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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ending March 31, 2002

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

For the transition period from to
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Commission file number 0-23489

Access Worldwide Communications, Inc.

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(Exact Name of Registrant as Specified in its Charter)

Delaware 52-1309227
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)

4950 Communication Ave., Suite 300
Boca Raton, Florida 33431
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(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number, including area code 1 (561) 226-5000

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

Title of each class. Name of each exchange on which registered.
- -------------------- ------------------------------------------
None None

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

Common Stock, $0.01 par value
-----------------------------
Title of Class

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 as the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes [X] No [ ]

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

9,740,001 shares of Common Stock, $.01 par value, as of May 15, 2002

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ACCESS WORLDWIDE COMMUNICATIONS, INC.

INDEX

Page
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Part I-Financial Information

Item 1. Financial Statements
Consolidated Balance Sheets-March 31, 2002 (unaudited) and December 31, 2001........... 1
Consolidated Statements of Operations (unaudited)-Three Months Ended
March 31, 2002 and March 31, 2001................................................... 2
Consolidated Statements of Cash Flows (unaudited)-Three Months Ended
March 31, 2002 and March 31, 2001................................................... 3
Notes to Consolidated Financial Statements............................................. 4-7

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations............................................................... 8-10

Item 3. Quantitative and Qualitative Disclosures About Market Risk............................. 10

Part II-Other Information

Item 1. Legal Proceedings...................................................................... 11

Item 6. Exhibits and Reports on Form 8-K....................................................... 11

Signatures............................................................................. 11

PART I--FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ACCESS WORLDWIDE COMMUNICATIONS, INC.

CONSOLIDATED BALANCE SHEETS

March 31,
2002 December 31,
(Unaudited) 2001
------------ ------------

ASSETS
Current assets:
Cash and cash equivalents ................................................ $ 5,267,188 $ 3,373,422
Accounts receivable, net of allowance for doubtful accounts of $63,490 and
$80,723, respectively ................................................. 13,715,573 15,358,920
Unbilled receivables ..................................................... 3,110,573 3,795,943
Other assets, net ........................................................ 2,072,770 2,286,600
------------ ------------
Total current assets .................................................. 24,166,104 24,814,885

Property and equipment, net .............................................. 4,916,629 10,114,449
Intangible assets, net ................................................... 9,244,500 21,420,624
Other assets, net ........................................................ 53,677 1,181,570
------------ ------------
Total assets .......................................................... $ 38,380,910 $ 57,531,528
============ ============
LIABILITIES, MANDATORILY REDEEMABLE PREFERRED STOCK AND COMMON
STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Current portion of indebtedness .......................................... $ 1,500,000 $ 30,471,375
Current portion of indebtedness - related parties ........................ 1,603,994 1,543,079
Accounts payable and accrued expenses .................................... 10,707,174 10,215,514
Accrued interest and other related party expenses ........................ 39,406 32,253
Accrued salaries, wages and related benefits ............................. 1,674,183 2,573,213
Deferred revenue ......................................................... 6,826,218 2,635,890
Warrant payable .......................................................... -- 1,321,326
------------ ------------
Total current liabilities ............................................. 22,350,975 48,792,650

Long-term portion of indebtedness ........................................... 4,488,473 3,951,973
Long-term portion of indebtedness - related parties ......................... 1,308,563 1,724,292
Other long-term liabilities ................................................. 346,322 350,405
Mandatorily redeemable preferred stock, $.01 par value:
2,000,000 shares authorized, 40,000 shares issued and outstanding ........ 4,000,000 4,000,000
------------ ------------
Total liabilities and mandatorily redeemable preferred stock .......... 32,494,333 58,819,320
------------ ------------
Commitments and Contingencies

Common stockholders' equity (deficit):
Common stock, $.01 par value: voting: 20,000,000 shares authorized; 9,740,001
shares issued and outstanding ............................................... 97,400 97,400
Additional paid-in capital .................................................. 63,636,069 63,636,069
Accumulated deficit ......................................................... (57,846,892) (65,021,261)
------------ ------------
Total common stockholders' equity (deficit) ........................... 5,886,577 (1,287,792)
------------ ------------
Total liabilities, mandatorily redeemable preferred stock and common
stockholders' equity (deficit) ..................................... $ 38,380,910 $ 57,531,528
============ ============

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

ACCESS WORLDWIDE COMMUNICATIONS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

FOR THE THREE MONTHS ENDED MARCH 31,

2002 2001
----------- -----------

Revenues ..................................................... $ 9,318,654 $13,314,362
Cost of revenues ............................................. 5,824,676 9,196,175
----------- -----------

