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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

FOR ANNUAL AND TRANSITION REPORTS
PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

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

For the fiscal year ended June 30, 2003

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 333-18221

DOLLAR FINANCIAL GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)

New York 13-2997911
-------------------------------- ---------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)

1436 Lancaster Avenue
Berwyn, Pennsylvania 19312-1288
-------------------------------- ---------------------
(Address of Principal Executive (Zip Code)
Offices)

Registrant's telephone number, including area code (610) 296-3400

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES |X| NO |_|.

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: |_|

Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes |_| No |X|

There is no market for the common stock of Dollar Financial Group, Inc. and all
of such stock is held by the registrant's parent, DFG Holdings, Inc. See "Item
12 - Security Ownership of Certain Beneficial Owners and Management."



APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes |_| No |_|

(APPLICABLE ONLY TO CORPORATE REGISTRANTS)

Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date. As of September 29,
2003, 100 shares of the registrant's common stock, par value $1.00 per share,
were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Certain information required by Part IV is incorporated by reference to
the Registrant's Registration Statement on Form S-4 (Registration No. 333-18221)
declared effective March 11, 1997, Registrant's Statement on Form 10-Q filed
February 16, 1999, Registrant's Statement on Form 8-K/A filed April 26, 1999,
Registrant's Statement on Form 8-K/A filed September 30, 1999 and Registrant's
Statement on Form 8-K/A filed February 28, 2000.


2


DOLLAR FINANCIAL GROUP, INC.

Table of Contents

2003 Report on Form 10-K

PART I

Item 1. Business ...................................................... 4
Item 2. Properties .................................................... 20
Item 3. Legal Proceedings ............................................. 21
Item 4. Submission of Matters to a Vote of Security Holders ........... 21

PART II

Item 5. Market for Registrant's Common Equity and Related Stockholder
Matters ................................................... 22
Item 6. Selected Financial Data ....................................... 22
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations ..................................... 25
Item 7A. Quantitative and Qualitative Disclosures About Market Risk .... 33
Item 8. Financial Statements and Supplementary Data ................... 34
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure ...................................... 62
Item 9A. Controls and Procedures ....................................... 62

PART III

Item 10. Directors and Executive Officers of the Registrant ............ 62
Item 11. Executive Compensation ........................................ 65
Item 12. Security Ownership of Certain Beneficial Owners and
Management ................................................ 67
Item 13. Certain Relationships and Related Transactions ................ 68
Item 14. Principal Accountant Fees and Services ........................ 70

PART IV

Item 15. Exhibits, Financial Statement Schedules and Reports on Form 8-K 70

Signatures ............................................................. 79


3


Item 1. BUSINESS

General

We are a leading international financial services company serving
under-banked consumers. Our customers are typically lower- and middle-income
working-class individuals who require basic financial services but, for reasons
of convenience and accessibility, purchase some or all of their financial
services from us rather than banks and other financial institutions. To serve
this market, we have a network of 1,084 stores, including 624 company-operated
stores, in 17 states, the District of Columbia, Canada and the United Kingdom.
We provide a diverse range of consumer financial products and services primarily
consisting of check cashing, short-term consumer loans, money orders and money
transfers. Our store network represents the second-largest network of its kind
in the United States and the largest network of its kind in each of Canada and
the United Kingdom.

Our network includes the following platforms for delivering our financial
services to the consumer in our core markets:

United States

We operate a total of 321 stores, with 233 operating under the name
"Money Mart" and 88 operating under the name "Loan Mart." The Money Mart
stores typically offer our full range of our products and services,
including check cashing and short-term consumer loans. The Loan Mart
stores offer short-term consumer loans and other ancillary services
depending upon location. By offering short-term lending services, we hope
to attract a customer who might not use check cashing services. We also
have relationships with 443 document transmitter locations, such as
independent mail stores and insurance offices, which assist in completing
short-term consumer loans we market through a direct-to-consumer lending
operation.

Our U.S. business had revenues of $110.5 million for fiscal 2003.

Canada

There are 290 stores in our Canadian network, of which 181 are
operated by us and 109 are operated by franchisees. All stores in Canada
are operated under the name "Money Mart" except locations in the Province
of Quebec. The stores in Canada typically offer check cashing, short-term
consumer loans and other ancillary products and services.

Our Canadian business had revenues of $(USD)67.0 million for fiscal
2003.

United Kingdom

There are 473 stores in our U.K. network, of which 122 are operated
by us and 351 are operated by franchisees. All stores in the United
Kingdom (with the exception of certain franchises operating under the name
"Cash A Cheque") are operated under the name "Money Shop." The stores in
the United Kingdom typically offer check cashing, short-term consumer
loans and other ancillary products and services.

Our U.K. business had revenues of $(USD)41.9 million for fiscal
2003.

Our customers, many of whom receive income on an irregular basis or from
multiple employers, are drawn to our convenient neighborhood locations, extended
operating hours and high-quality customer service. Our products and services,
principally our check cashing and short-term consumer loan program, provide
immediate access to cash for living expenses or other needs. We principally cash
payroll checks, although our stores also cash government benefit, personal and
income-tax-refund checks. During fiscal 2003, we cashed 8.6 million checks with
a total face amount of $3.1 billion and an average face amount of $355 per
check. Acting both as a servicer and as a direct lender, we originated 2.8
million loans with an average principal amount of $282 and a weighted average
term of approximately 15 days. We also strive to provide our customers with
high-value ancillary services, including Western Union money order and money
transfer products, electronic tax filing, bill payment, foreign currency
exchange, photo ID and prepaid local and long-distance phone services.


4


Industry Overview

We operate in a sector of the financial services industry that serves the
basic need of lower- and middle-income working-class individuals to have
convenient access to cash. This need is primarily evidenced by consumer demand
for check cashing and short-term loans, and consumers who use these services are
often underserved by banks and other financial institutions.

Lower- and middle-income individuals represent the largest part of the
population in each country in which we operate. Many of these individuals work
in the service sector, which in the United States is one of the fastest growing
segments of the workforce.

However, many of these individuals, particularly in the United States, do
not maintain regular banking relationships. They use services provided by our
industry for a variety of reasons, including that they often:

o do not have sufficient assets to meet minimum balance requirements
or to achieve the benefits of savings with banks;

o do not write enough checks to make a bank account beneficial;

o need to access financial services outside of normal banking hours;

o desire not to pay fees for banking services that they do not use;

o require immediate access to cash from their paychecks; and

o may have a dislike or distrust of banks.

In addition to check cashing services, under-banked consumers also require
short-term loans that provide cash for living and other expenses. They also may
not be able to or want to obtain loans from banks as a result of:

o their immediate need for cash;

o irregular receipt of payments from their employers;

o their desire for convenience and customer service; and

o the unavailability of bank loans in small denominations for short
terms.

Despite the demand for basic financial services, access to banks has
become more difficult over time for many consumers. Many banks have chosen to
close their less profitable or lower-traffic locations. Typically, these
closings have occurred in lower-income neighborhoods where the branches have
failed to attract a sufficient base of customer deposits. This trend has
resulted in fewer convenient alternatives for basic financial services in many
neighborhoods. Many banks have also reduced or eliminated some services that
under-banked consumers need.

As a result of these trends, a significant number of retailers have begun
to offer financial services to lower- and middle-income individuals. The
providers of these services are fragmented, and range from specialty finance
offices to retail stores in other industries that offer ancillary services.

We believe that the under-banked consumer market will continue to grow as
a result of a diminishing supply of competing banking services as well as
underlying demographic trends. These demographic trends include an overall
increase in the population and an increase in the number of service-sector jobs
as a percentage of the total workforce.

The demographics of the typical customers for non-banking financial
services vary slightly in each of the markets in which we operate, but the
trends driving the industry are generally the same. In addition, the type of
store and services that appeal to customers in each market vary based on
cultural, social, geographic and other factors. Finally, the composition of
providers of these services in each market results in part from the historical
development and regulatory environment in that market.


5


Growth Opportunities

We believe that significant opportunities for growth exist in our industry
as a result of:

o growth of the service-sector workforce;

o failure of commercial banks and other traditional financial service
providers to address adequately the needs of lower- and
middle-income individuals; and

o trends favoring larger operators in the industry.

We believe that, as the lower- and middle-income population segment
increases, and as trends within the retail banking industry make banking less
accessible to these consumers, the industry in which we operate will see a
significant increase in demand for their products and services. We also believe
that the industry will continue to consolidate as a result of a number of
factors, including:

o economies of scale available to larger operators;

o use of technology to serve customers better and to control large
store networks;

o inability of smaller operators to form the alliances necessary to
deliver new products; and

o increased licensing and regulatory burdens.

This consolidation process should provide us, as operator of one of the
largest store networks, with opportunities for continued growth.

Competitive Strengths

We believe that the following competitive strengths position us well for
continued growth:

Leading Position in Core Markets. We have a leading position in core
markets, operating 321 stores in the United States, 181 stores in Canada and 122
stores in the United Kingdom as of June 30, 2003. We have 109 franchised
locations in Canada and 351 franchised locations in the United Kingdom.
Highlights of our competitive position in these core markets include the
following:

o Our domestic network is focused in rapidly growing markets in
the western United States, where we believe we have held
leading market positions for over 10 years.

o We believe that we are the industry leader in Canada, and that
we hold a dominant market share with a store in almost every
city with a population of over 50,000. Based on a public
opinion study of three major metropolitan markets in English
speaking Canada, we have achieved brand awareness of 85%.

o We are the largest check cashing company in the United
Kingdom, comprising nearly 25% of the market measured by
number of stores, although we believe that we account for 40%
of all check cashing transactions performed at check cashing
stores.

High-quality Customer Service. We adhere to a strict set of market survey
and location guidelines when selecting store sites in order to ensure that our
stores are placed in desirable locations near our customers. We believe that our
customers appreciate this convenience, as well as the flexible and extended
operating hours that we typically offer, which are often more compatible with
our customers' work schedules. We provide our customers with a clean, attractive
and secure environment in which to transact their business. We believe that our
friendly and courteous customer service at both the store level and through our
centralized support centers is a competitive advantage.


