number of common shares outstanding to
weighted average common shares outstanding assuming dilution is as follows as of
March 31:


                                                   1999          1998
                                                   ----          ----
Weighted average number of common
shares                                         15,548,000     15,247,000

Common share equivalents of outstanding
stock options                                          --        422,000
                                               ----------     ----------
Weighted average number of common
shares assuming dilution                       15,548,000     15,669,000
                                               ==========     ==========


     All stock options  outstanding  as of March 31, 1999 were excluded from the
computation  of net loss per common  share,  as they are  antidilutive.  Certain
stock  options   outstanding  at  March  31,  1998  were  not  included  in  the
computations  of earnings  per share  assuming  dilution  because  the  options'
exercise  prices were greater than the average  trading  price of the  Company's
common shares.

(3) ACQUISITIONS

     On January 8, 1999, the Company  consummated  the acquisition of all of the
shares of outstanding capital stock of Network Publishing,  Inc. The acquisition
was accounted for utilizing purchase accounting.  The purchase price included an
initial cash payment in the aggregate of $1,800,000 together with a cash payment
of $200,000 to be held in escrow,  and resulted in costs in excess of fair value
of net assets acquired of $1.6 million. In addition, the purchase price includes
an earn-out  payment of up to $2,212,650  in restricted  shares of the Company's
Common Stock,  payable on or before April 15, 2000 and a potential lump sum cash
payment of $354,024,  payable no later than March 31, 2000.  Pro-forma financial
information has not been presented as this acquisition was deemed  immaterial to
the Company's operations as a whole.

     On  February  16,  1999,  the  Company,  by  way  of  merger  transactions,
consummated  the  acquisition  of  the  Empower  Companies.  Such  mergers  were
accounted for as a pooling of  interests.  The purchase  price  consisted of the
issuance of an aggregate of 1,831,091  restricted shares of the Company's Common
Stock. The Company may be required to issue additional  shares of its restricted
Common Stock which may be issued in connection with the net worth  adjustment as
of the  closing  date.  The  pre-merger  results of the Empower  Companies  were
revenues  of $7.7  million and net income of $1.8  million for the three  months
ended March 31, 1999 and revenues of $3.0 million and net income of $1.8 million
for the three  months  ended March 31,  1998.  In  connection  with this merger,
acquisition  expenses of $2.1 million  were  expensed  during 1999.  These costs
primarily relate to professional fees incurred in connection with the merger.


                                     - 6 -
<PAGE>
ITEM 2.        MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL  CONDITION AND
               RESULTS OF OPERATIONS.

OVERVIEW

     The  Company  provides a wide  range of  information  technology  services,
including  management  consulting,  enterprise-wide  business process solutions,
Internet applications services,  applications  outsourcing and maintenance,  web
site design and customization,  IT training  solutions,  systems integration and
custom software development based on leading technologies. The Company has grown
rapidly  since 1994 when it made a strategic  decision to diversify its customer
base by expanding the scope of its integration  and development  services and to
utilize software developed by SAP as a primary tool to implement enterprise-wide
business  process  solutions.  In 1995, the Company achieved the status of a SAP
National  Implementation  Partner.  In the same year,  the Company also began to
utilize Oracle's ERP application products to diversify its service offerings. In
1997,  the  Company  enhanced  its partner  status with SAP, by first  achieving
National Logo Partner status and then  AcceleratedSAP  Partner Status.  Also, in
1997,  the Company  further  diversified  its ERP-based  service  offerings,  by
beginning to provide PeopleSoft and Baan implementation  services. In July 1997,
the  Company  was  awarded  PeopleSoft  implementation  partnership  status.  In
September   1997,  the  Company  was  awarded  Baan   international   consulting
partnership  status.  In  June  1998,  the  Company  also  expanded  its  Oracle
applications implementation services practice and added upgrade services to meet
market demand of mid-size to large companies that are  implementing or upgrading
Oracle applications.

     During the first  quarter of 1999,  the  Company  expanded  its  operations
through   acquisitions.   On  January  8,   1999,   in  order  to  augment   the
Internet/Advanced  Technology  Practice,  the Company  acquired the  outstanding
capital stock of Network  Publishing,  Inc. ("NPI") located in Provo,  Utah. The
purchase  price  included an initial cash payment in the aggregate of $1,800,000
together with a cash payment of $200,000 to be held in escrow. In addition,  the
purchase  price  included an earn-out  payment of up to $2,212,650 in restricted
shares of the  Company's  Common Stock payable on or before April 15, 2000 and a
potential  lump sum cash  payment  of  $354,024  payable no later than March 31,
2000. This  acquisition has been accounted for in 1999 under the purchase method
of accounting.  NPI provides web site design and front-end application solutions
services. NPI has built a strong track record in designing web-sites that enable
clients to achieve the desired sales and marketing impact.

