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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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(MARK ONE) FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO .
COMMISSION FILE NUMBER 1-14037

THE DUN & BRADSTREET CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)



DELAWARE 13-3998945
(STATE OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION
NO.)
ONE DIAMOND HILL ROAD, MURRAY HILL, NJ 07974
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)


REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (908) 665-5000.

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:



NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
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COMMON STOCK, PAR VALUE $.01 PER SHARE................. NEW YORK STOCK EXCHANGE
PREFERRED SHARE PURCHASE RIGHTS........................ NEW YORK STOCK EXCHANGE


SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]

As of January 15, 1999, 165,195,356 shares of Common Stock of The Dun &
Bradstreet Corporation were outstanding and the aggregate market value of such
Common Stock held by nonaffiliates* (based upon its closing transaction price on
the Composite Tape on such date) was approximately $5,017.6 million.

*Calculated by excluding all shares held by executive officers and
directors of the Registrant without conceding that all such persons are
"affiliates" of the Registrant for purposes of federal securities laws.

DOCUMENTS INCORPORATED BY REFERENCE



PART III
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Item 10 Directors and Executive Section entitled "Proposal No. 1 -- Election of
Officers of the Registrant Directors" of the Company's proxy statement which
will be filed no later than 120 days after
December 31, 1998
Item 11 Executive Compensation Section entitled "Compensation of Executive
Officers and Directors" of the Company's proxy
statement which will be filed no later than 120
days after December 31, 1998
Item 12 Security Ownership of Section entitled "Security Ownership of
Certain Beneficial Management and Others" of the Company's proxy
Owners and Management statement which will be filed no later than 120
days after December 31, 1998
Item 13 Certain Relationships and Section entitled "Security Ownership of
Related Transactions Management and Others" of the Company's proxy
statement which will be filed no later than 120
days after December 31, 1998


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The Index to Exhibits is located on Pages 78-81 of this Form 10-K
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PART I

ITEM 1. BUSINESS

(a)(1) On June 30, 1998 (the "1998 Distribution Date"), The Dun & Bradstreet
Corporation ("Old D&B") separated into two publicly traded companies -- The New
Dun & Bradstreet Corporation ("New D&B" or the "Company") and R.H. Donnelley
Corporation. The separation (the "1998 Distribution") of the two companies was
accomplished through a tax-free dividend by Old D&B of the Company, which is a
new entity comprised of Moody's Investors Service ("Moody's") and the Dun &
Bradstreet operating company (the "D&B operating company"). New D&B changed its
name to "The Dun & Bradstreet Corporation," and the continuing entity (i.e., Old
D&B), consisting of R.H. Donnelley Inc., the operating company, and the DonTech
partnership, changed its name to "R.H. Donnelley Corporation" ("Donnelley"). The
tax-free stock dividend was issued on the 1998 Distribution Date to shareholders
of record at the close of business on June 17, 1998. Due to the relative
significance of Moody's and the D&B operating company, the transaction has been
accounted for as a reverse spin-off and, as such, Moody's and the D&B operating
company have been classified as continuing operations and R.H. Donnelley Inc.
and DonTech have been classified as discontinued operations.

For purposes of effecting the 1998 Distribution and of governing certain of the
continuing relationships between the Company and Donnelley after the
transaction, the two companies have entered into various agreements, including a
Distribution Agreement (the "1998 Distribution Agreement"), a Tax Allocation
Agreement (the "1998 Tax Allocation Agreement") and an Employee Benefits
Agreement (the "1998 Employee Benefits Agreement"). The following descriptions
summarize the material terms of such agreements, but are qualified by reference
to the texts of such agreements, which are incorporated herein by reference.

1998 DISTRIBUTION AGREEMENT

The 1998 Distribution Agreement provided for, among other things, certain
corporate transactions required to effect the 1998 Distribution and other
arrangements between Old D&B (i.e., Donnelley) and the Company subsequent to the
1998 Distribution.

In particular, the 1998 Distribution Agreement defines the assets and
liabilities which were allocated to and assumed by the Company and those which
remained with Donnelley. The 1998 Distribution Agreement also defines what
constitutes the "New D&B Business" and what constitutes the "R.H. Donnelley
Business".

Pursuant to the 1998 Distribution Agreement, Old D&B transferred or caused to be
transferred to the Company all its right, title and interest in the assets
comprising the New D&B Business and other assets not specifically included in
the R.H. Donnelley Business; and the Company transferred or caused to be
transferred to Donnelley all its right, title and interest in the assets
comprising the R.H. Donnelley Business. All assets were transferred without any
representation or warranty, "as is-where is", and the relevant transferee bears
the risk that any necessary consent to transfer was not obtained. Each party
also agreed to exercise its respective commercially reasonable efforts promptly
to obtain any necessary consents and approvals and to take such actions as may
be reasonably

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necessary or desirable to carry out the purposes of the 1998 Distribution
Agreement and the other agreements summarized below.

In general, pursuant to the terms of the 1998 Distribution Agreement, all assets
of Old D&B prior to the 1998 Distribution Date, other than those relating to the
R.H. Donnelley Business, became assets of the Company. The 1998 Distribution
Agreement also provides for assumptions of liabilities and cross indemnities
designed generally to allocate to the Company, effective as of the 1998
Distribution Date, financial responsibility for all liabilities of Old D&B,
other than those specified to be transferred to Donnelley on or prior to the
1998 Distribution Date or to remain with Donnelley subsequent to the 1998
Distribution Date (which liabilities primarily relate to the R.H. Donnelley
Business or the indebtedness incurred in connection with the 1998 Distribution).
The 1998 Distribution Agreement provides for the allocation generally to the
Company of the financial responsibility for the liabilities arising out of or in
connection with former businesses, other than those formerly conducted by
Donnelley prior to the 1998 Distribution.

The 1998 Distribution Agreement provides that the Company will comply with and
otherwise not take action inconsistent with each representation and statement
made to the Internal Revenue Service in connection with Old D&B's request for a
ruling letter as to certain tax aspects of the 1998 Distribution. The Company
agrees to maintain its status as a company engaged in the active conduct of a
trade or business, as defined in Section 355(b) of the Internal Revenue Code, to
continue to own stock of certain operating subsidiaries constituting control
(within the meaning of Section 368(c) of the Internal Revenue Code) of such
operating subsidiaries and to maintain at least 90% of the fair market value of
its assets in the form of stock and securities of certain operating
subsidiaries, in each case until the second anniversary of the 1998 Distribution
Date. The Company does not expect this limitation to inhibit its financing or
other activities or its ability to respond to unanticipated developments. As a
result of the representations in the request for a ruling letter and the
covenants in the 1998 Distribution Agreement, the acquisition of control of the
Company prior to the second anniversary may be more difficult or less likely to
occur because of the potential substantial liabilities associated with a breach
of such representations or covenants. The 1998 Distribution Agreement requires a
party that takes or fails to take any action which contributes to a
determination that the 1998 Distribution is not tax-free to Old D&B (i.e.,
Donnelley), the Company or their stockholders to indemnify the other party and
its stockholders from any taxes arising therefrom.

1998 TAX ALLOCATION AGREEMENT

Under the 1998 Tax Allocation Agreement, the Company is generally liable for all
income taxes of Old D&B (i.e., Donnelley) and its subsidiaries attributable to
periods prior to the 1998 Distribution, provided that in the case of any
separate company state or local income taxes, Donnelley and its subsidiaries and
the Company and its subsidiaries are liable for their own liabilities arising
from any audit adjustment. For income taxes attributable to periods beginning
after the 1998 Distribution, the Company is liable for taxes relating to the
Company and its subsidiaries; and Donnelley is liable for taxes relating to
Donnelley and its subsidiaries. For all other taxes, the Company and its
subsidiaries and Donnelley and its subsidiaries are responsible for their own
liabilities for all periods.

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1998 EMPLOYEE BENEFITS AGREEMENT

The 1998 Employee Benefits Agreement allocates responsibility for certain
employee benefits matters on and after the 1998 Distribution Date.

Under the 1998 Employee Benefits Agreement, Donnelley adopted a new defined
benefit pension plan and a new defined contribution savings plan for its
employees; and the Company assumed and became the sponsor of the Old D&B defined
benefit pension plan and the Old D&B defined contribution savings plan for the
benefit of its employees and in general former employees who terminated
employment on or prior to the 1998 Distribution Date ("Former Old D&B
Employees"). Assets and liabilities of the Old D&B pension plan and account
balances under the Old D&B savings plan that were attributable to Donnelley
employees were transferred to the applicable new Donnelley plan.

Generally, the Company assumed and became the sponsor of Old D&B's nonqualified
supplemental pension plans for the benefit of persons who, prior to the 1998
Distribution Date, were participants thereunder; provided, however, that with
respect to Donnelley employees, the Company generally retained only those
liabilities that were vested prior to the 1998 Distribution Date. Donnelley is
required to guarantee payment of the benefits under these plans to its employees
in the event that the Company is unable to satisfy its obligations.

The 1998 Employee Benefits Agreement required Donnelley to adjust outstanding
equity-based grants (i.e., Old D&B stock options, restricted stock and
performance share opportunities) held by Donnelley employees as of the 1998
Distribution Date in a manner intended to preserve, as closely as possible, the
economic value of the pre-spin-off grants. Similarly, outstanding equity-based
grants held by Company employees as of the 1998 Distribution Date were canceled
and then converted into Company Common Stock-based grants in a manner intended
to preserve, as closely as possible, the economic value of the pre-spin-off
grants. Former Old D&B Employees holding Old D&B stock options were given the
choice of receiving either adjusted Donnelley stock options or replacement
Company stock options.

Except as otherwise provided in the 1998 Employee Benefits Agreement, as of the
1998 Distribution Date, Donnelley employees generally ceased participation in
Old D&B's employee benefits plans, and Donnelley and the Company will each
generally recognize, among other things, its respective employees' past service
with Old D&B under its employee benefits plans.

1996 DISTRIBUTION AGREEMENTS

On November 1, 1996 (the "1996 Distribution Date"), the company then known as
The Dun & Bradstreet Corporation ("Historical D&B") reorganized into three
publicly traded independent companies by spinning off, through a tax-free
dividend, two of its businesses to shareholders (the "1996 Distribution"). The
1996 Distribution resulted in the following three companies: (1) Old D&B, (2)
ACNielsen Corporation ("ACNielsen") and (3) Cognizant Corporation ("Cognizant").
For purposes of effecting the transaction and of governing certain of the
continuing relationships among Old D&B, Cognizant and ACNielsen after the 1996
Distribution, the three companies entered into various agreements, including a
Distribution Agreement (the "1996 Distribution Agreement"), a Tax Allocation
Agreement (the "1996 Tax Allocation Agreement"), an Employee Benefits Agreement
(the "1996 Employee Benefits Agreement") and an Indemnity and Joint Defense
Agreement (the "1996 Indemnity and Joint Defense Agreement"). The following

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descriptions summarize some of the material terms of such agreements, but are
qualified by reference to the texts of such agreements, which are incorporated
herein by reference.

The 1996 Distribution Agreement provided for, among other things, assumptions of
liabilities and cross indemnities designed generally to allocate to Old D&B,
effective as of the 1996 Distribution Date, financial responsibility for all
liabilities of Historical D&B, except for certain liabilities arising out of or
in connection with the businesses that became part of Cognizant or ACNielsen as
a result of the 1996 Distribution. Similarly, the 1996 Distribution Agreement
provided for the allocation generally to Old D&B of the financial responsibility
for the liabilities arising out of or in connection with then-former businesses,
including those formerly conducted by or associated with Cognizant or ACNielsen;
provided that liabilities related to certain prior business transactions were
allocated to Cognizant if such liabilities exceed certain specified amounts. See
Note 13 (Contingencies) in Part II, Item 8 on Pages 63-65 of this Form 10-K.

Except as otherwise provided in the 1996 Distribution Agreement (as described
above), the 1996 Tax Allocation Agreement provided, among other things, that Old
D&B must pay Historical D&B's entire consolidated tax liability for the tax
years that Cognizant and ACNielsen were included in Historical D&B's
consolidated Federal income tax return. For periods prior to the 1996
Distribution Date, Old D&B is generally liable for state and local taxes
measured by income or imposed in lieu of income taxes. The 1996 Tax Allocation
Agreement allocated liability to Old D&B, Cognizant and ACNielsen for their
respective shares of other state and local taxes as well as any foreign taxes
attributable to periods prior to the 1996 Distribution Date.

The 1996 Employee Benefits Agreement provided, among other things, that Old D&B
retains responsibility for (i) benefits owed to former employees who terminated
employment with Historical D&B on or prior to the 1996 Distribution Date under
Historical D&B's defined benefit pension plan, defined contribution savings plan
and welfare plans, (ii) all benefits under Historical D&B's nonqualified
supplemental pension plans that were vested prior to the 1996 Distribution Date,
(iii) unexercised Historical D&B stock options held by Old D&B employees and
Historical D&B retirees and disabled employees as of the 1996 Distribution Date,
which options were adjusted to reflect the 1996 Distribution, and (iv) all
employee benefits litigation liabilities that were asserted prior to the 1996
Distribution Date (but not such liabilities that relate to the retirement and
savings plan assets of Cognizant or ACNielsen employees that were transferred to
Cognizant and ACNielsen, respectively).

Pursuant to the 1996 Indemnity and Joint Defense Agreement, Old D&B, Cognizant
and ACNielsen agreed (i) to certain arrangements allocating potential
liabilities arising out of the legal action filed by Information Resources, Inc.
on July 29, 1996 and (ii) to conduct a joint defense of such action. See Note 13
(Contingencies) in Part II, Item 8 on Pages 63-65 of this Form 10-K.

Pursuant to the terms of the 1996 Distribution Agreement, as a condition to the
1998 Distribution, the Company undertook to be jointly and severally liable with
Old D&B (i.e., Donnelley) to Cognizant and ACNielsen for any liabilities arising
under the 1996 Distribution Agreement and related agreements. Pursuant to the
1998 Distribution Agreement, as between Donnelley and the Company, all
liabilities and rights of Old D&B under the 1996 Distribution Agreement and
related agreements became liabilities and rights of the Company, and the Company
must indemnify Donnelley against any such liabilities.

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On June 30, 1998, Cognizant completed a spin-off of its IMS Health Incorporated
subsidiary, after which Cognizant's name was changed to "Nielsen Media Research,
Inc." Pursuant to the terms of the 1996 Distribution Agreement, as a condition
to the Cognizant spin-off, IMS Health Incorporated undertook to be jointly and
severally liable with Cognizant (i.e., Nielsen Media Research, Inc.) to Old D&B
(i.e., Donnelley) and ACNielsen for any liabilities arising under the 1996
Distribution Agreement and related agreements. As between Donnelley and the
Company, Donnelley's rights under this IMS Health Incorporated undertaking were
assigned to the Company pursuant to the provision of the 1998 Distribution
Agreement described in the immediately preceding paragraph.

(a)(2) Not applicable.

(b) Operating segment data for the years ended December 31, 1998, 1997 and 1996
is included in Note 15 (Segment Information) in Part II, Item 8 on Pages 67-70
of this Form 10-K.

(c) The Dun & Bradstreet Corporation (i.e., "New D&B") is a non-operating
holding company whose revenue is derived primarily from dividends received from
its subsidiaries. As of December 31, 1998, the number of full-time equivalent
employees of the Company was approximately 12,500.

The Company consists of the D&B operating company and Moody's. A narrative
description of the Company's operations follows.

THE DUN & BRADSTREET OPERATING COMPANY

GENERAL

The D&B operating company is the world's largest provider of
business-to-business credit, marketing and purchasing information and commercial
receivables management services. It has been in business for over 150 years and
in 1998 had $1.42 billion in revenue. The D&B operating company operates offices
in 36 countries, conducts operations in four other countries through minority
interests in joint venture companies, and operates through independent
correspondents in over 150 additional countries.

At the core of the D&B operating company's products and services is its global
database, the largest and most comprehensive of its kind in the world,
containing information on more than 50 million public and private businesses
from more than 200 countries. In addition, the D&B operating company's
D-U-N-S(R) Numbering System (a numerical system used to identify companies and
company affiliations) is an internationally recognized common company identifier
that is recommended or endorsed by the U.S. Government, the European Commission,
the International Standards Organization, the United Nations Edifact Council and
other global standard-setting organizations. The D&B operating company uses its
global database, the D-U-N-S(R) Number's hierarchical information and its
expertise in organizing and rationalizing data to help customers determine
creditworthiness, predict market demand and pinpoint prospective clients, and
increase purchasing efficiency. The D&B operating company's goal is to help
customers grow profitably by ensuring that their business strategies, decisions
and actions are based on a consistent flow of quality information throughout
their supply and demand chains.

The D&B operating company's 1998 revenue was derived from CREDIT INFORMATION
SERVICES (69.4%), MARKETING INFORMATION SERVICES (19.9%), PURCHASING INFORMATION
SERVICES (1.6%), and RECEIVABLES MANAGEMENT SERVICES (9.1%). Within these
categories, a

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further differentiation may be made between the D&B operating company's
traditional products and services ("Traditional Products") and its value-added
products and services ("Value-Added Products"). In general, Traditional Products
consist of standard-format reports (typically credit reports, marketing lists
and labels) containing information from the D&B operating company's global
database, whereas Value-Added Products integrate customer and D&B data and
provide decision-support tools and services through the use of proprietary
software solutions. Value-Added Products provide easy, open access to the D&B
operating company's database and are scalable for use on individual desktops, in
networks and on computer hosts. They are designed to improve customers' decision
making, speed-of-action and productivity, and to help customers realize greater
value from their information and technology investments. Value-Added Products
account for an increasingly significant portion of the D&B operating company's
revenues, having grown since their introduction in 1994 to about $200 million in
1998. Through alliances being developed with major enterprise application
software providers, the D&B operating company is expanding on the strategy
behind its Value-Added Products. In 1998, the D&B operating company began to
offer a new level of services by which it cleanses, consolidates and migrates
legacy client and vendor data to a customer's new enterprise resource planning
(ERP) system and links this data with the D-U-N-S(R) number ("Data
Rationalization Services"). The D&B operating company then offers real-time,
online access to its global database through the customer's ERP system.
Management intends to improve customers' processes by electronically integrating
information from the D&B operating company's global database into enterprise
resource planning (ERP), enterprise relationship management (ERM) and other
decision-support systems, and believes that this represents a significant
opportunity for the D&B operating company. Management expects that the
opportunity to provide these services will grow rapidly along with the expansion
of the ERP/ERM market itself, which has grown at an average annual rate of
approximately 40% since 1995.

Customers use the D&B operating company's CREDIT INFORMATION SERVICES to extend
commercial credit, approve loans and leases, underwrite insurance, evaluate
clients, and make other financial and risk assessment decisions. The D&B
operating company's largest customers for this information are major
manufacturers and wholesalers, insurance companies, banks, and other credit and
financial institutions. Its core credit information is available through a
variety of Traditional Products, including the Business Information Report,
which contains commercial credit information that may include basic background
information, financial and public records data, and information on financial
strength and payment history. Customers can access this information through the
D&B operating company's web site, personal computer, mail, telephone, fax and
customized connections with the customers' computer systems. Credit Information
Services are also distributed by a number of other firms, including leading
vendors of online information services and the web sites of certain third
parties.

Credit Information Services also include Value-Added Products such as Predictive
Scoring Services and Decision Support Services. Predictive Scoring Services use
statistical models to help customers predict the likelihood of delinquent
payment, failure to pay within terms, discontinuation of operations or the
filing of a bankruptcy petition. Decision Support Services include desktop
decision-support systems, such as Risk Assessment Manager(TM) (DecisionMaker(TM)
outside the U.S.), which use customers' rules to automate credit decisions using
internal and external information, including information from the D&B operating
company's global database.

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Traditionally, Credit Information Services were offered pursuant to an annual
contract requiring a minimum volume commitment. In January 1998, the D&B
operating company began to offer customers a choice of how to purchase these
services. Customers can now continue to commit to an annual contract or opt for
a flexible, monthly, pay-as-you-go plan, with no minimum usage requirement. The
Company believes that these changes, along with concurrent changes in sales
force compensation and service practices, generated increased revenue growth
rates for the D&B operating company in 1998 by attracting and retaining a
broader range of customers and providing a strong incentive for the D&B
operating company's sales force to familiarize customers with the full line of
the D&B operating company's solutions.

The D&B operating company's MARKETING INFORMATION SERVICES provide business-to-
business marketing information and analysis designed to help customers conduct
market segmentation, client profiling, prospect selection and marketing list
development using information from the D&B operating company's global database.
Marketing Information Services' Traditional Products are delivered in print, on
diskette, magnetic tape and CD-ROM, through online information services and
other third parties, and via the D&B operating company's web site and the web
sites of certain third parties. Marketing Information Services also include
Value-Added Products such as Market Spectrum(TM), a suite of database marketing
products and services that enhance internal customer data with external
information and analysis that can help target the most profitable clients and
prospects; analyze market penetration, territory alignment and market
segmentation; and perform demand estimation.

The D&B operating company's PURCHASING INFORMATION SERVICES help give customers
a better understanding of their supplier base, thereby enabling them to
rationalize their supplier rosters, leverage buying power, minimize
supply-related risks and identify and evaluate new sources of supply. In
addition to reports containing information from the D&B operating company's
global database delivered in a variety of ways, products in this area include
such Value-Added Products as Supplier Spend Analysis and Supplier Assessment
Manager(TM). Supplier Spend Analysis is a process by which the D&B operating
company integrates customers' supplier data with information from the D&B
operating company's global database and from third parties and then applies
analytical and benchmarking techniques designed to identify opportunities for
reducing purchasing costs and risks. Supplier Assessment Manager(TM) uses
decision-support software to automate the scoring and monitoring of supplier
performance, capabilities and risks using internal and external information.

The D&B operating company's RECEIVABLES MANAGEMENT SERVICES ("RMS") provide
customers with a full range of commercial accounts receivable management
services, including Traditional Products, such as third-party collection of
accounts and letter demand services, and Value-Added Products, such as
receivables management outsourcing programs. These services substitute for
and/or enhance customers' own internal management of accounts receivable.

RMS services and collects delinquent commercial receivables on behalf of
approximately 30,000 customers primarily in the business-to-business market.
Principal markets include insurance, telecommunications, and transportation
services. RMS also provides cross-border commercial receivables services in
which the RMS worldwide offices service cross-border claims for one another.

In third-party collections, RMS uses the Dun & Bradstreet name to communicate
with commercial debtors about delinquent accounts. Revenues are generally earned
on a

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contingent fee basis. Receivables outsourcing programs are selected by customers
seeking to outsource their commercial accounts receivable function to a
third-party vendor. Services include debt verification and collection, customer
service functions and analytical reporting.

In the U.S., RMS has sold franchises to third parties, which are given
permission to sell debt collection services under the Dun & Bradstreet and RMS
names. These franchises cover portions of 21 states. RMS uses franchises to
complement its field sales and telesales forces. These franchises are located in
less concentrated markets where local presence is preferred. RMS continues to be
responsible for all product fulfillment. Customer ownership remains with RMS,
with franchisees retaining exclusive access in their markets.

Certain jurisdictions require licensing for consumer and commercial debt
collection. RMS, and in some instances the individual collectors, must be
licensed in order to conduct business in these jurisdictions. The laws under
which such licenses are granted generally require annual license renewal and
provide for denial, suspension or revocation for improper actions or other
reasons.

GEOGRAPHIC BUSINESS SEGMENTS; COMPETITION

The D&B operating company manages its business globally through three geographic
segments: United States; Europe/Africa/Middle East; and Asia Pacific, Canada and
Latin America. None of the D&B operating company's business segments is
dependent on a single customer, or a few customers, such that a loss of any one
or more would have a material adverse effect on that business segment.

DUN & BRADSTREET UNITED STATES

The D&B operating company's United States segment ("D&B U.S.") had 1998 revenue
of $902.5 million, comprised of Credit Information Services (68.2%), Marketing
Information Services (22.0%), Purchasing Information Services (2.5%) and
Receivables Management Services (7.3%).

D&B U.S.'s Credit Information Services is the leading commercial
credit-reporting agency in the U.S. However, it faces substantial competition
from in-house operations of the businesses it seeks as customers and from other
general and specialized credit-reporting agencies and other information services
providers. It believes the principal attributes in judging the competition are
information quality, availability, service and price.

D&B U.S.'s Marketing Information Services, while a market leader in its
industry, faces competition from data providers who have competitive
distribution channels, delivery formats and data quality.