Gross profit ........................................... 3,493,978 4,118,187

Selling, general and administrative expenses (selling, general
and administrative expenses paid to related parties are
$125,950 and $188,925, respectively) ...................... 4,434,644 3,944,444
Amortization expense ......................................... 60,536 533,550
----------- -----------

Loss from operations ................................... (1,001,202) (359,807)

Interest income .............................................. 5,511 14,435
Interest income -related parties ............................. 109,948 236,517
Interest expense ............................................. (149,524) (1,275,740)
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Loss before income taxes ............................... (1,035,267) (1,384,595)

Income tax benefit ........................................... - (434,763)
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Loss from continuing operations ........................ (1,035,267) (949,832)
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Discontinued operations (Note 8):
(Loss) income from discontinued operations,
net of income tax (benefit) expense of
$(75,560) and $123,439, respectively ................ (500,151) 269,678
Gain on disposal of segments, net of income
tax expense of $1,316,110 ........................... 8,709,787 --
----------- -----------
8,209,636 269,678
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Net income (loss) ............................................ $ 7,174,369 $ (680,154)
=========== ===========

Basic earnings (loss) per share of common stock:
Continuing operations .................................. $ (0.11) $ (0.10)
Discontinued operations ................................ $ 0.84 $ 0.03
Net income (loss) ...................................... $ 0.74 $ (0.07)
Weighted average common shares outstanding ............. 9,740,001 9,740,001

Diluted earnings (loss) per share of common stock:
Continuing operations .................................. $ (0.11) $ (0.10)
Discontinued operations ................................ $ 0.84 $ 0.03
Net income (loss) ...................................... $ 0.74 $ (0.07)
Weighted average common shares outstanding ............. 9,750,608 9,740,001

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

ACCESS WORLDWIDE COMMUNICATIONS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE THREE MONTHS ENDED MARCH 31,

2002 2001
------------ -----------

Cash flows from operating activities:
Net income (loss) .................................................................. $ 7,174,369 $ (680,154)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization ................................................... 454,467 869,836
Amortization of deferred financing costs ........................................ 159,366 126,387
Gain on disposition of discontinued operations .................................. (10,025,897) --
Changes in discontinued operations .............................................. (652,191) (1,172,890)
Allowance for doubtful accounts ................................................. 27,500 6,730
Changes in operating assets and liabilities:
Accounts receivable .......................................................... (3,997,198) (5,936,102)
Unbilled receivables ......................................................... 598,580 (263,217)
Other assets ................................................................. 2,150,540 42,942
Accounts payable and accrued expenses ........................................ (1,491,138) 1,553,995
Accrued interest and related party expenses .................................. 7,155 (357,701)
Accrued salaries, wages and related benefits ................................. 233,360 (993,085)
Deferred revenue ............................................................. 4,634,358 5,484,374
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Net cash used in operating activities ........................................... (726,729) (1,318,885)
------------ -----------
Cash flows from investing activities:
Additions to property and equipment, net ........................................... (251,517) (170,660)
Additions to property and equipment from discontinued operations, net .............. (267,830) (388,334)
Net proceeds from sale of discontinued operations .................................. 31,785,496 --
------------ -----------
Net cash provided by (used in) investing activities ............................. 31,266,149 (558,994)
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Cash flows from financing activities:
Payments on capital leases ......................................................... -- (8,294)
Net (payments) borrowings under Credit Facility .................................... (28,302,237) 1,606,719
Payment of deferred financing costs ................................................ 26,203 --
Payments on related party debt ..................................................... (369,620) (328,815)
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Net cash (used in) provided by financing activities ............................. (28,645,654) 1,269,610
------------ -----------
Net increase (decrease) in cash and cash equivalents ............................ 1,893,766 (608,269)
Cash and cash equivalents, beginning of period ..................................... 3,373,422 1,926,140
------------ -----------
Cash and cash equivalents, end of period ........................................... $ 5,267,188 $ 1,317,871
============ ===========

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

ACCESS WORLDWIDE COMMUNICATIONS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements of Access
Worldwide Communication, Inc. ("Access Worldwide", "we", "our", "us", or the
"Company") have been prepared in accordance with accounting principles generally
accepted in the United States of America for interim financial information and
pursuant to the rules and regulations of the Securities and Exchange Commission.
Accordingly, we do not include therein all of the information and footnotes
required by accounting principles generally accepted in the United States of
America for a complete set of consolidated financial statements. For further
information, refer to our consolidated financial statements and footnotes
included in our Annual Report on Form 10-K.