6


Diversified Product and Geographic Mix. Our stores offer a wide range of
consumer financial products and services to meet the demands of their respective
locales, including check cashing, short-term consumer loans, money orders and
money transfers. We also provide high-value ancillary products and services,
including electronic tax filing, bill payment, foreign currency exchange, photo
ID and prepaid local and long-distance phone services. For fiscal 2003, the
revenue contribution by our check cashing operations was 49.4%, our consumer
lending operations was 37.2% and our other financial services was 13.4%. In
addition to our product diversification, our business is diversified
geographically. For fiscal 2003, our U.S. operations generated 50.4% of our
total revenue, our Canadian operations generated 30.5% of our total revenue and
our U.K. operations generated 19.1% of total revenue. Our product and geographic
mix provides a diverse stream of revenue.

Diversification and Management of Credit Risk. Our revenue is generated
through a high volume of small dollar financial transactions, and therefore our
exposure to loss from a single customer transaction is minimal. In addition, we
actively manage our customer risk profile and collection efforts in order to
maximize our consumer lending and check cashing revenues while maintaining
losses within a targeted range. We have instituted control mechanisms that have
been effective in managing risk. Such mechanisms, among others, include the
daily monitoring of initial return rates on our consumer loan portfolio. As a
result, we believe that we are unlikely to sustain a material credit loss from a
single transaction or series of transactions. We have experienced relatively low
net write-offs as a percentage of the face amount of checks cashed. For fiscal
2003, in our check cashing business, net write-offs as a percentage of face
amount of checks cashed were 0.2%. For the same period, with respect to loans
funded directly by us, net write-offs as a percentage of originations were 2.3%.

Management Expertise. We have a highly experienced and motivated
management team at both the corporate and operational levels. Our senior
management team has extensive experience in the financial services industry. Our
Chairman and Chief Executive, Jeffrey Weiss, and our President and Chief
Financial Officer, Donald Gayhardt, have been with us since 1990 and have
demonstrated, through their operational leadership and strategic vision, the
ability to grow the business, achieving a revenue compound annual growth rate of
23.3% since 1990. In addition to their expertise, the management team is highly
motivated to ensure continued business success, as they collectively own
approximately 19.0% of our parent company's fully diluted common stock.

Strategy

Our business strategy is designed to capitalize on our competitive
strengths and enhance our leading market positions. Key elements of our strategy
include:

Introducing Related Products and Services. We offer our customers multiple
financial products and services. We believe that our check cashing and consumer
lending customers enjoy the convenience of other high-value products and
services offered by us. These products and services enable our customers to
manage their personal finances more effectively. For example, in fiscal 2003, we
introduced debit cards as a new channel for delivering short-term consumer loans
to customers at our document transmitter locations and customer loyalty programs
in many of our stores. We also offered new tax-based products to our Canadian
customers, providing qualified individuals with cash advances against
anticipated tax refunds. We intend to continue to innovate and develop new
products and services for our customers.

Growing Through Disciplined Network Expansion. We intend to continue to
grow our network through the addition of new stores and franchisees, while
adhering to a disciplined selection process. In order to optimize our expansion,
we carefully assess potential markets by analyzing demographic, competitive and
regulatory factors, site selection and availability and growth potential. We
seek to add locations that offer check cashing, consumer lending or a
combination of both. In addition, we will continue to grow our
direct-to-consumer lending services that enable us to access a broader customer
base without the capital expense of adding company stores.

Maintaining our Customer-driven Retail Philosophy. We strive to maintain
our customer-service-oriented approach and meet the basic financial service
needs of our working, lower- and middle-income customers. We believe our
approach differentiates us from many of our competitors and is a key tenet of
our employee training programs. We offer extended operating hours in clean,
attractive and secure store locations to enhance appeal and stimulate store
traffic. In certain markets, we operate stores that are open 24 hours a day. To
ensure customer satisfaction, we periodically send anonymous market researchers
posing as shoppers to our U.S. stores to measure customer service performance.
We plan to continue to develop ways to improve our performance, including
through incentive programs to reward employees for exceptional customer service.


7


Enhancing Network and Store-level Profitability. With our network of 1,084
stores, we are well positioned to capitalize on economies of scale. Our
centralized core support functions, including collections, call center, field
operations and service, loan processing and tax filing, enable us to generate
efficiencies by improving collections and purchasing power with our vendors. Our
proprietary systems are used to further improve our customer relations and loan
servicing activities, as well as to provide a highly efficient means to manage
our internal as well as regulatory compliance efforts. We plan to continue to
take advantage of these efficiencies to enhance network and store-level
profitability.

Customers

Our core customer group generally lacks sufficient income to accumulate
assets or to build savings. These customers rely on their current income to
cover immediate living expenses and cannot afford to wait for checks to clear
through the commercial banking system. We believe that many of our customers use
our check cashing and short-term lending services in order to access cash
immediately without having to maintain a minimum balance in a checking account
and to borrow money to fund living expenses and other needs. We believe that
consumers value our affordability and attention to customer service, and their
choice of financial service provider is influenced by our convenient locations
and extended operating hours.

U.S. Customers

Based on our operating experience and information provided to us by our
customers, we believe that our core domestic check cashing customer group is
composed of individuals between the ages of 18 and 44. The majority of these
individuals rent their homes, are employed and have annual household incomes of
between $10,000 and $35,000, with a median income of $22,500. We believe that
many of our customers are workers or independent contractors who receive payment
on an irregular basis and generally in the form of a check. In addition, we
believe that although approximately 49% of our U.S. customers do have bank
accounts, these customers use check cashing stores because they find the
locations and extended business hours more convenient than those of banks and
because they value the ability to receive cash immediately, without waiting for
a check to clear.

Our operating experience and customer data also suggest that our
short-term consumer loan customers are mainly individuals between the ages of 18
and 49. The majority of these individuals rent their homes and are employed in
professional/managerial positions. A survey conducted by the Credit Research
Center of Georgetown University found that 51.5% of short-term consumer loan
customers reported household incomes between $25,000 and $50,000 with 25.4%
greater than $50,000. The survey also found that these customers choose
short-term consumer loans because of easy and fast approval and convenient
location. Unlike many of our check cashing customers, short-term consumer loan
customers have a bank account but experience temporary shortages in cash from
time to time.

Canadian Customers

Based on recent market research surveys, we believe that the demographics
of our Canadian customers are somewhat different from those of our U.S.
customers. Our typical Canadian check cashing customer is approximately 32 years
old, employed in the trades/labor sector and earning $(USD)28,000 annually. Our
typical Canadian short-term loan customer is 25 to 44 years old, employed in the
services sector and earning $(USD)35,000 annually. Approximately 60% of our
Canadian customers are male and 40% are female. In contrast to the United
States, 66% of our Canadian check cashing customers have bank accounts, and 98%
of our Canadian short-term loan customers have bank accounts. Our research shows
that these customers continue to use our services because of our fast and
courteous service, the stores' extended operating hours and convenient
locations.

U.K. Customers

Recent market research conducted on our behalf and our own customer data
have shown that 89% of our U.K. customers have annual incomes below
$(USD)30,000, and 58% are under the age of 35. According to market research,
approximately 85% of our customer base is employed, with equal numbers of males
and females. While 80% of our U.K. customers have bank accounts, they report a
high level of dissatisfaction with their current bank relationship. Market
research indicated customer service satisfaction levels for our U.K. customers
above 95% compared with 50% to 65% satisfaction for the major banks. Staff
friendliness and face-to-face contact are key drivers of customer satisfaction.
The need for immediate cash is the number one reason for using our services.



8


Products and Services

Our locations provide a broad range of consumer financial products and
services to our customers at convenient locations with extended operating hours.
Customers typically use our stores to cash checks (payroll, government and
personal), obtain short-term consumer loans and use one or more of the
additional financial services available at most locations. In addition,
customers use a variety of other products, including Western Union money order
and money transfer products, electronic tax filing, bill payment, foreign
currency exchange, photo ID and prepaid local and long-distance phone services.

Check Cashing

Customers may cash all types of checks at our check cashing locations,
including payroll checks, government checks and personal checks. In exchange for
a verified check, customers receive cash immediately and do not have to wait
several days for the check to clear. Before we distribute any cash, we verify
both the customer's identification and the validity of the check (occasionally
using multiple sources) as required by our standard verification procedures.
Customers are charged a fee for this service (typically a small percentage of
the face value of the check). The fee varies depending on the size and type of
check cashed as well as the customer's check cashing history at our stores. For
fiscal 2003, check cashing fees averaged approximately 3.55% of the face value
of checks cashed.

The following chart presents summaries of revenue from our check cashing
operations, broken down by consolidated operations, U.S. operations and Canadian
and U.K. operations for the periods indicated below:



Year ended June 30,
--------------------------------------------------------------------------------------
1999 2000 2001 2002 2003
--------------------------------------------------------------------------------------

Consolidated operations:
Face amount of checks cashed .......... $2,319,847,000 $2,743,765,000 $3,046,705,000 $2,969,455,000 $3,051,982,000
Number of checks cashed ............... 7,490,406 8,204,528 9,001,635 8,689,819 8,585,459
Average face amount per check ......... $ 309.71 $ 334.42 $ 338.46 $ 341.72 $ 355.48
Average fee per check ................. $ 10.14 $ 11.87 $ 11.74 $ 12.06 $ 12.63
Average fee as a % of face amount ..... 3.28% 3.55% 3.47% 3.53% 3.55%

U.S. operations:
Face amount of checks cashed .......... $1,723,912,000 $1,712,912,000 $1,728,504,000 $1,636,967,000 $1,508,407,000
Number of checks cashed ............... 5,176,483 4,654,747 4,485,393 4,317,534 3,786,363
Average face amount per check ......... $ 333.03 $ 367.99 $ 385.36 $ 379.14 $ 398.38
Average fee per check ................. $ 10.73 $ 12.17 $ 12.19 $ 12.41 $ 12.98
Average fee as a % of face amount ..... 3.22% 3.31% 3.16% 3.27% 3.26%

Canadian and U.K. operations:
Face amount of checks cashed .......... $ 595,935,000 $1,030,853,000 $1,318,201,000 $1,332,488,000 $1,543,575,000
Number of checks cashed ............... 2,313,923 3,549,781 4,516,242 4,372,285 4,799,096
Average face amount per check ......... $ 257.54 $ 290.40 $ 291.88 $ 304.76 $ 321.64
Average fee per check ................. $ 8.98 $ 11.47 $ 11.30 $ 11.71 $ 12.35
Average fee as a % of face amount ..... 3.49% 3.95% 3.87% 3.84% 3.84%


If a check cashed by us is not paid for any reason, we record the full
face value of the check as a loss in the period when the check was returned
unpaid. We then send the check to our internal collections department, or
occasionally directly to the store, for collection. Our employees contact the
maker and/or payee of each returned check. In certain circumstances, we will
take appropriate legal action. Recoveries on returned items are credited in the
period when the recovery is received. During fiscal 2003, we collected 74.2% of
the face value of returned checks.


