<PAGE> 1
Exhibit 99
CHECKFREE MANAGEMENT CORPORATION
UNAUDITED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
JUNE 30, MARCH 31,
1999 2000
---------- ----------
(IN THOUSANDS, EXCEPT
SHARE DATA)
<S> <C> <C>
ASSETS
Current assets:
Cash ...................................................................... $ 291 $ 1
Related party note receivable, current portion ............................ 1,970 3,060
---------- ----------
Total current assets ....................................... 2,261 3,061
Related party note receivable, less current portion ............................ 27,798 25,200
---------- ----------
Total ...................................................... $ 30,059 $ 28,261
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Claims payable ............................................................ $ 318 $ 379
Accrued liabilities ...................................................... -- 290
Deposit for future claims liability ....................................... 1,970 3,060
---------- ----------
Total current liabilities .................................. 2,288 3,729
Deposit for future claims liability, less current portion ...................... 27,430 24,181
Redeemable Preferred Stock:
Class C, 350 authorized shares, $100 par value; 350 shares issued and
outstanding ............................................................ 36 36
Class D, 750 authorized shares, $100 par value; 750 shares issued and
outstanding ............................................................ 78 76
---------- ----------
Total redeemable preferred stock ........................... 114 112
Stockholders' equity:
Preferred stock- Class B, 600 authorized shares, $100 par value; 600 shares
issued, no amounts outstanding ......................................... -- --
Common stock- Class A, 1,900 authorized shares, $100 par value; 1,900
shares issued and outstanding........................................... 190 190
Retained earnings ......................................................... 37 49
---------- ----------
Total stockholders' equity ................................. 227 239
---------- ----------
Total ..................................................... $ 30,059 $ 28,261
========== ==========
</TABLE>
See notes to Interim Unaudited Condensed Financial Statements
<PAGE> 2
CHECKFREE MANAGEMENT CORPORATION
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
DECEMBER 8, 1998
(DATE OF
INCEPTION) NINE MONTHS
THREE MONTHS ENDED MARCH 31, TO ENDED
1999 2000 MARCH 31, 1999 MARCH 31, 2000
---------------- ---------------- ---------------- ----------------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Revenues:
Interest income from related party .......... $ 661 $ 610 $ 661 $ 1,863
Other interest income ....................... 4 4 41 12
---------------- ---------------- ---------------- ----------------
Total revenues ............... 665 614 702 1,875
Expenses:
Interest expense on deposit for future claims
liability .............................. 604 553 604 1,689
General and administrative .................. 58 57 58 174
---------------- ---------------- ---------------- ----------------
Total expenses ............... 662 610 662 1,863
---------------- ---------------- ---------------- ----------------
Income before income tax ......................... 3 4 40 12
Income tax expense ............................... -- -- -- --
---------------- ---------------- ---------------- ----------------
Net income ....................................... 3 4 40 12
Dividends on redeemable preferred stock .......... 2 2 2 6
---------------- ---------------- ---------------- ----------------
Net income applicable to common shareholders ..... $ 1 $ 2 $ 38 $ 6
================ ================ ================ ================
</TABLE>
See notes to Interim Unaudited Condensed Financial Statements
<PAGE> 3
CHECKFREE MANAGEMENT CORPORATION
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
DECEMBER 8, 1998
(DATE OF
INCEPTION)
TO NINE MONTHS
MARCH 31, ENDED MARCH 31,
1999 2000
---------------- ----------------
(IN THOUSANDS)
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) ............................................. $ 40 $ 12
---------------- ----------------
Net cash provided by operating activities ...... 40 12
Cash flows from investing activities:
Loan to related party ......................................... (30,512) --
Principal payments on related party loan ...................... 349 1,507
---------------- ----------------
Net cash provided by (used in) investing
activities.................................... (30,163) 1,507
Cash flows from financing activities:
Proceeds from assumption of health plan liabilities ........... 30,472 --
Payments made on health plan liabilities ...................... (609) (1,890)
Advance from related party, net................................ -- 90
Proceeds from issuance of stock ............................... 300 --
Redeemable preferred stock dividends paid ..................... -- (9)
---------------- ----------------
Net cash provided by (used in) financing
activities.................................... 30,163 (1,809)
---------------- ----------------
Net increase (decrease) in cash ................................... 40 (290)
Cash:
Beginning of period ........................................... -- 291
---------------- ----------------
End of period ................................................. $ 40 $ 1
================ ================
Supplemental disclosure of cash flow information:
Interest paid ................................................. $ 604 $ 1,689
================ ================
Dividends accrued on redeemable preferred stock ................ $ 2 $ 6
================ ================
</TABLE>
See notes to Interim Unaudited Condensed Financial Statements
<PAGE> 4
CHECKFREE MANAGEMENT CORPORATION
NOTES TO INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED MARCH 31, 2000
1. INTRODUCTION
CheckFree Management Corporation ("CheckFree Management") was formed
from a plan of recapitalization of RCM Systems, Inc., a wholly owned
subsidiary of CheckFree Holdings Corporation ("CheckFree Holdings"), on
December 8, 1998. CheckFree Management was formed as a medical claims
management subsidiary in order to appropriately minimize, control, and
manage the medical claims liabilities of CheckFree Holdings and its
subsidiaries.
As of September 30, 1999, CheckFree Holdings and its subsidiaries owned
approximately 63% of CheckFree Management. On November 19, 1999,
CheckFree Corporation, a wholly owned subsidiary of CheckFree Holdings,
purchased all outstanding shares of Class D Preferred Stock. Subsequent
to this purchase, CheckFree Holdings and its subsidiaries own 89% of
the Company.
The accompanying condensed consolidated financial statements and notes
thereto have been prepared in accordance with the rules and regulations
of the Securities and Exchange Commission for Form 10-Q and include all
of the information and disclosures required by generally accepted
accounting principles for interim financial reporting. The results of
operations for the nine months ended March 31, 2000 are not necessarily
indicative of the results for the full year.
These financial statements should be read in conjunction with the
financial statements, accounting policies and financial notes thereto
of CheckFree Management included within CheckFree Holdings Corporation
and Subsidiaries Annual Report filed with the Securities and Exchange
Commission on Form 10-K/A. In the opinion of management, the
accompanying condensed consolidated unaudited financial statements
reflect all adjustments (consisting only of normal recurring
adjustments) which are necessary for a fair representation of financial
results for the interim periods presented.
2. REDEEMABLE PREFERRED STOCK DIVIDEND
During the quarter ended March 31, 2000, CheckFree Management declared
and paid approximately $9,000 of previously accrued redeemable
preferred stock dividends.
3. RECENT ACCOUNTING PRONOUNCEMENTS
In June 1998 the Financial Accounting Standards Board issued SFAS 133,
"Accounting for Derivative Instruments and Hedging Activities," which
will require that all derivative financial instruments be recognized as
either assets or liabilities in the balance sheet. SFAS 133 will be
effective for the Company's first quarter of fiscal 2001. The Company's
current investment policy does not allow for the use of hedging
instruments. In anticipation of the adoption of SFAS 133, the Company
is currently reviewing all outstanding contracts for evidence of
embedded derivative. Based on the procedures undertaken through this
point, management does not believe that adoption of SFAS 133 will have
a material impact on its results of operations.