The preparation of consolidated financial statements in conformity with
accounting principles generally accepted in the United States of America
requires us to make estimates and assumptions that affect reported amounts
included in the consolidated financial statements. In our opinion, all
adjustments necessary for a fair presentation of this interim financial
information have been included. Such adjustments consisted only of normal
recurring items. The results of operations for the three months ended March 31,
2002 are not necessarily indicative of the results to be expected for the year
ending December 31, 2002.

2. RECLASSIFICATIONS

Certain reclassifications have been made to the March 31, 2001 consolidated
financial statements to conform to the March 31, 2002 presentation. Such
reclassifications did not change our net loss or total common stockholders'
equity as previously reported.

3. INCOME TAXES

The effective tax rate used by us to record the income tax expense for the
three months ended March 31, 2002 differs from the federal statutory rate
primarily due to the utilization of net operating loss carryfowards. The
effective tax rate for the three months ended March 31, 2001 differs from the
federal statutory rate due primarily to state income taxes and non-deductible
goodwill amortization.

4. SEVERANCE ACCRUAL

During the first quarter of 2002, we recorded a severance accrual of
$957,436, to accrued salaries, wages and related benefits, for certain
management employees, as the Company realigned its management team to reflect
its existing business subsequent to the sale of its Phoenix Marketing Group
("Phoenix") and its Cultural Access Group ("CAG") divisions (see Note 8). Such
amount was included in selling, general and administrative expenses for the
three months ended March 31, 2002.

5. NEW ACCOUNTING PRONOUNCEMENTS

In June 2001, the Financial Accounting Standards Board ("FASB" or the
"Board") issued Statement of Financial Accounting Standards No. 141 ("SFAS
141"), Business Combinations, and No. 142 ("SFAS 142"), Goodwill and Other
Intangible Assets, collectively referred to as the "Standards". SFAS 141
supersedes Accounting Principles Board Opinion ("APB") No. 16, Business
Combinations. The provisions of SFAS 141 (1) require that the purchase method of
accounting be used for all business combinations initiated after June 30, 2001,
(2) provide specific criteria for the initial recognition and measurement of
intangible assets apart from goodwill, and (3) require that unamortized negative
goodwill be written off immediately as an extraordinary gain instead of being
deferred and amortized. SFAS 141 also requires that upon adoption of SFAS 142,
we reclassify the carrying amounts of certain intangible assets into or out of
goodwill, based on certain criteria. SFAS 142 supersedes APB 17, Intangible
Assets, and is effective for fiscal years beginning after December 15, 2001.
SFAS 142 primarily addresses the accounting for goodwill and intangible assets
subsequent to their initial recognition. The provisions of SFAS 142 (1) prohibit
the amortization of goodwill and indefinite-lived intangible assets, (2) require
that goodwill and indefinite-lived intangibles assets be tested annually for
impairment (and in interim periods if certain events occur indicating that the
carrying value of goodwill and/or indefinite-lived intangible assets may be
impaired), (3) require that reporting units be identified for the purpose of
assessing potential future impairments of goodwill, and (4) remove the forty-
year limitation on the amortization period of intangible assets that have finite
lives.

We have adopted the provisions of SFAS 142 effective January 1, 2002 and as
a result we no longer record amortization expense on goodwill. As a result of
adopting the new rules effective January 1, 2002, the Company's amortization
expense decreased approximately $473,014 for the three month period ended March
31, 2002. As of the first quarter of calendar year 2002, the Company has, as
required, begun to perform an impairment analysis of intangible assets.

ACCESS WORLDWIDE COMMUNICATIONS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

5. NEW ACCOUNTING PRONOUNCEMENT - CONTINUED

SFAS 142 requires that goodwill be tested annually for impairment using a
two-step process. The first step is to identify a potential impairment and, in
transition, this step must be measured as of the beginning of the fiscal year.
However, a company has six months from the date of adoption to complete the
first step. We expect to complete that first step of the goodwill impairment
test during the second quarter of 2002. The second step of the goodwill
impairment test measures the amount of the impairment loss (measured as of the
beginning of the year of adoption), if any, and must be completed by the end of
our fiscal year. Intangible assets deemed to have an indefinite life will be
tested for impairment using a one-step process, which compares the fair value to
the carrying amount of the asset as of the beginning of the fiscal year, and
pursuant to the requirements of SFAS 142 will be completed during the second
quarter of 2002. Any impairment loss resulting from the transitional impairment
tests will be reflected as the cumulative effect of a change in accounting
principle in the second quarter of 2002. The Company has not yet determined what
effect these impairment tests will have on the Company's earnings and financial
position.