9


The following chart presents summaries of our returned check experience,
broken down by consolidated operations, U.S. operations and Canadian and U.K.
operations for the periods indicated below:



Year ended June 30,
-----------------------------------------------------------------------
1999 2000 2001 2002 2003
-----------------------------------------------------------------------

Consolidated operations:
Face amount of returned checks $16,607,000 $22,866,000 $27,938,000 $27,875,000 $26,164,000
Collections on returned checks 12,505,000 17,097,000 19,752,000 20,812,000 19,426,000
Net write-offs of returned checks 4,102,000 5,769,000 8,186,000 7,063,000 6,738,000
Collections as a percentage of returned checks 75.3% 74.7% 70.7% 74.7% 74.2%
Net write-offs as a percentage of check
cashing revenues 5.4% 5.9% 7.7% 6.7% 6.2%
Net write-offs as a percentage of face amount
of checks cashed 0.18% 0.21% 0.26% 0.24% 0.22%

U.S. operations:
Face amount of returned checks $11,246,600 $12,019,000 $14,519,000 $15,412,000 $12,046,000
Collections on returned checks 7,646,040 7,808,000 8,872,000 10,560,000 8,335,000
Net write-offs of returned checks 3,600,560 4,211,000 5,647,000 4,852,000 3,711,000
Collections as a percentage of returned checks 68.0% 65.0% 61.1% 68.5% 69.2%
Net write-offs as a percentage of check
cashing revenues 6.5% 7.4% 10.3% 9.1% 7.6%
Net write-offs as a percentage of face amount
of checks cashed 0.21% 0.25% 0.33% 0.30% 0.25%

Canadian and U.K. operations:
Face amount of returned checks $ 5,360,400 $10,847,000 $13,419,000 $12,463,000 $14,118,000
Collections on returned checks 4,858,960 9,289,000 10,880,000 10,252,000 11,091,000
Net write-offs of returned checks 501,440 1,558,000 2,539,000 2,211,000 3,027,000
Collections as a percentage of returned checks 90.7% 85.6% 81.1% 82.3% 78.6%
Net write-offs as a percentage of check
cashing revenues 2.4% 3.8% 5.0% 4.3% 5.1%
Net write-offs as a percentage of face amount
of checks cashed 0.08% 0.15% 0.18% 0.17% 0.20%


Consumer Lending

We originate short-term loans on behalf of two domestic banks and for our
own account.

The short-term consumer loans we originate are commonly referred to as
"payday" or "deferred deposit" loans. In a payday-loan transaction, at the time
the funds are advanced to the borrower, the borrower signs a note and provides
the lender with a post-dated check or a written authorization to initiate an
automated clearinghouse charge to the borrower's checking account for the loan
principal plus a finance charge; on the due date of the loan (which is generally
set at a date on or near the borrower's next payday), the check or automated
clearinghouse debit is presented for payment.

Since June 13, 2002, we have acted as a servicer for County Bank of
Rehoboth Beach, Delaware and since October 18, 2002, for First Bank of Delaware.
On behalf of these banks, we market unsecured short-term loans to customers with
established bank accounts and verifiable sources of income. Loans are made for
amounts up to $500, with terms of 7 to 23 days. Under these programs, we earn
servicing fees, which may be reduced if the related loans are not collected. We
maintain a reserve for estimated reductions. In addition, we maintain a reserve
for anticipated losses for loans we make directly. In order to estimate the
appropriate level of these reserves, we consider the amount of outstanding loans
owed to us, as well as loans owed to banks and serviced by us, the historical
loans charged-off, current collection patterns and current economic trends. As
these conditions change, additional allowances might be required in future
periods. During fiscal 2003, County Bank originated or extended approximately
$277.9 million of loans through our locations and document transmitters. First
Bank originated or extended approximately $92.5 million of loans through us


10


during this period. County Bank originated or extended approximately $14.7
million of loans through us during fiscal 2002.

We also originate unsecured short-term loans to customers on our own
behalf in Canada, the United Kingdom and certain U.S. markets. We bear the
entire risk of loss related to these loans. In the United States, these loans
are made for amounts up to $500, with terms of 7 to 37 days. In Canada, loans
are issued to qualified borrowers based on a percentage of the borrowers' income
with terms of 1 to 35 days. We issue loans in the United Kingdom for up to
(pound)500, with a term of 28 days. We originated or extended approximately
$427.6 million of the loans through our locations and document transmitters
during fiscal 2003 and approximately $284.7 million through our locations and
document transmitters during 2002.

We had approximately $20.4 million of consumer loans on our balance sheet
at June 30, 2003 and approximately $18.2 million on June 30, 2002. These amounts
are reflected in loans and other receivables. Loans and other receivables at
June 30, 2003 are reported net of a reserve of $2.4 million related to consumer
lending. Loans and other receivables at June 30, 2002 are reported net of a
reserve of $2.9 million related to consumer lending.

The following chart presents a summary of our consumer lending
originations and revenues for the following periods:



Year ended June 30,
----------------------------------
2001 2002 2003
----------------------------------
(in thousands)

U.S. originations ..................................... $ 11,965 $ 19,723 $ 81,085
Canadian originations ................................. 138,127 188,632 248,149
U.K. originations ..................................... 44,679 76,344 98,388
----------------------------------
Total originations .................................... $194,771 $284,699 $427,622
==================================

Servicing revenues, net ............................... $ 41,920 $ 44,765 $ 41,175
Company funded domestic loan revenues ................. 1,966 3,545 14,137
Company funded foreign loan revenues .................. 18,776 27,043 35,918
Net write-offs on company funded loans ................ (4,295) (5,554) (9,716)
----------------------------------
Total consumer lending revenues, net .................. $ 58,367 $ 69,799 $ 81,514
==================================
Net write-offs as a percentage of total originations .. 2.2% 2.0% 2.3%


During 2002, Eagle National Bank discontinued the business of offering
short-term consumer loans through our stores and our document transmitter
locations. Under this program, we earned marketing and servicing fees. Eagle
originated or extended approximately $402.7 million of loans through us during
fiscal 2002.

Other Services and Products

In addition to check cashing and short-term loans, our customers may
choose from a variety of products and services when conducting business at our
locations. These services include Western Union money order and money transfer
products, electronic tax filing, bill payment, foreign currency exchange, photo
ID and prepaid local and long-distance phone services. A survey of our customers
by an independent third party revealed that over 50% of customers use other
services in addition to check cashing. We offer our customers multiple financial
products and services. We believe that our check cashing and consumer lending
customers enjoy the convenience of other high-value products and services
offered by us.


11


Among our most significant products and services other than check cashing
and short-term loans are the following:

o Money Transfers--Through a strategic alliance with Western Union,
customers can transfer funds to any location providing Western Union money
transfer services. Western Union currently has 150,000 agents in more than
190 countries throughout the world. We receive a percentage of the
commission charged by Western Union for the transfer. For fiscal 2003, we
generated total money transfer revenues of $11.7 million, primarily at our
check cashing stores.

o Money Orders--Our stores issue money orders for a minimal fee. Customers
who do not have checking accounts typically use money orders to pay rent
and utility bills. During fiscal 2003, money order transactions had an
average face amount of $140 and an average fee of $1.03. For fiscal 2003,
our customers purchased 2.4 million money orders, generating total money
order revenues of $2.5 million.


12


Store Operations

Locations

The following chart sets forth the number of stores in operation as of the
dates:



June 30,
----------------------------------------
Markets 1999 2000 2001 2002 2003
------- ----------------------------------------

CALIFORNIA
Southern................................. 41 44 47 47 47
Northern................................. 79 92 95 93 91

ARIZONA
Phoenix.................................. 25 34 40 45 43
Tucson................................... 0 7 13 16 16

OHIO
Cleveland................................ 22 21 19 19 18
Other Ohio cities (1).................... 5 7 5 4 4

PENNSYLVANIA
Philadelphia............................. 10 11 8 8 6
Pittsburgh............................... 10 10 11 11 11

OTHER UNITED STATES
Washington............................... 15 17 21 18 18
Virginia................................. 14 15 16 16 16
Oklahoma................................. 0 8 13 13 10
Nevada................................... 0 1 11 11 8
Colorado................................. 0 6 14 15 7
Oregon................................... 0 2 5 5 5
Louisiana................................ 3 3 4 4 4
Texas.................................... 3 3 3 4 4
Utah..................................... 3 7 5 5 4
New Mexico............................... 4 4 3 3 3
Hawaii................................... 3 3 3 3 3
Maryland/D.C............................. 4 4 11 10 2
Wisconsin................................ 1 1 1 1 1
Franchised locations..................... 3 0 0 0 0

CANADA
Company operated......................... 101 139 157 167 181
Franchised locations..................... 80 81 86 87 109

UNITED KINGDOM
Company operated......................... 11 107 126 123 122
Franchised locations..................... 0 264 261 290 351
---------------------------------------
Total stores............................. 437 891 978 1,018 1,084
=======================================


- ----------
(1) These other cities include Akron, Canton, Youngstown and Cincinnati.


13


All of our company-operated stores are leased, generally under leases
providing for an initial multi-year term and renewal terms from one to five
years. We generally assume the responsibility for required leasehold
improvements, including signage, customer service representative partitions,
alarm systems, computers, time-delayed safes and other office equipment. We
adhere to a strict set of market survey and location guidelines when selecting
store sites in order to ensure that our stores are placed in desirable locations
near our customers.