     In  addition,  by way of merger  transactions,  the Company  augmented  its
PeopleSoft practice in North America by acquiring the Empower Solutions,  L.L.C.
and its affiliate Empower,  Inc. (the "Empower  Companies") located in Plymouth,
Michigan on February 16, 1999. The purchase  price  consisted of the issuance of
an aggregate of 1,831,091  restricted  shares of the Company's Common Stock. The
Company may be  required to issue  additional  shares of its  restricted  Common
Stock which may be issued in connection with a net worth  adjustment  determined
as of the closing date. The amount of such adjustment is in the process of being
finalized by the parties.  The  acquisition has been accounted for as pooling of
interests and thus prior  financial  statements have been revised to reflect the
activities  of such  companies  for all  periods in  accordance  with  generally
accepted accounting  principles.  The Empower Companies provide business process
reengineering,  system design and development,  project  management and training
services.

                                     - 7 -
<PAGE>

     The  Company  generates  revenue  from  professional  services  rendered to
customers.  Revenue is  recognized  as services  are  performed.  The  Company's
services   range  from  providing   customers   with  a  single   consultant  to
multi-personnel  full-scale projects. The Company provides these services to its
customers  primarily  on a time and  materials  basis and  pursuant  to  written
contracts which can be terminated  with limited  advance  notice,  typically not
more than 30 days, and without  significant  penalty,  generally limited to fees
earned and expenses incurred by the Company through the date of termination. The
Company provides its services directly to end-user  organizations or as a member
of a consulting team assembled by another information technology consulting firm
to Fortune 1000 and other large and mid-sized  companies.  The Company generally
bills its customers semi-monthly for the services provided by its consultants at
contracted rates. Where contractual provisions permit, customers also are billed
for reimbursement of expenses incurred by the Company on the customers' behalf.

     The Company has provided  services on certain  projects in which it, at the
request of the  clients,  offered a fixed price for its  services.  For the year
ended  December  31, 1998,  revenues  derived  from  projects  under fixed price
contracts represented approximately 4% of the Company's total revenue. No single
fixed price project was material to the Company's business during 1998. However,
one  fixed  price  project,  which  began  late in 1998  and is  expected  to be
completed in early 2000,  represented  5% of the Company's  total revenue during
the quarter  ended March 31,  1999.  Fixed price  contracts,  in the  aggregate,
represented 14% of the Company's total revenue during such quarter.  The Company
believes that, as it pursues its strategy of making turnkey project management a
larger portion of its business,  it will continue to offer fixed price projects.
The Company has had limited  prior  experience in pricing and  performing  under
fixed price  arrangements  and  believes  that there are certain  risks  related
thereto and thus prices such  arrangements to reflect the associated risk. There
can be no  assurance  that the Company  will be able to complete  such  projects
within the fixed  price  timeframes.  The  failure to perform  within such fixed
price  contracts,  if entered into,  could have a material adverse effect on the
Company's business.

     The  Company has derived  and  believes  that it will  continue to derive a
significant  portion  of its  revenue  from a limited  number of  customers  and
projects.  For the three months ended March 31, 1999 and the year ended December
31, 1998,  the  Company's ten largest  customers  accounted for in the aggregate
approximately  37% and 38% of its  revenue,  respectively.  For the  year  ended
December 31, 1998, no customer  accounted for more than 10% of revenue.  For the
three months ended March 31, 1999, one customer,  Puerto Rico  Department of the
Treasury,  accounted for 11% of revenue. During the three months ended March 31,
1999 and the year ended December 31, 1998, 17% and 19% of the Company's revenue,
respectively, was generated by serving as a member of consulting teams assembled
by other information technology consulting firms. There can be no assurance that
such information technology consulting firms will continue to engage the Company
in the future at current levels of retention, if at all. During the three months
ended March 31, 1999 and the year ended December 31, 1998, approximately 46% and
52%,  respectively,  of the Company's total revenue was derived from projects in
which the Company implemented software developed by SAP. During the three months
ended March 31, 1999 and the year ended December 31, 1998,  approximately 8% and
11% was  derived  from  projects  in  which  the  Company  implemented  software
developed  by Oracle.  During the three months ended March 31, 1999 and the year
ended  December 31, 1998,  26% and 19%,  respectively,  of the  Company's  total
revenue was derived  from  projects  in which the Company

                                     - 8 -
<PAGE>

implemented  software  developed  by  PeopleSoft.  During the three months ended
March 31,  1999,  approximately  62% of the  Company's  revenue was derived from
engagements  in which  the  Company  had  project  management  responsibilities,
compared to 58% during the year ended December 31, 1998.

     The Company's most significant cost is project personnel expenses, which
consist of consultant salaries, benefits and payroll-related expenses. Thus, the
Company's financial performance is based primarily upon billing margin (billable
hourly rate less the cost to the Company of a consultant on an hourly basis) and
personnel  utilization rates (billable hours divided by paid hours). The Company
believes that turnkey  project  management  assignments  typically  carry higher
margins. The Company has been shifting to such higher-margin  turnkey management
assignments  and more complex  projects by leveraging its  reputation,  existing
capabilities,  proprietary  implementation  methodology,  development  tools and
offshore development  capabilities with expanded sales and marketing efforts and
new service offerings to develop turnkey project sales  opportunities  with both
new and existing  customers.  The  Company's  inability to continue its shift to
higher-margin  turnkey  management  assignments  and more  complex  projects may
adversely impact the Company's future growth.