D&B U.S.'s Purchasing Information Services enjoys a unique position as a
provider of business information that can be used to reduce purchasing costs. In
this area, D&B U.S. faces competition from in-house operations of the businesses
it seeks as customers and from other general and specialized information and
professional services providers. It believes the principal attributes in judging
the competition are information quality, availability, service and price.

RMS is the leader in the commercial receivables management industry in the U.S.
There are several consumer collection agencies that have larger receivables
portfolios, particularly health-care and credit card collection providers. The
third-party commercial collection market is highly fragmented with over 5,000
collection agencies. The outsourcing market has significantly fewer competitors
due to the need for larger-scale operations by the

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receivables providers. Both markets are very price-competitive, with status and
statistical reporting and speed-of-service as key qualitative attributes.

DUN & BRADSTREET EUROPE/AFRICA/MIDDLE EAST

The D&B operating company's Europe/Africa/Middle East segment ("D&B Europe") had
1998 revenue of $427.7 million, comprised of Credit Information Services
(73.1%), Marketing Information Services (15.3%) and Receivables Management
Services (11.6%). D&B Europe expects to commence offering Purchasing Information
Services in 1999.

D&B Europe has operations in 20 countries and conducts operations in three other
countries through minority interests in joint venture companies. D&B Europe is
believed to be the largest single supplier of commercial credit information
services in Europe. However, the competitive environment varies considerably
from country to country. In some countries, leadership positions exist, whereas
in others the businesses are highly competitive. The competition is primarily
local and there are no competitors offering a comparable range of global
services or capabilities. D&B Europe faces competition from banks, credit
insurance companies, public information suppliers (such as company registries),
consumer information companies, application software developers, online content
providers and in-house operations of businesses, as well as direct competition
from businesses providing similar services.

Management believes that the increase in cross-border trade expected to result
from the European Monetary Union may represent a significant opportunity for D&B
Europe over time since it is the only pan-European commercial data provider. The
transition to a single European currency also entails certain risks to D&B
Europe's business, as described under the caption "New European Currency" in
Part II, Item 7 on Pages 30-31 of this Form 10-K.

D&B Europe continues to invest in data systems and is continuing its rollout to
the European market of a range of new cross-border products. D&B Europe has also
continued investing heavily in a new technology platform, which is expected to
result in enhanced product/service flexibility as well as opportunities to
streamline operations.

D&B Europe is subject to the usual risks inherent in carrying on business in
certain countries outside of the U.S., including currency fluctuations and
possible nationalization, expropriation, price controls, changes in the
availability of data from public sector sources, limits on collecting certain
types of personal information or on providing information across borders, or
other restrictive governmental actions. Management believes that the risks of
nationalization or expropriation are reduced because its basic service is the
delivery of information, rather than the production of products that require
manufacturing facilities or the use of natural resources.

DUN & BRADSTREET ASIA PACIFIC, CANADA AND LATIN AMERICA

The D&B operating company's Asia Pacific, Canada and Latin America segment ("D&B
APCLA") had 1998 revenue of $88.6 million, comprised of Credit Information
Services (63.8%), Marketing Information Services (21.4%) and Receivables
Management Services (14.8%).

D&B APCLA has operations in 15 countries and conducts operations in one other
country through a minority interest in a joint venture company. It faces
competition from banks, credit insurance companies, public information suppliers
(such as company registries), consumer information companies, application
software developers, online content providers

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and in-house operations of businesses as well as direct competition from
businesses providing similar services. The competition is primarily local and
there are no competitors offering a comparable range of global services or
capabilities.

In 1996, D&B APCLA reorganized its operations in Brazil, Mexico, Chile and
Venezuela. It continues to provide cross-border services originating in Latin
America through local affiliates, small local operations centers and an
operations center in Florida. In the Asia Pacific region, D&B APCLA has entered
into joint venture and distribution arrangements to leverage its staff and data
sourcing and distribution capabilities and is exploring additional such
opportunities.

D&B APCLA is subject to the usual risks inherent in carrying on business in
certain countries outside of the U.S., including currency fluctuations and
possible nationalization, expropriation, price controls, changes in the
availability of data from public sector sources, limits on collecting certain
types of personal information or on providing information across borders, or
other restrictive governmental actions. Management believes that the risks of
nationalization or expropriation are reduced because its basic service is the
delivery of information, rather than the production of products that require
manufacturing facilities or the use of natural resources.

THE D&B OPERATING COMPANY'S STRATEGY

As technology changes and evolves, the D&B operating company is changing the way
it provides solutions to customers. The D&B operating company's strategy is to
integrate its information in business processes through both back-office and
front-office solutions. This means extending its business beyond a core
transaction-based service -- primarily credit reports and marketing lists -- to
the provision of quality business information through technology-based packaged
applications. The D&B operating company is pursuing new opportunities to
increase revenue growth and profitability by building on its core competencies
in providing business information and analysis to companies worldwide. Following
are the key components of this strategy:

- EXPAND THE USE OF TRADITIONAL PRODUCTS. Traditional Products annually
generate more than $1 billion in revenue worldwide. Additional
distribution of these products and services will be pursued through new
customer sales efforts and through expanded use of the Internet. Because
many of these products are used in conjunction with or are accessed
through Value-Added Products, the D&B operating company hopes to increase
the distribution and sale of Traditional Products globally through the
sale of Value-Added Products.

- FOCUS RESOURCES ON THE DEVELOPMENT AND DEPLOYMENT OF VALUE-ADDED
PRODUCTS. Revenues from Value-Added Products, D&B U.S.'s fastest-growing
product area, are expected to continue to grow through the accelerated
rollout of existing Value-Added Products around the world, as well as
through the expansion of the D&B operating company's Global Accounts
Program. The Global Accounts Program targets very large customers having
multi-country operations spanning the D&B operating company's three
geographic segments.

- BECOME A MAJOR CONTENT PROVIDER FOR USERS OF ENTERPRISE DECISION-SUPPORT
SOFTWARE SYSTEMS. The D&B operating company aims to become the leading
business information provider to the enterprise resource planning (ERP)
and enterprise relationship management (ERM) markets. In February 1999,
the D&B operating company announced a strategic alliance with SAP AG, the
leading

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provider of enterprise application solutions, to provide users of SAP's
R/3 software with Data Rationalization Services and online access to the
D&B operating company's global database. The D&B operating company is
actively pursuing alliances with other major business application
software providers.

- IDENTIFY AND DEVELOP ELECTRONIC COMMERCE PRODUCTS AND SERVICES. The D&B
operating company has begun developing solutions to establish itself as a
major third-party provider of information for business-to-business
electronic commerce via the Internet. Inclusion of D&B operating company
data for verification, authentication and registration services could
help both buyers and sellers as well as network providers to identify
dependable business partners. Management of the D&B operating company
believes that the significant growth anticipated in the electronic
commerce marketplace will create the need for a trusted, independent
third party to provide verification, authentication and registration
services. The D&B operating company intends to identify and pursue
opportunities to participate in these processes and to develop new
products and services and reposition existing products and services for
the electronic commerce market.

- IMPROVE THE PROFITABILITY OF INTERNATIONAL OPERATIONS. As described
above, the accelerated rollout of Value-Added Products around the world
is expected to be a key factor in improving international profitability.
In addition, cost structures have been and will continue to be reviewed
with the intent of implementing further efficiencies to improve
international profit margins. For example, the building of a pan-European
technology platform is expected to eliminate duplicative development
efforts and reduce ongoing systems maintenance costs.

MOODY'S INVESTORS SERVICE, INC.

GENERAL

Moody's is a leading global credit rating agency. Moody's publishes credit
opinions, research, and ratings on fixed-income securities, issuers of
securities and other credit obligations. It also provides a broad range of
business and financial information. Credit ratings help investors analyze the
credit risks associated with fixed-income securities. Ratings also create
efficiencies in fixed-income markets by providing reliable, credible, and
independent assessments of credit risk. For issuers, Moody's services increase
market liquidity and may reduce transaction costs.

Moody's employs over 680 analysts and has a total of more than 1,300 associates
located around the world. Moody's maintains offices in 12 countries and has
begun to expand into developing markets through joint ventures or affiliation
agreements with local rating agencies. Moody's provides ratings and information
on governmental and commercial entities in 100 countries. Its customers include
investors; depositors, creditors, investment banks, commercial banks and other
financial intermediaries; and a wide range of corporate and governmental issuers
of securities. Moody's is not dependent on a single customer, or a few
customers, such that a loss of any one or more would have a material adverse
effect on its business.

Moody's publishes rating opinions on a broad range of credit obligations. These
include various United States corporate and governmental obligations,
international cross-border notes and bonds, domestic obligations in foreign
local markets, structured finance securities and commercial paper issuers. In
recent years, Moody's has moved beyond its traditional

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13

bond ratings activity, assigning ratings to insurance companies' obligations,
bank loans, derivative product companies, bank deposits and other bank debt,
managed funds, and derivatives. At the end of 1998, Moody's had outstanding
ratings on approximately 100,000 corporate and over 68,000 public finance
obligations. Ratings are disseminated to the public through a variety of print
and electronic media, including real-time systems widely used by securities
traders and investors.

In addition to its rating activities, Moody's publishes investor-oriented credit
research for over 15,600 subscribers globally. Moody's publishes more than 100
research products, including in-depth research on major issuers, industry
studies, special comments, and summary credit opinion handbooks. Detailed
descriptions of both the rated issue and issuer, along with a summary of the
rationale for the assignment of the specific rating, also appear in various
Moody's credit research products. Product selection includes insurance,
utilities, speculative grade instruments, bank and global credit research.

Moody's Risk Management Services, Inc. (formerly known as Financial Proformas,
Inc.), a wholly owned subsidiary of Moody's, develops and distributes credit
education materials, seminars and computer-based lending simulations, which it
complements with financial and risk assessment software for the commercial
lending community.

In July 1998, Moody's completed the sale of its Financial Information Services
(FIS) unit, which provides current and historical business and financial
information for investment research and reference uses.

Moody's is registered as an investment adviser under the Investment Advisers Act
of 1940. Moody's has been designated as a Nationally Recognized Statistical
Rating Organization ("NRSRO") by the SEC. The SEC is currently engaged in a
rule-making process to establish the criteria for designation as an NRSRO; such
criteria may impose operating requirements upon Moody's. Moody's is also subject
to regulation in certain countries outside the United States.

PROSPECTS FOR GROWTH

Over the past decade, the global public fixed-income markets have more than
doubled in outstanding principal amount. Moody's believes that the size of the
global credit markets will continue to increase. In addition, the securities
being issued in the global fixed-income markets are becoming more complex.
Moody's expects that these trends will increase the demand for high-quality,
independent credit opinions from Moody's.

The size of the world capital markets is increasing because, in general, the
global political and economic climate has promoted economic growth and
productive capital investment. Moody's believes that the outlook is generally
favorable for the continued growth of the world capital markets, particularly in
Europe as a consequence of financial market integration under the European
Monetary Union (EMU).

Lower-cost information technology makes information about investment
alternatives available throughout the world. Investors are able to obtain
information about securities issued outside their national markets. Investors
are also able to obtain information about new financing techniques and new types
of securities that they may wish to purchase or sell. This availability of
information promotes globalization and integration of financial markets. A
number of new "emerging" capital markets have been created. There is investor
and intermediary interest in domestic currency debt obligations from such
markets that are now being sold cross-border in unprecedented volumes.

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14

Another trend that is increasing the size of the world capital markets is the
ongoing disintermediation of the world's financial system. Issuers are
increasingly financing in the global public capital markets, rather than through
traditional financial intermediaries. In addition, financial intermediaries are
selling assets in the global public capital markets, in addition to or instead
of retaining those assets. Structured finance securities markets for many types
of assets have developed in many countries and are contributing to those trends.

The complexity of capital market instruments is also growing. Consequently,
assessing the credit risk of such instruments is a challenge for financial
intermediaries and asset managers. In the credit markets, third-party ratings
represent an increasingly viable alternative to traditional in-house research as
the geographic scope and complexity of market instruments grow.

Rating fees paid by issuers account for most of Moody's revenues. Therefore, a
substantial portion of Moody's revenues is dependent upon the volume of debt
securities issued in the global capital markets. Accordingly, Moody's is
dependent on the macro-economic prospects of the major world economies and the
fiscal and monetary policies pursued by their governments. Fees from
arrangements with frequent debt issuers and from commercial paper and medium
term note programs, bank and insurance company financial strength ratings and
mutual fund ratings are less dependent on the volume of debt securities issued
in the global capital markets. Moody's non-U.S. operations are subject to the
usual risks inherent in carrying on business in certain countries outside the
United States, including currency fluctuations and possible nationalization,
expropriation, price controls, changes in the availability of data from public
sector sources, limits on providing information across borders or other
restrictive governmental actions. Management believes that the risks of
nationalization or expropriation are reduced because its basic service is the
delivery of information, rather than the production of products that require
manufacturing facilities or the use of natural resources.

COMPETITION

Moody's competes with other credit rating agencies and with credit opinions
offered by investment banks and brokerage firms. Institutional investors also
have in-house credit research capabilities. Credit rating agencies compete, in
addition, with other methods of addressing credit risk, such as credit insurance
and credit derivatives. Moody's most direct competitor in the global credit
rating business is Standard and Poor's Corporation ("S&P"), a division of The
McGraw-Hill Companies, Inc. There are some rating markets, based on industry,
geography and/or instrument type, in which Moody's has made investments and
obtained market positions superior to S&P's. In other markets the reverse is
true. Moody's believes that its rating revenues for 1998 are similar to S&P's.

Other rating agency competitors of Moody's are Duff & Phelps and Fitch IBCA.
Fitch IBCA is a recent combination of the U.S. rating agency, Fitch, and the
British-French rating agency, IBCA. Although Moody's and S&P are larger than
Duff & Phelps and Fitch IBCA, increased competition from those two rating
agencies can be expected.

Over the last decade, additional rating agencies have been established,
primarily in emerging markets, and primarily as a result of local capital market
regulation. Regulators worldwide have recognized that credible, independent
credit ratings can further regulatory objectives for the development of public
fixed-income securities markets. The result of such regulatory activity has been
the creation of a number of primarily national ratings agencies in various
countries around the world. Regulation may stimulate the production of

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less credible ratings over time and tends to make all rating systems appear
undifferentiated -- to the detriment of Moody's high-quality rating opinions.

Regulators of financial institutions are attempting to improve their approach to
supervision. They are shifting away from rule-based systems that address only
specific risk components and institution-specific protections -- toward more
sophisticated, prudential supervision. The regulators' evolving approach
includes their making qualitative judgments about the sophistication of each
financial institution's risk management processes and systems, in terms of both
market and credit risk. While such regulatory trends present additional
opportunities for the use of Moody's ratings, they may also result in additional
competition for Moody's.

MOODY'S STRATEGY

Moody's intends to focus its business strategy on the following opportunities:

- CONTINUE INTERNATIONAL EXPANSION. Moody's maintains a global network of
offices and business affiliations, including full-service rating and
marketing operations in the major global financial centers of Frankfurt,
Hong Kong, London, Paris and Tokyo. Moody's expects that these centers
will position it to benefit from the expansion in global capital markets
and offer the greatest potential for its revenue growth. Moody's also
expects accelerated growth of its ratings activities as a consequence of
financial market integration under the European Monetary Union (EMU) and
from ongoing global development of non-traditional financial instruments
(e.g., derivatives, credit-linked bonds and catastrophe bonds). Moody's
will continue its expansion into developing markets through joint
ventures or affiliations.

- FOCUS ON NATURAL ADJACENCIES. Moody's is pursuing initiatives that
expand credit ratings from securities markets to other credit risk
exposures. Moody's has a committed effort to extend its opinion franchise
to the global bank counterparty universe through emerging market ratings,
including bank financial strength ratings. Insurance financial strength
ratings in the property and casualty, reinsurance, and life insurance
markets represent additional growth opportunities. Moody's has introduced
issuer ratings for mid-sized corporations not active in the debt markets.
Moody's is investigating numerous non-traditional opportunities to extend
its opinion franchise.

- PURSUE OPPORTUNITIES IN NEW SECTORS. The enhancement of risk management
processes will hasten the convergence of the loan and capital markets as
intermediaries and investors seek additional opportunities for the
development of financial markets and a consistent standard of relative
risk comparison. Moody's intends to expand coverage for ratings of bank
loans. Moody's has also introduced equity mutual fund indices and fund
analyzers for institutional fund managers.

- PURSUE OPPORTUNITIES IN SECURITIZATION. The repackaging of financial
assets has had a profound effect on the U.S. fixed-income market. New
patterns of securitization will emerge in the next decade. The bulk of
assets securitized in the past five years are consumer assets owned by
banks. Now, commercial assets, principally commercial mortgages, term
receivables, and corporate loans, are increasingly being securitized.
Securitization concepts are rapidly being exported to Europe and Asia. In
addition, securitization is evolving into a strategic corporate finance
tool. Moody's is aggressively pursuing opportunities in these areas.

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INTELLECTUAL PROPERTY

The Company owns and controls a number of trade secrets, confidential
information, trademarks, trade names, copyrights, patents and other intellectual
property rights which, in the aggregate, are of material importance to the
Company's business. Management of the Company believes that each of the "Dun &
Bradstreet" and "Moody's" names and related names, marks and logos are of
material importance to the Company. The Company is licensed to use certain
technology and other intellectual property rights owned and controlled by
others, and, similarly, other companies are licensed to use certain technology
and other intellectual property rights owned and controlled by the Company. The
Company considers its trademarks, service marks, databases, software and other
intellectual property to be proprietary and the Company relies on a combination
of copyright, trademark, trade secret, patent, non-disclosure and contract
safeguards for protection.

The names of the Company's products and services referred to herein are
trademarks, service marks or registered trademarks or service marks owned by or
licensed to the Company or one or more of its subsidiaries.

(d) Financial information about foreign and domestic markets is included in Note
15 (Segment Information) in Part II, Item 8 on Pages 67-70 of this Form 10-K.

ITEM 2. PROPERTIES

The executive offices of the Company are located at One Diamond Hill Road,
Murray Hill, New Jersey in a 184,000 square foot property owned by the Company.
This property also serves as the executive offices of D&B U.S. and D&B APCLA.

The Company's other properties are geographically distributed to meet sales and
operating requirements worldwide. These properties are generally considered to
be both suitable and adequate to meet current operating requirements and
virtually all space is being utilized. The most important of these other
properties include the following sites that are owned by the Company: (i) a
300,000 square foot office building in New York, New York that serves as the
executive offices of Moody's; (ii) two commercial office buildings (totaling
114,200 square feet) in Berkeley Heights, New Jersey used as data processing
facilities for the U.S. operations of the D&B operating company and Moody's;
(iii) a 147,000 square foot office building in Parsippany, New Jersey housing
personnel from the sales, marketing and technology groups of the D&B operating
company; and (iv) a 236,000 square foot office building in High Wycombe, England
that serves as the executive offices of D&B Europe. The Company's operations are
also conducted from 81 other offices located throughout the U.S. (all of which
are leased) and 101 non-U.S. office locations (95 of which are leased).

ITEM 3. LEGAL PROCEEDINGS

Information in response to this Item is included in Note 13 (Contingencies) in
Part II, Item 8 on Pages 63-65 of this Form 10-K.

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

Not applicable.

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EXECUTIVE OFFICERS OF THE REGISTRANT*

Officers are elected by the Board of Directors to hold office until their
respective successors are chosen and qualified.

Listed below are the executive officers of the Registrant at February 16, 1999
and brief summaries of their business experience during the past five years.
Information concerning officer titles at The Dun & Bradstreet Corporation
reflect titles with (i) Old D&B and Historical D&B, as applicable, for periods
prior to the 1998 Distribution Date and (ii) the Company for periods after the
1998 Distribution Date.



NAME TITLE AGE
- ---- ----- ---

Volney Taylor**.................... Chairman of the Board and Chief
Executive Officer 59
William F. Doescher................ Senior Vice President and Chief
Communications Officer 61
Nancy L. Henry..................... Senior Vice President and Chief
Legal Counsel 53
Elahe Hessamfar.................... Senior Vice President and Chief
Technology Officer 45
Peter J. Ross...................... Senior Vice President and Chief
Human Resources Officer 53
Frank S. Sowinski.................. Senior Vice President and Chief
Financial Officer 42
Chester J. Geveda, Jr.............. Vice President and Controller 52


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

* Set forth as a separate item pursuant to Items 401(b) and (e) of Regulation
S-K.

** Member of the Board of Directors since December 19, 1984.

Mr. Taylor has served as chairman and chief executive officer of The Dun &
Bradstreet Corporation since November 1996 and has served as a director since
1984. He served as executive vice president of The Dun & Bradstreet Corporation
from February 1982 to November 1996. Since January 1991, he has also served as
chairman of the Dun & Bradstreet operating company.

Mr. Doescher has served as senior vice president and chief communications
officer of The Dun & Bradstreet Corporation since November 1996. He is also
senior vice president -- global communications of the Dun & Bradstreet operating
company, a position he has held since April 1992.

Ms. Henry has served as senior vice president and chief legal counsel of The Dun
& Bradstreet Corporation since March 1997. Prior thereto, she was special
counsel at the law firm of Skadden, Arps, Slate, Meagher & Flom LLP from April
1985.

Ms. Hessamfar has served as senior vice president and chief technology officer
of The Dun & Bradstreet Corporation since August 1997. Prior thereto, she served
as chief information officer of Turner Broadcasting System from July 1993 to
July 1997 and as vice president -- information systems of PAC Bell Directories
from May 1987 to June 1993.

Mr. Ross has served as senior vice president and chief human resources officer
of The Dun & Bradstreet Corporation since November 1996. He is also senior vice
president -- human

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resources of the Dun & Bradstreet operating company, a position he has held
since June 1988.

Mr. Sowinski has served as senior vice president and chief financial officer of
The Dun & Bradstreet Corporation since November 1996. He is also executive vice
president -- global marketing of the Dun & Bradstreet operating company, a
position he has held since October 1997. Prior thereto, Mr. Sowinski served the
Dun & Bradstreet operating company as executive vice president -- applications
and alliances from November 1996 to September 1997, as executive vice
president -- applications, mass marketing and alliances from October 1994 to
October 1996, as executive vice president -- marketing from April 1993 to
September 1994 and as senior vice president -- finance & planning from August
1989 to March 1993.

Mr. Geveda has served as vice president and controller of The Dun & Bradstreet
Corporation and as senior vice president -- finance of the Dun & Bradstreet
operating company since November 1996. Prior thereto, he served as senior vice
president -- finance and planning of the Dun & Bradstreet operating company from
April 1993 to October 1996 and as senior vice president -- finance and
administration of Dun & Bradstreet Europe/Africa/Middle East from September 1990
to March 1993.

PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS

Information in response to this Item is set forth under the captions "Dividends"
and "Common Stock Information" in Part II, Item 7 on Page 31 of this Form 10-K.