In October 2001, the Board issued SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets ("SFAS 144"). SFAS 144 addresses (i)
the recognition and measurement of the impairment of long-lived assets to be
held and used and (ii) the measurement of long-lived assets to be disposed of by
sale. In addition, SFAS 144 supersedes the accounting and reporting provisions
of APB No. 30 ("APB 30"), Reporting the Results of Operations, Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions, for segments of a business to be
disposed of. However, SFAS 144 retains APB 30's requirement that entities report
discontinued operations separately from continuing operations and extends that
reporting requirement to "a component of an entity" that either has been
disposed of (by sale, abandonment, or in a distribution to owners) or is
classified as "held for sale". SFAS 144 is effective for fiscal years beginning
after December 15, 2001. The Company implemented SFAS 144 in the first quarter
of 2001 (see Note 8).

In addition, in May 2002, the Board issued SFAS No. 145, Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections ("SFAS 145"). SFAS 145 rescinds the automatic treatment of gains or
losses from extinguishment of debt as extraordinary unless they meet the
criteria for extraordinary items as outlined in APB Opinion No. 30, Reporting
the Results of Operations, Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions. SFAS 145 also requires sale-leaseback accounting for certain lease
modifications that have economic effects that are similar to sale-leaseback
transactions and makes various technical corrections to existing pronouncements.
The provisions of SFAS 145 related to the rescission of FASB Statement 4 are
effective for fiscal years beginning after May 15, 2002, with early adoption
encouraged. All other provisions of SFAS 145 are effective for transactions
occurring after May 15, 2002, with early adoption encouraged. We do not
anticipate the adoption of SFAS 145 will have a material effect on our earnings
or financial position.

6. EARNINGS (LOSSES) PER COMMON SHARE

The computation of weighted average number of common and common equivalent
shares used in the calculation of basic and diluted earnings (losses) per share
is as follows:

For the Three Months Ended March 31,
------------------------------------

Shares
---------

2002:
Weighted average number of common shares outstanding - basic ...... 9,740,001
Effects of dilutive securities:
Stock options ............................................. 10,607
---------
Weighted average number of common and common equivalent shares
outstanding - dilutive ........................................... 9,750,608
=========

2001:
Weighted average number of common shares outstanding - basic ...... 9,740,001
---------
Weighted average number of common and common equivalent shares
outstanding - dilutive* .......................................... 9,740,001
=========

The computation of earnings (losses) per share was calculated based on the
separate components in our statements of operations, including net income
(loss), loss from continuing operations and income from discontinued operations.
Differences in total are attributed to rounding.

* Since the effects of the stock options and earnout contingencies are
anti-dilutive for the three months ended March 31, 2001, these effects have not
been included in the calculation of dilutive earnings per share.

ACCESS WORLDWIDE COMMUNICATIONS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

7. COMMITMENTS AND CONTINGENCIES

We are involved in legal actions arising in the ordinary course of our
business. We believe that the ultimate resolution of these matters will not have
a material adverse effect on our financial position, results of operation or
cash flow except as described below.

On May 29, 2001, Douglas Rebak and Joseph Macaluso filed suit against the
Company in Federal District Court for the district of New Jersey. The lawsuit
seeks enforcement of an alleged amendment to an earn-out agreement between the
Company and Messrs. Rebak and Macaluso relating to our acquisition of Phoenix in
1997. Messrs. Rebak and Macaluso were two majority shareholders of Phoenix prior
to the acquisition and became officers of the Company after Phoenix became a
subsidiary of Access Worldwide. The suit alleges that we agreed to amend the
earn-out agreement. The lawsuit seeks actual damages of $850,000 plus additional
unspecified punitive damages. We have denied the allegations of the Complaint,
and intend to defend vigorously. While we believe the claims have no legal
basis, we cannot provide assurances as to the outcome of the litigation.