Facilities and Hours of Operation

As part of our retail and customer-driven strategy, we present a clean and
attractive environment and an appealing format for our stores. Size varies by
location, but the stores are generally 1,000 to 1,400 square feet, with
approximately half of that space allocated to the teller and back office areas.

Operating hours vary by location, but are typically extended and designed
to cater to those customers who, due to work schedules, cannot make use of
"normal" banking hours. A typical store operates from 9:00 A.M. to 9:00 P.M.
during weekdays and on Saturdays, and from 10:00 A.M. to 5:00 P.M. on Sundays.
In certain locations, we operate stores 24 hours, seven days per week.

Operational Structure

Our senior management is located at our corporate headquarters in Berwyn,
Pennsylvania and is responsible for our overall direction. We also maintain
corporate offices in Victoria, British Columbia and Nottingham, England.
Management of our North American store operations is located in our Victoria
office while the Nottingham office provides support for our U.K. store
operations. This support includes centralized functions such as information
systems, treasury, accounting, human resources, loss prevention and marketing.
Our corporate staff also includes personnel dedicated to compliance functions,
including internal audit, risk management, privacy and general counsel
functions. We believe that our ongoing investment in and company-wide focus on
our compliance practices provides us with a competitive advantage relative to
most other companies in our industry.

Additionally, in each country in which we operate, we have a store
management organization that is responsible for the day to day operations of our
stores. District managers are directly responsible for the oversight of our
store managers and store operations. Typically, each district manager oversees
eight to ten stores. Each district manager reports to a market manager who
supervises approximately five district managers. The market managers report to
the head of operations in each of our corporate offices.

In addition, in fiscal 2001 we opened a centralized facility to support
our domestic consumer lending business. This call-center facility, located in
Salt Lake City, Utah, currently employs 141 full-time staff. Operating from 8:00
A.M. to midnight, eastern time (including weekends), our staff performs inbound
and outbound customer service for current and prospective consumer loan
customers as well as collection and loan-servicing functions for all past-due
domestic consumer loans. Our management at this facility includes experienced
call-center operations, customer service, information technology and collection
personnel. We believe that this centralized facility has helped us to improve
our loan servicing significantly and has led to reduced credit losses on loans
originated by us in the United States and significantly enhances our ability to
manage the compliance responsibilities related to our domestic consumer lending
operations.

Technology

We currently have an enterprise-wide transaction processing computer
network. We believe that this system has improved customer service by reducing
transaction time and has allowed us to manage returned-check losses and loan
collection efforts better and to comply with regulatory record keeping and
reporting requirements.

We continue to enhance our point-of-sale transaction processing system
composed of a networked hardware and software package with integrated database
and reporting capabilities. The point-of-sale system provides our stores with
instantaneous customer information, thereby reducing transaction time and
improving the efficiency of our credit verification process. Also, we have
deployed an enhanced centralized loan management and collections system that
provides improved customer service processing and management of loan
transactions. The loan-management system and collections system uses integrated
automated clearinghouse payment and returns processing, which facilitates faster
notification of returns and faster clearing of funds as well as utilizing fax
server document-processing technology, which has the effect of reducing both
processing and loan closing times. The point-of-sale system, together with the
enhanced loan-


14


management and collections systems, has improved our ability to offer new
products and services and our customer service.

Security

The principal security risks to our operations are robbery and
defalcation. We have put in place extensive security systems, dedicated security
personnel and management information systems to address both areas of potential
loss. We believe that our systems are among the most effective in the industry.
Net security losses represented less than 0.8% of total revenues for fiscal
2003, a decline from net security losses of 1.1% of total revenues for fiscal
2002.

To protect against robbery, most store employees work behind
bullet-resistant glass and steel partitions, and the back office, safe and
computer areas are locked and closed to customers. Each store's security
measures include safes, electronic alarm systems monitored by third parties,
control over entry to teller areas, detection of entry through perimeter
openings, walls, and ceilings and the tracking of all employee movement in and
out of secured areas. Employees use cellular phones to ensure safety and
security whenever they are outside the secure teller area. Additional security
measures include identical alarm systems in all stores, remote control over
alarm systems, arming/disarming and changing user codes and mechanically and
electronically controlled time-delay safes.

Since we handle high volumes of cash and negotiable instruments at our
locations, daily monitoring, unannounced audits and immediate responses to
irregularities are critical in combating defalcations. We have an internal
auditing program that includes periodic unannounced store audits and cash counts
at randomly selected locations.

Seasonality

Our business is seasonal due to the impact of several tax-related
services, including cashing tax refund checks. Historically, we have generally
experienced our highest revenues and earnings during our third fiscal quarter
ending March 31, when revenues from these tax-related services peak.

Advertising and Marketing

We frequently survey and research customer trends and purchasing patterns
in order to place the most effective advertising for each market. Our marketing
promotions typically include in-store merchandising materials, advertising
support and instruction of store personnel in the use of the materials. Drawing
on statistical data from our transaction database, we use sophisticated direct
marketing strategies to communicate with existing customers and prospects with
demographic characteristics similar to those of existing customers. National
television advertising promotes our brand in Canada and our franchisees
contribute to fund this advertising. We also arrange cooperative advertising for
our products and services with strategic partners such as Western Union. We
provide our store managers with local marketing training that sets standards for
promotions and marketing programs for their stores. Local marketing includes
attendance and sponsorship of community events. A national classified telephone
directory company is used to place all Yellow Pages advertising as effectively
and prominently as possible. We research directory selection to assure effective
communication with our target customers.

Competition

Our store network represents the second-largest network of its kind in the
United States and the largest network of its kind in each of Canada and the
United Kingdom. The industry in which we operate in the United States is highly
fragmented. An independent industry report estimated the number of check cashing
outlets at 13,000 in March 2002, an increase from the approximately 2,200
national listings in 1986, according to a similar industry survey. We believe we
operate one of only seven U.S. check cashing store networks that have more than
100 locations, the remaining competitors being local chains and single-unit
operators. According to an industry survey, the seven largest check cashing
chains in the United States control fewer than 22% of the total number of U.S.
stores, reflecting the industry's fragmented nature. An independent report
estimated the number of stores offering short-term consumer loans as their
principal business at approximately 12,000 as of June 2003.

In Canada, we believe that we are the industry leader and that we hold a
dominant market share with exceptional brand awareness. In a recent public
opinion study of three major metropolitan markets in English speaking Canada, we
found that we have achieved brand awareness of 85%. We estimate that the number
of outlets offering check cashing


15


and/or short-term consumer loans is 1,100. We believe there is only one
other network of stores with over 100 locations and only three chains with over
50 locations. While we believe that we enjoy almost 30% market share by outlet
in Canada, our research estimates our market share by volume of business to be
closer to 50%.

Based on information from the British Cheque Cashers Association, we
believe that we have a U.K. market share of approximately 25%. In addition, we
believe that our 473 company-operated and franchised stores account for up to
40% of the total check cashing transactions performed at check cashing stores in
the United Kingdom. In the consumer lending market, recent research indicates
that the market for small, short-term loans is served by approximately 1,500
store locations, which include check cashers, pawn brokers and home-collected
credit companies.

In addition to other check cashing stores and consumer lending stores in
the United States, Canada and the United Kingdom, we compete with banks and
other financial services entities, as well as with retail businesses, such as
grocery and liquor stores, which often cash checks for their customers. Some
competitors, primarily grocery stores, do not charge a fee to cash a check.
However, these merchants provide this service to a limited number of customers
with superior credit ratings and will typically only cash "first party" checks,
or those written on the customer's account and made payable to the store.

We also compete with companies that offer automated check cashing
machines, and with franchised kiosk units that provide check-cashing and money
order services to customers, which can be located in places such as convenience
stores, bank lobbies, grocery stores, discount retailers and shopping malls.

We believe that convenience, hours of operations and other aspects of
customer service are the principal factors influencing customers' selection of a
financial services company in our industry, and that the pricing of products and
services is a secondary consideration.

Regulation

We are subject to regulation by foreign, federal and state governments
that affects the products and services we provide.

Regulation of Check Cashing

To date, regulation of check cashing fees has occurred on the state level.
We are currently subject to fee regulation in seven states: Arizona, California,
the District of Columbia, Hawaii, Louisiana, Maryland, Ohio and Pennsylvania,
where regulations set maximum fees for cashing various types of checks. Our fees
comply with all state regulations.

Certain states, including California, the District of Columbia, Ohio,
Pennsylvania, Utah and Washington, have enacted licensing requirements for check
cashing stores. Other states, including Ohio, require the conspicuous posting of
the fees charged by each store. A number of states, including Ohio, also have
imposed recordkeeping requirements, while others require check cashing stores to
file fee schedules with the state.

In Canada, the federal government does not directly regulate our industry,
nor do provincial governments generally impose any regulations specific to the
industry. The exception is in the Province of Quebec, where check cashing stores
are not permitted to charge a fee to cash government checks.

Regulation of Consumer Lending

In the majority of states where we engage in consumer lending, we act as a
servicer for County Bank or First Bank, federally insured financial institutions
both chartered under the laws of the state of Delaware. We provide County Bank
and First Bank with marketing, servicing and collections services for their
unsecured short-term loan products that are offered under our brand name Cash
'Til Payday.


16


County Bank and First Bank are subject to federal and state banking
regulations. Legislation has been introduced in the past at both the state and
federal levels that could affect our ability to generate origination fees as a
servicer for a bank, as well as our ability to offer consumer loans directly to
consumers. While we do not believe that any federal legislation will be passed,
if enacted we would not be able to market short-term loans as currently
structured. The FDIC has also proposed increasing the capital requirement for
banks involved in this business to as much as 100%. These capital requirements
could make it substantially more expensive for such banks to engage in consumer
lending.

We have determined, primarily for regulatory reasons, that we should make
consumer loans directly to consumers in seven states where advantageous enabling
legislation exists: California, Colorado, Louisiana, Oklahoma, Oregon, Virginia
and Wisconsin. We have decided not to participate in the consumer lending
business in certain other states where legislation is unfavorable or the service
is not likely to be profitable. We currently can participate in the consumer
lending business in all states where we have a sizeable presence, although there
is no guarantee that this situation will continue at the federal or state level.