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ITEM 6. SELECTED FINANCIAL DATA

THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

FIVE-YEAR SELECTED FINANCIAL DATA



1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
(AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)

RESULTS OF OPERATIONS
Operating Revenues.................... $1,934.5 $1,811.0 $1,782.5 $1,735.3 $1,685.0
Costs and Expenses(1)................. 1,513.8 1,407.3 1,725.3 1,522.4 1,337.9
-------- -------- -------- -------- --------
Operating Income...................... 420.7 403.7 57.2 212.9 347.1
Non-Operating Expense -- Net(2)....... (20.9) (71.3) (71.2) (68.0) (35.1)
-------- -------- -------- -------- --------
Income from Continuing Operations
before Provision for Income Taxes... 399.8 332.4 (14.0) 144.9 312.0
Provision for Income Taxes............ 153.4 113.4 102.1 49.6 110.4
-------- -------- -------- -------- --------
Income (Loss) from:
Continuing Operations................. 246.4 219.0 (116.1) 95.3 201.6
Discontinued Operations, Net of Income
Taxes(3)............................ 33.7 92.0 72.3 225.9 428.0
-------- -------- -------- -------- --------
Income (Loss) before Cumulative Effect
of Accounting Changes............... 280.1 311.0 (43.8) 321.2 629.6
Cumulative Effect of Accounting
Changes, Net of Income Tax
Benefit(4).......................... -- (127.0) -- -- --
-------- -------- -------- -------- --------
Net Income (Loss)..................... $ 280.1 $ 184.0 $ (43.8) $ 321.2 $ 629.6
======== ======== ======== ======== ========
BASIC EARNINGS (LOSS) PER SHARE OF
COMMON STOCK
Continuing Operations................. $ 1.45 $ 1.28 $ (.69) $ .56 $ 1.18
Discontinued Operations............... .20 .54 .43 1.33 2.52
-------- -------- -------- -------- --------
Before Cumulative Effect of Accounting
Changes............................. 1.65 1.82 (.26) 1.89 3.70
Cumulative Effect of Accounting
Changes, Net of Income Tax
Benefit(4).......................... -- (.74) -- -- --
-------- -------- -------- -------- --------
Basic Earnings (Loss) Per Share of
Common Stock........................ $ 1.65 $ 1.08 $ (.26) $ 1.89 $ 3.70
======== ======== ======== ======== ========


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1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
(AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)

DILUTED EARNINGS (LOSS) PER SHARE OF
COMMON STOCK
Continuing Operations................. $ 1.44 $ 1.27 $ (.69) $ .55 $ 1.17
Discontinued Operations............... .19 .53 .43 1.32 2.50
-------- -------- -------- -------- --------
Before Cumulative Effect of Accounting
Changes............................. 1.63 1.80 (.26) 1.87 3.67
Cumulative Effect of Accounting
Changes, Net of Income Tax
Benefit(4).......................... -- (.73) -- -- --
-------- -------- -------- -------- --------
Diluted Earnings (Loss) Per Share of
Common Stock........................ $ 1.63 $ 1.07 $ (.26) $ 1.87 $ 3.67
======== ======== ======== ======== ========
OTHER DATA
Dividends Paid Per Share.............. $ .81 $ .88 $ 1.82 $ 2.63 $ 2.56
======== ======== ======== ======== ========
Dividends Declared Per Share.......... $ .775 $ 1.10 $ 1.82 $ 2.63 $ 2.56
======== ======== ======== ======== ========
Weighted Average Number of Shares
Outstanding -- Basic................ 169.5 170.8 170.0 169.5 169.9
======== ======== ======== ======== ========
Weighted Average Number of Shares
Outstanding -- Diluted(5)........... 171.7 172.6 170.0 171.6 171.7
======== ======== ======== ======== ========
BALANCE SHEET
Total Assets(6)....................... $1,789.2 $2,086.0 $2,225.4 $3,644.9 $3,759.8
======== ======== ======== ======== ========


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

(1) 1998 included a one-time charge of $28.0 million for reorganization costs
associated with the separation of the Company and Donnelley. 1996 included
one-time charges of $161.2 million for reorganization costs associated with
the 1996 Distribution and loss on sale of $68.2 million for American Credit
Indemnity. 1995 included a fourth-quarter non-recurring charge of $188.5
million partially offset by gains of $90.0 million and $28.0 million for the
sale of Interactive Data Corporation and warrants received in connection
with the sale of Donnelley Marketing, respectively.

(2) 1998 included a one-time gain on the sale of Financial Information Services,
the publishing unit of Moody's Investors Service, of $9.6 million.

(3) Income taxes on Discontinued Operations were $22.5 million, $52.2 million,
$145.1 million, $73.4 million and $139.4 million in 1998, 1997, 1996, 1995
and 1994, respectively.

(4) 1997 included the impact of a change in revenue recognition policies (see
Note 1 to the consolidated financial statements).

(5) The exercise of diluted shares has not been assumed for the year ended
December 31, 1996, since the result is antidilutive.

(6) Included Net Assets of Discontinued Operations of $296.5 million, $430.6
million, $1,652.2 million and $1,809.3 million in 1997, 1996, 1995 and 1994,
respectively.

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

OVERVIEW

On June 30, 1998, The Dun & Bradstreet Corporation ("Old D&B") separated into
two publicly traded companies -- The New Dun & Bradstreet Corporation ("New D&B"
or the "Company") and R.H. Donnelley Corporation. The separation (the "1998
Distribution") of the two companies was accomplished through a tax-free dividend
by Old D&B of the Company, which is a new entity comprised of Moody's Investors
Service ("Moody's") and the Dun & Bradstreet operating company ("D&B"). New D&B
changed its name to "The Dun & Bradstreet Corporation," and the continuing
entity (i.e., Old D&B) consisting of R.H. Donnelley Inc., the operating company
and the DonTech partnership changed its name to "R.H. Donnelley Corporation"
("Donnelley"). The tax-free stock dividend was issued on June 30, 1998, to
shareholders of record at the close of business on June 17, 1998. Due to the
relative significance of Moody's and D&B, the transaction has been accounted for
as a reverse spin-off and, as such, Moody's and D&B have been classified as
continuing operations and R.H. Donnelley Inc. and DonTech have been classified
as discontinued operations. For purposes of effecting the 1998 Distribution and
of governing certain of the continuing relationships between the Company and
Donnelley after the transaction, the two companies have entered into various
agreements as described in Note 2 to the Company's consolidated financial
statements on Pages 47-49 of this Form 10-K.

On November 1, 1996, the company then known as The Dun & Bradstreet Corporation
reorganized into three publicly traded independent companies by spinning off
through a tax-free dividend (the "1996 Distribution") two of its businesses to
shareholders. The 1996 Distribution resulted in the following three companies:
(1) Old D&B, (2) Cognizant Corporation ("Cognizant") and (3) ACNielsen
Corporation ("ACNielsen"). In conjunction with the 1996 Distribution, Dun &
Bradstreet Software ("DBS") and NCH Promotional Services ("NCH") also were
disposed of. After the transaction was completed, Old D&B's continuing
operations consisted of D&B, Moody's and Donnelley. For purposes of effecting
the 1996 Distribution and governing certain of the ongoing relationships among
Old D&B, Cognizant and ACNielsen after the 1996 Distribution, Old D&B, Cognizant
and ACNielsen entered into various agreements, as described in Note 2 to the
Company's consolidated financial statements on Pages 47-49 of this Form 10-K.

Pursuant to Accounting Principles Board Opinion ("APB") 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," the consolidated financial statements of the Company have been
reclassified to reflect both the 1998 Distribution and the 1996 Distribution.
Accordingly, revenues, costs and expenses, and cash flows of Donnelley,
Cognizant, ACNielsen, DBS and NCH have been excluded from the respective
captions in the Consolidated Statements of Operations and Consolidated
Statements of Cash Flows. The net operating results of these entities have been
reported, net of applicable income taxes, as "Income from Discontinued
Operations," and the net cash flows of these entities have been reported as "Net
Cash (Used in) Provided by Discontinued Operations." The assets and liabilities
of Donnelley have been excluded from the respective captions in the Consolidated
Balance Sheets and have been reported as "Net Assets of Discontinued
Operations."

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RESULTS OF OPERATIONS

As of December 31, 1998, the Company adopted the provisions of Statement of
Financial Accounting Standards ("SFAS") No. 131, "Disclosures about Segments of
an Enterprise and Related Information." In accordance with SFAS No. 131, the
segment information is being reported consistent with the Company's method of
internal reporting. The prior years' segment information has been restated
accordingly. The Company's reportable segments are Dun & Bradstreet United
States ("D&B U.S."), Dun & Bradstreet Europe/ Africa/Middle East ("D&B Europe"),
Dun & Bradstreet Asia Pacific/Canada/Latin America ("D&B APCLA") and Moody's.
The three Dun & Bradstreet segments, managed on a geographical basis, provide
business-to-business credit, marketing and purchasing information and
receivables management services. The Moody's segment provides credit opinions on
investment securities and assigns ratings to fixed-income securities and other
credit obligations. The Company evaluates performance and allocates resources
based on segment operating income.

YEAR ENDED DECEMBER 31, 1998, COMPARED WITH YEAR ENDED DECEMBER 31, 1997

The Company's basic earnings per share from continuing operations were $1.45 in
1998, up $.17 from $1.28 in 1997. On a diluted basis, the Company reported
earnings per share from continuing operations of $1.44 in 1998, compared to
earnings per share from continuing operations of $1.27 in 1997. The Company's
basic earnings per share for 1998 were $1.65 compared to $1.08 per share in
1997, including earnings per share from discontinued operations of $.20 and $.54
in 1998 and 1997, respectively. On a diluted basis, the Company's earnings per
share in 1998 of $1.63 were up from the 1997 diluted earnings per share of
$1.07, including diluted earnings per share from discontinued operations of $.19
and $.53 in 1998 and 1997, respectively. The 1998 results include one-time
reorganization costs associated with the 1998 Distribution of $28.0 million
($23.2 million after-tax, $.14 per share basic, $.13 per share diluted) and a
gain of $9.6 million ($5.3 million after-tax, $.03 per share basic and diluted)
on the sale of Financial Information Services ("FIS"), the financial publishing
unit of Moody's. The 1997 results include a one-time, non-cash charge for the
cumulative effect of accounting changes ($.74 per share basic, $.73 per share
diluted), with respect to certain of the Company's revenue recognition methods.

Operating revenues grew 6.8% to $1,934.5 million in 1998 from $1,811.0 million
in 1997. Excluding the results of FIS, which was sold in July 1998, revenue
increased 7.8%. Revenue growth for 1998 reflects significant growth at Moody's
and strong growth at D&B U.S. offset by a decline at D&B APCLA. D&B Europe was
essentially unchanged. Excluding the impact of foreign exchange, operating
revenues for the Company grew 8.2% in 1998 from 1997.

1998 operating costs increased 16.7% to $568.2 million, largely attributable to
increased Year 2000 spending, costs incurred by D&B Europe for new systems and
technology, and costs associated with the introduction of new products and
services. Selling and administrative expenses decreased slightly.

Operating income in 1998 of $420.7 million increased 4.2% from $403.7 million in
1997. 1998 operating income included $28.0 million in reorganization costs
incurred in conjunction with the 1998 Distribution. Excluding reorganization
costs, operating income increased 11.1%. Operating income growth reflected
strong growth at Moody's and D&B U.S.

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Non-operating expense -- net of $20.9 million in 1998, primarily comprised of
interest income and expense and minority interest expense (included in other
expense -- net), decreased by $50.4 million compared to 1997. The sharp decrease
was due to significantly lower interest expense and higher interest income, as
1998 debt levels were lower than 1997 levels (see further discussion in the
Liquidity and Financial Position section).

In 1998, the Company's effective tax rate from continuing operations was 38.4%,
compared to 34.1% in 1997. This increase resulted from an increase in the
estimated underlying effective tax rate to 36.8% and the non-deductibility of
certain reorganization costs.

Income from discontinued operations, net of income taxes, was $33.7 million in
1998 and $92.0 million in 1997. Discontinued operations represents six months of
Donnelley operating results in 1998, compared to the full year of Donnelley
operating results reported as discontinued operations in 1997. Donnelley's
operating income was historically lower during the first half of the year.

SEGMENT RESULTS

D&B U.S. revenues were $902.5 million in 1998, up 8.4% from 1997, including
increases in Credit Information Services ("Credit") of 4.1% to $615.1 million,
Marketing Information Services ("Marketing") of 17.7% to $198.5 million,
Purchasing Information Services ("Purchasing") of 46.7% to $23.0 million and
Receivables Management Services ("RMS") of 16.0% to $65.9 million. The growth
rates are largely attributable to the growth in revenues from value-added
products, which increased by 60.6% to $198.0 million from the prior year. D&B
U.S. operating income was $269.9 million in 1998, up 6.7% from the prior year,
driven by the higher revenue, partially offset by higher expenses incurred for
selling, advertising, new product development and Year 2000 remediation.

D&B Europe's 1998 revenues of $427.7 million were flat compared to 1997, due
largely to the strengthening of the U.S. dollar. European Credit revenues
decreased .8% to $312.9 million in 1998, while Marketing revenues increased
16.8% to $65.2 million in 1998 and RMS decreased 9.3% to $49.6 million in 1998.
Excluding the impact of foreign exchange, D&B Europe would have reported a 3.9%
increase in revenues in 1998, including an increase in Credit revenues of 2.8%,
an increase in Marketing of 19.5% and a decrease in RMS of 6.3% from 1997.
Increases in product usage have been partially offset by price erosion resulting
from the competitive environment in Europe. D&B Europe reported an operating
loss of $4.2 million, reflecting the continued investments in new technology and
systems in Europe, and increased Year 2000 remediation costs.

D&B APCLA reported a 5.5% decrease in operating revenues to $88.6 million in
1998 from $93.8 million in 1997, resulting from the negative impact of foreign
exchange rates. In 1998, APCLA Credit revenues decreased 5.6% to $56.5 million,
Marketing revenues decreased 6.1% to $19.0 million and RMS revenues decreased
4.2% to $13.1 million. Excluding the impact of foreign exchange, D&B APCLA would
have reported a 5.4% increase in revenues in 1998, comprised of an 8.0% increase
in Credit, a 2.7% decrease in Marketing and a 4.0% increase in RMS. D&B APCLA
reported an operating loss of $9.1 million in 1998, compared to an operating
loss of $6.3 million in 1997, due to lower reported operating revenues and
higher expenses, including Year 2000 costs and employee-related costs in Asia.

Moody's revenues (excluding the results of FIS) of $495.5 million in 1998 were
up 17.1% from 1997, driven by gains in corporate and municipal bonds, structured
ratings and commercial paper. Despite the market disruptions occurring during
the second half of

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1998, issuance of high-yield, corporate and municipal bonds increased
significantly when compared to 1997. Moody's operating income of $223.5 million
in 1998 was up 20.4% from 1997, reflecting strong revenue growth.

YEAR ENDED DECEMBER 31, 1997, COMPARED WITH YEAR ENDED DECEMBER 31, 1996

The Company's basic earnings per share from continuing operations were $1.28 in
1997, up $1.97 from a loss of $.69 per share reported in 1996. On a diluted
basis, the Company reported earnings per share from continuing operations of
$1.27 per share, compared with a loss of $.69 per share reported in 1996. The
1996 loss reflected all corporate overhead expenses associated with the Company
prior to the 1996 Distribution and certain reorganization-related expenses. The
Company's basic earnings per share in 1997 were $1.08, up $1.34 from a loss of
$.26 per share reported in 1996. On a diluted basis, the Company reported
earnings per share of $1.07, compared with a loss of $.26 in 1996. The 1997
results include a one-time, non-cash charge for the cumulative effect of
accounting changes of $127.0 million, net of an income tax benefit of $87.7
million ($.74 per share basic, $.73 per share diluted), with respect to certain
of the Company's revenue recognition methods.

Effective January 1, 1997, the Company changed its revenue recognition method
for its Credit and Moody's businesses. In accordance with APB No. 20,
"Accounting Changes," the cumulative effect of these accounting changes resulted
in a pre-tax non-cash charge of $214.7 million ($127.0 million after-tax).
Credit revenue is now recognized as products and services are used by customers,
which the Company believes is a better measure of the business's performance.
Prior to 1997, the Company recorded revenue from its Credit business on a
straight-line basis over the annual subscription period.

Operating revenues grew 1.6% to $1,811.0 million from $1,782.5 million in 1996.
Excluding the results of American Credit Indemnity ("ACI"), which was divested
in 1996, revenue would have increased 5.3% from 1996. Revenue growth for the
Company reflects significant growth at Moody's and moderate growth at D&B U.S.,
offset by declines at D&B Europe and D&B APCLA. Excluding the impact of foreign
exchange, operating revenues increased 3.9% in 1997 from 1996.

Operating costs and selling and administrative expenses, excluding corporate
expenses in each year, decreased 6.8% to $1,240.4 million from $1,330.6 million.
This decrease is largely attributable to the inclusion of ACI in 1996.

Operating income in 1997 of $403.7 million increased $346.5 million from $57.2
million in 1996. 1996 operating income reflected $161.2 million in
reorganization costs incurred in conjunction with the 1996 Distribution and a
$68.2 million loss attributable to the sale of ACI. Excluding these
non-recurring items, 1997 operating income would have been up 40.9% from $286.6
million in 1996. Operating income growth reflected strong growth at Moody's and
growth in D&B U.S., partially offset by declines in D&B Europe and D&B APCLA.

Non-operating expense -- net of $71.3 million in 1997, which primarily included
interest expense on notes payable, and minority interest costs (included in
other expense -- net), was essentially unchanged compared with 1996. Interest
expense in 1997 included a $3.2 million charge to mark-to-market certain
interest rate swaps and a $2.9 million charge as a result of interest rate swap
cancellations. These charges were offset by lower financing costs in 1997.

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In 1997, the Company's effective tax rate from continuing operations was 34.1%.
Due to tax implications of the 1996 Distribution, discussed below, the 1996
effective tax rate was 729.3%. The underlying effective tax rate, excluding
one-time items for 1996, was approximately 34%.

Income from discontinued operations, net of income taxes, was $92.0 million in
1997 and $230.5 million in 1996. Operating results of Donnelley comprised the
income from discontinued operations in 1997, while 1996 included operating
results of Donnelley and NCH for the full year and Cognizant, ACNielsen and DBS
for the 10 months ended October 31, 1996. Donnelley operating income included a
gain on the sale of the East Coast proprietary operations of Donnelley
("P-East") of $9.4 million in 1997 and a loss on the sale of the West Coast
proprietary operations of Donnelley ("P-West") of $28.5 million in 1996. Also
recorded in 1996 was a loss on the disposition of DBS of $220.6 million ($158.2
million after-tax). Additionally, the Company sold NCH in the fourth quarter of
1996. No gain or loss resulted from the sale.

SEGMENT RESULTS

D&B U.S. revenues were $832.2 million in 1997, up 6.2% from 1996, including
increases in Credit of 3.9% to $591.1 million, Marketing of 13.7% to $168.5
million, Purchasing of 40.7% to $15.7 million and RMS of 2.9% to $56.9 million.
The growth rates are largely attributable to revenues for value-added products,
which increased 105.5% to $123.3 million in 1997. D&B U.S. operating income was
$252.9 million in 1997, up 6.3%, consistent with the increase in revenues.

D&B Europe's 1997 revenues of $426.1 million were 4.3% lower than 1996,
resulting from the increased strength of the U.S. dollar. Credit revenues
decreased 4.9% to $315.5 million, while Marketing increased 4.6% to $55.9
million and RMS decreased 8.7% to $54.7 million in 1997. Excluding the impact of
foreign exchange, D&B Europe would have reported a 3.9% increase in revenues,
including a 3.3% increase in Credit, a 9.1% increase in Marketing and a 1.7%
increase in RMS. D&B Europe's operating income was $.6 million in 1997,
reflecting the continued investments in new technology and systems in Europe and
increased Year 2000 costs.

D&B APCLA reported an 8.8% decrease in operating revenues to $93.8 million in
1997 from $102.9 million in 1996, primarily as a result of phasing out certain
unprofitable operations in Latin America. Credit revenues decreased 12.3% to
$59.9 million, Marketing revenues increased 33.5% to $20.2 million and RMS
revenues decreased 29.6% to $13.7 million in 1997. Excluding the impact of
foreign exchange, D&B APCLA would have had a 5.1% decrease in revenues,
including an 8.3% decrease in Credit, a 9.7% increase in Marketing and a 5.5%
decrease in RMS. D&B APCLA reported an operating loss of $6.3 million, a
decrease from operating income of $1.5 million in 1996, due to expenses
associated with the introduction of new products.

Moody's revenues of $423.1 million in 1997, excluding the results of FIS, were
up 21.0% from 1996, driven by gains in corporate bonds, increased coverage in
the mortgage-backed market and continued expansion outside the U.S. Corporate
bonds displayed strong volume growth, especially in the high-yield market, where
volumes were 30% above the prior year. Moody's operating income of $185.7
million in 1997 was up 43.6% from 1996, resulting from strong revenue results
and reduction in overhead in conjunction with an internal reorganization at
Moody's.

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RECENTLY ISSUED ACCOUNTING STANDARDS

In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities" ("SFAS No. 133").
This statement establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities. It requires recognition of all
derivatives as either assets or liabilities on the balance sheet and measurement
of those instruments at fair value. If certain conditions are met, a derivative
may be designated specifically as: (a) a hedge of the exposure to changes in the
fair value of a recognized asset or liability or an unrecognized firm commitment
(a fair value hedge); (b) a hedge of the exposure to variable cash flows of a
forecasted transaction (a cash flow hedge); or (c) a hedge of the foreign
currency exposure of a net investment in a foreign operation, an unrecognized
firm commitment, an available-for-sale security, or a
foreign-currency-denominated forecasted transaction. The Company currently
hedges foreign-currency-denominated transactions and will comply with the
requirements of SFAS No. 133 when adopted. This statement is effective for all
fiscal quarters of fiscal years beginning after June 15, 1999. The Company
expects to adopt SFAS No. 133 beginning January 1, 2000. The effect of adopting
SFAS No. 133 is not expected to be material.

In March 1998, the American Institute of Certified Public Accountants issued
Statement of Position ("SOP") 98-1, "Accounting for the Costs of Computer
Software Developed or Obtained for Internal Use." Among other provisions, SOP
98-1 requires that entities capitalize certain internal-use software costs once
certain criteria are met. Under SOP 98-1, overhead, general and administrative,
and training costs are not to be capitalized. SOP 98-1 is effective for
financial statements for fiscal years beginning after December 15, 1998;
therefore, the Company will adopt the provisions as of January 1, 1999. During
1998, the Company capitalized approximately $10 million of costs incurred in
developing internal-use software, which would not be capitalized in the future.

MARKET RISK SENSITIVE INSTRUMENTS

Because the Company operates in 41 countries, the Company is exposed to market
risk from changes in foreign exchange rates and interest rates, which could
affect its results of operations and financial condition. In order to reduce the
risk from fluctuations in foreign currencies and interest rates, the Company
sometimes uses forward foreign exchange contracts and in the past has used
interest rate swap agreements. These derivative financial instruments are viewed
by the Company as risk management tools that are entered into for hedging
purposes only. The Company does not use derivative financial instruments for
trading or speculative purposes.

The Company also has investments in fixed-income marketable securities.
Consequently, the Company is exposed to fluctuations in rates on these
marketable securities. Market risk associated with investments in marketable
securities is immaterial and has been excluded from the sensitivity discussions.

A discussion of the Company's accounting policies for derivative financial
instruments is included in the Summary of Significant Accounting Policies in
Note 1 to the Company's consolidated financial statements, and further
disclosure relating to financial instruments is included in Note 5 to the
Company's consolidated financial statements on Pages 50-51 of this Form 10-K.

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The following analysis presents the sensitivity of the fair value of the
Company's market risk sensitive instruments to changes in market rates and
prices.

INTEREST RATE RISK

The Company is exposed to market risk through its commercial paper program,
where it borrows at prevailing short-term commercial paper rates. At December
31, 1998, the Company had $35.9 million of commercial paper outstanding and as
such the market risk is immaterial when calculated utilizing estimates of the
termination value based upon a 10% increase or decrease in interest rates from
their December 31, 1998 levels.

The Company has in the past entered into interest rate swap agreements to manage
exposure to changes in interest rates. Interest rate swaps have allowed the
Company to raise funds at floating rates and effectively swap them into fixed
rates that are lower than those available to it if fixed-rate borrowings were to
be made directly. During 1998, in connection with the 1998 Distribution and
repayment of outstanding notes payable, Old D&B canceled all of its interest
rate swap agreements. The Company has not entered into any interest rate swap
agreements since the 1998 Distribution and therefore is not subject to interest
rate risk on interest rate swaps.

FOREIGN EXCHANGE RISK

The Company's non-U.S. operations generated approximately 30% of total revenues
in 1998. As of December 31, 1998, approximately 38% of the Company's assets were
located outside the U.S., and no single country had a significant concentration
of cash.

The Company follows a policy of hedging substantially all cross-border
intercompany transactions denominated in a currency other than the functional
currency applicable to each of its various subsidiaries. The Company only uses
forward foreign exchange contracts to implement its hedging strategy. Typically,
these contracts have maturities of six months or less. These forward contracts
are executed with creditworthy institutions and are denominated primarily in
British pounds sterling, German marks and Swedish krona.

The fair value of foreign currency risk is calculated by using estimates of the
cost of closing out all outstanding forward foreign exchange contracts, given a
10% increase or decrease in forward rates from their December 31, 1998, levels.
At December 31, 1998, the Company had approximately $117 million in forward
foreign exchange contracts outstanding, with various expiration dates through
March 1999 (see Note 5 to the Company's consolidated financial statements on
Pages 50-51 of this Form 10-K). At December 31, 1998, net unrealized gains
related to the Company's forward contracts were $.5 million. If forward rates
were to increase by 10% from December 31, 1998, levels, the unrealized loss on
these contracts would be $5.5 million. If forward rates were to decrease by 10%
from December 31, 1998, levels, the unrealized gain on these contracts would be
$6.5 million. However, the estimated potential gain or loss on forward contracts
is expected to be offset by changes in the underlying transactions. Therefore,
the impact of a 10% movement in foreign exchange rates would be immaterial.

LIQUIDITY AND FINANCIAL POSITION

The Company generates significant cash flows from its business operations.
Management believes that these cash flows are sufficient to fund its operating
needs, service debt and pay dividends, and will continue to be sufficient in the
future.