8. DISCONTINUED OPERATIONS

In accordance with Statement of Financial Accounting Standards No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets," we have
reclassified as discontinued operations, the operations of our (a) CAG division,
which provided in-language, in-culture market research services and consulting
services to Fortune 500 Companies in a variety of industries, and which was sold
on January 31, 2002 to LuminaAmericas, Inc., a provider of integrated marketing
solutions for the US-Hispanic and Latin America markets, for $1.2 million in
cash, plus the assumption of certain liabilities and (b) Phoenix, which provided
pharmaceutical sample distribution services, and which was sold on February 25,
2002 to Express Scripts, Inc., a pharmacy benefit management company, for $33.0
million in cash, plus the assumption of certain liabilities. We realized a net
gain of $8.7 million on the disposal of the segments, net of income tax
(benefit) expense and expenses incurred in connection with the transactions. In
addition to the classification of the gain on the disposal of the segments as
discontinued operations, we reclassified the (loss) income from the operations
of the segments, net of the related income tax (benefit) expense, for the period
from January 1, 2002 until the date of the transactions and for the three month
period ended March 31, 2001 to discontinued operations in the accompanying
statements of operations. Revenues and operating (loss) income for these two
divisions were:

For the period ended March 31,
Cultural Access Group 2002 2001
- --------------------- ------ ------

Revenues $ 358,008 $ 819,703
Operating loss (370,998) (163,994)

For the period ended March 31,
Phoenix Marketing Group 2002 2001
- ----------------------- ------ ------

Revenues $4,207,194 $7,773,694
Operating (loss) income (7,189) 901,649

9. INDEBTEDNESS

On December 19, 2001, we entered into a purchase and sale agreement for
Phoenix, pending approval by our stockholders and our group of lenders (the
"Bank Group"). In January 2002, we notified the Bank Group that we were in
default of all of our financial covenants under our credit facility, as amended,
with the Bank Group (the "Credit Facility") and we began negotiations for the
Fifth Amendment and Waiver agreement (the "Fifth Amendment") to the Credit
Facility. The Fifth Amendment was entered into on February 22, 2002 and (a)
provides that the Bank Group waives the "Acknowledged Events of Default" and
amended certain provisions of the Credit Facility and its accompanying
amendments, including requiring us to meet new financial covenants, (b) limited
the revolving committed amount to (i) $7 million through May 31, 2002; (ii) $8
million from June 1, 2002 through March 31, 2003; and (iii) $7.2 million from
April 1, 2003 through June 30, 2003. The stated interest rate on the outstanding
Credit Facility remained at prime plus 3%. The Fifth Amendment expired on July
1, 2003, at which time all amounts outstanding pursuant to the Credit Facility
are to be paid in full.

ACCESS WORLDWIDE COMMUNICATIONS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

9. INDEBTEDNESS - (Continued)

On January 29, 2002, we entered into a purchase and sale agreement for CAG,
which closed on January 31, 2002. The sale of Phoenix was approved by the
stockholders and the Bank Group on February 22, 2002, and closed shortly
thereafter (see Note 8).

We repaid approximately $28.9 million outstanding pursuant to the Credit
Facility from the net proceeds of these transactions at the time we executed the
Fifth Amendment.

On April 5, 2002, we entered into the Sixth Amendment and Waiver Agreement
(the "Sixth Amendment") to the Credit Facility, which amends certain provisions
of the Credit Agreement including requiring us to pay an additional $1.5 million
from the remaining Phoenix transaction proceeds, to repay such amount
outstanding under the Credit Facility and limits the revolving committed amount
to (i) $5.5 million through May 31, 2002; (ii) $6.5 million from June 1, 2002
though March 31, 2003, and (iii) $5.7 million from April 1, 2003 through June
30, 2003.

10. WARRANT PAYABLE

The warrant that was issued to the Bank Group in connection with the Credit
Facility (the "Warrant"), that entitled the Bank Group to purchase approximately
1.5 million shares of our common stock at an exercise price of $0.01 per share,
and which was scheduled to expire on April 3, 2011, was effectively cancelled in
connection with the repayment of approximately $28.9 million on the Credit
Facility in connection with the execution of the Fifth Amendment.

11. SEGMENTS

In accordance with Statement of Financial Accounting Standards No. 131,
"Disclosures about Segments of an Enterprise and Related Information", our
reportable segments are strategic business units that offer different products
and services to different industries principally in the United States.

The table below presents information about our reportable segments for our
continuing operations used by the chief operating decision-maker of the Company
for the three months ended March 31, 2002 and 2001. The following information
about reportable segments for the three months ended March 31, 2002 and 2001
excludes the results of Phoenix (previously included in the Pharmaceutical
Segment) and CAG (previously included in the Other Segment) as such amounts have
been reclassified as discontinued operations (see Note 8).