     Since  late 1994,  the  Company  has made  substantial  investments  in its
infrastructure in order to support its rapid growth.  For example,  in 1994, the
Company  established  and funded an  operations  facility in India,  the Advance
Development  Center  (the  "ADC"),  and in 1995  established  a sales  office in
California. In addition, from 1994 to date, the Company has incurred expenses to
develop   proprietary   development   tools  and  its  proprietary   accelerated
implementation  methodology  and toolset.  Since 1995, the Company has also been
increasing  its  sales  force  and  its  marketing,   finance,   accounting  and
administrative  staff,  in order to manage its  growth.  The  Company  currently
maintains its headquarters in Edison, New Jersey, and branch offices in Chicago,
Detroit,  Foster City  (California),  Reston  (Virginia),  Edison (New  Jersey),
Dallas,  Atlanta,  Phoenix  and  Washington,  D.C.  The Company  also  currently
maintains offices in Europe (the United Kingdom, Denmark, and Belgium), and Asia
Pacific (Australia,  India, New Zealand,  the Philippines,  and Singapore).  The
Company leases its headquarters in Edison,  New Jersey,  totaling  approximately
48,475  square  feet.  Such lease has an initial  term of ten (10) years,  which
commenced in September 1998.

     This Form 10-Q contains  forward-looking  statements  within the meaning of
Section 21E of the  Securities  Exchange  Act of 1934,  as  amended,  including,
without  limitation,  statements  regarding the Company's  intention to shift to
higher margin turnkey  management  assignments and more complex  projects and to
utilize its proprietary  implementation  methodology in an increasing  number of
projects.  In addition,  statements regarding the Company's intent to expand its
service   offerings   through   internal  growth  and   acquisitions   are  also
forward-looking  statements.  Such forward-looking  statements include risks and
uncertainties, including, but not limited to:

     o    the  substantial  variability  of the  Company's  quarterly  operating
          results  caused by a variety of factors,  many of which are not within
          the Company's control, including (a) patterns of software and hardware
          capital spending by customers,  (b) information technology outsourcing
          trends,  (c) the timing,  size and stage of  projects,  (d) timing and
          impact of acquisitions,  (e) new service  introductions by the Company
          or its competitors and the timing of new product  introductions by the
          Company's ERP partners, (f) levels of market

                                     - 9 -
<PAGE>

          acceptance   for  the  Company's   services,   (g)  general   economic
          conditions,  (h) the hiring of  additional  staff and (i) fixed  price
          contracts;

     o    changes in the Company's billing and employee utilization rates;

     o    the  Company's  ability to manage its growth  effectively,  which will
          require  the  Company (a) to continue  developing  and  improving  its
          operational,  financial  and other  internal  systems,  as well as its
          business  development  capabilities,  (b) to attract,  train,  retain,
          motivate and manage its  employees,  (c) to continue to maintain  high
          rates of employee  utilization  at profitable  billing  rates,  (d) to
          successfully  integrate the personnel and  businesses  acquired by the
          Company, and (e) to maintain project quality, particularly if the size
          and scope of the Company's projects increase;

     o    the  Company's  ability to  maintain  an  effective  internal  control
          structure;

     o    the Company's  limited  operating  history  within its current line of
          business;

     o    the Company's  reliance on a continued  relationship  with SAP America
          and the Company's present status as a SAP National Logo Partner;

     o    the  Company's   substantial  reliance  on  key  customers  and  large
          projects;

     o    the  highly  competitive  nature  of the  markets  for  the  Company's
          services;

     o    the Company's ability to successfully  address the continuing  changes
          in information  technology,  evolving industry  standards and changing
          customer objectives and preferences;

     o    the Company's  reliance on the continued services of its key executive
          officers and leading technical personnel;

     o    the  Company's  ability to attract and retain a  sufficient  number of
          highly skilled employees in the future;

     o    the  Company's   ability  to  continue  to  diversify  its  offerings,
          including growth in its Oracle, Baan and PeopleSoft services;

     o    uncertainties  resulting  from  pending  litigation  matters  and from
          potential  administrative  and  regulatory  immigration  and  tax  law
          matters;

     o    the Company's ability to protect its intellectual property rights; and

     o    Year  2000  compliance  of  vendors'   products  and  related  issues,
          including impact of the Year 2000 problem on customer buying patterns.

     As a result of these factors and others,  the Company's  actual results may
differ materially from the results disclosed in such forward-looking statements.