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At December 31, 1998, cash and cash equivalents totaled $90.6 million, an
increase from $81.8 million in 1997. Net cash provided by operating activities
of continuing operations decreased by $54.5 million to $325.5 million in 1998.
This decrease is largely attributable to the impact on the timing of cash flows
resulting from the change to the D&B business model implemented effective
January 1, 1998, whereby customers now have the option of choosing to purchase
Credit products and services on a monthly or annual contract plan, offset by an
increase in income from continuing operations. Previously, Credit products and
services were generally sold under annual contracts, most of which required
payment in full up front.

Net cash provided by operating activities of discontinued operations decreased
by $103.7 million to $16.7 million in 1998, as only six months of operations
were included in 1998. Historically, Donnelley generated most of its cash flows
in the second half of the year.

Net cash used in investing activities totaled $104.7 million in 1998, compared
with $15.9 million in 1997. Cash used in investing activities in 1997 was offset
by cash provided by discontinued operations of $105.7 million, which included
the proceeds from the sale of P-East of $122.0 million, partially offset by
capital expenditures. This compared to net cash used by investing activities of
discontinued operations in 1998 of $3.1 million. 1998 cash flows included
proceeds from the sale of FIS of $26.5 million. In 1998, spending for capital
expenditures, computer software and other intangibles by continuing operations
totaled $147.1 million, compared to $129.1 million in 1997. This increase is
largely due to investment in new computer hardware and software. Currently, the
Company has no material commitments for capital expenditures.

In June 1998, the Company arranged $600 million of bank commitments under two
credit facilities. Each facility permits borrowings up to $300 million, with one
maturing in June 1999 and one maturing in June 2003. Under these facilities, the
Company has the ability to borrow at prevailing short-term interest rates. As of
December 31, 1998, the Company did not have any borrowings outstanding under
these facilities. The Company had commercial paper borrowings of $35.9 million
at December 31, 1998.

In connection with the 1998 Distribution, during June 1998, R.H. Donnelley Inc.
borrowed $350 million under the R.H. Donnelley Inc. credit facility and issued
$150 million of senior subordinated notes under the R.H. Donnelley Inc.
indenture. The proceeds of these borrowings were used to repay existing
indebtedness (commercial paper and other short-term borrowings) of Old D&B in
the amount of $287.1 million at the time of the 1998 Distribution; the Company
used the excess proceeds for general corporate purposes, including the payment
of reorganization costs. The $500 million of debt became an obligation of
Donnelley upon the 1998 Distribution.

In connection with the 1998 Distribution and repayment of existing indebtedness,
Old D&B canceled all of its interest rate swap agreements and recorded into
income the previously unrecognized fair value loss at the time of termination.
At the time of the cancellation, the fair value of the interest rate swaps was a
loss of $12.7 million, of which $3.8 million ($.6 million in the first quarter
of 1998 and $3.2 million in 1997) had been recognized in income relating to
swaps which did not qualify for settlement accounting. The previously
unrecognized loss of $8.9 million was recorded during the second quarter of 1998
and included in reorganization costs.

On April 1, 1997, Old D&B completed a $300 million minority interest financing.
Funds raised by this financing were used to repay a portion of the outstanding
short-term debt in April 1997. Also during the second quarter of 1997, Old D&B
reentered the commercial

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paper market and used the proceeds to repay the additional amounts outstanding
on the short-term debt facility. The obligation related to the minority interest
financing became an obligation of the Company upon the 1998 Distribution. At
December 31, 1998, the Company had $300 million of minority interest financing
outstanding.

On June 30, 1998, the Company announced that its Board of Directors had
authorized the repurchase of up to $300 million of common shares from time to
time over the next three years in the open market or in negotiated purchases. In
addition, the board authorized the Company to repurchase shares as needed to
offset awards under the Company's incentive plans. As of December 31, 1998, the
Company purchased 5.7 million shares under the repurchase program for a total of
$150.0 million. In addition, during 1998, the Company purchased 2.3 million
shares to offset awards made under incentive plans for approximately $70.2
million. The Company received net proceeds from the exercise of stock options of
$41.0 million during 1998.

The Company enters into global tax planning initiatives in the normal course of
business. The Internal Revenue Service ("IRS") is currently reviewing the
utilization of certain capital losses during 1989 and 1990, and the Company
expects that the IRS will challenge the Company's treatment of certain of these
losses. If an assessment is made and should the IRS prevail, the total cash
obligation to the IRS would approximate $500 million for taxes and accrued
interest as of December 31, 1998. Pursuant to a series of agreements, IMS Health
Incorporated ("IMS") and Nielsen Media Research ("NMR") are jointly and
severally liable to pay one-half, and the Company the other half, of any
payments for taxes and accrued interest arising from this matter and certain
other potential tax liabilities after the Company pays the first $137 million.
If assessed, the Company will consider available alternatives to vigorously
defend its position. Certain alternatives would require making a payment to the
IRS for its share of the taxes and accrued interest (approximately $320 million,
of which $160 million represents tax-deductible interest), which would be repaid
to the Company if it prevails in its position. The funds that would be needed to
make the Company's share of such payment are expected to come from external
borrowings.

YEAR 2000

GENERAL

The Company relies on computer hardware, software and related information
technology ("IT Systems"). IT Systems are used in the creation and delivery of
the Company's products and services, and also are used in the Company's internal
operations, such as billing and accounting. IT Systems include systems that use
information provided by third-party data suppliers to update the Company's
databases. The Company also relies on other systems, such as elevators, and on
utilities, such as telecommunications and power utilities, to operate ("Non-IT
Systems").

The Company has recognized the potential impact of the year 2000 on its business
since 1996, when it began actively addressing the information-technology-related
components of the Year 2000 issue in its European and U.S. operations. In 1997,
the Company created a Corporate Year 2000 Program Office to manage overall risks
and to facilitate activities across the Company. The Corporate Year 2000 Program
Office reports directly to the Company's Year 2000 Executive Committee
(comprised of the Company's Chief Executive Officer, Chief Financial Officer,
Chief Technology Officer and Chief Legal Counsel), which sets overall priorities
and monitors progress. Since 1997, each operating unit has had business and
technology executives and project teams in place to plan and

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carry out all Year 2000 efforts within their units. The Company has used the
services of outside consultants and subject-area specialists working with the
Corporate Year 2000 Program Office to assess the progress of its Year 2000
program.

The most important areas of focus of the Company's Year 2000 program are the
Company's products and services (including its databases, software that
manipulates these databases and software provided to customers); billing,
ordering and tracking systems; technical infrastructure (such as LANs, mail
systems and web sites); desktop computers; suppliers; business operation support
systems (such as payroll); and facilities and equipment.

STATE OF READINESS

The Company has focused its efforts on becoming "Year 2000 Ready." The Company
defines this term to mean that a process will continue to run in the same manner
when dealing with dates on or after January 1, 2000, as it did before January 1,
2000.

With respect to IT Systems, the Company's Year 2000 program includes the
following phases: Inventory, Assessment, Remediation, Year 2000 Ready Testing
and Transaction-Based Testing.

Year 2000 Ready Testing involves two major tests. A "system test" checks the
system's functions in a Year 2000 test environment that uses simulated or
forward-dated system clocks and a variety of other simulated forward-dated data
or systems interfaces as required. A "production integration" test confirms that
the system will continue to perform its current-date processes when put into
production. Transaction-Based Testing further tests the Company's most critical
work flows at regional and global levels.

Early in its Year 2000 program, the Company categorized its IT Systems in terms
of criticality to allow the work to be performed consistent with its importance
to the Company. Criticality 1 systems are defined as those systems that are most
critical to the Company's business and revenue. Criticality 2 systems are
defined as those systems that are very important to the Company and would have a
severe impact on business and revenue if not made Year 2000 Ready. Criticality 3
systems are not essential but would have some impact on business and revenue if
not made Year 2000 Ready. Criticality 4 systems have little or no impact on
business and revenue and are scheduled to be decommissioned prior to the year
2000.

As of December 31, 1998, the Company had completed more than 90% of the steps
required to achieve Year 2000 Readiness of the Company's approximately 2,000
Criticality 1 and Criticality 2 IT Systems. The Company's current target is for
substantially all Criticality 1 and Criticality 2 IT Systems to be Year 2000
Ready by March 31, 1999. Transaction-Based Testing of the Company's most
critical work flows, work on Criticality 3 IT Systems and decommissioning of
Criticality 4 IT Systems have begun and will continue through 1999.

The Corporate Year 2000 Program Office and operating-unit Year 2000 teams are
also addressing Year 2000 Readiness issues regarding the Company's Non-IT
Systems.

As part of its Year 2000 program, the Company has categorized its suppliers in
terms of criticality. Criticality 1 suppliers are those whose products and
services are most critical to the Company. Criticality 2 suppliers are those
whose products and services are very important to the Company but for whom
workarounds can be established and operable by June 30, 1999, if the products
and services that the Company obtains from such suppliers are not Year 2000
Ready. Criticality 3 suppliers are those who could be replaced easily
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and reasonably inexpensively. In 1998, the Company began its assessment of its
Criticality 1 and Criticality 2 suppliers, and its current target is to
substantially complete such assessment by March 31, 1999. Such assessment
involves the identification of those suppliers who will be sufficiently Year
2000 Ready; identification of those who will not be sufficiently ready,
requiring the Company to switch to an alternate supplier or product;
identification of those suppliers who have some issues but with whom it is most
prudent for the Company to continue its relationship; and identification of
those suppliers for whom testing will be necessary. In instances where such
testing is not possible (for example, it may not be possible for the Company to
test the operational ability of its telecommunications, electricity or gas
service suppliers in a Year 2000 environment) and alternate sources of supply
are not feasible, the Company may have to rely on the assurances of the
supplier.

COSTS

External and internal costs associated with modifying software for Year 2000
Readiness are expensed as incurred and are funded through operating cash flow.
It is currently estimated that the aggregate cost of the Company's Year 2000
program will be approximately $80 million. The increase from the prior estimate
of $70 million to $75 million is attributable to the refinement of estimates
associated with contingency planning. Through December 31, 1998, the Company had
incurred approximately $54 million ($11 million in 1997 and $43 million in 1998)
and expects to incur approximately $22 million in 1999 and $4 million in 2000.
These estimates do not include the costs of software and systems that are being
replaced or upgraded in the normal course of business.

RISKS AND CONTINGENCY PLANS

The Company believes that it will substantially complete the implementation of
its Year 2000 program prior to January 1, 2000. If the Company does not complete
its Year 2000 program prior to the commencement of the year 2000, if it fails to
identify and remediate all critical Year 2000 problems, or if major suppliers or
customers experience material Year 2000 problems, the Company's results of
operations or financial condition could be materially affected.

Contingency planning is under way in all of the Company's businesses. In
addition to supplier-related activities, high-level plans have been developed
for facilities and equipment, telecommunications infrastructure, product
development and fulfillment, and internal administrative processes. These plans
take into account human resources and communications issues that relate to the
Company's employees. By the end of June 1999, the Company expects to have
detailed contingency plans in place to address the most likely remaining effects
on the Company from external risks. As more information emerges about companies
upon which the Company is critically reliant, these plans will be adjusted
accordingly.

NEW EUROPEAN CURRENCY

On January 1, 1999, eleven of the countries in the European Union began a
three-year transition to a single European currency ("euro") to replace the
national currency of each participating country. The Company intends to phase in
the transition to the euro over the next three years. The Company has
established a task force to address issues related to the euro. The Company
believes that the euro conversion may have a material impact on its operations
and financial condition if it fails to successfully address such issues. The
task force has prepared a project plan and is proceeding with the implementation
of that plan.
30
32

The Company's project plan includes the following: ensuring that the Company's
information technology systems that process data for inclusion in the Company's
products and services can appropriately handle amounts denominated in euro
contained in data provided to the Company by third-party data suppliers;
modification of the Company's products and services to deal with euro-related
issues; and modification of the Company's internal systems (such as payroll,
accounting and financial reporting) to deal with euro-related issues. The
Company does not believe that the cost of such modifications will have a
material effect on the Company's results of operations or financial condition.
There is no guarantee that all problems will be foreseen and corrected, or that
no material disruption of the Company's business will occur. The conversion to
the euro may have competitive implications for the Company's pricing and
marketing strategies, which could be material in nature; however, any such
impact is not known at this time.

DIVIDENDS

The Company paid a quarterly dividend of $.185 per share for the third and
fourth quarters of 1998. Old D&B paid quarterly dividends of $.22 per share
during the first half of 1998 and the full year of 1997, resulting in a
full-year dividend per share paid of $.81 and $.88 for 1998 and 1997,
respectively. Total cash used to pay dividends decreased in 1998 to $137.4
million from $150.6 million in 1997.

COMMON STOCK INFORMATION

The Company's common stock (symbol DNB) is listed on the New York Stock
Exchange. The number of shareholders of record was 10,232 at December 31, 1998.

The following table summarizes price and cash dividend information for Old D&B's
and the Company's common stock as reported in the periods shown. The decline in
price per share during the third quarter of 1998 reflects, in part, the
separation from Donnelley as a result of the 1998 Distribution. The
first-quarter 1998 and 1999 dividend declarations were made in the fourth
quarters of 1997 and 1998, respectively, although the record and payment dates
are both in the ensuing first quarters.



PRICE PER SHARE ($) DIVIDENDS DIVIDENDS
-------------------------------------- DECLARED PAID
1998 1997 PER SHARE ($) PER SHARE ($)
--------------- --------------- ---------------- --------------
HIGH LOW HIGH LOW 1998 1997 1998 1997
---- --- ---- --- ---- ---- ----- -----

First Quarter........ 35 3/16 30 1/2 27 1/2 23 1/8 -- .22 .22 .22
Second Quarter....... 36 11/16 32 3/8 27 3/8 23 3/4 .22 .22 .22 .22
Third Quarter........ 34 7/16 21 3/4 29 25 5/8 .185 .22 .185 .22
Fourth Quarter....... 31 13/16 22 29/32 31 1/4 25 1/4 .37 .44 .185 .22
-- -- -- -- ---- ---- ---- ---
Year................. 36 11/16 21 3/4 31 1/4 23 1/8 .775 1.10 .81 .88
== == == == ==== ==== ==== ===


FORWARD-LOOKING STATEMENTS

Certain statements in this Annual Report are forward-looking. These may be
identified by the use of forward-looking words or phrases, such as "believe,"
"expect," "anticipate," "should," "planned," "estimated," "potential," "target"
and "goal," among others. All such forward-looking statements are based on the
Company's reasonable expectations at the time they are made. The Private
Securities Litigation Reform Act of 1995 provides a "safe harbor" for such
forward-looking statements. In order to comply with the terms of the safe

31
33

harbor, the Company notes that a variety of factors could cause the Company's
actual results and experience to differ materially from the anticipated results
or other expectations expressed in such forward-looking statements. The risks
and uncertainties that may affect the operations, performance, development and
results of the Company's businesses include: (1) complexity and uncertainty
regarding the development of new high-technology products; (2) possible loss of
market share through competition; (3) introduction of competing products or
technologies by other companies; (4) pricing pressures from competitors and/or
customers; (5) changes in the business information and risk management
industries and markets; (6) the Company's ability to protect proprietary
information and technology or to obtain necessary licenses on commercially
reasonable terms; (7) the Company's ability to complete the implementation of
its Year 2000 and euro plans on a timely basis; (8) the possible loss of key
employees to investment or commercial banks, or elsewhere; (9) fluctuations in
foreign currency exchange rates; (10) changes in the interest-rate environment;
and (11) the outcome of the IRS's review of the Company's utilization of capital
losses described above under the Liquidity and Financial Position section and
the associated cash flow implications.

The risks and uncertainties that may affect the Company's assessment of Year
2000 issues and new European currency issues include: (1) the complexity
involved in ascertaining all situations in which Year 2000 or new European
currency issues may arise; (2) the ability of the Company to obtain the services
of sufficient personnel to implement the programs; (3) possible increases in the
cost of personnel required to implement the programs; (4) absence of delays in
scheduled deliveries of new hardware and software from third-party suppliers;
(5) reliability of responses from suppliers and others to whom inquiries are
being made; (6) ability of the Company to meet the scheduled dates for
completion of the programs; and (7) absence of unforeseen events that could
delay timely implementation of the programs.

The Company undertakes no obligation to publicly release any revision to any
forward-looking statement to reflect any future events or circumstances.

The Company may from time to time make oral forward-looking statements. In
connection with the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, the Company is hereby identifying important
factors that could cause actual results to differ materially from those
contained in any such forward-looking statement made by or on behalf of the
Company. Any such statement is qualified by reference to the factors set forth
above.

ITEM 7a. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Information in response to this Item is set forth under the caption "Market Risk
Sensitive Instruments" in Part II, Item 7 on Pages 25-26 of this Form 10-K.

32
34

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX TO FINANCIAL STATEMENTS AND SCHEDULES



PAGE(S)
-------

Report of Independent Accountants........................... 34
Statement of Management Responsibility for Financial
Statements................................................ 35
CONSOLIDATED FINANCIAL STATEMENTS
At December 31, 1998 and 1997:
Consolidated Balance Sheets............................... 38-39
For the years ended December 31, 1998, 1997 and 1996:
Consolidated Statements of Operations..................... 36-37
Consolidated Statements of Cash Flows..................... 40-41
Consolidated Statements of Shareholders' Equity........... 42-43
Notes to Consolidated Financial Statements................ 44-74
SCHEDULES
Schedules are omitted as not required or inapplicable or
because the required information is provided in the
consolidated financial statements, including the notes
thereto.


33
35

REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholders and the Board of Directors of The Dun & Bradstreet
Corporation:

In our opinion, the consolidated financial statements listed in the accompanying
index, after the restatement described in Note 1, present fairly, in all
material respects, the financial position of The Dun & Bradstreet Corporation
and Subsidiaries at December 31, 1998 and 1997, and the results of their
operations and their cash flows for the years ended December 31, 1998, 1997 and
1996, in conformity with generally accepted accounting principles. These
financial statements are the responsibility of the Company's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.

As discussed in Note 1 to the consolidated financial statements, the Company
changed certain revenue recognition accounting policies in 1997.

/s/ PricewaterhouseCoopers LLP

New York, New York
February 3, 1999

34
36

STATEMENT OF MANAGEMENT RESPONSIBILITY FOR FINANCIAL STATEMENTS

To the Shareholders of The Dun & Bradstreet Corporation:

Management has prepared and is responsible for the consolidated financial
statements and related information that appear in Items 6 and 7 and on pages
36-74 of this Form 10-K. The consolidated financial statements, which include
amounts based on the estimates of management, have been prepared in conformity
with generally accepted accounting principles. Other financial information in
this Annual Report on Form 10-K is consistent with that in the consolidated
financial statements.

Management believes that the Company's internal control systems provide
reasonable assurance at reasonable cost that assets are safeguarded against loss
from unauthorized use or disposition, and that the financial records are
reliable for preparing financial statements and maintaining accountability for
assets. These systems are augmented by written policies, an organizational
structure providing division of responsibilities, careful selection and training
of qualified financial personnel and a program of internal audits.

The independent accountants are engaged to conduct an audit of and render an
opinion on the financial statements in accordance with generally accepted
auditing standards. These standards include an assessment of the systems of
internal controls and tests of transactions to the extent considered necessary
by them to support their opinion.

The Board of Directors, through its Audit Committee consisting solely of outside
directors of the Company, is responsible for reviewing and monitoring the
Company's financial reporting and accounting practices. PricewaterhouseCoopers
LLP and the internal auditors each have full and free access to the Audit
Committee and meet with it regularly, with and without management.

/s/ VOLNEY TAYLOR
----------------------------------
Volney Taylor
Chairman and Chief Executive
Officer

/s/ FRANK S. SOWINSKI
----------------------------------
Frank S. Sowinski
Senior Vice President and Chief
Financial Officer

35
37

THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS



YEARS ENDED DECEMBER 31,
---------------------------------------------------
1998 1997 1996
--------------- --------------- ---------------
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA

RESULTS OF OPERATIONS
Operating Revenues..................... $ 1,934.5 $ 1,811.0 $ 1,782.5
Operating Costs........................ 568.2 487.0 617.2
Selling and Administrative Expenses.... 776.0 788.4 806.3
Depreciation and Amortization.......... 141.6 131.9 140.6
Reorganization Costs................... 28.0 -- 161.2
------------ ------------ ------------
Operating Income....................... 420.7 403.7 57.2
------------ ------------ ------------
Interest Income........................ 6.4 1.8 4.4
Interest Expense....................... (12.1) (53.4) (37.1)
Other Expense -- Net................... (15.2) (19.7) (38.5)
------------ ------------ ------------
Non-Operating Expense -- Net........... (20.9) (71.3) (71.2)
------------ ------------ ------------
Income (Loss) from Continuing
Operations before Provision for
Income Taxes......................... 399.8 332.4 (14.0)
Provision for Income Taxes............. 153.4 113.4 102.1
------------ ------------ ------------
Income (Loss) from Continuing
Operations........................... 246.4 219.0 (116.1)
------------ ------------ ------------
Discontinued Operations:
Income from Discontinued Operations,
Net of Income Taxes of $22.5,
$52.2 and $207.5 for 1998, 1997
and 1996, respectively............ 33.7 92.0 230.5
Loss on Disposal, Net of Income Tax
Benefit of $62.4 for 1996......... -- -- (158.2)
------------ ------------ ------------
Income from Discontinued Operations.... 33.7 92.0 72.3
------------ ------------ ------------
Income (Loss) before Cumulative Effect
of Accounting Changes................ 280.1 311.0 (43.8)
Cumulative Effect of Accounting
Changes, Net of Income Tax Benefit of
$87.7................................ -- (127.0) --
------------ ------------ ------------
Net Income (Loss)...................... $ 280.1 $ 184.0 $ (43.8)
============ ============ ============


36
38



YEARS ENDED DECEMBER 31,
---------------------------------------------------
1998 1997 1996
--------------- --------------- ---------------
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA

BASIC EARNINGS (LOSS) PER SHARE OF
COMMON STOCK
Continuing Operations.................. $ 1.45 $ 1.28 $ (.69)
Discontinued Operations................ .20 .54 .43
------------ ------------ ------------
Before Cumulative Effect of Accounting
Changes.............................. 1.65 1.82 (.26)
Cumulative Effect of Accounting
Changes, Net of Income Tax Benefit... -- (.74) --
------------ ------------ ------------
Basic Earnings (Loss) Per Share
of Common Stock.............. $ 1.65 $ 1.08 $ (.26)
============ ============ ============
DILUTED EARNINGS (LOSS) PER SHARE OF
COMMON STOCK
Continuing Operations.................. $ 1.44 $ 1.27 $ (.69)
Discontinued Operations................ .19 .53 .43
------------ ------------ ------------
Before Cumulative Effect of Accounting
Changes.............................. 1.63 1.80 (.26)
Cumulative Effect of Accounting
Changes, Net of Income Tax Benefit... -- (.73) --
------------ ------------ ------------
Diluted Earnings (Loss) Per Share of
Common Stock......................... $ 1.63 $ 1.07 $ (.26)
============ ============ ============
SHARE DATA
Weighted Average Number of Shares
Outstanding -- Basic................. 169,492,000 170,765,000 170,017,000
============ ============ ============
Weighted Average Number of Shares
Outstanding -- Diluted............... 171,703,000 172,552,000 170,017,000
============ ============ ============


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

37
39

THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



DECEMBER 31,
--------------------
1998 1997
-------- --------
(DOLLAR AMOUNTS IN
MILLIONS, EXCEPT PER
SHARE DATA)

ASSETS
CURRENT ASSETS:
Cash and Cash Equivalents................................... $ 90.6 $ 81.8
Accounts Receivable -- Net of Allowance of $39.0 in 1998 and
$39.4 in 1997............................................. 445.2 454.5
Other Current Assets........................................ 228.2 269.2
-------- --------
Total Current Assets................................... 764.0 805.5
-------- --------
NON-CURRENT ASSETS:
Property, Plant and Equipment............................... 298.3 317.2
Prepaid Pension Costs....................................... 224.3 190.9
Computer Software........................................... 148.6 128.0
Goodwill.................................................... 191.8 194.6
Other Non-Current Assets.................................... 162.2 153.3
-------- --------
Total Non-Current Assets............................... 1,025.2 984.0
-------- --------
Net Assets of Discontinued Operations....................... -- 296.5
-------- --------
Total Assets................................................ $1,789.2 $2,086.0
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes Payable............................................... $ 36.9 $ 451.5
Accrued Income Taxes........................................ 326.3 4.1
Other Accrued and Current Liabilities....................... 529.9 505.4
Unearned Subscription Income................................ 459.6 573.5
-------- --------
Total Current Liabilities.............................. 1,352.7 1,534.5
-------- --------
Pension and Postretirement Benefits......................... 372.7 389.0
Other Non-Current Liabilities............................... 133.1 388.3