Our Canadian consumer lending activities are subject to provincial
licensing in Saskatchewan, Nova Scotia and Newfoundland but are subject only to
limited substantive regulation. A federal usury ceiling applies to loans we make
to Canadian consumers. Such borrowers contract to repay us in cash; if they
repay by check, we also collect, in addition to the maximum permissible finance
charge, our customary check-cashing fees.

In the United Kingdom, consumer lending is governed by the Consumer Credit
Act of 1974 and related rules and regulations. As required by the act, we have
obtained licenses from the Office of Fair Trading, which is responsible for
regulating competition policy and consumer protection. The act also contains
rules regarding the presentation, form and content of loan agreements, including
statutory warnings and the layout of financial information. To comply with these
rules, we use model credit agreements provided by the British Cheque Cashers
Association.

Our consumer lending activities are also subject to certain other state,
federal and U.K. regulations, including, but not limited to, regulations
governing lending practices and terms, such as truth in lending and usury laws,
and rules regarding advertising content.

Currency Reporting Regulation

Regulations promulgated by the United States Department of the Treasury
under the Bank Secrecy Act require reporting of transactions involving currency
in an amount greater than $10,000, or the purchase of monetary instruments for
cash in amounts from $3,000 to $10,000. In general, every financial institution
must report each deposit, withdrawal, exchange of currency or other payment or
transfer that involves currency in an amount greater than $10,000. In addition,
multiple currency transactions must be treated as a single transaction if the
financial institution has knowledge that the transactions are by, or on behalf
of, any one person and result in either cash in or cash out totaling more than
$10,000 during any one business day. We believe that our point-of-sale system
and employee training programs support our compliance with these regulatory
requirements.

Also, money services businesses are required by the Money Laundering Act
of 1994 to register with the United States Department of the Treasury. Money
services businesses include check cashers and sellers of money orders. Money
services businesses must renew their registrations every two years, maintain a
list of their agents, update the agent list annually and make the agent list
available for examination. In addition, the Bank Secrecy Act requires money
services businesses to file a Suspicious Activity Report for any transaction
conducted or attempted involving amounts individually or in total equaling
$2,000 or greater, when the money services businesses knows or suspects that the
transaction involves funds derived from an illegal activity, the transaction is
designed to evade the requirements of the Bank Secrecy Act or the transaction is
considered so unusual that there appears to be no reasonable explanation for the
transaction. The USA PATRIOT Act includes a number of anti-money-laundering
measures designed to assist in the identification and seizure of terrorist
funds, including provisions that will directly impact check cashers and other
money services businesses. Specifically, the USA PATRIOT Act requires all check
cashers to establish certain programs designed to detect and report money
laundering activities to law enforcement. We believe we are in compliance with
the USA PATRIOT Act.


17


Privacy Regulation

We are subject to a variety of state, federal and foreign laws and
regulations restricting the use and seeking to protect the confidentiality of
identifying and other personal consumer information. We have systems in place
intended to safeguard such information as required.

Other Regulation

We operate a total of 139 stores in California and Maryland. These states
have enacted so-called "prompt remittance" statutes. These statutes specify a
maximum time for the payment of proceeds from the sale of money orders to the
issuer of the money orders. In this way, the statutes limit the number of days,
known as the "float," that we have use of the money from the sale of the money
order.

In addition to fee regulations, licensing requirements and prompt
remittance statutes, certain jurisdictions have also placed limitations on the
commingling of money order proceeds and established minimum bonding or capital
requirements.

Proprietary Rights

We hold the rights to a variety of service marks relating to products or
services we provide in our stores. In addition, we maintain service marks
relating to the various names under which our stores operate.

Insurance Coverage

We maintain insurance coverage against losses, including theft, to protect
our earnings and properties. We also maintain insurance coverage against
criminal acts with a deductible of $50,000 per occurrence.

Employees

On June 30, 2003, we employed 3,348 persons worldwide, consisting of 274
persons in our accounting, management information systems, legal, human
resources, treasury, finance and administrative departments and 3,074 persons in
our stores, including customer service representatives, store managers, regional
supervisors, operations directors and store administrative personnel.

None of our employees is represented by a labor union, and we believe that
our relations with our employees are good.


18


Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private
Securities Litigation Reform Act of 1995

This report may contain certain forward-looking statements regarding our
expected performance for future periods, and actual results for such periods may
materially differ. Such forward-looking statements involve risks and
uncertainties, including risks of changing market conditions in the overall
economy and the industry, consumer demand, regulatory factors and the success of
our strategies and other factors detailed from time to time in our annual and
other reports filed with the Securities and Exchange Commission. The words
"believe," "expect," "anticipate," "will" and similar expressions identify
forward-looking statements. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date on which they
are made. We undertake no obligation to update publicly or revise any
forward-looking statements. Factors that could cause actual results to differ
materially from the forward-looking statement, including our goals referred to
herein, include but are not limited to our inability to:

o effectively compete in the financial services industry and maintain
our share of the market;

o manage risks inherent in an international operation, including
foreign currency fluctuation;

o maintain our key banking relationships;

o sustain demand for our products and services;

o manage changes in applicable laws and regulations governing consumer
protection and lending practices;

o manage our growth effectively;

o compete in light of technological advances; or

o safeguard against employee error and theft.


19


Item 2. PROPERTIES

All of our company-operated stores are leased, generally under leases
providing for an initial multi-year term and renewal terms from one to five
years. The leases may contain provisions for additional rental charges based on
revenue and payment of real estate taxes and common area charges. With respect
to leased stores open as of June 30, 2003, the following table shows the total
number of leases expiring during the periods indicated, assuming the exercise of
our renewal options:

Period Ending Number of
June 30, Leases Expiring
-------- ---------------
2004 110
2005 - 2008 465
2009 - 2013 59
2014 - 2018 12
2019 - 2023 2
------
648

The following table reflects the change in the number of stores during
fiscal 2003:

Number of stores at June 30, 2002 1,018
New stores opened 14
Stores acquired 5
Stores closed (36)
Net change in franchise stores 83
---------
Number of stores at June 30, 2003 1,084
=========


20


Item 3. LEGAL PROCEEDINGS

We are a defendant in four putative class-action lawsuits, all of which
were commenced by the same plaintiffs' law firm, alleging violations of
California's wage-and-hour laws. The named plaintiffs in these suits, which are
pending in the Superior Court of the State of California, are our former
employees Vernell Woods (commenced August 22, 2000), Juan Castillo (commenced
May 1, 2003), Stanley Chin (commenced May 7, 2003) and Kenneth Williams
(commenced June 3, 2003). Each of these suits seeks an unspecified amount of
damages and other relief in connection with allegations that we misclassified
California store (Woods) and regional (Castillo) managers as "exempt" from a
state law requiring the payment of overtime compensation, that we failed to
provide employees with meal and rest breaks required under a new state law
(Chin) and that we computed bonuses payable to our store managers using an
impermissible profit-sharing formula (Williams). In January 2003, without
admitting liability, we sought to settle the Woods case, which we believe to be
the most significant of these suits, by offering each individual putative class
member an amount intended in good faith to settle his or her claim. As of June
30, 2003, 92% of these settlement offers had been accepted. Plaintiffs' counsel
is presently disputing through arbitration the validity of the settlements
accepted by the individual putative class members. We believe we have
meritorious defenses to the challenge and to the claims of the non-settling
putative Woods class members and plan to defend them vigorously. We believe we
have adequately provided for the costs associated with this matter. We are
vigorously defending the Castillo, Chin and Williams lawsuits and believe we
have meritorious defenses to the claims asserted in those matters. We believe
the outcome of such litigation will not significantly affect our financial
results.

On January 29, 2003, a former customer, Kurt MacKinnon, commenced an
action against our Canadian subsidiary and 26 other Canadian lenders on behalf
of a purported class of British Columbia residents who, plaintiff claims, were
overcharged in payday-loan transactions. The action, which is pending in the
Supreme Court of British Columbia, alleges violations of laws proscribing usury
and unconscionable trade practices and seeks restitution and damages, including
punitive damages, in an unknown amount. On March 25, 2003, we moved to stay the
action as against us and to compel arbitration of plaintiff's claims as required
by his agreement with us. We are presently awaiting a decision on that motion.
We believe we have meritorious defenses to the action and intend to defend it
vigorously. We believe the outcome of such litigation will not significantly
affect our financial results.

On October 30, 2002, the Oklahoma Administrator of Consumer Credit issued
an administrative order revoking the supervised-lending license of our Oklahoma
subsidiary on the ground that certain loans we marketed that were made by County
Bank did not conform with Oklahoma internal usury laws. The Administrator's
order also requires us to refund certain purportedly excess finance charges
collected by County Bank. The Administrator's order is presently on appeal to
the Oklahoma District Court. On August 20, 2003, that court denied the
Administrator's motion to require us to desist from further loan-origination
activities pending appeal. We are also appealing a federal court's abstention
from ruling on this matter to the United States Court of Appeals for the Tenth
Circuit. We are presently unable to evaluate the likelihood of any particular
outcome of this matter but, in our opinion, the outcome of such litigation will
not significantly affect our financial results.

In addition to the litigation discussed above, we are involved in routine
litigation and administrative proceedings arising in the ordinary course of
business. In our opinion, the outcome of such litigation and proceedings will
not significantly affect our financial results.

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

None.


21


PART II

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

There is no established public trading market for our common stock.

DFG Holdings, Inc. is the sole record and beneficial owner of all of our
outstanding common stock.

The Indenture dated November 15, 1996 between us and State Street Bank and
Trust Company, as trustee (the "Indenture"), relating to the 10 7/8% Senior
Notes due 2006, the agreement dated December 18, 1998 relating to the 10 7/8%
Senior Subordinated Notes due 2006 as well as our credit agreement, contain
restrictions as to the declaration and payment of dividends. See "Item 7 -
Management's Discussion and Analysis of Financial Condition and Results of
Operations" and the notes to consolidated financial statements included
elsewhere in this report.