                                     - 10 -
<PAGE>

RESULTS OF OPERATIONS

     The following table sets forth for the periods  indicated certain financial
data as a percentage of revenue:

                                                 PERCENTAGE OF REVENUE
                                             -----------------------------
                                                  THREE MONTHS ENDED
                                                       MARCH 31,
                                             -----------------------------
                                                  1999          1998
                                                  ----          ----
Revenue....................................       100.0%        100.0%
Cost of sales..............................        66.6          63.0
                                                  -----         -----
   Gross profit............................        33.4          37.0
Selling, general and administrative
  expenses.................................        27.6          23.7
Acquisition expenses.......................         4.5            --
                                                  -----         -----
   Operating income........................         1.3          13.3
Other income (expense).....................        (0.3)          0.2
                                                 ------        ------
Income before provision for income taxes..          1.0          13.5
Provision for income taxes.................         1.2           2.4
                                                  -----         -----
Net (loss) income..........................        (0.2)%        11.1%
                                                  =====         =====

                  THREE MONTHS ENDED MARCH 31, 1999 COMPARED TO
                        THREE MONTHS ENDED MARCH 31, 1998

     Revenue.  Revenue increased by 39.1%, or $13.2 million,  from $33.6 million
during the three months ended March 31, 1998, to $46.8 million  during the three
months  ended  March 31,  1999.  This  increase  is  attributable  primarily  to
increased demand for the Company's  implementation services as compared with the
same period in the prior  year.  Revenue  for the three  months  ended March 31,
1999,  included a fixed price project which  accounted for  approximately  5% of
revenue, as well as revenues from the NPI acquisition completed in January 1999.

     Gross profit.  The Company's cost of sales  includes  primarily the cost of
salaries to consultants  and related  employee  benefits and payroll taxes.  The
Company's cost of sales increased by 47.2%, or $10.0 million, from $21.2 million
during the three months ended March 31, 1998 to $31.2  million  during the three
months ended March 31, 1999. The increase was due to increased  personnel  costs
resulting from the hiring of additional  consultants  during 1998 to support the
increase  in demand for the  Company's  services.  The  Company's  gross  profit
increased by 25.4%, or $3.2 million,  from $12.5 million during the three months
ended March 31, 1998 to $15.6  million  during the three  months ended March 31,
1999.  Gross  profit  margin  decreased  from 37.0% of revenue  during the three
months  ended March 31, 1998 to 33.4% of revenue  during the three  months ended
March 31, 1999. While revenue from  implementation  services  increased from the
same period in 1998, the Company  experienced a decline in its consultant  staff
utilization  during the first  quarter of 1999,  a result of changing ERP market
dynamics.  As a consequence,  gross margins were adversely  affected  during the
current period.

     Selling,   general  and  administrative   expenses  Selling,   general  and
administrative  expenses  consist  primarily  of  administrative  salaries,  and
related benefits costs,  occupancy costs, sales person compensation,  travel and
entertainment,  costs associated with the ADC and related

                                     - 11 -
<PAGE>

development costs and professional  fees.  Selling,  general and  administrative
expenses increased by 62.1%, or $5.0 million, from $8.0 million during the three
months ended March 31, 1998 to $12.9 million during the three months ended March
31,  1999,  and  increased  as a  percentage  of  revenue  from  23.7% to 27.6%,
respectively.  The  increases  in such  expenses  in  absolute  dollars and as a
percentage of revenue were due primarily to the increase in salaries and related
benefits,  reflecting  headcount  increases in the Company's sales force and its
marketing,  finance, accounting and administrative staff, in order to manage its
growth. The Company's occupancy costs increased as a result of the relocation of
our  corporate  headquarters  into  approximately  48,000  square feet of office
space,  from our former location which consisted of approximately  17,000 square
feet. In addition,  the Company  experienced  increases in sales and  management
recruiting  costs,  occupancy  costs as  additional  offices  were opened in the
United States, support services and the provision for doubtful accounts.

     Acquisition expense. During the first quarter of 1999, the Company incurred
costs  of $2.1  million  in  connection  with  the  acquisition  of the  Empower
Companies.

     Interest  income  (expense).  Interest  income has been  earned on interest
bearing cash accounts and short-term investments.  In accordance with investment
guidelines approved by the Company's Board of Directors, cash balances in excess
of those  required to fund  operations  have been  invested in  short-term  U.S.
Treasury  securities  and  commercial  paper with a credit  rating no lower than
A1/P1. The Company incurred $110,000 in interest expense during the three months
ended March 31, 1999,  primarily related to borrowings under its line of credit.
Borrowings under the line of credit were used to fund operating  activities,  to
purchase  NPI, and  purchases of computer  equipment  and office  furniture  and
fixtures.