Minority Interest........................................... 301.7... 301.9
SHAREHOLDERS' EQUITY:
Preferred Stock, authorized -- 10,000,000 shares;
$.01 par value per share -- 1998, outstanding -- none
$1.00 par value per share -- 1997, outstanding -- none
Series Common Stock, authorized -- 10,000,000 shares;
$.01 par value per share -- 1998, outstanding -- none
Common Stock, authorized -- 400,000,000 shares;
$.01 par value per share -- 1998, issued -- 171,451,136
shares................................................. 1.7 --
$1.00 par value per share -- 1997, issued -- 188,420,996
shares................................................. -- 188.4
Capital Surplus............................................. 251.1 80.2
Retained Earnings........................................... (240.9) 367.7


38
40



DECEMBER 31,
--------------------
1998 1997
-------- --------
(DOLLAR AMOUNTS IN
MILLIONS, EXCEPT PER
SHARE DATA)

Treasury Stock at cost:
6,396,924 shares for 1998................................. (168.1) --
17,853,652 shares for 1997................................ -- (964.0)
Cumulative Translation Adjustment........................... (170.2) (162.6)
Minimum Pension Liability................................... (44.6) (37.4)
-------- --------
Total Shareholders' Equity............................. (371.0) (527.7)
-------- --------
Total Liabilities and Shareholders' Equity.................. $1,789.2 $2,086.0
======== ========


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

39
41

THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS



YEARS ENDED DECEMBER 31,
-------------------------------
1998 1997 1996
------- -------- --------
(DOLLAR AMOUNTS IN MILLIONS)

CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss)............................... $ 280.1 $ 184.0 $ (43.8)
Less: Income from Discontinued Operations....... 33.7 92.0 72.3
------- -------- --------
Income (Loss) from Continuing Operations........ 246.4 92.0 (116.1)
Reconciliation of Net Income to Net Cash
Provided by Operating Activities:
Cumulative Effect of Accounting Changes, Net
of Income Tax Benefit...................... -- 127.0 --
Depreciation and Amortization................. 141.6 131.9 140.6
(Gain) Loss from Sale of Businesses, Net of
Income Taxes............................... (5.3) -- 68.2
Decrease (Increase) in Notes Receivable....... 2.9 47.5 (55.3)
Restructuring Payments........................ -- -- (39.4)
Postemployment Benefit Payments............... (16.3) (30.6) (50.3)
Net Decrease (Increase) in Accounts
Receivable................................. 5.0 (33.8) (52.1)
Deferred Income Taxes......................... (49.2) 7.0 83.2
Accrued Income Taxes.......................... 317.8 (38.7) 16.2
(Decrease) Increase in Long-Term
Liabilities................................ (213.3) 38.7 105.4
Increase in Other Long-Term Assets............ (18.9) -- --
Net (Increase) Decrease in Other Working
Capital Items.............................. (100.1) 84.3 89.5
Other......................................... 14.9 (45.3) (10.0)
------- -------- --------
Net Cash Provided by Operating Activities:
Continuing Operations......................... 325.5 380.0 179.9
Discontinued Operations....................... 16.7 120.4 152.1
------- -------- --------
Net Cash Provided by Operating Activities....... 342.2 500.4 332.0
------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from Sales of Marketable Securities.... 50.9 27.2 17.6
Payments for Marketable Securities.............. (50.4) (27.1) (2.4)
Proceeds from Sale of Businesses................ 26.5 -- 93.9
Capital Expenditures............................ (55.4) (50.3) (57.9)
Additions to Computer Software and Other
Intangibles................................... (91.7) (78.8) (94.1)
Net Cash (Used in) Provided by Investing
Activities of Discontinued Operations......... (3.1) 105.7 (180.5)
Other........................................... 18.5 7.4 13.3
------- -------- --------
Net Cash Used in Investing Activities........... (104.7) (15.9) (210.1)
------- -------- --------


40
42



YEARS ENDED DECEMBER 31,
-------------------------------
1998 1997 1996
------- -------- --------
(DOLLAR AMOUNTS IN MILLIONS)

CASH FLOWS FROM FINANCING ACTIVITIES
Payment of Dividends............................ (137.4) (150.6) (310.8)
Payments for Purchase of Treasury Shares........ (220.2) (60.1) (25.6)
Net Proceeds from Exercise of Stock Options..... 41.0 40.8 63.7
(Decrease) Increase in Commercial Paper
Borrowings.................................... (385.7) 421.6 (405.0)
Increase in Minority Interest................... -- 300.0 --
(Decrease) Increase in Other Short-Term
Borrowings.................................... (28.9) (1,090.6) 1,116.2
Payment of Redeemable Partnership Interests..... -- -- (575.0)
Proceeds from Debt Assumed by R.H. Donnelley.... 500.0 -- --
Other........................................... 3.9 9.2 (1.1)
------- -------- --------
Net Cash Used in Financing Activities........... (227.3) (529.7) (137.6)
------- -------- --------
Effect of Exchange Rate Changes on Cash and Cash
Equivalents................................... (1.4) (.8) (2.1)
------- -------- --------
Increase (Decrease) in Cash and Cash
Equivalents................................... 8.8 (46.0) (17.8)
Cash and Cash Equivalents, Beginning of Year.... 81.8 127.8 145.6
------- -------- --------
Cash and Cash Equivalents, End of Year.......... $ 90.6 $ 81.8 $ 127.8
======= ======== ========


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

41
43

THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(THREE YEARS ENDED DECEMBER 31, 1998)


COMMON
STOCK CUMULATIVE
($1 AND $.01 CAPITAL RETAINED TREASURY TRANSLATION
PAR VALUE) SURPLUS EARNINGS STOCK ADJUSTMENT
------------ ------- --------- --------- -----------
(DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)

BALANCE, JANUARY 1, 1996......... $ 188.4 $ 70.0 $ 2,184.5 $(1,107.3) $(177.3)
Net Loss......................... (43.8)
Dividends Declared ($1.82
per share)..................... (310.8)
Stock Dividend to Shareholders of
Cognizant and ACNielsen,
Including 800,000
Treasury Shares................ (1,370.2) 49.5 79.8
Treasury Shares Reissued Under
Stock Options and Deferred
Compensation Plans
(1,525,935).................... 2.6 59.0
Treasury Shares Reissued Under
Restricted Stock Plan
(16,410)....................... 4.7
Treasury Shares Acquired
(923,199)...................... (25.6)
Change in Cumulative Translation
Adjustment..................... (55.8)
Unrealized Losses on
Investments.................... (3.0)
------- ------ --------- --------- -------
Total Comprehensive Loss.........
BALANCE, DECEMBER 31, 1996....... 188.4 72.6 456.7 (1,019.7) (153.3)
------- ------ --------- --------- -------
Net Income....................... 184.0
Dividends Declared ($1.10 per
share, see Note 1)............. (188.1)
Adjustment to Stock Dividend to
Shareholders of Cognizant and
ACNielsen...................... (11.3)
Treasury Shares Reissued Under
Stock Options and Deferred
Compensation Plans
(2,010,091).................... 7.6 (72.4) 115.6
Treasury Shares Reissued Under
Restricted Stock Plan
(20,884)....................... .2
Treasury Shares Acquired
(2,271,851).................... (60.1)
Change in Cumulative Translation
Adjustment..................... (9.3)
Minimum Pension Liability
Adjustment.....................
Unrealized Losses on
Investments.................... (1.2)
------- ------ --------- --------- -------
Total Comprehensive Income.......
BALANCE, DECEMBER 31, 1997....... 188.4 80.2 367.7 (964.0) (162.6)
------- ------ --------- --------- -------



MINIMUM TOTAL COMPREHENSIVE
PENSION SHAREHOLDERS' INCOME
LIABILITY EQUITY (LOSS)
---------- ------------- -------------
(DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)

BALANCE, JANUARY 1, 1996......... $ -- $ 1,158.3
Net Loss......................... (43.8) $ (43.8)
Dividends Declared ($1.82
per share)..................... (310.8)
Stock Dividend to Shareholders of
Cognizant and ACNielsen,
Including 800,000
Treasury Shares................ (1,240.9)
Treasury Shares Reissued Under
Stock Options and Deferred
Compensation Plans
(1,525,935).................... 61.6
Treasury Shares Reissued Under
Restricted Stock Plan
(16,410)....................... 4.7
Treasury Shares Acquired
(923,199)...................... (25.6)
Change in Cumulative Translation
Adjustment..................... (55.8) (55.8)
Unrealized Losses on
Investments.................... (3.0) (3.0)
------ --------- -------
Total Comprehensive Loss......... $(102.6)
BALANCE, DECEMBER 31, 1996....... -- (455.3)
------ --------- =======
Net Income....................... 184.0 $ 184.0
Dividends Declared ($1.10 per
share, see Note 1)............. (188.1)
Adjustment to Stock Dividend to
Shareholders of Cognizant and
ACNielsen...................... (11.3)
Treasury Shares Reissued Under
Stock Options and Deferred
Compensation Plans
(2,010,091).................... 50.8
Treasury Shares Reissued Under
Restricted Stock Plan
(20,884)....................... .2
Treasury Shares Acquired
(2,271,851).................... (60.1)
Change in Cumulative Translation
Adjustment..................... (9.3) (9.3)
Minimum Pension Liability
Adjustment..................... (37.4) (37.4) (37.4)
Unrealized Losses on
Investments.................... (1.2) (1.2)
------ --------- -------
Total Comprehensive Income....... $ 136.1
BALANCE, DECEMBER 31, 1997....... (37.4) (527.7)
------ --------- =======


42
44


COMMON
STOCK CUMULATIVE
($1 AND $.01 CAPITAL RETAINED TREASURY TRANSLATION
PAR VALUE) SURPLUS EARNINGS STOCK ADJUSTMENT
------------ ------- --------- --------- -----------
(DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)

Dollar Par Common Stock:
Treasury Shares Reissued Under
Stock Options and Deferred
Compensation Plans
(1,514,773).................. (52.6) 85.3
Treasury Shares Acquired
(790,800).................... (27.2)
Stock Dividend to Shareholders of
R.H. Donnelley................. 183.5
Adjustment to Penny Par Value.... (169.6) 169.6
Recapitalization................. (17.1) .5 (889.3) 905.9
Net Income....................... 280.1
Dividends Declared ($.775 per
share)......................... (130.4)
Penny Par Common Stock:
Treasury Shares Reissued Under
Stock Options and Deferred
Compensation Plans
(837,232).................... (1.3) 24.3
Treasury Shares Earned Under
Restricted Stock Plan
(5,595)...................... .6
Treasury Shares Acquired
(7,239,751).................. (193.0)
Common Shares Issued Under
Stock Options and Restricted
Stock Plan (159,819)......... 2.1
Change in Cumulative Translation
Adjustment..................... (7.6)
Minimum Pension Liability
Adjustment.....................
Unrealized Gains on
Investments.................... .1
------- ------ --------- --------- -------
Total Comprehensive Income.......
BALANCE, DECEMBER 31, 1998....... $ 1.7 $251.1 $ (240.9) $ (168.1) $(170.2)
======= ====== ========= ========= =======



MINIMUM TOTAL COMPREHENSIVE
PENSION SHAREHOLDERS' INCOME
LIABILITY EQUITY (LOSS)
---------- ------------- -------------
(DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE DATA)

Dollar Par Common Stock:
Treasury Shares Reissued Under
Stock Options and Deferred
Compensation Plans
(1,514,773).................. 32.7
Treasury Shares Acquired
(790,800).................... (27.2)
Stock Dividend to Shareholders of
R.H. Donnelley................. 183.5
Adjustment to Penny Par Value.... --
Recapitalization................. --
Net Income....................... 280.1 $ 280.1
Dividends Declared ($.775 per
share)......................... (130.4)
Penny Par Common Stock:
Treasury Shares Reissued Under
Stock Options and Deferred
Compensation Plans
(837,232).................... 23.0
Treasury Shares Earned Under
Restricted Stock Plan
(5,595)...................... .6
Treasury Shares Acquired
(7,239,751).................. (193.0)
Common Shares Issued Under
Stock Options and Restricted
Stock Plan (159,819)......... 2.1
Change in Cumulative Translation
Adjustment..................... (7.6) (7.6)
Minimum Pension Liability
Adjustment..................... (7.2) (7.2) (7.2)
Unrealized Gains on
Investments.................... .1 .1
------ --------- -------
Total Comprehensive Income....... $ 265.4
BALANCE, DECEMBER 31, 1998....... $(44.6) $ (371.0)
====== ========= =======


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

43
45

THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Tabular dollar amounts in millions, except per share data

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION. The consolidated financial statements include
those of The Dun & Bradstreet Corporation (the "Company") and its subsidiaries
and investments in which the Company has a controlling interest. Investments in
companies over which the Company has significant influence but not a controlling
interest are carried on an equity basis. The effects of all significant
intercompany transactions have been eliminated.

The financial statements of subsidiaries outside the United States and Canada
reflect a fiscal year ended November 30 to facilitate timely reporting of the
Company's consolidated financial results.

As discussed more thoroughly in Note 2, R.H. Donnelley Corporation, Cognizant
Corporation ("Cognizant"), ACNielsen Corporation ("ACNielsen"), Dun & Bradstreet
Software ("DBS") and NCH Promotional Services ("NCH") are presented as
discontinued operations.

CASH EQUIVALENTS. Marketable securities that mature within 90 days of purchase
date are considered cash equivalents and are stated at cost, which approximates
fair value.

MARKETABLE SECURITIES. In accordance with Statement of Financial Accounting
Standards ("SFAS") No. 115, "Accounting for Certain Investments in Debt and
Equity Securities," marketable securities at December 31, 1998 and 1997, are
classified as "available for sale" and are reported at fair value, with net
unrealized gains and losses reported in shareholders' equity.

The fair value of current and non-current marketable securities was estimated
based on quoted market prices. Realized gains and losses on marketable
securities are determined on the specific identification method.

The Company's marketable securities, $49.7 million and $53.0 million at December
31, 1998 and 1997, respectively, consisted primarily of debt securities of the
U.S. Government and its agencies.

PROPERTY, PLANT AND EQUIPMENT. Buildings, machinery and equipment are
depreciated principally using the straight-line method over a period of three to
40 years. Leasehold improvements are amortized on a straight-line basis over the
shorter of the term of the lease or the estimated useful life of the
improvement.

COMPUTER SOFTWARE, GOODWILL AND INTANGIBLE ASSETS. Certain computer software
costs are capitalized in accordance with SFAS No. 86, "Accounting for the Costs
of Computer Software to Be Sold, Leased or Otherwise Marketed," and are reported
at the lower of unamortized cost or net realizable value. Effective January 1,
1999, the Company will adopt Statement of Position ("SOP") 98-1, "Accounting for
the Costs of Computer Software Developed or Obtained for Internal Use." Among
other provisions, SOP 98-1 requires that entities capitalize certain
internal-use software costs once certain criteria are met. Under SOP 98-1,
overhead, general and administrative, and training costs are not to be
capitalized. During 1998, the Company capitalized approximately $10 million of
costs incurred in developing internal-use software which would not be
capitalized in the future. Costs in connection with business process
reengineering are expensed as incurred. Other

44
46
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

intangibles result from acquisitions and database enhancements. Computer
software and other intangibles are being amortized, using principally the
straight-line method, over three to five years and five to 15 years,
respectively. Goodwill represents the excess purchase price over the fair value
of identifiable net assets of businesses acquired and is amortized on a
straight-line basis over five to 40 years.

In accordance with SFAS No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of," the Company reviews for
impairment of long-lived assets and certain identifiable intangibles whenever
events or changes in circumstances indicate that the carrying amount of an asset
may not be recoverable. In general, the Company will recognize an impairment
loss when the sum of undiscounted expected future cash flows is less than the
carrying amount of such assets. The measurement for such an impairment loss is
then based on the fair value of the asset.

At each balance sheet date, the Company reviews the recoverability of goodwill,
not identified with long-lived assets, based on estimated undiscounted future
cash flows from operating activities compared with the carrying value of
goodwill, and recognizes any impairment on the basis of such comparison. The
recognition and measurement of goodwill impairment is assessed at the
business-unit level.

REVENUE RECOGNITION. The Company recognizes revenue as services are performed,
information is delivered, and products and services are used by its customers.
Amounts billed for service and subscriptions are credited to unearned
subscription income and reflected in operating revenues as used over the
subscription term, which is generally one year.

ACCOUNTING CHANGES. Effective January 1, 1997, the Company changed its revenue
recognition method for its Credit Information Services business to recognize
revenue as products and services are used by its customers. Previously, the
Company recognized revenue ratably over the contract period. This change is
consistent with the Company's change in focus from a sales contract basis to a
product usage basis in order to drive revenue growth and increase customer
satisfaction. Additionally, the Company changed its revenue recognition method
for its Moody's Investors Service ("Moody's") business to recognize revenue over
the service period from previously recognizing revenues and costs at the time of
billing. In the opinion of management, these accounting changes bring revenue
recognition methods more in line with the economics of the business and provide
a better measure of operating results.

In accordance with Accounting Principles Board Opinion ("APB") No. 20,
"Accounting Changes," the cumulative effect of changing the accounting for
certain of the Company's revenue recognition policies resulted in a pre-tax
non-cash charge of $214.7 million ($127.0 million after-tax or $.74 per share
basic, $.73 per share diluted). On a pro-forma basis, these changes would have
increased 1996 net income by $3.1 million. The impact on basic and diluted
earnings per share would have been an increase in 1996 of $.02 per share.

FOREIGN CURRENCY TRANSLATION. For all operations outside the United States
where the Company has designated the local currency as the functional currency,
assets and liabilities are translated using the end-of-year exchange rates, and
revenues and expenses are

45
47
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

translated using average exchange rates for the year. For these countries,
currency translation adjustments are accumulated in a separate component of
shareholders' equity, whereas realized transaction gains and losses are
recognized in other expense -- net. For operations in countries that are
considered to be highly inflationary, where the U.S. dollar is designated as the
functional currency, monetary assets and liabilities are translated using
end-of-year exchange rates, and nonmonetary accounts are translated using
historical exchange rates. Translation and transaction gains of $1.0 million in
1998 and $.9 million in 1997 and losses of $.9 million in 1996 are recognized in
other expense -- net.

EARNINGS PER SHARE OF COMMON STOCK. In accordance with SFAS No. 128, "Earnings
per Share" ("SFAS No. 128"), basic earnings per share are calculated based on
the weighted average number of shares of common stock outstanding during the
reporting period. Diluted earnings per share are calculated giving effect to all
potentially dilutive common shares, assuming such shares were outstanding during
the reporting period.

FINANCIAL INSTRUMENTS. At times, the Company uses forward foreign exchange
contracts and interest rate swaps to hedge existing assets, liabilities and firm
commitments. The Company does not use any derivatives for trading or speculative
purposes.

Gains and losses on forward foreign exchange contracts that qualify as hedges of
existing assets or liabilities are included in the carrying amounts of those
assets or liabilities and are ultimately recognized in income as part of those
carrying amounts. Gains and losses related to qualifying hedges of firm
commitments are also deferred and are recognized in income or as adjustments of
carrying amounts when the hedged transactions occur. For forward foreign
exchange contracts, the risk reduction is assessed on a transaction basis, and
contract amounts and terms are matched to existing intercompany transactions.

The Company has in the past used interest rate swaps to hedge interest rate risk
on commercial paper. Settlement accounting is accorded to the swaps that have
contractual, periodic payment terms considered to be aligned to the expected
future commercial paper issuances. Periodic swap payments and receipts under
interest rate swaps are recorded as part of interest expense. Neither the swap
contracts nor the gains or losses on these contracts, which are designated and
effective as hedges, are recognized in the financial statements.

If a hedging instrument is sold or terminated prior to maturity, gains and
losses will continue to be deferred until the hedged item is recognized in
income. If a hedging instrument ceases to qualify for settlement accounting, any
subsequent gains and losses are recognized currently in income.

ESTIMATES. The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the period.
Actual results could differ from those estimates. Estimates are used in the
determination of allowances for doubtful accounts, depreciation and
amortization, computer software, employee benefits plans, taxes and
contingencies, among others.

46
48
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

RECLASSIFICATIONS AND RESTATEMENT. As discussed in Note 2, the consolidated
financial statements have been reclassified to identify separately the results
of operations, net assets and cash flows of the Company's discontinued
operations. In addition, certain prior-year amounts have been reclassified to
conform to the 1998 presentation.

The Company restated retained earnings and dividends payable at December 31,
1997, to record dividends declared December 17, 1997, to be paid March 10, 1998,
to shareholders of record on February 20, 1998, in the amount of $37.5 million.
This restatement has no impact on results of operations or cash flows.

NOTE 2 REORGANIZATION AND DISCONTINUED OPERATIONS

Pursuant to APB 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," the consolidated financial
statements of the Company have been reclassified to reflect as discontinued
operations, the companies that comprised the Company's Directory Information
Services business segment as a result of the 1998 Distribution and the companies
that comprised the Company's Marketing Information Services, Software Services
and Other Business Services business segments as a result of the 1996
Distribution.

1998 DISTRIBUTION

On June 30, 1998, The Dun & Bradstreet Corporation ("Old D&B") separated into
two publicly traded companies -- The New Dun & Bradstreet Corporation ("New D&B"
or the "Company") and R.H. Donnelley Corporation. The separation (the "1998
Distribution") of the two companies was accomplished through a tax-free dividend
by Old D&B of the Company, which is a new entity comprised of Moody's and Dun &
Bradstreet, the operating company ("D&B"). The new entity is now known as "The
Dun & Bradstreet Corporation" and the continuing entity (i.e., Old D&B),
consisting of R.H. Donnelley Inc., the operating company, and the DonTech
partnership, changed its name to R.H. Donnelley Corporation ("Donnelley"). Due
to the relative significance of the new entity, the transaction has been
accounted for as a reverse spin-off and, as such, Moody's and D&B have been
classified as continuing operations and Donnelley and DonTech have been
classified as discontinued operations. On June 3, 1998, following receipt of a
ruling from the Internal Revenue Service that the transaction would be tax-free
to Old D&B and its U.S. shareholders, the Board of Directors of Old D&B declared
a dividend distribution to shareholders of record on June 17, 1998, consisting
of one share of New D&B for each share of Old D&B common stock held as of the
record date. The 1998 Distribution was effected on June 30, 1998, and resulted
in an increase to shareholders' equity of $188.5 million. During the fourth
quarter of 1998, adjustments to the dividend of $5.0 million were recorded,
primarily as a result of employee benefits plan revisions.

For purposes of governing certain of the ongoing relationships between the
Company and Donnelley following the 1998 Distribution, the companies entered
into various agreements, including a Distribution Agreement, Tax Allocation
Agreement, Employee Benefits Agreement, Intellectual Property Agreement, Shared
Transaction Services Agreement, Data Services Agreement and Transition Services
Agreements.

47
49
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

For financial reporting purposes, the assets and liabilities of the Directory
Information Services segment have been separately classified on the balance
sheet as "Net Assets of Discontinued Operations." A summary of these assets and
liabilities at December 31, 1997, was as follows:



Current assets.............................................. $ 92.7
Total assets................................................ 362.3
Current liabilities......................................... 64.6
Total liabilities........................................... 65.8
Net assets of discontinued operations....................... 296.5


The net operating results of the Directory Information Services segment have
been reported in the caption "Income from Discontinued Operations," in the
consolidated statements of operations. Summarized operating results for the
Directory Information Services segment for the years ended December 31 were as
follows:



1998 1997 1996
------ ------ ------

Operating revenues.......................... $107.8 $343.4 $377.6
Income before provision for income taxes.... 56.2 144.2 141.1
Net income.................................. 33.7 92.0 89.5


1996 DISTRIBUTION

On November 1, 1996, the company then known as The Dun & Bradstreet Corporation
reorganized into three publicly traded independent companies by spinning off
through a tax-free distribution two of its businesses to shareholders (the "1996
Distribution"). The 1996 Distribution resulted in the following three companies:
1) Old D&B, consisting of D&B, Moody's and Donnelley; 2) ACNielsen; and 3)
Cognizant, consisting of IMS International, Inc., Gartner Group, Nielsen Media
Research, Pilot Software, Cognizant Technology Solutions Corporation, Cognizant
Enterprises and Erisco. During 1998, Cognizant further separated into two new
companies, IMS Health Incorporated ("IMS") and Nielsen Media Research, Inc.
("NMR"). In connection with the 1996 Distribution, DBS and NCH were sold. On
October 10, 1996, following receipt of a ruling from the Internal Revenue
Service that the transaction would be tax-free to the Company and its U.S.
shareholders, the Company's Board of Directors declared a dividend distribution
to shareholders of record on October 21, 1996, consisting of one share of
Cognizant common stock for each share of the Company's common stock and one
share of ACNielsen common stock for every three shares of the Company's common
stock held on such record date. The 1996 Distribution was effected on November
1, 1996. These transactions resulted in a non-cash dividend that reduced
shareholders' equity by $1,240.9 million. During 1997, adjustments to the
dividend of $11.3 million were recorded, primarily as a result of employee
benefits plan revisions.