Item 6. SELECTED FINANCIAL DATA

The selected consolidated historical financial information on the
following page should be read in conjunction with the consolidated financial
statements and notes thereto and the information contained in "Item 7 -
Management's Discussion and Analysis of Financial Condition and Results of
Operations" included elsewhere in this report. The balance sheet and statement
of operations data as of and for the years ended June 30, 1999, 2000, 2001, 2002
and 2003 have been derived from historical consolidated financial statements.


22




Year ended June 30,
-----------------------------------------------------------------------------------
1999(1),(2) 2000(3) 2001(4) 2002(5) 2003
-----------------------------------------------------------------------------------
(dollars in thousands, except check cashing data)

Statement of Operations Data:
Revenues:
Revenues from check cashing .......... $ 76,304 $ 97,350 $ 105,690 $ 104,792 $ 108,435
Revenues from consumer lending, net .. 18,559 34,787 58,367 69,799 81,514
Other revenues ....................... 26,116 33,616 31,442 27,385 29,439
-----------------------------------------------------------------------------------
Total revenues .......................... 120,979 165,753 195,499 201,976 219,388

Store and regional expenses:
Salaries and benefits ................ 35,329 47,058 57,453 65,295 69,799
Occupancy ............................ 9,609 12,800 16,881 18,087 18,856
Depreciation ......................... 2,227 4,683 5,829 6,522 5,859
Other ................................ 23,764 36,503 45,321 46,238 47,766
-----------------------------------------------------------------------------------
Total store and regional expenses ....... 70,929 101,044 125,484 136,142 142,280

Establishment of reserves for new
consumer lending arrangements ........ -- -- -- 2,244 --
Corporate expenses ...................... 13,648 20,864 22,500 24,516 31,241
Loss on store closings and sales and
other restructuring .................. 103 249 926 1,435 3,987
Goodwill amortization ................... 4,686 5,564 4,710 -- --
Other depreciation and amortization ..... 1,020 1,620 1,952 2,709 3,320
Interest expense ........................ 16,401 17,491 20,361 18,694 20,168
Recapitalization costs .................. 12,575 1,478 -- -- --
Establishment of reserve for legal matter -- -- -- -- 2,750
-----------------------------------------------------------------------------------

Income before income taxes and
extraordinary item ................... 1,617 17,443 19,566 16,236 15,642
Income tax provision .................... 3,881 12,043 12,876 10,199 13,511
-----------------------------------------------------------------------------------
(Loss) income before extraordinary item . (2,264) 5,400 6,690 6,037 2,131
Extraordinary loss on debt extinguishment
(net of income tax benefit of $45) .. 85 -- -- -- --
-----------------------------------------------------------------------------------
Net (loss) income ....................... $ (2,349) $ 5,400 $ 6,690 $ 6,037 $ 2,131
===================================================================================

Operating and Other Data:
Net cash provided by (used in):
Operating activities ................. $ 15,951 $ 16,792 $ 16,442 $ 14,453 $ 4,230
Investing activities ................. (23,471) (44,526) (32,365) (10,108) (10,679)
Financing activities ................. 18,269 35,306 15,602 9,409 (11,295)
Stores in operation at end of period .... 437 891 978 1,018 1,084

Check Cashing Data:
Face amount of checks cashed ............ $2,319,847,000 $2,743,765,000 $3,046,705,000 $2,969,455,000 $3,051,982,000
Number of checks cashed ................. 7,490,406 8,204,528 9,001,635 8,689,819 8,585,459
Average face amount per check cashed .... $ 309.71 $ 334.42 $ 338.46 $ 341.72 $ 355.48
Average fee per check ................... $ 10.14 $ 11.87 $ 11.74 $ 12.06 $ 12.63
Average fee as a % of face amount ....... 3.28% 3.55% 3.47% 3.53% 3.55%

Balance Sheet Data (at end of period):
Cash .................................... $ 65,782 $ 73,288 $ 72,452 $ 86,633 $ 71,805
Total assets ............................ 203,709 259,714 276,172 291,312 296,536
Total indebtedness ...................... 142,166 179,146 197,136 208,191 198,970
Shareholder's equity .................... 36,334 39,595 42,624 53,515 68,397



23


(1) On November 13, 1998, Holdings entered into an agreement and plan of
merger with DFG Acquisition, Inc., a Delaware corporation, controlled by
Green Equity Investors II, L.P., a Delaware limited partnership and some
of the Holdings' stockholders providing for the merger of DFG Acquisition,
Inc. with and into Holdings, with Holdings as the surviving corporation.
The merger, which was consummated on December 18, 1998 was accounted for
as a recapitalization of Holdings. In the merger, the senior members of
management of Holdings retained substantially all of their stock in
Holdings, and the other stockholders received cash in exchange for their
shares of Holdings.

(2) On February 10, 1999, we acquired all of the outstanding shares of Instant
Cash Loans Limited, which operated eleven stores in the UK. The initial
purchase price for this acquisition was $9.4 million plus initial working
capital of approximately $2.0 million and was funded with the issuance of
our 10 7/8% Senior Subordinated Notes Due 2006. The excess of the purchase
price over the fair value of identifiable net assets acquired was $8.3
million. On February 17, 1999, National Money Mart Company, one of our
subsidiaries, acquired the remaining 86.5% partnership interest in its
Calgary Money Mart Partnership. The Calgary Money Mart Partnership
operated six stores in Alberta, Canada. The aggregate purchase price for
this acquisition was $5.6 million and was funded with the issuance of our
10 7/8% Senior Subordinated Notes Due 2006. The excess of the purchase
price over the fair value of identifiable net assets acquired was $5.2
million.

(3) On July 7, 1999, we acquired all of the outstanding shares of Cash A
Cheque Holdings Great Britain Limited, which operated 44 company owned
stores in the UK. The initial purchase price for this acquisition was
$12.5 million and was funded through excess internal cash, our revolving
credit facility and our 10 7/8% Senior Subordinated Notes Due 2006. The
excess of the purchase price over the fair value of the identifiable net
assets acquired was $8.2 million. Additional consideration of $9.7 million
was subsequently paid based under the profit-based earn-out agreement. On
November 18, 1999, we acquired all of the outstanding shares of Cheques R
Us, Inc. and Courtenay Money Mart Ltd. , which operated six stores in
British Columbia. The aggregate purchase price for this acquisition was
$1.2 million and was funded through excess internal cash. The excess of
the purchase price over the fair value of identifiable net assets acquired
was $1.1 million. On December 15, 1999, we acquired all of the outstanding
shares of Cash Centres Corporation Limited, which operated five company
owned stores and 238 franchises in the UK. The aggregate purchase price
for this acquisition was $8.4 million and was funded through our revolving
credit facility. The excess of the purchase price over the fair value of
identifiable net assets acquired was $7.7 million. Additional
consideration of $2.7 million was subsequently paid based under a
profit-based earn-out agreement. On February 10, 2000, we acquired
substantially all of the assets of CheckStop, Inc., which is a payday-loan
business operating through 150 independent document transmitters in 17
states. The aggregate purchase price for this acquisition was $2.6 million
and was funded through our revolving credit facility. The excess of the
purchase price over the fair value of identifiable net assets acquired was
$2.4 million. Additional consideration of $250,000 was subsequently paid
based upon a future results of operations earn-out agreement.

(4) On August 1, 2000, we purchased all of the outstanding shares of West
Coast Chequing Centres, Ltd, which operated six stores in British
Columbia. The aggregate purchase price for this acquisition was $1.5
million and was funded through excess internal cash. The excess price over
the fair value of identifiable net assets acquired was $1.4 million. On
August 7, 2000, we purchased substantially all of the assets of Fast 'n
Friendly Check Cashing, which operated 8 stores in Maryland. The aggregate
purchase price for this acquisition was $700,000 and was funded through
our revolving credit facility. The excess purchase price over fair value
of identifiable net assets acquired was $660,000. Additional consideration
of $150,000 was subsequently paid based on a revenue earn-out agreement.
On August 28, 2000, we purchased primarily all of the assets of Ram-Dur
Enterprises, Inc. d/b/a AAA Check Cashing Centers, which operated five
stores in Tucson, Arizona. The aggregate purchase price for this
acquisition was $1.3 million and was funded through our revolving credit
facility. The excess purchase price over fair value of identifiable net
assets acquired was $1.2 million. On December 5, 2000, we purchased all of
the outstanding shares of Fastcash Ltd., which operated 13 company owned
stores and 27 franchises in the UK. The aggregate purchase price for this
acquisition was $3.1 million and was funded through our revolving credit
facility. The excess of the purchase price over the fair value of the
identifiable assets acquired was $2.7 million. Additional consideration of
$2.0 million was subsequently paid during fiscal 2003 based upon a future
results of operations earn-out agreement.

(5) On July 1, 2001, we adopted Financial Accounting Standards Board
Opinion No. 142 "Goodwill and Other Intangible Assets". In accordance with
the provisions of SFAS No. 142 we ceased amortization of
goodwill.


24


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

Overview

We have historically derived our revenues primarily from providing check
cashing services, consumer lending and other consumer financial products and
services, including money orders, money transfers and bill payment. For our
check cashing services, we charge our customers fees that are usually equal to a
percentage of the amount of the check being cashed and are deducted from the
cash provided to the customer. For our consumer loans, we receive origination
and servicing fees from the banks providing the loans or, if we fund the loans
directly, interest on the loans.

Our expenses primarily relate to the operations of our store network,
including salaries and benefits for our employees, occupancy expense for our
leased real estate, depreciation of our assets and corporate and other expenses,
including costs related to opening and closing stores. During fiscal 2003, we
took actions to reduce costs and make our operations more efficient, including
centralizing and consolidating our store support functions for our North
American operations. We expect that these actions will reduce our expenses by in
excess of $5.0 million during fiscal 2004.

In each foreign country in which we operate, local currency is used for
both revenue and expenses. Therefore, we record the impact of foreign currency
exchange rate fluctuations related to our foreign net income.

Discussion of Critical Accounting Policies

In the ordinary course of business, we have made a number of estimates and
assumptions relating to the reporting of results of operations and financial
condition in the preparation of our financial statements in conformity with
accounting principles generally accepted in the United States. We evaluate these
estimates on an ongoing basis, including those related to revenue recognition,
loss reserves and intangible assets. We base these estimates on the information
currently available to us and on various other assumptions that we believe are
reasonable under the circumstances. Actual results could vary from these
estimates under different assumptions or conditions.