Segment
Pharmaceutical Consumer Total Reconciliation Total
-------------- ---------- ----------- -------------- -----------

2002:
Revenues ............... $4,596,859 $4,721,795 $ 9,318,654 -- $ 9,318,654
Gross Profit ........... 1,354,992 2,138,986 3,493,978 -- 3,493,978
EBITDA ................. (239,200) 508,773 269,573 $(816,308) (546,735)
Depreciation expense.... 108,557 267,866 376,423 17,508 393,931
Amortization expense.... 60,536 -- 60,536 -- 60,536

2001:
Revenues ............... $7,973,761 $5,340,601 $13,314,362 -- $13,314,362
Gross Profit ........... 1,813,076 2,305,111 4,118,187 -- 4,118,187
EBITDA ................. 362,266 487,110 849,376 $(339,347) 510,029
Depreciation expense.... 92,983 228,785 321,768 14,518 336,286
Amortization expense.... 533,550 -- 533,550 -- 533,550

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

The following discussion of the financial condition and results of
operations of the Company should be read in conjunction with our Annual Report
on Form 10-K for the year ended December 31, 2001.

Critical Accounting Policies

In connection with the preparation of our interim consolidated financial
statements for the three months ended March 31, 2002, we determined that the
following additional accounting policy is deemed "critical". Critical accounting
policies are those policies, which require management's highest degree of
judgment, estimates, and assumptions.

Discontinued operations

We considered the disposal of our Phoenix Marketing Group division
("Phoenix") and Cultural Access Group division ("CAG") divisions during the
three months ended March 31, 2002 to be discontinued operations pursuant to the
guidance in Statement of Financial Accounting Standards No. 144. As a result of
the guidance, we determined that such amounts met the criteria established in
the literature with respect to presenting such operations from discontinued
businesses separately from continuing operations of the Company.

Three Months Ended March 31, 2002 Compared to Three Months Ended March 31, 2001

Our revenues decreased $4.0 million, or 30.1%, to $9.3 million for the
three months ended March 31, 2002, compared to $13.3 million for the three
months ended March 31, 2001. Revenues for the Pharmaceutical Segment decreased
$3.4 million, or 42.5%, to $4.6 million for the three months ended March 31,
2002, compared to $8.0 million for the three months ended March 31, 2001. The
decrease was due to a continued decrease in medical education meeting programs
scheduling in the first quarter of 2002 due to the continued slow down in the
economy. Revenues for our medical education business are recorded using a
percentage of completion methodology whereby a portion of revenues are recorded
over the life of the project including a percentage of the total projected costs
at scheduling. Revenues for the Consumer Segment decreased $0.6 million or 11.3%
to $4.7 million for the three months ended March 31, 2002, compared to $5.3
million for the three months ended March 31, 2001. The decrease was due to
increased delays in new client programs due to the continued slow down in the
economy during the first quarter of 2002.

Our cost of revenues decreased $3.4 million, or 37%, to $5.8 million for
the three months ended March 31, 2002, compared to $9.2 million for the three
months ended March 31, 2001. Cost of revenues as a percentage of revenues
decreased to 62.4% for the three months ended March 31, 2002, from 69.2% for the
three months ended March 31, 2001. Cost of revenues as a percentage of revenues
for the Pharmaceutical Segment for the three months ended March 31, 2002
decreased to 69.6%, compared to 77.5% for the three months ended March 31, 2001.
The decrease was due to management's efforts to more efficiently and effectively
run the communications center and manage its mix of programs which resulted in a
decrease in the number of employees, increased productivity and reduced postage
costs. Cost of revenues as a percentage of revenues for the Consumer Segment
decreased to 55.3% for the three months ended March 31, 2002, from 56.6% for the
three months ended March 31, 2001. The decrease was due to an increase in
revenues at our Boca Raton communication center.

Our selling, general and administrative expenses increased slightly by $0.5
million, or 12.8%, to $4.4 million for the three months ended March 31, 2002,
compared to $3.9 million for the three months ended March 31, 2001. Selling,
general and administrative expenses as a percentage of revenues for the Company
increased to 47.3% for the three months ended March 31, 2002, compared to 29.3%
for the three months ended March 31, 2001. Selling, general and administrative
expenses as a percentage of revenues for the Pharmaceutical Segment increased to
37% for the three months ended March 31, 2002, from 18.8% for the three months
ended March 31, 2001. The increase was due to the decrease in revenues related
to medical education meeting programs scheduling in the first quarter of 2002
due to the continued slow down in the economy and severance expense recorded in
the first quarter of 2002 for certain management personnel. Selling, general and
administrative expenses as a percentage of revenues for the Consumer Segment
increased 40.4% for the three months ended March 31, 2002, compared to 37.7%
for the three months ended March 31, 2001. The increase was due to increased
recruiting costs and depreciation expense at our Boca Raton communication
center.