For purposes of governing certain of the ongoing relationships among the
Company, Cognizant and ACNielsen as a result of the 1996 Distribution, the three
new companies entered into various agreements, including a Distribution
Agreement, Tax Allocation Agreement, Employee Benefits Agreement, Indemnity and
Joint Defense Agreement,

48
50
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Intellectual Property Agreement, Shared Transaction Services Agreement, Data
Services Agreement and Transition Services Agreement. These agreements set forth
the principles to be applied in allocating certain related costs and specified
portions of contingent liabilities to be shared if certain amounts are exceeded
(see Note 13 -- Contingencies). Pursuant to their separation, IMS and NMR are
each jointly and severally liable for all Cognizant liabilities under the 1996
agreements.

The net operating results of the Company's Marketing Information Services,
Software Services and Other Business Services business segments have been
included in the consolidated statements of operations in the caption "Income
from Discontinued Operations." These segments included the companies that made
up Cognizant and ACNielsen, along with DBS and NCH. Summarized operating results
for those discontinued operations for the year ended December 31, 1996, were as
follows:



Operating revenues.......................................... $2,761.6
Income before provision for income taxes.................... 297.0
Net income.................................................. 141.0


The Company completed the sale of DBS on November 1, 1996, for proceeds of
$191.3 million, including a note of $41.2 million, resulting in a pre-tax loss
of $220.6 million ($158.2 million after-tax). Pursuant to the Distribution
Agreement, the cash proceeds from the sale were transferred to Cognizant. During
the third quarter of 1997, cash was received from the buyer to satisfy the note
receivable, which was due in May 1998.

The sale of NCH was completed on December 31, 1996. Pursuant to the Distribution
Agreement, the proceeds of $20.5 million from the sale of NCH, which included a
note of $8.5 million, were transferred to Cognizant. At December 31, 1996, the
Company recorded a receivable of $20.5 million from the buyer of NCH and a
corresponding payable to Cognizant. These transactions were settled in January
1997. The Company did not incur a gain or loss on the sale.

Also included in 1996 results, within discontinued operations, are tax costs
allocated to discontinued operations of $49.1 million.

NOTE 3 NON-RECURRING ITEMS

In July 1998, the Company sold Financial Information Services, the financial
publishing unit of Moody's. The Company received $26.5 million of cash proceeds
and recorded within other expense -- net a pre-tax gain of $9.6 million on the
transaction. Also in 1998, the Company incurred pre-tax expenses of $28.0
million in connection with the separation of Donnelley (primarily professional
fees of $19.1 million and costs resulting from the termination of interest rate
swaps of $8.9 million).

The 1996 results for the Company reflect after-tax non-recurring charges of
$262.3 million, incurred as a result of the 1996 Distribution and the sale of
American Credit Indemnity ("ACI"). Of the $262.3 million, $229.4 million was
recorded in pre-tax income and a net tax cost of $32.9 million was recorded in
the provision for income taxes. The $229.4 million represents reorganization
costs of $161.2 million (professional and consulting fees of $75.0 million and
settlement of executive compensation plans and retention bonuses of

49
51
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

$86.2 million) and $68.2 million resulting from the losses incurred on the sale
of ACI completed in October 1996.

NOTE 4 RECONCILIATION OF WEIGHTED AVERAGE SHARES



1998 1997 1996
------- ------- -------
(SHARE DATA IN THOUSANDS)

Weighted Average Number of Shares -- Basic....... 169,492 170,765 170,017
Dilutive effect of shares issuable under stock
options, restricted stock and performance share
plans.......................................... 2,017 1,629 --
Adjustment of shares applicable to stock options
exercised during the period and performance
share plans.................................... 194 158 --
------- ------- -------
Weighted Average Number of Shares -- Diluted..... 171,703 172,552 170,017
======= ======= =======


As required by SFAS No. 128, the Company has provided a reconciliation of basic
weighted average shares to diluted weighted average shares within the tables
outlined above. The exercise of potentially dilutive shares has not been assumed
for the year ended December 31, 1996, since the result is antidilutive. Options
to purchase 3.4 million and 3.1 million shares of common stock were outstanding
at December 31, 1998 and 1997, respectively, but were not included in the
computation of diluted earnings per share because the options' exercise prices
were greater than the average market price of the Company's common stock. The
Company's options generally expire 10 years after the initial grant date.

Upon the 1998 Distribution, employees of the Company were granted substitute
options, preserving the economic value, as closely as possible, of the options
that existed immediately prior to the 1998 Distribution and any awards or
options held by them in respect of Donnelley were canceled.

NOTE 5 FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISKS

The Company uses forward foreign exchange contracts and in the past has used
interest rate swap agreements to reduce exposure to fluctuations in foreign
exchange rates and interest. The Company does not use derivative financial
instruments for trading or speculative purposes. If a hedging instrument ceases
to qualify as a hedge, any subsequent gains and losses are recognized currently
in income. Collateral is generally not required for these types of instruments.

By their nature, all such instruments involve risk, including the credit risk of
non-performance by counterparties. However, at December 31, 1998 and 1997, in
management's opinion there was no significant risk of loss in the event of
non-performance of the counterparties to these financial instruments. The
Company controls its exposure to credit risk through monitoring procedures.

50
52
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

FOREIGN EXCHANGE

In order to reduce the risk of foreign currency exchange rate fluctuations, the
Company follows a policy of hedging substantially all cross-border intercompany
transactions denominated in a currency other than the functional currency
applicable to each of its various subsidiaries. The financial instruments used
to hedge these cross-border intercompany transactions are forward foreign
exchange contracts with maturities of six months or less. These forward
contracts are executed with creditworthy institutions and are denominated
primarily in the British pound sterling, German mark and Swedish krona. The
gains and losses on these forward contracts are recorded to income or expense
and are essentially offset by the gains and losses on the underlying foreign
currency transactions.

At December 31, 1998 and 1997, the Company had approximately $117 million of
forward foreign exchange contracts outstanding with various expiration dates
through March 1999 and March 1998, respectively. At December 31, 1998,
unrealized gains on these contracts were $.9 million and the unrealized losses
were $.4 million. At December 31, 1997, unrealized gains on these contracts were
$1.5 million and the unrealized losses were $.4 million.

INTEREST RATE SWAP AGREEMENTS

In the past, the Company has entered into interest rate swap agreements to
manage exposure to changes in interest rates. Interest rate swaps allowed the
Company to raise funds at floating rates and effectively swap them into fixed
rates that were lower than those available to it if fixed-rate borrowings were
to be made directly.

In connection with the 1998 Distribution and repayment of outstanding notes
payable, Old D&B canceled all of its interest rate swap agreements (which fixed
interest rates on $300.0 million of variable rate debt through January 2005) and
recorded into income the previously unrecognized fair value loss at the time of
termination. At the time of the cancellation, the fair value of the interest
rate swaps was a loss of $12.7 million, of which $3.8 million ($.6 million in
the first quarter of 1998 and $3.2 million in 1997) had been recognized in
income relating to swaps which did not qualify for settlement accounting. The
previously unrecognized loss of $8.9 million was recorded during the second
quarter of 1998 and included in reorganization costs.

The following table indicates the type of swaps that were in use at December 31,
1997, and their weighted average interest rates.



Variable to fixed swaps --
Notional amount........................................ $300.0
Average pay (fixed) rate............................... 6.84%
Average receive (variable) rate........................ 5.75%


51
53
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 6 PENSION AND POSTRETIREMENT BENEFITS



POSTRETIREMENT
PENSION PLANS BENEFITS
---------------------- ------------------
1998 1997 1998 1997
--------- --------- ------- -------

CHANGE IN BENEFIT OBLIGATIONS
Benefit obligation at January 1.... $(1,227.3) $(1,097.1) $(216.6) $(196.6)
Service cost....................... (18.2) (18.4) (2.8) (3.5)
Interest cost...................... (82.6) (83.4) (14.3) (14.6)
Benefits paid...................... 93.8 87.1 17.7 17.5
Impact of 1998 Distribution........ 41.4 -- 6.1 --
Plan amendment..................... -- (9.1) -- --
Actuarial gain..................... (43.3) (106.4) (1.3) (17.2)
Plan participant contributions..... -- -- (2.8) (2.2)
--------- --------- ------- -------
Benefit obligation at December
31............................... $(1,236.2) $(1,227.3) $(214.0) $(216.6)
========= ========= ======= =======
CHANGE IN PLAN ASSETS
Fair value of plan assets at
January 1........................ $ 1,330.2 $ 1,145.4 $ -- $ --
Actual return on plan assets....... 264.3 243.8 -- --
Employer contribution.............. 25.3 28.1 14.9 15.3
Impact of 1998 Distribution........ (60.9) -- -- --
Plan participant contributions..... -- -- 2.8 2.2
Benefits paid...................... (93.8) (87.1) (17.7) (17.5)
--------- --------- ------- -------
Fair value of plan assets at
December 31...................... $ 1,465.1 $ 1,330.2 $ -- $ --
========= ========= ======= =======
RECONCILIATION OF FUNDED STATUS TO
TOTAL AMOUNT RECOGNIZED
Funded status of plan.............. $ 228.9 $ 102.9 $(214.0) $(216.6)
Unrecognized actuarial (gain)
loss............................. (112.1) (3.6) 18.8 18.0
Unrecognized prior service cost.... 29.6 33.8 (2.7) (7.2)
Unrecognized net transition
asset............................ (24.3) (35.5) -- --
--------- --------- ------- -------
Net amount recognized.............. $ 122.1 $ 97.6 $(197.9) $(205.8)
========= ========= ======= =======


52
54
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



POSTRETIREMENT
PENSION PLANS BENEFITS
---------------------- ------------------
1998 1997 1998 1997
--------- --------- ------- -------

AMOUNTS RECOGNIZED IN THE
CONSOLIDATED BALANCE SHEETS
Prepaid pension costs.............. $ 224.3 $ 190.9 $ -- $ --
Net assets of discontinued
operations....................... -- 9.5 -- (10.7)
Pension and postretirement
benefits......................... (167.7) (165.4) (197.9) (195.1)
Intangible assets.................. 20.9 25.2 -- --
Minimum pension liability.......... 44.6 37.4 -- --
--------- --------- ------- -------
Net amount recognized.............. $ 122.1 $ 97.6 $(197.9) $(205.8)
========= ========= ======= =======


1997 benefit obligations and plan assets include amounts attributable to
Donnelley. The net amount recognized attributable to Donnelley has been included
in the net assets of discontinued operations.

The benefit obligation and accumulated benefit obligation for pension plans with
accumulated benefit obligations in excess of plan assets were $185.9 million and
$167.7 million, respectively, in 1998, and $183.7 million and $165.4 million,
respectively, in 1997. Grantor trusts are used to fund these obligations. At
December 31, 1998 and 1997, the balance of those trusts was $46.9 million and
$49.8 million, respectively.



PENSION PLANS POSTRETIREMENT BENEFITS
---------------------------- -----------------------
1998 1997 1996 1998 1997 1996
------- ------- ------ ----- ----- -----

COMPONENTS OF NET
PERIODIC (INCOME) COST
Service cost............ $ 18.2 $ 18.4 $ 34.8 $ 2.8 $ 3.5 $ 5.9
Interest cost........... 82.6 83.4 87.4 14.3 14.6 15.4
Expected return on plan
assets................ (109.4) (100.9) (107.1) -- -- --
Amortization of
transition
obligation............ 3.1 1.6 10.1 -- -- --
Amortization of prior
service cost.......... 4.4 4.5 3.8 (4.4) (4.5) (5.0)
Recognized actuarial
gain.................. (10.4) (10.5) (12.7) -- -- .2
------- ------- ------ ----- ----- -----
Net periodic (income)
cost.................. $ (11.5) $ (3.5) $ 16.3 $12.7 $13.6 $16.5
======= ======= ====== ===== ===== =====
1997 net periodic cost includes expense attributable to discontinued operations
of $1.0 million and $1.7 million for pension plans and postretirement plans,
respectively. 1996 net periodic cost includes expense attributable to
discontinued operations of $11.5 million and $6.3 million for pension plans and
postretirement plans, respectively.


53
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



PENSION PLANS POSTRETIREMENT BENEFITS
---------------------------- -----------------------
1998 1997 1996 1998 1997 1996
------- ------- ------ ----- ----- -----

ASSUMPTIONS AS OF
DECEMBER 31
Discount rate........... 6.75% 7.00% 7.75% 6.75% 7.00% 7.75%
Expected return on plan
assets................ 9.75 9.70 9.75 -- -- --
Rate of compensation
increase.............. 3.91 4.46 5.15 3.91 4.46 5.15
Cash balance
accumulation
conversion rate....... 5.50 5.75 -- -- -- --


For measurement purposes, a 6.5% annual rate of increase in the per capita cost
of covered health-care benefits was assumed for 1999. The rate was assumed to
decrease gradually to 5.0% for 2021 and remain at that level thereafter.

Assumed health-care cost trend rates have a significant effect on the amounts
reported for the health-care plans. A one-percentage-point change in the assumed
health-care cost trend rates would have the following effects:



1% POINT
--------------------
INCREASE DECREASE
-------- --------

Benefit obligation at end of year................... $18.5 $(16.9)
Service cost plus interest cost..................... 1.4 (1.3)


PROFIT PARTICIPATION PLAN

The Company also has a profit participation plan covering substantially all U.S.
employees, which provides for an employee salary deferral contribution and
Company contributions. Employees may contribute up to 16% of their pay. The
Company contributes an amount equal to 50% of employee contributions, up to 6%
of the employee's pay. The Company also makes contributions to the plan if
certain objectives are met, based on performance over a two-year period. The
Company recognized expense associated with the plan of $16.4 million, $13.3
million and $9.5 million in 1998, 1997 and 1996, respectively.

NOTE 7 EMPLOYEE STOCK PLANS

Under its 1998 Key Employees' Stock Incentive Plan, the Company has granted
options to certain associates to purchase shares of its common stock at the
market price on the date of the grant. Options granted under the plan vest 100%
after five years with the opportunity for accelerated vesting if certain
conditions are met. These options expire 10 years from the date of the grant.
The 1998 Key Employees Stock Incentive Plan, adopted upon the 1998 Distribution,
provides for the granting of up to 16.5 million shares.

At the 1998 Distribution date, employees of the Company were granted substitute
options and other equity-based awards (under the 1998 Dun & Bradstreet
Corporation Replacement Plan for Certain Employees Holding Dun & Bradstreet
Corporation Equity-

54
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Based Awards), preserving the economic value, as closely as possible, of the
awards that existed immediately prior to the 1998 Distribution, and any awards
held by them in respect of Donnelley were surrendered. For employees of
Donnelley, awards were adjusted immediately following the 1998 Distribution to
preserve, as closely as possible, the economic value of the awards that existed
immediately prior to the 1998 Distribution. The remaining holders of unexercised
options, including retirees and certain other former employees of the Company,
were offered the choice of converting their options to the Company's or
continuing to hold Donnelley options.

In November 1996, in conjunction with the 1996 Distribution, those individuals
who became employees of Cognizant or ACNielsen were granted substitute awards in
the stock of their new employer, and any stock awards or options held by them in
respect of the Company were reflected as surrendered in the table on Page 57.
For the remaining holders of unexercised options, including employees of the
Company, retirees and certain other former employees of the Company, the number
of shares subject to options and the option exercise price were adjusted
immediately following the 1996 Distribution to preserve, as closely as possible,
the economic value of the options that existed prior to the 1996 Distribution,
pursuant to the plans.

The Company applies APB No. 25, "Accounting for Stock Issued to Employees," and
related interpretations in accounting for its plans. Accordingly, no
compensation cost has been recognized for the stock option plans. The Company
has adopted the disclosure-only provisions of SFAS No. 123, "Accounting for
Stock-Based Compensation" ("SFAS No. 123"). Had compensation cost for the
Company's stock option plans been determined based on the fair value at the
grant date for awards in 1998, 1997 and 1996 (excluding awards granted to
employees of discontinued operations) consistent with the provisions of SFAS No.
123, the Company's income (loss) from continuing operations and earnings (loss)
per share would have been reduced to the pro-forma amounts indicated below:



1998 1997 1996
------ ------ -------

Income (loss) from continuing operations
As reported...................................... $246.4 $219.0 $(116.1)
Pro-forma........................................ $240.1 $215.4 $(119.7)
Basic earnings (loss) per share of common stock
from continuing operations
As reported...................................... $ 1.45 $ 1.28 $ (.69)
Pro-forma........................................ $ 1.42 $ 1.26 $ (.70)
Diluted earnings (loss) per share of common stock
from continuing operations
As reported...................................... $ 1.44 $ 1.27 $ (.69)
Pro-forma........................................ $ 1.40 $ 1.25 $ (.70)


The pro-forma disclosures shown are not representative of the effects on income
(loss) and earnings (loss) per share in future years.

55
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The fair value of each option grant is estimated on the date of grant using the
Black-Scholes option-pricing model with the following weighted average
assumptions:



AFTER 1996
CONVERSION PRIOR TO DISTRIBUTION PRIOR TO
AFTER 1998 AT 1998 1998 AND FOR 1996
DISTRIBUTION DISTRIBUTION DISTRIBUTION 1997 CONVERSION DISTRIBUTION
------------ ------------ ------------ --------- ------------ ------------

Expected dividend
yield.............. 2.75% 2.75% 3.3% 3.3% 3.7% 4.7%
Expected stock
volatility......... 20% 20% 20% 20% 17% 15%
Risk-free interest
rate............... 5.38% 5.42% 5.53% 5.73% 5.85% 6.08%
Expected holding
period............. 6.0 years 2.3 years 4.5 years 4.5 years 4.5 years 5.0 years


Options outstanding at December 31, 1998, were originally granted during the
years 1989 through 1998 and are exercisable over periods ending not later than
2008. At December 31, 1998, 1997 and 1996, options for 8,527,343 shares,
8,133,155 shares and 8,313,166 shares of common stock, respectively, were
exercisable and 12,427,373 shares, 1,450,195 shares and 4,240,772 shares,
respectively, were available for future grants under the plans.

56
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Changes in stock options for the three years ended December 31, 1998, are
summarized as follows:



WEIGHTED
AVERAGE
EXERCISE
SHARES PRICE ($)
---------- ---------

Options outstanding at January 1, 1996.................. 9,147,728 55.90
Granted............................................... 10,704 60.25
Exercised............................................. (977,042) 51.09
Surrendered or expired................................ (689,297) 59.10
----------
Options outstanding at October 31, 1996................. 7,492,093 56.23
Attributable to 1996 Distribution....................... (2,958,686) 57.08
----------
Options outstanding at October 31, 1996................. 4,533,407 55.68
==========
Options converted at November 1, 1996................... 11,958,980 21.10
Granted............................................... 4,452,250 22.96
Exercised............................................. (543,354) 21.02
Surrendered or expired................................ (451,416) 22.87
----------
Options outstanding at December 31, 1996................ 15,416,460 21.59
Granted............................................... 3,151,980 30.01
Exercised............................................. (2,008,234) 20.38
Surrendered or expired................................ (840,878) 22.97
----------
Options outstanding at December 31, 1997................ 15,719,328 23.36
Granted............................................... 87,390 32.84
Exercised............................................. (1,305,111) 20.77
Surrendered or expired................................ (336,444) 24.53
----------
Options outstanding at June 30, 1998.................... 14,165,163 23.63
Attributable to 1998 Distribution....................... (1,206,985) 24.78
----------
Options outstanding at June 30, 1998.................... 12,958,178 23.52
==========
Options converted at July 1, 1998....................... 13,734,489 22.19
Granted............................................... 4,171,907 32.47
Exercised............................................. (1,095,003) 18.84
Surrendered or expired................................ (432,396) 26.35
----------
Options outstanding at December 31, 1998................ 16,378,997 24.92
==========


The weighted average fair value of options granted during 1998, 1997 and 1996
was $7.13, $5.52 and $3.61, respectively.

57
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The following table summarizes information about stock options outstanding at
December 31, 1998:



STOCK OPTIONS OUTSTANDING STOCK OPTIONS
-------------------------------------- EXERCISABLE
WEIGHTED ----------------------
AVERAGE WEIGHTED WEIGHTED
REMAINING AVERAGE AVERAGE
CONTRACTUAL EXERCISE EXERCISE
RANGE OF EXERCISE PRICES SHARES LIFE PRICE ($) SHARES PRICE ($)
- ------------------------ ---------- ----------- --------- --------- ---------

$14.84-$23.35......... 9,548,923 5.9 years 20.71 7,859,474 20.49
$24.00-$34.22......... 6,830,074 9.3 years 30.82 667,869 28.37
---------- ---------
16,378,997 8,527,343
========== =========


The plans also provide for the granting of stock appreciation rights and limited
stock appreciation rights in tandem with stock options to certain key employees.
Upon the 1998 Distribution, the Old D&B stock appreciation rights and limited
stock appreciation rights were adjusted or converted in substantially the same
manner as the unexercised Old D&B stock options. At December 31, 1998, there
were 30,400 stock appreciation rights and 1,518,215 limited stock appreciation
rights ("LSARs") attached to stock options, which are exercisable only if, and
to the extent that, the related option is exercisable and, in the case of LSARs,
only upon the occurrence of specified contingent events.

Upon the 1998 Distribution, Old D&B restricted stock which had been granted to
key associates of the Company under the 1989 Key Employees Restricted Stock Plan
was forfeited and replaced with New D&B stock, preserving the economic value
that existed immediately prior to the 1998 Distribution. During 1998, no new
awards of restricted stock were granted and 36,620 shares were replaced. During
1997 and 1996, restricted share grants of 20,000 and 19,779, respectively, were
awarded under the plan. Forfeitures in 1996 totaled 6,877 shares. There were no
forfeitures during 1998 and 1997. The restrictions on the majority of such
shares lapse over a period of three years from the date of the grant and the
cost is charged to compensation expense ratably.

Under the 1998 Key Employees' Stock Incentive Plan, key associates may be
granted shares of the Company's stock based on the achievement of two-year
revenue growth goals or other key operating objectives, where appropriate. At
the end of the performance period, Company performance at target will yield the
targeted amount of shares, whereas Company performance above or below target
will yield larger or smaller share awards, respectively. Awards that were
outstanding at the 1998 Distribution were canceled and replaced, preserving the
economic value that existed prior to the 1998 Distribution. Recorded in selling
and administrative expenses was compensation expense of $16.0 million and $14.6
million in 1998 and 1997, respectively, for the plans.

58
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 8 INCOME TAXES

Income before provision for income taxes consisted of:



1998 1997 1996
------ ------ ------

U.S......................................... $407.2 $331.5 $(15.3)
Non-U.S..................................... (7.4) .9 1.3
------ ------ ------
$399.8 $332.4 $(14.0)
====== ====== ======


The provision (benefit) for income taxes consisted of:



1998 1997 1996
------ ------ ------

Current tax provision:
U.S. Federal...................................... $176.0 $ 31.9 $ 40.6
State and local................................... 14.4 52.9 (22.4)
Non-U.S........................................... 12.2 21.6 .7
------ ------ ------
Total current tax provision......................... 202.6 106.4 18.9
------ ------ ------
Deferred tax (benefit) provision:
U.S. Federal...................................... (58.0) 36.5 52.7
State and local................................... 7.6 (23.1) 15.0
Non-U.S........................................... 1.2 (6.4) 15.5
------ ------ ------
Total deferred tax (benefit) provision.............. (49.2) 7.0 83.2
------ ------ ------
Provision for income taxes.......................... $153.4 $113.4 $102.1
====== ====== ======


The following table summarizes the significant differences between the U.S.
Federal statutory tax rate and the Company's effective tax rate for financial
statement purposes.