     Provision for income taxes.  The Company's  effective tax rate was 120% and
18% for the three  months  ended  March 31,  1999 and  1998,  respectively.  The
effective  tax rate  for the  three  months  ended  March  31,  1999,  increased
significantly  as a  result  of  the  non-deductibility  of  acquisition-related
expenses.   Additionally,  prior  to  acquisition  the  Empower  Companies  were
pass-through  entities for income tax reporting purposes,  thus their income was
not taxed at the corporate level.  Accordingly,  the Company's federal statutory
tax rate was  decreased  by 12% for the  three  months  ended  March  31,  1998.
Further,  in 1996,  the  Company  elected a five year tax  holiday in India,  in
accordance with a local tax incentive  program whereby no income tax will be due
in such  period.  For the three  months  ended March 31,  1999,  the tax holiday
favorably impacted the Company's  effective tax rate by approximately 49%, while
the effect in the three months ended March 31, 1998 was 6%.

BACKLOG

     The Company  normally  enters into written  contracts with its customers at
the time it commences work on a project. These written contracts contain varying
terms  and  conditions  and  the  Company  does  not  generally  believe  it  is
appropriate  to  characterize  such written  contracts as creating  backlog.  In
addition, because these written contracts often provide that the arrangement can
be terminated with limited advance notice and without significant  penalty,  the
Company does not believe that projects in process at any one time are a reliable
indicator or measure of expected  future  revenue.  In the event that a customer
terminates  a project,  the  customer  remains  obligated to pay the Company for
services performed by it through the date of termination.


                                     - 12 -
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

     The  Company  had cash and cash  equivalents  of $3.9  million at March 31,
1999, and $4.2 million at December 31, 1998. The Company had working  capital of
$30.5 million at March 31, 1999 and $32.6 million at December 31, 1998.

     Cash used in operating  activities was $4.8 million during the three months
ended March 31, 1999,  resulting  primarily from the net loss of $91,000 for the
three months  ended March 31, 1999,  and an increase of $5.5 million in accounts
receivable and unbilled services, a decrease in income taxes payable of $773,000
partially offset by an increase of $810,000 in accounts payable, accrued payroll
and other expenses, and depreciation and amortization expense of $773,000.  Cash
used in operating  activities for the three months ended March 31, 1998 was $2.3
million.

     The  Company  invested  $791,000  million  and  $2.1  million  in  computer
equipment and office  furniture and fixtures during the three months ended March
31, 1999 and 1998,  respectively.  The increase  reflects  both the purchases of
computer and  telecommunication  equipment for  consultants  and  administrative
staff, and office furniture and fixtures.

     From January 1997 until  January  1999,  the Company had a credit  facility
with a bank,  which  included a  revolving  line of credit and a  component  for
equipment  term  loans.  As of the  date  on  which  such  credit  facility  was
terminated, there were no amounts outstanding under the revolving line of credit
and no equipment term loans outstanding.

     On January 29, 1999, the Company  entered into an unsecured  three-year $30
million  Revolving  Credit Loan Agreement (the "Loan  Agreement") with PNC Bank,
N.A.  (the  "Bank").  The  proceeds  of the credit  facility  may be used by the
Company for  financing  acquisitions  and  general  corporate  purposes.  At the
Company's option, for each loan, interest shall be computed either at the Bank's
prime rate per annum or the Adjusted Libo Rate plus the  Applicable  Margin,  as
such terms are defined in the Loan Agreement.  The Company's  obligations  under
the credit  agreement are payable at the  expiration of such facility on January
29, 2002.  Approximately $7.3 million was outstanding under this credit facility
at March 31, 1999.

        The Company  believes  that its available  funds,  together with current
credit arrangements and the cash flows expected to be generated from operations,
will be adequate to satisfy its current and planned  operations through at least
the next twelve months.

YEAR 2000 COMPLIANCE

     Historically,  certain computer programs have been written using two digits
rather  than four to define  the  applicable  year,  which  could  result in the
computer  recognizing a date using "00" as the year 1900 rather than 2000.  This
in turn,  could  result in major  system  failures  or  miscalculations,  and is
generally  referred to as the "Year 2000 Problem".  The Company believes that it
has  sufficiently  assessed its state of readiness with respect to its Year 2000
compliance. Based on its assessment, the Company does not believe that Year 2000
compliance  will result in material  investments  by the  Company,  nor does the
Company  anticipate  that the Year 2000 Problem will have any adverse effects on
the business  operations or financial  performance  of the Company.  The Company
does not believe that it has any material exposure to the Year 2000 Problem with
respect  to  its  own   information   systems  and  believes  that  all  of  its
business-critical

                                     - 13 -
<PAGE>

systems  correctly  define the Year 2000 and  subsequent  years.  Based upon its
assessment, theCompany has established no reserve nor instituted any contingency
plans. There can be no assurance,  however,  that the Year 2000 problem will not
adversely  affect  the  Company's   business  operating  results  and  financial
condition.