Our amortization expense decreased $0.4 million, or 80%, to $0.1 million
for the three months ended March 31, 2002, compared to $0.5 million for the
three months ended March 31, 2001. The decrease was due to the implementation of
Statement of Financial Accounting Standards No. 142, "Goodwill and Other
Intangible Assets," which terminated the amortization of goodwill effective
January 1, 2002.

Our net interest expense decreased $0.97 million, or 97%, to $0.03 million
net interest expense for the three months ended March 31, 2002, compared to $1.0
million net interest expense for the three months ended March 31, 2001. The
decrease was due a lower prime rate of interest, a pay down of approximately
$28.9 million of outstanding debt obtained from the Phoenix and CAG transactions
and interest income from Phoenix and CAG intercompany loans for which the
corresponding interest expense has been classified as discontinued operations.

In accordance with Statement of Financial Accounting Standards No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets," we have
reclassified as discontinued operations, the operations of our (a) CAG division,
which provided in-language, in-culture market research services and consulting
services to Fortune 500 Companies in a variety of industries, and which was sold
on January 31, 2002 to LuminaAmericas, Inc., a provider of integrated marketing
solutions for the US-Hispanic and Latin America markets, for $1.2 million in
cash, plus the assumption of certain liabilities and (b) Phoenix division, which
provided pharmaceutical sample distribution services, and which was sold on
February 25, 2002 to Express Scripts, Inc., a pharmacy benefit management
company, for $33.0 million in cash, plus the assumption of certain liabilities.
We realized a net gain of $8.7 million on the disposal of the segments, net of
income tax (benefit) expense and expenses incurred in connection with the
transactions. In addition to the classification of the gain on the disposal of
the segments as discontinued operations, we reclassified the (loss) income from
the operations of the segments, net of the related income tax (benefit) expense,
for the period from January 1, 2002 until the date of the transaction and for
the three month period ended March 31, 2002 until the date of the transactions
and for the three month period ended March 31, 2001 to discontinued operations
in the accompanying statements of operations. Revenues and operating (loss)
income for these two divisions were:

For the period ended March 31,
Cultural Access Group 2002 2001
- --------------------- ---- ----
Revenues $ 358,008 $ 819,703

Operating loss (370,998) (163,994)

For the period ended March 31,
Phoenix Marketing Group 2002 2001
- ----------------------- ---- ----
Revenues $4,207,194 $7,773,694

Operating (loss) income (7,189) 901,649

Liquidity and Capital Resources

At March 31, 2002, we had working capital of $1.8 million, as compared to
negative working capital of $24.0 million at December 31, 2001. Cash and cash
equivalents were $5.3 million at March 31, 2002, compared to $3.4 million at
December 31, 2001.

Net cash used in operating activities during the first quarter of 2002 was
$0.7 million for the first quarter of 2002, compared to $1.3 million used in
operating activities during the first quarter of 2001. The decrease in net cash
used in operating activities was due principally to an increase in accounts
receivable partially offset by a decrease in other assets, accounts payable and
accrued expenses and accrued salaries, wages and related benefits.

Net cash provided by investing activities was $31.3 million for the first
quarter of 2002, compared to net cash used in investing activities of $0.6
million for the first quarter of 2001. The increase in cash provided by
investing activities was due principally to net proceeds received from the sale
of our Phoenix and CAG divisions.

Net cash used in financing activities was $28.6 million for the first
quarter of 2002, compared to net cash provided by financing activities of $1.3
million for the first quarter of 2001. The increase in net cash used in
financing activities was due principally to the pay down of our Credit Facility
with the net proceeds received from the sale of our Phoenix and CAG divisions.

At December 31, 2001, we were in default on all our financial covenants
under the Credit Facility with the Bank Group. On February 22, 2002 and April 5,
2002, we renegotiated the Credit Facility with the Bank Group and entered into
the Fifth and Sixth Amendment and Waiver agreements, respectively, in connection
with the Credit Facility (the "Amendments"). As a result of the renegotiations,
the sale of two of our divisions and the repayment of approximately $30.4
million of the outstanding bank debt subsequent to December 31, 2001 pursuant to
the Amendments, we are now required to repay the outstanding balance on the
revolving credit in full on July 1, 2003, rather than January 2, 2003, as
previously provided under the Credit Facility.