1998 1997 1996
---- ----- ------

Statutory tax rate..................................... 35.0% 35.0% 35.0%
State and local taxes, net of U.S. Federal tax
benefit.............................................. 3.6 4.9 33.1
Non-U.S. taxes......................................... 3.4 4.6 (110.9)
Recognition of capital and ordinary losses............. (5.3) (10.4) 181.4
Non-recurring reorganization costs..................... 1.5 -- (845.5)
Repatriation of foreign earnings....................... -- -- (11.5)
Other.................................................. .2 -- (10.9)
---- ----- ------
Effective tax rate..................................... 38.4% 34.1% (729.3)%
==== ===== ======


Income taxes paid were $136.5 million, $170.3 million and $170.2 million in
1998, 1997 and 1996, respectively. Income taxes refunded were $32.1 million,
$37.6 million and $140.9 million in 1998, 1997 and 1996, respectively.

59
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Deferred tax assets (liabilities) consisted of the following at December 31:



1998 1997 1996
------ ------ ------

Deferred tax assets:
Operating losses.................................. $ 48.3 $ 53.7 $ 33.6
Postretirement benefits........................... 63.0 49.0 79.5
Postemployment benefits........................... 3.7 12.8 22.5
Reorganization and restructuring costs............ 31.0 4.4 11.3
Bad debts......................................... 13.1 12.7 5.7
Other............................................. 3.7 12.3 13.4
------ ------ ------
Total deferred tax assets........................... 162.8 144.9 166.0
Valuation allowance................................. (48.3) (53.7) (33.6)
------ ------ ------
Net deferred tax asset.............................. 114.5 91.2 132.4
------ ------ ------
Deferred tax liabilities:
Intangibles....................................... (7.9) (31.7) (47.4)
Revenue recognition............................... -- -- (12.3)
Tax-leasing transactions.......................... (20.4) (22.1) (37.8)
Depreciation...................................... (13.1) (13.5) (4.0)
------ ------ ------
Total deferred tax liability........................ (41.4) (67.3) (101.5)
------ ------ ------
Net deferred tax asset.............................. $ 73.1 $ 23.9 $ 30.9
====== ====== ======


At December 31, 1998, undistributed earnings of non-U.S. subsidiaries aggregated
$115.9 million. Deferred tax liabilities have not been recognized for these
undistributed earnings because it is management's intention to reinvest such
undistributed earnings outside the U.S. If all undistributed earnings were
remitted to the U.S., the amount of incremental U.S. Federal and foreign income
taxes payable, net of foreign tax credits, would be $44.2 million. During 1996,
$467.9 million of non-U.S. earnings, primarily from the Cognizant and ACNielsen
businesses, was repatriated by the Company in order to facilitate its 1996
reorganization.

During the three-year period ended December 31, 1983, the Company invested
$304.4 million in tax-leasing transactions, varying in length from 4.5 to 25
years. These leases provided the Company with benefits from tax deductions in
excess of taxable income for Federal income tax purposes. These amounts are
included in deferred income taxes.

60
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 9 NOTES PAYABLE

Notes payable consisted of the following at December 31:



1998 1997
----- ------

Commercial paper...................................... $35.9 $421.6
Bank notes............................................ 1.0 29.9
----- ------
$36.9 $451.5
===== ======


The Company had commercial paper borrowings of $35.9 million at December 31,
1998. Interest rates on these borrowings ranged from 5.95% to 6.10%.

In June 1998, the Company negotiated $600 million of committed bank lines of
credit under a $300 million 364-day revolving credit facility and a $300 million
five-year revolving credit facility maturing June 2003. Under these facilities,
the Company has the ability to borrow at prevailing short-term interest rates.
As of December 31, 1998, the Company did not have any borrowings outstanding
under these facilities.

At December 31, 1998, the Company also had non-committed lines of credit of $41
million against which $1.0 million was borrowed. These arrangements have no
material commitment fees or compensating balance requirements.

The weighted average interest rates on commercial paper and notes payable at
December 31, 1998 and 1997, were 6.06% and 5.97%, respectively.

Interest paid totaled $12.1 million, $49.6 million and $43.2 million for the
years ended December 31, 1998, 1997 and 1996, respectively.

In connection with the 1998 Distribution, during June 1998, R.H. Donnelley Inc.
borrowed $350 million under the R.H. Donnelley Inc. credit facility and issued
$150 million of senior subordinated notes under the R.H. Donnelley Inc.
indenture. This $500 million of debt remained an obligation of R.H. Donnelley
Inc. after the 1998 Distribution. A portion of the proceeds of this borrowing
was used by Old D&B to repay outstanding indebtedness at the time of the 1998
Distribution of $287.1 million. The remainder was used by the Company for
general corporate purposes, including the payment of costs and expenses
associated with the reorganization.

NOTE 10 INVESTMENT PARTNERSHIPS

During 1993, the Company participated in the formation of a limited partnership
to invest in various securities, including those of the Company. Third-party
investors held limited-partner and special investors interests totaling $500.0
million. Funds raised by the partnership provided a source of financing for the
Company's repurchase in 1993 of 8.3 million shares of its common stock. During
the fourth quarter of 1996, the Company redeemed these partnership interests.
This redemption was financed with short-term borrowings.

The partnership is presently engaged in the business of licensing database
assets and computer software. One of the Company's subsidiaries serves as
managing general partner, and two subsidiaries hold limited-partner interests.
In April 1997, the partnership raised

61
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

$300.0 million of minority interest financing from a third-party investor. The
Company's subsidiaries contributed assets to the partnership, and the
third-party investor contributed cash ($300.0 million) in exchange for a
limited-partner interest. Funds raised by the partnership were loaned to the
Company and used to repay existing short-term debt in April 1997. The
partnership can be terminated by the parties under various circumstances between
December 2000 and April 2001. At December 31, 1998, the third-party investment
in this partnership was included in minority interest.

For financial reporting purposes, the results of operations, assets, liabilities
and cash flows of the partnership described above are included in the Company's
consolidated financial statements.

NOTE 11 CAPITAL STOCK

Under the Company's Restated Certificate of Incorporation, the Company has
authority to issue 420,000,000 shares with a par value of $.01 per share of
which 400,000,000 represent shares of common stock, 10,000,000 represent shares
of preferred stock and 10,000,000 represent shares of series common stock. The
preferred and series common stock can be issued with varying terms, as
determined by the Board of Directors.

On June 30, 1998, 171,291,317 shares of New D&B common stock were distributed to
the shareholders of Old D&B. Since New D&B has been treated as the successor
entity for accounting purposes, the Company's historical financial statements
reflect the recapitalization of New D&B in connection with the 1998
Distribution, including the elimination of treasury shares (which shares became
treasury shares of Donnelley); the adjustment of the par value of the preferred
stock and the common stock to $.01 per share; and the authorization of the
series common stock.

In connection with the 1998 Distribution, the Company entered into a Rights
Agreement designed to protect shareholders of the Company in the event of
unsolicited offers to acquire the Company and other coercive takeover tactics
which, in the opinion of the Board of Directors, could impair its ability to
represent shareholder interests. Under the Rights Agreement, each share of the
common stock has a right which trades with the stock until the right becomes
exercisable. Each right entitles the registered holder to purchase 1/1000 of a
share of Series A junior participating preferred stock, par value $.01 per
share, at a price of $150 per 1/1000 of a share, subject to adjustment. The
rights will generally not be exercisable until a person or group ("Acquiring
Person") acquires beneficial ownership of, or commences a tender offer or
exchange offer which would result in such person or group having beneficial
ownership of 15% or more of the outstanding common stock.

In the event that any person or group becomes an Acquiring Person, each right
will thereafter entitle its holder (other than the Acquiring Person) to receive,
upon exercise, shares of stock having a market value of two times the exercise
price in the form of the Company's common stock or, where appropriate, the
Acquiring Person's common stock. The Company may redeem the rights, which expire
in June 2008, for $.01 per right, under certain circumstances.

62
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 12 LEASE COMMITMENTS

Certain of the Company's operations are conducted from leased facilities, which
are under operating leases that expire over the next 10 years. The Company also
leases certain computer and other equipment under operating leases that expire
over the next five years. These leases are frequently renegotiated or otherwise
changed as advancements in computer technology produce opportunities to lower
costs and improve performance. Additionally, the Company has agreements with
various third parties to purchase certain data processing and telecommunications
services extending beyond one year. Rental expenses under operating leases were
$66.8 million, $80.9 million and $106.3 million for the years ended December 31,
1998, 1997 and 1996, respectively. Future minimum lease payments under
noncancelable leases at December 31, 1998, are as follows:



THERE-
1999 2000 2001 2002 2003 AFTER TOTAL
- ----- ----- ----- ----- ----- ------ ------

$57.8 $37.1 $24.9 $13.8 $10.0 $15.2 $158.8
===== ===== ===== ===== ===== ===== ======


NOTE 13 CONTINGENCIES

The Company and its subsidiaries are involved in legal proceedings, claims,
litigation and tax matters, arising in the ordinary course of business. In the
opinion of management, the outcome of such current legal proceedings, claims,
litigation and tax matters could have a material effect on quarterly or annual
operating results or cash flows. However, in the opinion of management these
matters will not materially affect financial position when resolved in a future
period.

In addition, the Company also has certain other contingencies discussed below.

INFORMATION RESOURCES, INC.

On July 29, 1996, Information Resources, Inc. ("IRI") filed a complaint in the
United States District Court for the Southern District of New York, naming as
defendants Old D&B, A.C. Nielsen Company (a subsidiary of ACNielsen) and IMS
International, Inc. (formerly a subsidiary of Cognizant and currently a
subsidiary of IMS Health Incorporated).

The complaint alleges various violations of United States antitrust laws,
including alleged violations of Sections 1 and 2 of the Sherman Act. The
complaint also alleges a claim of tortious interference with a contract and a
claim of tortious interference with a prospective business relationship. These
claims relate to the acquisition by defendants of Survey Research Group Limited
("SRG"). IRI alleges SRG violated an alleged agreement with IRI when it agreed
to be acquired by the defendants and that the defendants induced SRG to breach
that agreement.

On October 15, 1996, defendants moved for an order dismissing all claims in the
complaint. On May 6, 1997, the United States District Court for the Southern
District of New York issued a decision dismissing IRI's claim of attempted
monopolization in the United States, with leave to replead within 60 days. The
Court denied defendants' motion with respect to the remaining claims in the
complaint. On June 3, 1997, defendants filed

63
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

an answer denying the material allegations in IRI's complaint, and A.C. Nielsen
Company filed a counterclaim alleging that IRI has made false and misleading
statements about its services and commercial activities. On July 7, 1997, IRI
filed an Amended and Restated Complaint repleading its alleged claim of
monopolization in the United States and realleging its other claims. By notice
of motion dated August 18, 1997, defendants moved for an order dismissing the
amended claim. On December 1, 1997, the Court denied the motion and, on December
16, 1997, defendants filed a supplemental answer denying the remaining material
allegations of the amended complaint.

IRI's complaint alleges damages in excess of $350 million, which amount IRI
asked to be trebled under antitrust laws. IRI also seeks punitive damages in an
unspecified amount.

In connection with the IRI action, on October 28, 1996, Cognizant, ACNielsen and
Old D&B entered into an Indemnity and Joint Defense Agreement (the "Indemnity
and Joint Defense Agreement") pursuant to which they have agreed (i) to certain
arrangements allocating potential liabilities ("IRI Liabilities") that may arise
out of or in connection with the IRI action and (ii) to conduct a joint defense
of such action. In particular, the Indemnity and Joint Defense Agreement
provides that ACNielsen will assume exclusive liability for IRI Liabilities up
to a maximum amount to be calculated at such time such liabilities, if any,
become payable (the "ACN Maximum Amount"), and that Old D&B and Cognizant will
share liability equally for any amounts in excess of the ACN Maximum Amount. The
ACN Maximum Amount will be determined by an investment banking firm as the
maximum amount which ACNielsen is able to pay after giving effect to (i) any
plan submitted by such investment bank which is designed to maximize the
claims-paying ability of ACNielsen without impairing the investment banking
firm's ability to deliver a viability opinion (but which will not require any
action requiring stockholder approval), and (ii) payment of related fees and
expenses. For these purposes, financial viability means the ability of
ACNielsen, after giving effect to such plan, the payment of related fees and
expenses, and the payment of the ACN Maximum Amount, to pay its debts as they
become due and to finance the current and anticipated operating and capital
requirements of its business, as reconstituted by such plan, for two years from
the date any such plan is expected to be implemented.

In connection with the 1998 Distribution, the Company and Donnelley entered into
an agreement whereby the Company has assumed all potential liabilities arising
from the IRI action and agreed to indemnify Donnelley in connection with such
potential liabilities.

During 1998, Cognizant separated into two new companies, IMS Health Incorporated
("IMS") and Nielsen Media Research, Inc. ("NMR"). IMS and NMR are each jointly
and severally liable for all Cognizant liabilities under the Indemnity and Joint
Defense Agreement.

Management is unable to predict at this time the final outcome of the IRI action
or whether the resolution of this matter could materially affect the Company's
results of operations, cash flows or financial position.

TAX MATTERS

The Company enters into global tax planning initiatives in the normal course of
business. These initiatives are subject to review by tax authorities. As a
result of the review process,

64
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THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

uncertainties exist and it is possible that some of these matters could be
resolved unfavorably to the Company.

The Internal Revenue Service ("IRS"), as part of its audit process, is currently
reviewing the Company's utilization of certain capital losses generated during
1989 and 1990. While the Company has not received a formal assessment with
respect to these transactions, the Company expects that the IRS will challenge
the Company's utilization of these capital losses. Accordingly, at the present
time, if assessed, the Company intends to defend its position vigorously. If an
assessment is made and the IRS prevails in its view, the total cash obligation
to the IRS at December 31, 1998, would approximate $500 million for taxes and
accrued interest. Pursuant to a series of agreements, IMS and NMR are jointly
and severally liable to pay one-half, and the Company the other half of any
payments for taxes and accrued interest arising from this matter and certain
other potential tax liabilities after the Company pays the first $137 million.

In connection with the 1998 Distribution, the Company and Donnelley entered into
an agreement whereby the Company has assumed all potential liabilities arising
from these tax matters and agreed to indemnify Donnelley in connection with such
potential liabilities.

As of December 31, 1998, the Company has accrued its anticipated share of the
probable liability (approximately $320 million, including $160 million of
tax-deductible interest) arising from the Company's utilization of these capital
losses in 1989 and 1990. As a result, the final resolution of this matter will
not have a material effect on the results of operations, but could have a
material effect on cash flows and financial position.

NOTE 14 SUPPLEMENTAL FINANCIAL DATA

Other Current Assets:



AT DECEMBER 31,
----------------
1998 1997
------ ------

Deferred taxes.............................................. $ 37.0 $ 67.1
Prepaid expenses............................................ 189.7 200.0
Other....................................................... 1.5 2.1
------ ------
$228.2 $269.2
====== ======


65
67
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Property, Plant and Equipment -- Net, carried at cost:



AT DECEMBER 31,
----------------
1998 1997
------ ------

Buildings................................................... $198.6 $203.1
Machinery and equipment..................................... 426.4 455.1
------ ------
625.0 658.2
Less: accumulated depreciation.............................. 382.2 398.6
------ ------
242.8 259.6
Leasehold improvements, less: accumulated amortization of
$47.9 and $52.6........................................... 26.8 28.7
Land........................................................ 28.7 28.9
------ ------
$298.3 $317.2
====== ======


Computer Software and Goodwill:



COMPUTER
SOFTWARE GOODWILL
-------- --------

January 1, 1997............................................ $108.7 $216.2
Additions at cost.......................................... 68.7 --
Amortization............................................... (50.6) (5.1)
Other deductions and reclassifications..................... 1.2 (16.5)(1)
------ ------
December 31, 1997.......................................... 128.0 194.6
Additions at cost.......................................... 86.0 5.1
Amortization............................................... (55.6) (6.1)
Other deductions and reclassifications..................... (9.8) (1.8)(1)
------ ------
December 31, 1998.......................................... $148.6 $191.8
====== ======


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

(1) Impact of foreign currency fluctuations.

Allowance for Doubtful Accounts:



January 1, 1996............................................. $14.5
Additions charged to costs and expenses..................... 7.2
Recoveries.................................................. 4.8
-----
December 31, 1996........................................... 26.5
Additions charged to costs and expenses..................... 9.0
Recoveries.................................................. 3.9
-----
December 31, 1997........................................... 39.4
Additions charged to costs and expenses..................... 7.5
Write-offs.................................................. (7.9)
-----
December 31, 1998........................................... $39.0
=====


66
68
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Other Expense -- Net:



YEARS ENDED DECEMBER 31,
--------------------------
1998 1997 1996
------ ------ ------

Minority interest...................................... $22.5 $16.9 $33.4
Gain on sale of FIS.................................... (9.6) -- --
Other expense.......................................... 2.3 2.8 5.1
----- ----- -----
$15.2 $19.7 $38.5
===== ===== =====


NOTE 15 SEGMENT INFORMATION

At December 31, 1998, the Company adopted the provisions of SFAS No. 131,
"Disclosures about Segments of an Enterprise and Related Information" ("SFAS No.
131"). In accordance with SFAS No. 131, the segment information is being
reported consistent with the Company's method of internal reporting, which
excludes divested operations from the segments. The prior years' segment
information has been restated accordingly. The Company's reportable segments are
Dun & Bradstreet United States ("U.S."), Dun & Bradstreet Europe/Africa/Middle
East ("Europe"), Dun & Bradstreet Asia Pacific, Canada and Latin America and
Moody's Investors Service. The three Dun & Bradstreet segments, managed on a
geographical basis, provide business-to-business credit, marketing and
purchasing information and receivables management services. The Moody's
Investors Service segment provides credit opinions on investment securities and
assigns ratings to fixed-income securities and other credit obligations. The
accounting policies of the segments are the same as those described in Note
1 -- Summary of Significant Accounting Policies. The Company evaluates
performance and allocates resources based on segment operating income.
Intersegment sales are immaterial.



YEARS ENDED DECEMBER 31,
--------------------------------
1998 1997 1996
-------- -------- --------

OPERATING REVENUES
Dun & Bradstreet U.S......................... $ 902.5 $ 832.2 $ 783.4
Dun & Bradstreet Europe...................... 427.7 426.1 445.3
Dun & Bradstreet Asia Pacific/Canada/Latin
America................................... 88.6 93.8 102.9
-------- -------- --------
Total Dun & Bradstreet Operating Company..... 1,418.8 1,352.1 1,331.6
Moody's Investors Service.................... 495.5 423.1 349.7
All Other(1)................................. 20.2 35.8 101.2
-------- -------- --------
Consolidated Total............................. $1,934.5 $1,811.0 $1,782.5
======== ======== ========


67
69
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



YEARS ENDED DECEMBER 31,
--------------------------------
1998 1997 1996
-------- -------- --------

OPERATING INCOME (LOSS)
Dun & Bradstreet U.S. ....................... $ 269.9 $ 252.9 $ 237.8
Dun & Bradstreet Europe...................... (4.2) .6 3.7
Dun & Bradstreet Asia Pacific/Canada/Latin
America................................... (9.1) (6.3) 1.5
-------- -------- --------
Total Dun & Bradstreet Operating Company..... 256.6 247.2 243.0
Moody's Investors Service.................... 223.5 185.7 129.3
All Other(1)................................. (59.4) (29.2) (315.1)
-------- -------- --------
Consolidated Total............................. 420.7 403.7 57.2
Non-Operating Expense -- Net................. (20.9) (71.3) (71.2)
-------- -------- --------
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE
PROVISION FOR INCOME TAXES................... $ 399.8 $ 332.4 $ (14.0)
======== ======== ========
DEPRECIATION AND AMORTIZATION(2)
Dun & Bradstreet U.S. ....................... $ 60.5 $ 54.9 $ 48.0
Dun & Bradstreet Europe...................... 55.1 51.6 59.3
Dun & Bradstreet Asia Pacific/Canada/Latin
America................................... 7.0 6.4 6.7
-------- -------- --------
Total Dun & Bradstreet Operating Company..... 122.6 112.9 114.0
Moody's Investors Service.................... 14.3 13.5 17.4
All Other(1)................................. 4.7 5.5 9.2
-------- -------- --------
Consolidated Total............................. $ 141.6 $ 131.9 $ 140.6
======== ======== ========
CAPITAL EXPENDITURES
Dun & Bradstreet U.S. ....................... $ 19.9 $ 19.3 $ 19.7
Dun & Bradstreet Europe...................... 19.9 14.8 17.9
Dun & Bradstreet Asia Pacific/Canada/Latin
America................................... 5.9 1.7 1.9
-------- -------- --------
Total Dun & Bradstreet Operating Company..... 45.7 35.8 39.5
Moody's Investors Service.................... 7.5 11.0 10.3
All Other(1)................................. 2.2 3.5 8.1
-------- -------- --------
Consolidated Total............................. $ 55.4 $ 50.3 $ 57.9
======== ======== ========
COMPUTER SOFTWARE AND OTHER INTANGIBLES
Dun & Bradstreet U.S. ....................... $ 44.2 $ 44.7 $ 53.4
Dun & Bradstreet Europe...................... 35.8 28.5 34.1
Dun & Bradstreet Asia Pacific/Canada/Latin
America................................... 1.1 2.7 1.3
-------- -------- --------
Total Dun & Bradstreet Operating Company..... 81.1 75.9 88.8
Moody's Investors Service.................... 4.5 2.9 5.3
All Other(1)................................. 6.1 -- --
-------- -------- --------
Consolidated Total............................. $ 91.7 $ 78.8 $ 94.1
======== ======== ========


68
70
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



YEARS ENDED DECEMBER 31,
--------------------------------
1998 1997 1996
-------- -------- --------

ASSETS
Dun & Bradstreet U.S......................... $ 409.3 $ 415.1 $ 362.5
Dun & Bradstreet Europe...................... 599.9 581.0 658.3
Dun & Bradstreet Asia Pacific/Canada/Latin
America................................... 68.9 90.3 112.6
-------- -------- --------
Total Dun & Bradstreet Operating Company..... 1,078.1 1,086.4 1,133.4
Moody's Investors Service.................... 152.4 153.0 151.1
Discontinued Operations...................... -- 296.5 430.6
All Other(1)................................. 558.7 550.1 510.3
-------- -------- --------
Consolidated Total............................. $1,789.2 $2,086.0 $2,225.4
======== ======== ========


SUPPLEMENTAL GEOGRAPHIC AND PRODUCT LINE INFORMATION



YEARS ENDED DECEMBER 31,
--------------------------------
1998 1997 1996
-------- -------- --------

OPERATING REVENUES
United States................................ $1,318.0 $1,213.3 $1,171.5
International................................ 616.5 597.7 611.0
-------- -------- --------
Consolidated Total............................. $1,934.5 $1,811.0 $1,782.5
======== ======== ========
LONG-LIVED ASSETS
United States................................ $ 492.4 $ 482.1 $ 515.4
International................................ 446.9 448.8 487.5
-------- -------- --------
Consolidated Total............................. $ 939.3 $ 930.9 $1,002.9
======== ======== ========
PRODUCT LINE REVENUES
Credit Information Services.................. $ 984.5 $ 966.5 $ 968.9
Marketing Information Services............... 282.7 244.7 216.9
Purchasing Information Services.............. 23.0 15.7 11.2
Receivables Management Services.............. 128.6 125.2 134.6
-------- -------- --------
Total Dun & Bradstreet Operating Company....... $1,418.8 $1,352.1 $1,331.6
======== ======== ========


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

(1) The following tables itemize "All Other"



YEARS ENDED DECEMBER 31,
------------------------------
1998 1997 1996
------ -------- --------

OPERATING REVENUES
Divested Operations:
Financial Information Services................ $ 18.5 $ 34.3 $ 35.6
American Credit Indemnity..................... -- -- 62.9
Other Revenues.................................. 1.7 1.5 2.7
------ -------- --------
Total "All Other"............................... $ 20.2 $ 35.8 $ 101.2
====== ======== ========


69
71
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



YEARS ENDED DECEMBER 31,
------------------------------
1998 1997 1996
------ -------- --------

OPERATING INCOME (LOSS)
Divested Operations:
Financial Information Services................ $ 4.2 $ 5.8 $ 6.7
American Credit Indemnity..................... -- -- .5
Corporate and Other............................. (35.6) (35.0) (92.9)
Loss on the sale of American Credit Indemnity... -- -- (68.2)
Reorganization Costs............................ (28.0) -- (161.2)
------ -------- --------
Total "All Other"............................... $(59.4) $ (29.2) $ (315.1)
====== ======== ========
DEPRECIATION AND AMORTIZATION
Divested Operations:
Financial Information Services................ $ 1.1 $ 2.6 $ 2.4
American Credit Indemnity..................... -- -- 1.3
Corporate and Other............................. 3.6 2.9 5.5
------ -------- --------
Total "All Other"............................... $ 4.7 $ 5.5 $ 9.2
====== ======== ========
CAPITAL EXPENDITURES
Divested Operations:
Financial Information Services................ $ .7 $ 3.4 $ 1.3
American Credit Indemnity..................... -- -- .3
Corporate and Other............................. 1.5 .1 6.5
------ -------- --------
Total "All Other"............................... $ 2.2 $ 3.5 $ 8.1
====== ======== ========
COMPUTER SOFTWARE AND OTHER INTANGIBLES
Corporate....................................... $ 6.1 $ -- $ --
------ -------- --------
Total "All Other"............................... $ 6.1 $ -- $ --
====== ======== ========
ASSETS
Divested Operations:
Financial Information Services................ $ -- $ 6.0 $ 7.4
Corporate and Other (primarily domestic pensions
and taxes).................................... 558.7 544.1 502.9
------ -------- --------
Total "All Other"............................... $558.7 $ 550.1 $ 510.3
====== ======== ========


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

(2) Includes depreciation and amortization of Property, Plant and Equipment,
Computer Software, Goodwill and Other Intangibles.