     However,  the purchasing  patterns of customers and potential customers may
be affected by issues associated with the Year 2000 Problem. As companies expend
significant  resources to correct  their current data storage  solutions,  these
expenditures  may result in reduced  funds to  purchase  products  or  undertake
projects  such as those offered by the Company.  There can be no assurance  that
the Year 2000 Problem, as it relates to customers, potential customers and other
third-parties,  will not  adversely  affect the  Company's  business,  operating
results and  financial  condition.  Conversely,  the Year 2000 Problem may cause
other  companies  to  accelerate  purchases,  thereby  causing  an  increase  in
short-term  demand  and a  consequent  decrease  in  long-term  demand  for  the
Company's products.

EUROPEAN MONETARY UNION (EMU)

     The euro was  introduced  on  January  1,  1999,  at which  time the eleven
participating  EMU member countries  established  fixed conversion rates between
their  existing   currencies  (legacy  currencies)  and  the  euro.  The  legacy
currencies  will  continue to be used as legal tender  through  January 1, 2002;
thereafter, the legacy currencies will be canceled and euro bills and coins will
be used for cash  transactions  in the  participating  countries.  The Company's
European  sales and  operations  offices  affected by the euro  conversion  have
established  plans to address the  systems  issues  raised by the euro  currency
conversion  and  are  cognizant  of  the  potential  business   implications  of
converting to a common currency. The Company is unable to determine the ultimate
financial  impact of the  conversion on its  operations,  if any, given that the
impact will be  dependent  upon the  competitive  situations  which exist in the
various  regional  markets in which the Company  participates  and the potential
actions  which  may or may  not  be  taken  by  the  Company's  competitors  and
suppliers.



                                     - 14 -
<PAGE>

PART II.       OTHER INFORMATION

ITEM 1.        LEGAL PROCEEDINGS.

     On February 16, 1996, the Company,  as plaintiff,  filed a complaint in the
Superior Court of New Jersey,  Chancery  Division,  Middlesex County,  against a
former  consultant  to the Company,  seven  former  employees of the Company and
Pegasus Systems, Inc. ("Pegasus"), a corporation which currently employs certain
of such individuals (collectively, the "Defendants"). The complaint, which seeks
damages and  injunctive  relief  against the  Defendants,  alleges,  among other
things,   misappropriation  of  proprietary  information,   unfair  competition,
tortious interference,  breach of employment agreements,  breach of a consulting
agreement between the Company and Pegasus,  and breach of duty of loyalty,  good
faith and fair dealing. Upon the filing of its complaint, the Company obtained a
temporary  restraining  order and in May 1996 obtained a preliminary  injunction
prohibiting  the Defendants  from using or disclosing the Company's  proprietary
information, prohibiting the Defendants from contacting or soliciting certain of
the Company's  customers  and  prohibiting  the  Defendants  from  recruiting or
attempting  to recruit  the  Company's  employees,  agents or  contractors.  The
preliminary  injunction  remains in effect.  The Defendants have filed an answer
and counterclaim. Pegasus has asserted a breach of contract counterclaim against
the Company alleging that the Company owes it $129,000 for consulting  services.
Pegasus and two of the individual  Defendants  also asserted  claims against the
Company and two of its officers for tortious  interference  and  defamation.  In
addition,  one of the  individual  Defendants has asserted that the Company owes
him $70,000 in commissions.  In addition to monetary damages the Defendants seek
injunctive relief. The Defendants  unsuccessfully sought a temporary restraining
order  against the  Company.  On October 13,  1998,  the  parties  negotiated  a
settlement  to dispose of all claims  asserted in this  lawsuit as well as those
asserted in the claim against Sophien Bennaceur  (discussed  below). The Company
drafted and  circulated a settlement  agreement  which has been  executed by the
respective  parties  and  disposed  of both  lawsuits  and which has no material
impact on the Company's business, financial condition or results of operations.

     On February 13, 1998,  Russell  Schultz,  a former employee of the Company,
filed a complaint in the Superior  Court of New Jersey,  Law Division,  Monmouth
County, naming the Company as a defendant.  The complaint,  which seeks damages,
alleges,  among other things,  that the Company  misrepresented  plaintiff's job
description in order to induce plaintiff to leave his prior employer,  failed to
provide  stock  options  to  the  plaintiff  and  violated  plaintiff's  written
employment  contract.  The Company was served  with the  complaint  on March 16,
1998.  Subsequently,  on July 10,  1998,  upon the  Company's  Motion  to Compel
Arbitration,  the court dismissed the plaintiff's  complaint without  prejudice.
Subsequently, the plaintiff's motion to reconsider the dismissal was denied. The
plaintiff  filed  his  demand  for  Arbitration  with the  American  Arbitration
Association  on February  17, 1999 and the Company  filed its answer on February
26, 1999.  It is too early in the dispute  process to determine  the impact,  if
any,  that  such  dispute  will  have  upon the  Company's  business,  financial
condition or results of operations.