We believe that the following critical accounting policies affect the more
significant judgments and estimates used in the preparation of our financial
statements:

Revenue Recognition

Generally, we recognize revenue when services for the customer have been
provided which, in the case of check cashing and other retail products, is at
the point of sale. For our unsecured short-term loan service, all revenues are
recognized ratably over the life of the loan, offset by net write-offs.

Consumer Loan Loss Reserves and Check Cashing Returned Item Policy

We maintain a loan loss reserve for anticipated losses for loans we make
directly as well as for fee adjustments for losses on loans we originate and
service for others. To estimate the appropriate level of loan loss reserves, we
consider the amount of outstanding loans owed to us, as well as loans owed to
banks and serviced by us, historical loans charged off, current collection
patterns and current economic trends. As these conditions change, we may need to
make additional allowances in future periods.

A loss on consumer loans is charged against revenues during the period in
which the loss occurred. A recovery is credited to revenues during the period in
which the recovery is made. These net losses and changes in the loan loss
reserve are charged to revenues in the consolidated statements of operations.

We charge operating expense for losses on returned checks during the
period in which such checks are returned. Recoveries on returned checks are
credited to operating expense in the period during which recovery occurs. These
net losses are charged to other store and regional expenses in the consolidated
statements of operations.


25


Goodwill

We have significant goodwill on our balance sheet. The testing of goodwill
for impairment under established accounting guidelines also requires significant
use of judgment and assumptions. In accordance with accounting guidelines, we
determine the fair value of our goodwill using multiples of earnings of other
companies. Goodwill is tested and reviewed for impairment on an ongoing basis
under established accounting guidelines. However, changes in business conditions
may require future adjustments to asset valuations.

Results of Operations

The following table sets forth our results of operations as a percentage
of revenues for the following periods:



Year ended June 30,
-------------------------
2001 2002 2003
-------------------------

Statement of Operations Data:
Revenues:
Revenues from check cashing ................................. 54.1% 51.9% 49.4%
Revenues from consumer lending, net ......................... 29.9 34.6 37.2
Other revenues .............................................. 16.0 13.5 13.4
-----------------------
Total revenues .................................................. 100.0 100.0 100.0

Store and regional expenses:
Salaries and benefits ....................................... 29.4 32.3 31.8
Occupancy ................................................... 8.6 9.0 8.6
Depreciation ................................................ 3.0 3.2 2.7
Other ....................................................... 23.2 22.9 21.8
-----------------------
Total store and regional expenses ............................... 64.2 67.4 64.9

Establishment of reserves for new consumer lending arrangements . -- 1.1 --
Corporate expenses .............................................. 11.5 12.1 14.2
Loss on store closings and sales and other restructuring ........ 0.5 0.8 1.8
Goodwill amortization ........................................... 2.4 -- --
Other depreciation and amortization ............................. 1.0 1.3 1.5
Interest expense ................................................ 10.4 9.3 9.2
Establishment of reserve for legal matter ....................... -- -- 1.3
-----------------------
Income before income taxes ...................................... 10.0 8.0 7.1
Income tax provision ............................................ 6.6 5.0 6.1
-----------------------
Net income ...................................................... 3.4% 3.0% 1.0%
=======================


Year Ended June 30, 2003 Compared to the Year Ended June 30, 2002

Revenues. Total revenues were $219.4 million for fiscal 2003, compared to
$202.0 million for fiscal 2002, an increase of $17.4 million, or 8.6%.
Comparable retail store, franchised store and document transmitter revenues
increased $15.8 million, or 8.1%, which is primarily attributable to our foreign
operations as those markets continue to mature as well as the impact of
favorable foreign currency rates in fiscal 2003. New store openings accounted
for an increase of $4.5 million, which was partially offset by a decline of $2.9
million in revenues from closed stores.

The increase in total revenues resulted primarily from an increase of
$11.7 million, or 16.8%, in consumer lending revenues. The increase in consumer
lending revenues was primarily a result of a $7.8 million, or 34.2%, increase in
revenues in Canada resulting from higher lending volumes and increased finance
charges, and an increase of $3.9 million, or 8.3%, in domestic revenues
primarily resulting from a decrease in credit losses (which are netted against
revenues). In addition to the increase in consumer lending revenues, our check
cashing revenues increased by $3.6 million, or 3.5%. Foreign check cashing
revenues accounted for $8.1 million of this increase offset by a $4.5 million
decline in domestic check cashing revenues due to an overall decline in service
sector employment. The balance of the increase in total revenues, $2.1 million,
relates to other ancillary products, primarily revenues from money transfer
fees.


26


Store and Regional Expenses. Store and regional expenses were $142.3
million for fiscal 2003, compared to $136.1 million for fiscal 2002, an increase
of $6.2 million, or 4.5%. The full-year effect of the new store openings in
fiscal 2003 accounted for an increase of $1.5 million. Also, store and regional
expenses increased $4.0 million due to increased salaries and benefits
attributable to our foreign subsidiaries, commensurate with the growth in those
operations. Total store and regional expenses as a percentage of revenues
decreased from 67.4% in fiscal 2002 to 64.9% in fiscal 2003. Store and regional
expenses as a percentage of revenues of our foreign subsidiaries were 55.7% for
fiscal 2002 and 52.5% for fiscal 2003.

Salaries and Benefits Expense. Salaries and benefits expense was
$69.8 million for fiscal 2003, compared to $65.3 million for fiscal 2002,
an increase of $4.5 million, or 6.9%. New store openings accounted for
$600,000 of the increase. Our foreign subsidiaries accounted for an
increase of $4.0 million in salaries and benefits. Salaries and benefits
expenses as a percentage of revenues decreased from 32.3% for fiscal 2002
to 31.8% for fiscal 2003.

Occupancy Expense. Occupancy expense was $18.9 million for fiscal
2003, compared to $18.1 million for fiscal 2002, an increase of $800,000,
or 4.3%. New store openings accounted for $400,000 of the increase.
Occupancy expense as a percentage of revenues decreased from 9.0% for
fiscal 2002 to 8.6% for fiscal 2003.

Depreciation Expense. Depreciation expense was $5.9 million for
fiscal 2003, compared to $6.5 million for fiscal 2002, a decrease of
$600,000, or 10.2%. Depreciation expense as a percentage of revenues
decreased from 3.2% for fiscal 2002 to 2.7% for fiscal 2003.

Other. Other store and regional expenses were $47.8 million for
fiscal 2003, compared to $46.2 million for fiscal 2002, an increase of
$1.6 million, or 3.3%. New store openings accounted for an increase in
other store and regional expenses of $700,000. The closing of stores
during the fiscal year partially offset these increases. Other store and
regional expenses consist of bank charges, armored security costs, net
returned third party checks, cash shortages, cost of goods sold,
advertising and other costs incurred by the stores.

Establishment of Reserves for New Consumer Lending Arrangements. During
fiscal 2002 we ceased servicing loans for Eagle National Bank, entered into a
new servicing arrangement with County Bank and increased the number of
company-funded loans we originated. In connection with these new consumer
lending arrangements, we established a reserve of $2.2 million.

Corporate Expenses. Corporate expenses were $31.2 million for fiscal 2003,
compared to $24.5 million for fiscal 2002, an increase of $6.7 million, or
27.4%. The increase was due to costs associated with the implementation of
enhanced transaction processing systems, the establishment of new business
development strategies, professional fees associated with our new banking
relationships with First Bank and County Bank and increased salaries and
benefits associated with the growth of foreign operations. During the fourth
quarter of fiscal 2003, we transferred certain operational support functions to
our Canadian headquarters from our U.S. headquarters to complete a process of
rationalizing our North American corporate office functions that had begun in
October 2002. We believe the restructuring efforts undertaken in fiscal 2003
will result in an annual savings of $5.0 million. Corporate expenses as a
percentage of revenues increased from 12.1% for fiscal 2002 to 14.2% for fiscal
2003. We expect corporate expenses as a percentage of revenues to decline in
fiscal 2004.

Loss on Store Closings and Sales and Other Restructuring. Loss on store
closings and sales and other restructuring was $4.0 million for fiscal 2003,
compared to $1.4 million for fiscal 2002. For fiscal 2003, we provided $1.6
million for the closure costs associated with the shutdown of 27 underperforming
stores. These costs consist primarily of lease obligations and leasehold
improvement write-offs. In addition, we provided $1.7 million, consisting
primarily of severance and retention bonus costs, for the consolidation and
relocation of certain non-operating functions. We anticipate that loss on store
closings and sales and other restructuring will decline significantly in 2004.

Other Depreciation and Amortization. Other depreciation and amortization
expenses were $3.3 million for fiscal 2003, compared to $2.7 million for fiscal
2002, an increase of $600,000, or 22.6%. This increase is attributable to
additional investments in technology and the expansion of our Canadian corporate
office as a result of the relocation of certain operational support functions to
Canada from the U.S. headquarters. Other depreciation and amortization as a
percentage of revenues increased from 1.3% for fiscal 2002 to 1.5% for fiscal
2003.


27


Interest Expense. Interest expense was $20.2 million for fiscal 2003,
compared to $18.7 million for fiscal 2002, an increase of $1.5 million, or 7.9%.
This increase is attributable to an increase in the average borrowings of our
credit facilities, an increase in interest rates as a result of the November
2002 amendment of our credit facility and the impact of the 15.6% interest rate
associated with our collateralized borrowing.

Establishment of Reserve for Legal Matter. We accrued $2.8 million during
fiscal 2003 related to a legal matter described in "Business--Legal
Proceedings."

Income Tax Provision. Provision for income taxes was $13.5 million in 2003
and $10.2 million in 2002. Our effective tax rate for 2003 was 86.4%, compared
to 62.8% for 2002. The effective rate differs from the federal statutory rate of
35% due to state taxes, foreign taxes and U.S. taxes on foreign earnings,
primarily resulting from the guarantees on our domestic revolving credit
facility and senior notes by our foreign subsidiaries.