We believe that we will be able to maintain compliance with the financial
covenants established by the Amendments during 2002, which compliance would
allow us to maintain sufficient liquidity in 2002 to fund operations. However,
failure to achieve our revenue and income projections as a result of the loss of
a key customer or other factors could result in us not being able to maintain
compliance with such covenants. Such non-compliance would result in an event of
default, which, if not waived by the Bank Group, would result in the
acceleration of the amounts due under the Credit Facility. We would be unable to
make such accelerated repayment of amounts due on the Credit Facility.

We believe that to the extent that our outstanding balance on the Credit
Facility is not repaid from the proceeds of the sale of another one of our
divisions prior to the maturity thereof, or that we do not refinance the
outstanding balance pursuant to the Credit Facility prior to maturity, we will
be required to find sources other than operations to repay the outstanding
balance on the Credit Facility at maturity. If we are unable to sell another one
of our divisions, providing sufficient proceeds to repay the Credit Facility,
refinance the Credit Facility on acceptable terms or find another source of
repayment for the Credit Facility other than operations, then our business and
financial condition could be materially and adversely impacted. We cannot assure
our stockholders that we will be able to sell one of our remaining divisions on
terms that are acceptable to the Company or at all, obtain any such refinancing
on terms acceptable to us or at all or that we would otherwise be able to obtain
funds to repay the Credit Facility when due.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risks from changes in interest rates and are
subject to interest rate risks on our Credit Facility caused by changes in
interest rates. Our ability to limit our exposure to market risk and interest
risk is restricted as a result of our current cash management arrangement under
the Credit Facility. Accordingly, we are unable to enter into any derivative or
similar transactions that could limit our exposure to market risk and interest
rate risks. Our Credit Facility is currently at an interest rate of prime, plus
3%. The prime rate is the prime rate published by Bank of America, N.A. A one
percent change in the prime interest rate would result in a pre-tax impact to us
on earnings of approximately $0.06 million per year.

Risk Factors That May Affect Future Results

This report contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities and Exchange Act of 1934, as amended. Those statements represent our
current expectations, beliefs, future plans and strategies, anticipated events
or trends concerning matters that are not historical facts. Such forward-looking
statements relate to our ability to maintain compliance with our financial
covenants under the Credit Facility.

Such statements involve known and unknown risks, uncertainties and other
factors that may cause the actual results to differ materially from those
expressed or implied by such forward-looking statements. Factors that could
cause actual results to differ materially from those expressed or implied by
such forward-looking statements include, but are not limited, to the following:

. Additional risks as a result of our recent downsizing;

. Competition from other third-party providers and those of our clients
and prospects who may decide to do the work that we do in-house;

. Industry consolidation which reduces the number of clients that we are
able to serve;

. Potential consumer saturation reducing the need for our services;

. Certain needs for our growth;

. Our dependence on the continuation of the trend towards outsourcing;

. Dependence on the industries we serve;

. The effect of change in a drug's lifecycle;

. Our ability and our clients' ability to comply with state, federal and
industry regulations;

. Reliance on a limited number of major customers;

. The effects of possible contract cancellations;

. Reliance on technology;

. Reliance on key personnel and our labor force and recent changes in
management;

. The possible prolonged impact of the events of September 11 and the
general downturn in the U.S. economy;

. The effect of an interruption of our business;

. Risks associated with our stock trading on the OTC Bulletin Board;

. The volatiliy of our stock price; and

. The unpredictability of the outcome of litigation in which we are
involved.

The Company assumes no duty to update any forward-looking statements. For a
more detailed discussion of these risks and others that could affect the
Company's results, see the Company's filings with the Securities and Exchange
Commission, including the risk factors section of Access Worldwide's Annual
Report on Form 10-K for the year ended December 31, 2001 filed with the
Securities and Exchange Commission.

PART II-OTHER INFORMATION

Item 1. Legal Proceedings

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits

10(rr) Employment Agreement dated March 4, 2002, by and between the Company
and Lee Edelstein

10(ss) Employment Agreement dated March 30, 2002, by and between the
Company and Shawkat Raslan

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.

ACCESS WORLDWIDE COMMUNICATIONS, INC.

Date: May 16, 2002 By: /s/ Shawkat Raslan
---------------------------------------
Shawkat Raslan, Chairman of the Board,
President, and Chief Executive Officer

Date: May 16, 2002 By: /s/ John Hamerski
---------------------------------------
John Hamerski, Executive Vice President
and Chief Financial Officer (principal
financial and accounting officer)