     On May 28, 1998, the Company and Rajkumar  Koneru,  as plaintiffs,  filed a
complaint in the United  States  District  Court for the District of New Jersey,
against Sophien  Bennaceur,  a former  employee and officer of the Company.  The
complaint,  which seeks damages and

                                     - 15 -
<PAGE>

injunctive   relief   against  the   defendant,   alleges  among  other  things,
misappropriation  of proprietary  information,  breach of employment  agreement,
breach of fiduciary duty and duty of loyalty,  unfair  competition  and tortious
interference. The defendant was served with the complaint and filed an answer on
July 9, 1998.  On October 13,  1998,  the parties  negotiated  a  settlement  to
dispose of all claims  asserted in this lawsuit as well as those asserted in the
Pegasus  litigation  (discussed  above).  The Company  drafted and  circulated a
settlement  agreement  which,  The Company  drafted and  circulated a settlement
agreement which has been executed by the respective parties and disposed of both
lawsuits and which has no material impact on the Company's  business,  financial
condition or results of operations..

     On January 20, 1999, Tony Knight, a former employee of the Company,
filed a complaint in the Superior  Court of the State of  California,  San Mateo
County, naming the Company, among others, as a defendant.  The complaint,  which
seeks  damages,  alleges,  among other  things,  that the Company  discriminated
against  plaintiff because of his race,  ancestry,  religious creed and national
origin and thereafter wrongfully terminated the plaintiff's  employment with the
Company. The Company,  through its counsel,  acknowledged receipt of the summons
and  complaint on April 20, 1999. It is too early in the  litigation  process to
determine the impact,  if any, that such litigation will have upon the Company's
business, financial condition or results of operations.

     There is no other  material  litigation  pending to which the  Company is a
party or to which any of its property is subject.

ITEM 2.        CHANGES IN SECURITIES AND USE OF PROCEEDS.

     The following  information relates to all securities of the Company sold by
the Company  within the quarter  ended March 31, 1999 which were not  registered
under the Securities Act of 1933, as amended (the "Securities Act"), at the time
of grant, issuance and/or sale:

              On February 16, 1999, the Company consummated (i) the merger
         of  Empower  Solutions,  L.L.C.,  a  Michigan  limited  liability
         company, with and into the Company's  wholly-owned  subsidiary ES
         Merger Corp., a Michigan  corporation  ("ES Merger  Corp."),  and
         (ii) the merger of ES Merger Corp. with and into Empower,  Inc. a
         Michigan  corporation  and an  affiliate  of  Empower  Solutions,
         L.L.C.  (the  mergers  of  Empower  Solutions,   L.L.C.  and  its
         affiliate Empower,  Inc. shall be referred to herein collectively
         as the  "Merger").  As a  result  of the  Merger,  Empower,  Inc.
         ("Empower")  became a  wholly-owned  subsidiary  of the  Company.
         Empower  is an  implementation  partner  of  PeopleSoft  and  its
         principle activities are business process reengineering,  systems
         design development, project management and training services. The
         parties intend for the Merger to be accounted for as a pooling of
         interests.

              The   purchase   price   consisted   of  the   issuance   of
         approximately   $33,200,000  in  restricted   Common  Stock  (the
         "Restricted  Stock") of the Company  (1,831,091  shares).  Of the
         purchase  price,  $3,320,000  of  restricted  Common Stock of the
         Company  (186,066 shares) is being held in escrow for a period of
         one year to satisfy any indemnification  claims. In addition, the
         purchase price may be adjusted

                                     - 16 -
<PAGE>

         upward or downward  within  ninety days of the date of the Merger
         based on the audited  calculation  of Empower's  closing net book
         value  at  the  date  of  the   Merger   (the  "Net  Book   Value
         Adjustment"). If positive, the Net Book Value Adjustment, if any,
         shall  result in a dollar for  dollar  increase  of the  purchase
         price which shall be paid by the Company  through the issuance of
         additional shares of restricted  Common Stock of the Company.  If
         negative,  the Net Book Value Adjustment,  if any, will result in
         the cancellation of shares of Restricted Stock held in escrow.

              As soon as  practicable  after the  Merger,  but in no event
         later than the  announcement  of the Company's 1999 first quarter
         financial  results,  the  Company  shall use its best  efforts to
         prepare  and  file a  Registration  Statement  with  the SEC (the
         "First  Registration   Statement")  registering  for  resale  the
         Restricted  Stock issued in connection  with the Merger,  and use
         its best  efforts to, as promptly  as possible  thereafter,  have
         such Registration Statement declared effective for the purpose of
         facilitating  the public resale of such Restricted  Stock. If, at
         the time the Company is  required to file the First  Registration
         Statement, the calculation of the Net Book Value has not yet been
         completed,  the Company  shall use its best efforts to include in
         the First  Registration  Statement  56% of the  Restricted  Stock
         issued in connection with the Merger. (Subsequently,  the Company
         agreed  to  use  its  best   efforts  to  include  in  the  First
         Registration  Statement  90% of the  Restricted  Stock  issued in
         connection with the Merger.) Not later than the first anniversary
         after the date of Merger,  the Company shall use its best efforts
         to  prepare  and  file a  Registration  Statement  with  the  SEC
         registering any remaining shares of the Restricted Stock.