70
72
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 16 QUARTERLY FINANCIAL DATA (UNAUDITED)



THREE MONTHS ENDED
----------------------------------------------------------
MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31 YEAR
-------- ------- ------------ ----------- --------

1998
Operating Revenues
Dun & Bradstreet U.S............ $ 225.5 $213.0 $219.8 $244.2 $ 902.5
Dun & Bradstreet Europe......... 92.4 106.6 98.9 129.8 427.7
Dun & Bradstreet Asia Pacific/
Canada/Latin America......... 20.1 23.4 22.3 22.8 88.6
------- ------ ------ ------ --------
Total Dun & Bradstreet Operating
Company...................... 338.0 343.0 341.0 396.8 1,418.8
Moody's Investors Service....... 123.3 133.1 117.1 122.0 495.5
All Other(1).................... 9.8 7.9 1.5 1.0 20.2
------- ------ ------ ------ --------
Consolidated Operating Revenues... $ 471.1 $484.0 $459.6 $519.8 $1,934.5
======= ====== ====== ====== ========
Operating Income (Loss)
Dun & Bradstreet U.S............ $ 69.9 $ 52.7 $ 63.6 $ 83.7 $ 269.9
Dun & Bradstreet Europe......... (15.2) (2.8) (2.9) 16.7 (4.2)
Dun & Bradstreet Asia Pacific/
Canada/Latin America......... (5.1) (1.0) (1.6) (1.4) (9.1)
------- ------ ------ ------ --------
Total Dun & Bradstreet Operating
Company...................... 49.6 48.9 59.1 99.0 256.6
Moody's Investors Service....... 55.8 62.3 51.3 54.1 223.5
All Other(1).................... (12.6) (32.7) (7.3) (6.8) (59.4)
------- ------ ------ ------ --------
Consolidated Operating Income
(Loss).......................... $ 92.8 $ 78.5 $103.1 $146.3 $ 420.7
======= ====== ====== ====== ========
Income from:
Continuing Operations, Net of
Income Taxes(2).............. $ 51.5 $ 39.6 $ 68.7 $ 86.6 $ 246.4
Discontinued Operations, Net of
Income Taxes................. 12.0 21.7 -- -- 33.7
------- ------ ------ ------ --------
Net Income........................ $ 63.5 $ 61.3 $ 68.7 $ 86.6 $ 280.1
======= ====== ====== ====== ========
Basic Earnings Per Share of Common
Stock:
Continuing Operations........... $ .30 $ .23 $ .40 $ .52 $ 1.45
Discontinued Operations......... .07 .13 -- -- .20
------- ------ ------ ------ --------
Basic Earnings Per Share of Common
Stock........................... $ .37 $ .36 $ .40 $ .52 $ 1.65
======= ====== ====== ====== ========


71
73
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



THREE MONTHS ENDED
----------------------------------------------------------
MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31 YEAR
-------- ------- ------------ ----------- --------

Diluted Earnings Per Share of
Common Stock(3):
Continuing Operations........... $ .30 $ .23 $ .40 $ .52 $ 1.44
Discontinued Operations......... .07 .12 -- -- .19
------- ------ ------ ------ --------
Diluted Earnings Per Share of
Common Stock.................... $ .37 $ .35 $ .40 $ .52 $ 1.63
======= ====== ====== ====== ========
1997
Operating Revenues
Dun & Bradstreet U.S............ $ 208.5 $196.4 $203.9 $223.4 $ 832.2
Dun & Bradstreet Europe......... 100.3 107.8 98.6 119.4 426.1
Dun & Bradstreet Asia Pacific/
Canada/Latin America......... 21.0 24.6 23.8 24.4 93.8
------- ------ ------ ------ --------
Total Dun & Bradstreet Operating
Company...................... 329.8 328.8 326.3 367.2 1,352.1
Moody's Investors Service....... 96.4 103.3 112.9 110.5 423.1
All Other(1).................... 10.2 8.8 8.6 8.2 35.8
------- ------ ------ ------ --------
Consolidated Operating Revenues... $ 436.4 $440.9 $447.8 $485.9 $1,811.0
======= ====== ====== ====== ========
Operating Income (Loss)
Dun & Bradstreet U.S............ $ 65.2 $ 50.9 $ 58.7 $ 78.1 $ 252.9
Dun & Bradstreet Europe......... (13.7) 1.2 (4.5) 17.6 .6
Dun & Bradstreet Asia Pacific/
Canada/Latin America......... (3.6) (.4) (.8) (1.5) (6.3)
------- ------ ------ ------ --------
Total Dun & Bradstreet Operating
Company...................... 47.9 51.7 53.4 94.2 247.2
Moody's Investors Service....... 37.2 46.5 50.3 51.7 185.7
All Other(1).................... (7.2) (9.1) (5.9) (7.0) (29.2)
------- ------ ------ ------ --------
Consolidated Operating Income
(Loss).......................... $ 77.9 $ 89.1 $ 97.8 $138.9 $ 403.7
======= ====== ====== ====== ========
Income (Loss) from:
Continuing Operations, Net of
Income Taxes................. $ 36.5 $ 47.7 $ 54.6 $ 80.2 $ 219.0
Discontinued Operations, Net of
Income Taxes(4).............. (1.6) 6.3 30.6 56.7 92.0
------- ------ ------ ------ --------


72
74
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



THREE MONTHS ENDED
----------------------------------------------------------
MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31 YEAR
-------- ------- ------------ ----------- --------

Income before Cumulative Effect of
Accounting Changes.............. 34.9 54.0 85.2 136.9 311.0
Cumulative Effect of Accounting
Changes, Net of Income Tax
Benefit......................... (127.0) -- -- -- (127.0)
------- ------ ------ ------ --------
Net Income (Loss)................. $ (92.1) $ 54.0 $ 85.2 $136.9 $ 184.0
======= ====== ====== ====== ========
Basic Earnings (Loss) Per Share of
Common Stock:
Continuing Operations........... $ .21 $ .28 $ .32 $ .47 $ 1.28
Discontinued Operations......... (.01) .04 .18 .33 .54
------- ------ ------ ------ --------
Before Cumulative Effect of
Accounting Changes........... .20 .32 .50 .80 1.82
Cumulative Effect of Accounting
Changes, Net of Income Tax
Benefit...................... (.74) -- -- -- (.74)
------- ------ ------ ------ --------
Basic Earnings (Loss) Per Share of
Common Stock.................... $ (.54) $ .32 $ .50 $ .80 $ 1.08
======= ====== ====== ====== ========
Diluted Earnings (Loss) Per Share
of Common Stock(3):
Continuing Operations........... $ .21 $ .28 $ .31 $ .46 $ 1.27
Discontinued Operations......... (.01) .03 .18 .33 .53
------- ------ ------ ------ --------
Before Cumulative Effect of
Accounting Changes........... .20 .31 .49 .79 1.80
Cumulative Effect of Accounting
Changes, Net of Income Tax
Benefit...................... (.73) -- -- -- (.73)
------- ------ ------ ------ --------
Diluted Earnings (Loss) Per Share
of Common Stock................. $ (.53) $ .31 $ .49 $ .79 $ 1.07
======= ====== ====== ====== ========


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

(1) The following tables itemize "All Other" for Operating Revenues and
Operating Income:



THREE MONTHS ENDED
----------------------------------------------------------
MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31 YEAR
-------- ------- ------------ ----------- --------

OPERATING REVENUES
1998
Divested Operations -- Financial
Information Services............ $ 9.2 $ 7.6 $ 1.4 $ .3 $ 18.5
Other Revenues.................... .6 .3 .1 .7 1.7
------ ------ ------ ------ --------
Total........................ $ 9.8 $ 7.9 $ 1.5 $ 1.0 $ 20.2
====== ====== ====== ====== ========


73
75
THE DUN & BRADSTREET CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



THREE MONTHS ENDED
----------------------------------------------------------
MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31 YEAR
-------- ------- ------------ ----------- --------

1997
Divested Operations -- Financial
Information Services............ $ 9.9 $ 8.5 $ 8.2 $ 7.7 $ 34.3
Other Revenues.................... .3 .3 .4 .5 1.5
------ ------ ------ ------ --------
Total........................ $ 10.2 $ 8.8 $ 8.6 $ 8.2 $ 35.8
====== ====== ====== ====== ========
OPERATING INCOME (LOSS)
1998
Divested Operations -- Financial
Information Services............ $ 2.8 $ 1.1 $ .3 $ -- $ 4.2
Reorganization Costs.............. (.5) (27.5) -- -- (28.0)
Corporate and Other............... (14.9) (6.3) (7.6) (6.8) (35.6)
------ ------ ------ ------ --------
Total........................ $(12.6) $(32.7) $ (7.3) $ (6.8) $ (59.4)
====== ====== ====== ====== ========
1997
Divested Operations -- Financial
Information Services............ $ 2.7 $ 1.4 $ 1.4 $ .3 $ 5.8
Corporate and Other............... (9.9) (10.5) (7.3) (7.3) (35.0)
------ ------ ------ ------ --------
Total........................ $ (7.2) $ (9.1) $ (5.9) $ (7.0) $ (29.2)
====== ====== ====== ====== ========


(2) Income from Continuing Operations, Net of Income Taxes included after-tax
reorganization costs of $.5 million and $22.7 million incurred in the
quarters ended March 31 and June 30, respectively, and a one-time after-tax
gain on the sale of Financial Information Services, the publishing unit of
Moody's Investors Service, of $5.3 million incurred in the quarter ended
September 30.

(3) The number of weighted average shares outstanding changes as common shares
are issued for employee plans and other purposes, or as shares are
repurchased. For this reason, the sum of quarterly earnings per common share
may not be the same as earnings per common share for the year.

(4) Income from Discontinued Operations, Net of Income Taxes included a $9.4
million pre-tax gain on the sale of P-East in the quarter ended December 31,
1997.

74
76

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

Not applicable.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Information in response to this Item is incorporated herein by reference to the
section entitled "Election of Directors" in the Company's Proxy Statement to be
filed with the Securities and Exchange Commission no later than 120 days after
December 31, 1998, except that "Executive Officers of the Registrant" on Pages
16-17 of this Form 10-K responds to Item 401(b) and (e) of Regulation S-K.

ITEM 11. EXECUTIVE COMPENSATION

Information in response to this Item is incorporated herein by reference to the
section entitled "Compensation of Executive Officers and Directors" in the
Company's Proxy Statement to be filed with the Securities and Exchange
Commission no later than 120 days after December 31, 1998.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Information in response to this Item is incorporated herein by reference to the
section entitled "Security Ownership of Management and Others" in the Company's
Proxy Statement to be filed with the Securities and Exchange Commission no later
than 120 days after December 31, 1998.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information in response to this Item is incorporated herein by reference to the
section entitled "Security Ownership of Management and Others" in the Company's
Proxy Statement to be filed with the Securities and Exchange Commission no later
than 120 days after December 31, 1998.

PART IV

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

(a) List of documents filed as part of this report.

(1) Financial Statements.

See Index to Financial Statements and Schedules in Part II, Item 8 on
Page 33 of this Form 10-K.

(2) Financial Statement Schedules.

None.

(3) Exhibits.

See Index to Exhibits on Pages 78-81 of this Form 10-K.

75
77

(b) Reports on Form 8-K.

None.

(c) Exhibits.

See Index to Exhibits on Pages 78-81 of this Form 10-K.

(d) Financial Statement Schedules.

None.

76
78

SIGNATURES

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

THE DUN & BRADSTREET CORPORATION
(Registrant)

By: /s/ VOLNEY TAYLOR
-----------------------------------
(Volney Taylor,
Chairman and Chief Executive
Officer)

Date: February 16, 1999

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



/s/ VOLNEY TAYLOR /s/ ROBERT R. GLAUBER
- -------------------------------------- --------------------------------------
(Volney Taylor, (Robert R. Glauber, Director)
Chairman, Chief Executive Officer and
Director)
(principal executive officer)

/s/ FRANK S. SOWINSKI /s/ RONALD L. KUEHN, JR.
- -------------------------------------- --------------------------------------
(Frank S. Sowinski, Senior Vice (Ronald L. Kuehn, Jr., Director)
President
and Chief Financial Officer)
(principal financial officer)

/s/ CHESTER J. GEVEDA, JR. /s/ ROBERT J. LANIGAN
- -------------------------------------- --------------------------------------
(Chester J. Geveda, Jr., Vice (Robert J. Lanigan, Director)
President -- Controller)
(principal accounting officer)

/s/ HALL ADAMS, JR. /s/ VERNON R. LOUCKS JR.
- -------------------------------------- --------------------------------------
(Hall Adams, Jr., Director) (Vernon R. Loucks Jr., Director)

/s/ CLIFFORD L. ALEXANDER, JR. /s/ HENRY A. MCKINNELL, JR.
- -------------------------------------- --------------------------------------
(Clifford L. Alexander, Jr., Director) (Henry A. McKinnell, Jr. Director)

/s/ MARY JOHNSTON EVANS /s/ MICHAEL R. QUINLAN
- -------------------------------------- --------------------------------------
(Mary Johnston Evans, Director) (Michael R. Quinlan, Director)

Date: February 16, 1999


77
79

INDEX TO EXHIBITS



REGULATION
S-K
EXHIBIT
NUMBER

3 ARTICLES OF INCORPORATION AND BY-LAWS
.1 Restated Certificate of Incorporation of the Registrant
dated June 15, 1998, as amended effective June 30, 1998
(incorporated by reference to Exhibit 3.1 to Registrant's
Quarterly Report on Form 10-Q, filed August 14, 1998).
.2 Amended and Restated By-laws of the Registrant (incorporated
by reference to Exhibit 3.2 to Registrant's Registration No.
001-14037 on Form 10, filed June 18, 1998).
4 INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING
INDENTURES
.1 Multi-Year Revolving Credit and Competitive Advance
Facility, dated as of June 9, 1998, among the Registrant
(p.k.a. The New Dun & Bradstreet Corporation), the Borrowing
Subsidiaries parties thereto, the Lenders parties thereto,
The Chase Manhattan Bank, Citibank, N.A. and Morgan Guaranty
Trust Company (incorporated by reference to Exhibit 4.1 to
Registrant's Quarterly Report on Form 10-Q, filed August 14,
1998).
.2 364-Day Revolving Credit and Competitive Advance Facility,
dated as of June 9, 1998, among the Registrant (p.k.a. The
New Dun & Bradstreet Corporation), the Borrowing
Subsidiaries parties thereto, the Lenders parties thereto,
The Chase Manhattan Bank, Citibank, N.A. and Morgan Guaranty
Trust Company (incorporated by reference to Exhibit 4.2 to
Registrant's Quarterly Report on Form 10-Q, filed August 14,
1998).
.3 Specimen Common Stock certificate (incorporated by reference
to Exhibit 4.1 to Registrant's Registration No. 001-14037 on
Form 10, filed June 18, 1998).
.4 Rights Agreement, dated as of June 3, 1998, between the
Registrant (p.k.a. The New Dun & Bradstreet Corporation) and
First Chicago Trust Company of New York (incorporated by
reference to Exhibit 1 to Registrant's Registration No.
001-14037 on Form 8-A, filed June 18, 1998).
10 MATERIAL CONTRACTS
.1 Distribution Agreement dated as of June 30, 1998 between
R.H. Donnelley Corporation (p.k.a. The Dun & Bradstreet
Corporation) and the Registrant (p.k.a. The New Dun &
Bradstreet Corporation) (incorporated by reference to
Exhibit 10.1 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.2 Tax Allocation Agreement dated as of June 30, 1998 between
R.H. Donnelley Corporation (p.k.a. The Dun & Bradstreet
Corporation) and the Registrant (p.k.a. The New Dun &
Bradstreet Corporation) (incorporated by reference to
Exhibit 10.2 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.3 Employee Benefits Agreement dated as of June 30, 1998
between R.H. Donnelley Corporation (p.k.a. The Dun &
Bradstreet Corporation) and the Registrant (p.k.a. The New
Dun & Bradstreet Corporation) (incorporated by reference to
Exhibit 10.3 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).


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.4 Intellectual Property Agreement dated as of June 30, 1998
between R.H. Donnelley Corporation (p.k.a. The Dun &
Bradstreet Corporation) and the Registrant (p.k.a. The New
Dun & Bradstreet Corporation) (incorporated by reference to
Exhibit 10.4 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.5 Shared Transaction Services Agreement dated as of June 30,
1998 between R.H. Donnelley Corporation (p.k.a. The Dun &
Bradstreet Corporation) and the Registrant (p.k.a. The New
Dun & Bradstreet Corporation) (incorporated by reference to
Exhibit 10.5 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.6 Data Services Agreement dated as of June 30, 1998 between
R.H. Donnelley Corporation (p.k.a. The Dun & Bradstreet
Corporation) and the Registrant (p.k.a. The New Dun &
Bradstreet Corporation) (incorporated by reference to
Exhibit 10.6 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.7 Transition Services Agreement dated as of June 30, 1998
between R.H. Donnelley Corporation (p.k.a. The Dun &
Bradstreet Corporation) and the Registrant (p.k.a. The New
Dun & Bradstreet Corporation) (incorporated by reference to
Exhibit 10.7 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.8 Amended and Restated Transition Services Agreement dated as
of June 30, 1998 among R.H. Donnelley Corporation (p.k.a.
The Dun & Bradstreet Corporation), the Registrant (p.k.a.
The New Dun & Bradstreet Corporation), Cognizant
Corporation, IMS Health Incorporated, ACNielsen Corporation
and Gartner Group, Inc. (incorporated by reference to
Exhibit 10.8 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.9 Undertaking of the Registrant (p.k.a. The New Dun &
Bradstreet Corporation) dated June 29, 1998 (incorporated by
reference to Exhibit 10.9 to Registrant's Quarterly Report
on Form 10-Q, filed August 14, 1998).
.10 Distribution Agreement dated as of October 28, 1996, among
R.H. Donnelley Corporation (p.k.a. The Dun & Bradstreet
Corporation), Cognizant Corporation and ACNielsen
Corporation (incorporated by reference to Exhibit 10(x) to
the Annual Report on Form 10-K of R.H. Donnelley Corporation
(p.k.a. The Dun & Bradstreet Corporation) for the year ended
December 31, 1996, file number 1-7155, filed March 27,
1997).
.11 Tax Allocation Agreement dated as of October 28, 1996, among
R.H. Donnelley Corporation (p.k.a. The Dun & Bradstreet
Corporation), Cognizant Corporation and ACNielsen
Corporation (incorporated by reference to Exhibit 10(y) to
the Annual Report on Form 10-K of R.H. Donnelley Corporation
(p.k.a. The Dun & Bradstreet Corporation) for the year ended
December 31, 1996, file number 1-7155, filed March 27,
1997).


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.12 Employee Benefits Agreement dated as of October 28, 1996,
among R.H. Donnelley Corporation (p.k.a. The Dun &
Bradstreet Corporation), Cognizant Corporation and ACNielsen
Corporation (incorporated by reference to Exhibit 10(z) to
the Annual Report on Form 10-K of R.H. Donnelley Corporation
(p.k.a. The Dun & Bradstreet Corporation) for the year ended
December 31, 1996, file number 1-7155, filed March 27,
1997).
.13 Indemnity and Joint Defense Agreement dated as of October
28, 1996, among R.H. Donnelley Corporation (p.k.a. The Dun &
Bradstreet Corporation), Cognizant Corporation and ACNielsen
Corporation (incorporated by reference to Exhibit 10(aa) to
the Annual Report on Form 10-K of R.H. Donnelley Corporation
(p.k.a. The Dun & Bradstreet Corporation) for the year ended
December 31, 1996, file number 1-7155, filed March 27,
1997).
.14 Amended and Restated Agreement of Limited Partnership of D&B
Investors L.P. dated April 1, 1997 (incorporated by
reference to Exhibit 10.14 to Registrant's Quarterly Report
on Form 10-Q, filed August 14, 1998).
.15 Amendment No. 1 dated July 14, 1997 to the Amended and
Restated Agreement of Limited Partnership of D&B Investors
L.P. dated April 1, 1997 (incorporated by reference to
Exhibit 10.15 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.16 Agreement to Retire General Partner Interest dated October
21, 1996 by and between D&B Investors L.P. and IMS America,
Ltd. (incorporated by reference to Exhibit 10.16 to
Registrant's Quarterly Report on Form 10-Q, filed August 14,
1998).
.17 Assignment Agreements dated as of June 15, 1998 relating to
rights and obligations in respect of D&P Investors L.P.
(incorporated by reference to Exhibit 10.17 to Registrant's
Quarterly Report on Form 10-Q, filed August 14, 1998).
.18+ The Dun & Bradstreet Corporation Nonfunded Deferred
Compensation Plan for Non-Employee Directors (incorporated
by reference to Exhibit 10.18 to Registrant's Quarterly
Report on Form 10-Q, filed August 14, 1998).
.19+ 1998 Dun & Bradstreet Replacement Plan for Certain
Non-Employee Directors Holding Dun & Bradstreet Corporation
Equity-Based Awards (incorporated by reference to Exhibit
10.19 to Registrant's Quarterly Report on Form 10-Q, filed
August 14, 1998).
.20+ 1998 Dun & Bradstreet Non-Employee Directors' Stock
Incentive Plan (incorporated by reference to Exhibit 10.20
to Registrant's Quarterly Report on Form 10-Q, filed August
14, 1998).
.21+ The Dun & Bradstreet Corporation Cash Incentive Plan
(incorporated by reference to Exhibit 10.21 to Registrant's
Quarterly Report on Form 10-Q, filed August 14, 1998).
.22+ The Dun & Bradstreet Corporation Covered Employee Cash
Incentive Plan (incorporated by reference to Exhibit 10.22
to Registrant's Quarterly Report on Form 10-Q, filed August
14, 1998).


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.23+ 1998 Dun & Bradstreet Replacement Plan for Certain Employees
Holding Dun & Bradstreet Corporation Equity-Based Awards
(incorporated by reference to Exhibit 10.23 to Registrant's
Quarterly Report on Form 10-Q, filed August 14, 1998).
.24+ 1998 Dun & Bradstreet Key Employees' Stock Incentive Plan
(incorporated by reference to Exhibit 10.24 to Registrant's
Quarterly Report on Form 10-Q, filed August 14, 1998).
.25+ Form of Limited Stock Appreciation Rights Agreement
(incorporated by reference to Exhibit 10.25 to Registrant's
Quarterly Report on Form 10-Q, filed August 14, 1998).
.26+ Forms of Change in Control Severance Agreements
(incorporated by reference to Exhibit 10.26 to Registrant's
Quarterly Report on Form 10-Q, filed August 14, 1998).
.27+ Executive Transition Plan (incorporated by reference to
Exhibit 10.27 to Registrant's Quarterly Report on Form 10-Q,
filed August 14, 1998).
.28+ Pension Benefit Equalization Plan (incorporated by reference
to Exhibit 10.28 to Registrant's Quarterly Report on Form
10-Q, filed August 14, 1998).
.29+ Supplemental Executive Benefit Plan (incorporated by
reference to Exhibit 10.29 to Registrant's Quarterly Report
on Form 10-Q, filed August 14, 1998).
.30+ Profit Participation Benefit Equalization Plan (incorporated
by reference to Exhibit 10.30 to Registrant's Quarterly
Report on Form 10-Q, filed August 14, 1998).
21* SUBSIDIARIES OF THE REGISTRANT
List of Active Subsidiaries as of January 31, 1999
23* CONSENTS OF EXPERTS AND COUNSEL
Consent of PricewaterhouseCoopers LLP
27* FINANCIAL DATA SCHEDULE


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

* Filed herewith

+ Represents a management contract or compensatory plan

81