              If at any time  following the date of the Merger or prior to
         the first  anniversary of the date of Merger the Company proposes
         to file a registration statement under the Securities Act (except
         with respect to registration statements on Forms S-4, S-8, or any
         other form not  available  for  registering  the Common Stock for
         sale to the public),  with respect to an offering of Common Stock
         for its own  account or the  account of another  holder  thereof,
         then the Company  shall in each case give written  notice of such
         proposed  filing to the holders of the Restricted  Stock at least
         30 days before the  anticipated  filing date of the  registration
         statement with respect thereto (the "Piggyback Registration") and
         use its best  efforts to include in such  Piggyback  Registration
         33.33% of the  Restricted  Stock not then subject to an effective
         Registration Statement.

ITEM 5. OTHER INFORMATION.

     Acquisitions

     On  January  8,  1999,  the  Company   consummated  the  acquisition   (the
"Acquisition") of all of the shares of outstanding  capital stock of NPI, a Utah
corporation located in Provo, Utah. As a result of the Acquisition, NPI became a
wholly-owned  subsidiary of the Company. The principal activities of NPI are web
site design and front-end application solutions services.

     The purchase  price  included an initial  cash payment in the  aggregate of
$1,800,000  together  with a cash  payment  of  $200,000  to be held  in  escrow
pursuant to an escrow agreement

                                     - 17 -
<PAGE>

entered into between the Company and the  shareholders of NPI. In addition,  the
purchase  price  includes an earn-out  payment of up to $2,212,650 in restricted
shares of the Company's Common Stock,  $0.01 par value per share, (the "Earn-Out
Payment"),  payable on or before  April 15, 2000 and a  potential  lump sum cash
payment of  $354,024  (the  "Kicker  Payment"),  payable no later than March 31,
2000. The Company has agreed to use commercially  reasonable efforts to register
the shares of the Company's  Common Stock issued in connection with the Earn-Out
Payment  pursuant to a  registration  statement on Form S-3 (or any successor or
similar form) on or before April 30, 2000.

     No Earn-Out Payment shall be paid unless NPI's fiscal 1999 revenue and
income  before  provision  for income taxes  exceeds  $2,350,000  and  $188,000,
respectively.  The Kicker  Payment  shall be paid if, and only if,  NPI's fiscal
1999 income before provision for income taxes exceeds $450,000.

     On  February  16,  1999,  by  way  of  merger  transactions,   the  Company
consummated  the  acquisition  of Empower  Solutions,  L.L.C.  and its affiliate
Empower,  Inc. See Item 2. "Changes in Securities  and Use of Proceeds" for more
detailed information concerning such acquisition.

     Changes in the Board of Directors

     On April 27,  1999,  Klaus P.  Besier,  a member of the Board  since  1996,
resigned from the Board. As a result of such resignation, there is currently one
vacancy  on the  Board.  Additionally,  Mr.  Besier  has  declined  to stand for
re-election to the Board at the Company's upcoming annual shareholders'  meeting
scheduled for Tuesday,  May 25, 1999. The Board currently expects to designate a
substitute nominee.

     On April 27, 1999,  David A. Finley,  a member of the Board since 1997, was
named Chairman of the Board, a non-executive officer, non-employee position.




                                     - 18 -
<PAGE>

ITEM 6.      EXHIBITS AND REPORTS ON FORM 8-K.

       (a)   Exhibits.

               27.1 Financial Data Schedule for the period ended March 31, 1999.

               27.2 Financial  Data  Schedule  for the year ended  December  31,
                    1998.

               27.3 Financial Data Schedule for the period ended March 31, 1998.

       (b)   Reports on Form 8-K.

               On  January  20,  1999,  the  Company  filed a report on Form 8-K
               relating to the Company's acquisition of Network Publishing, Inc.

               On February  24,  1999,  the  Company  filed a report on Form 8-K
               relating  to the  Company's  acquisition  of  Empower  Solutions,
               L.L.C. and its affiliate Empower, Inc.

               Subsequent  to the  quarter  ended  March 31,  1999,  the Company
               filed,  on May 3, 1999,  a report of Form 8-K/A  relating  to the
               Company's  acquisition  of  Empower  Solutions,  L.L.C.  and  its
               affiliate Empower, Inc.




                                     - 19 -
<PAGE>

                                   SIGNATURES


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


                                                   Intelligroup, Inc.




DATE: May 17, 1999                    By:  /s/ Stephen A. Carns
                                           -------------------------------------
                                           Stephen A. Carns,
                                           President and Chief Executive Officer
                                           (Principal Executive Officer)


DATE: May 17, 1999                    By:  /s/ Gerard E. Dorsey
                                           -------------------------------------
                                           Gerard E. Dorsey,
                                           Senior Vice President-Finance and
                                           Chief Financial Officer
                                           (Principal Financial and Accounting
                                           Officer)



                                     - 20 -