Year Ended June 30, 2002 Compared to the Year Ended June 30, 2001

Revenues. Total revenues were $202.0 million for fiscal 2002, compared to
$195.5 million for fiscal 2001, an increase of $6.5 million, or 3.3%. Comparable
retail store, franchised store and document transmitter revenues increased $2.4
million, or 1.3%. The entities acquired during fiscal 2001 and new store
openings accounted for an increase of $10.0 million. The increase in total
revenues resulted from an $11.4 million, or 19.5%, increase in consumer lending
revenues, net. The increase in consumer lending revenues, net was primarily a
result of a $7.9 million, or 53%, increase in foreign lending operations,
principally due to volume growth in Canada and the introduction of consumer loan
products into our acquired stores in the United Kingdom, and a $2.2 million, or
61.4%, revenue increase in our direct-to-consumer lending business. The balance
of the increase in consumer lending revenues, net, $1.3 million, is attributable
to other domestic lending operations. Partially offsetting this increase,
however, was a decline in revenues of $3.1 million from closed stores and a
decline in revenues of $2.8 million from the termination of the State of New
York government contract, both occurring during fiscal 2001.

Store and Regional Expenses. Store and regional expenses were $136.1
million for fiscal 2002, compared to $125.5 million for fiscal 2001, an increase
of $10.6 million, or 8.4%. The full-year effect of the acquisitions in fiscal
2001 resulted in an increase in store and regional expenses of $1.0 million and
new store openings accounted for an increase of $6.0 million. Also, store and
regional expenses increased $1.3 million due to salaries and benefits
attributable to foreign subsidiaries, commensurate with the growth in those
operations. In addition, $600,000 of the increase in store and regional expenses
resulted from an increase in salaries and benefits due to the continued growth
of our direct-to-consumer lending business and $1.9 million of the increase in
store and regional expenses resulted from the costs of the further development
of our centralized collection division in fiscal 2002. Store and regional
expenses as a percentage of revenues increased from 64.2% in fiscal 2001 to
67.4% in fiscal 2002. Store and regional expenses as a percentage of revenues
from our foreign subsidiaries were 57.5% for fiscal 2001 and 55.7% for fiscal
2002.

Salaries and Benefits Expense. Salaries and benefits expense was
$65.3 million for fiscal 2002, compared to $57.5 million for fiscal 2001,
an increase of $7.8 million, or 13.6%. Acquisitions accounted for an
increase in salaries and benefits of $500,000 and new store openings
accounted for $2.8 million. Our foreign subsidiaries accounted for an
increase of $1.3 million in salaries and benefits. In addition, our
direct-to-consumer lending business and centralized collection divisions
accounted for an increase of $2.5 million due to increased growth.
Salaries and benefits expenses as a percentage of revenues increased from
29.4% for fiscal 2001 to 32.3% for fiscal 2002.

Occupancy Expense. Occupancy expense was $18.1 million for fiscal
2002, compared to $16.9 million for fiscal 2001, an increase of $1.2
million, or 7.1%. New store openings and acquisitions accounted for the
increase. Occupancy expense as a percentage of revenues increased from
8.6% for fiscal 2001 to 9.0% for fiscal 2002.

Depreciation Expense. Depreciation expense was $6.5 million for
fiscal 2002, compared to $5.8 million for fiscal 2001 an increase of
$700,000, or 12.1%. New store openings and acquisitions accounted for an
increase of $600,000. Depreciation expense as a percentage of revenues
increased to 3.2% for fiscal 2002 from 3.0% for fiscal 2001.


28


Other. Other store and regional expenses were $46.2 million for
fiscal 2002, compared to $45.3 million for fiscal 2001, an increase of
$900,000, or 2.0%. New store openings and acquisitions accounted for an
increase in other store and regional expenses of $1.8 million. In
addition, costs associated with our direct-to-consumer lending business
and centralized collection divisions increased during fiscal 2002 due to
the growth in that business. Stores closed during fiscal 2002 partially
offset these increases.

Establishment of Reserves for New Consumer Lending Arrangements. During
fiscal 2002 we ceased servicing loans for Eagle National Bank, entered into a
new servicing arrangement with County Bank and increased the number of
company-funded loans we originated. In connection with these new consumer
lending arrangements, we established a reserve of $2.2 million.

Corporate Expenses. Corporate expenses were $24.5 million for fiscal 2002,
compared to $22.5 million for fiscal 2001, an increase of $2.0 million, or 8.9%.
This increase resulted from additional salaries and benefits associated with the
growth of the foreign operations during fiscal 2002. Corporate expenses as a
percentage of revenues increased to 12.1% for fiscal 2002 from 11.5% for fiscal
2001.

Loss on Store Closings and Sales. During fiscal 2002, we closed 16 stores.
Loss on store closings and sales was $1.2 million for fiscal 2002, compared to
$900,000 for fiscal 2001.

Other Depreciation and Amortization. Other depreciation and amortization
expenses were $2.7 million for fiscal 2002, compared to $2.0 million for fiscal
2001, an increase of $0.7 million, or 35%. This increase is attributable to
additional capital expenditures made by the corporate office during fiscal 2002.
Other depreciation and amortization as a percentage of revenues increased from
1.0% for fiscal 2001 to 1.3% for fiscal 2002.

Interest Expense. Interest expense was $18.7 million for fiscal 2002,
compared to $20.4 million for fiscal 2001, a decrease of $1.7 million, or 8.3%.
This decrease was primarily attributable to the decrease in the average interest
rates of our credit facilities.

Income Tax Provision. Provision for income taxes was $10.2 million in 2002
and $12.9 million in 2001. Our effective tax rate for 2002 was 62.8%, compared
to 65.8% for 2001. The effective rate differs from the federal statutory rate of
35% due to state taxes, foreign taxes, U.S. taxes on foreign earnings and, for
fiscal 2001, nondeductible goodwill amortization resulting from the management
buyout of our company on June 30, 1994 and several subsequent acquisitions.

Liquidity and Capital Resources

Our principal sources of cash are from operations and borrowings under our
credit facilities. We anticipate that our primary uses of cash will be to
provide working capital, finance capital expenditures, meet debt service
requirements, fund company-originated short-term consumer loans and finance
store expansion.

Net cash provided by operating activities was $16.4 million in fiscal
2001, $14.5 million in fiscal 2002 and $4.2 million in fiscal 2003. The decline
in net cash provided by operating activities is primarily a result of the
increased working capital related to the timing of settlements associated with
the consumer lending program. Our prior relationship with Eagle National Bank
provided for daily settlement of amounts owed to us from consumer loan activity;
our relationship with County Bank provides for monthly settlement and our
relationship with First Bank provides for semi-monthly settlement.

Net cash used in investing activities was $32.4 million in fiscal 2001,
$10.1 million in fiscal 2002 and $10.7 million in fiscal 2003. Our investing
activities primarily relate to purchases of property and equipment for our
stores, investments in technology and acquisitions. During fiscal 2003, $3.0
million of this amount was attributable to earn-out payments on acquisitions
completed during previous years. We currently expect that our capital
expenditures will aggregate approximately $7.0 million during fiscal 2004 for
remodeling and relocation of certain existing stores and for opening new stores.


29


Net cash provided by (used in) financing activities was $15.6 million in
fiscal 2001, $9.4 million in fiscal 2002 and $(11.3) million in fiscal 2003. The
decline during fiscal 2003 was primarily the result of a decrease in borrowings
under our revolving credit facilities from $78.9 million as of June 30, 2002 to
$61.7 million as of June 30, 2003.

Revolving Credit Facilities. We have three revolving credit facilities: a
domestic revolving credit facility, a Canadian overdraft facility and a United
Kingdom overdraft facility.

Domestic Revolving Credit Facility. Our borrowing capacity under our
domestic revolving credit facility is limited to the total commitment of
$72.0 million less letters of credit totaling $9.0 million issued by Wells
Fargo Bank, which guarantee the performance of certain of our contractual
obligations. At June 30, 2003, our borrowing capacity was $63.0 million.
The domestic revolving credit facility contains a provision for a
reduction of $1.5 million by September 30, 2003 and an additional $1.5
million by December 31, 2003. Borrowings under the domestic revolving
credit facility as of June 30, 2003 were $60.8 million.

Canadian Overdraft Facility. We have a Canadian overdraft facility
to fund peak working capital needs for our Canadian operations. The
Canadian overdraft facility provides for a commitment of up to
approximately $4.8 million, of which $4.8 million was outstanding on June
30, 2002 and $0.0 was outstanding on June 30, 2003. Amounts outstanding
under the Canadian overdraft facility bear interest at a rate of Canadian
prime plus 0.50% and are secured by the pledge of a cash collateral
account of an equivalent balance.

United Kingdom Overdraft Facility. For our U.K. operations, we have
a United Kingdom overdraft facility which provides for a commitment of up
to approximately $6.2 million, of which $5.5 million was outstanding on
June 30, 2002 and $900,000 was outstanding on June 30, 2003. Amounts
outstanding under the United Kingdom overdraft facility bear interest at a
rate of LIBOR plus 1.00%. The United Kingdom overdraft facility is secured
by a $6.0 million letter of credit issued by Wells Fargo Bank under our
domestic revolving credit facility.

Long-Term Debt. Long-term debt consists of our senior notes that mature on
November 15, 2006, and our senior subordinated notes that mature on December 31,
2006.

Operating Leases. Operating leases are scheduled payments on existing
store and other administrative leases. These leases typically have initial terms
of 5 years and may contain provisions for renewal options, additional rental
charges based on revenue and payment of real estate taxes and common area
charges.

Other Collateralized Borrowings. On November 15, 2002, we entered into an
agreement with a third party to sell, without recourse subject to certain
obligations, a participation interest in a portion of the short-term consumer
loans originated by us in the United Kingdom. Pursuant to the agreement, we will
retain servicing responsibilities and earn servicing fees, which are subject to
reduction if the related loans are not collected. At June 30, 2003, we had $8.0
million of loans receivable pledged under this agreement.


30


We entered into the commitments described above and other contractual
obligations in the normal course of business as a source of funds for asset
growth and asset/liability management and to meet required capital needs. Our
principal future obligations and commitments as of June 30, 2003, excluding
periodic interest payments, include the following:



Payments Due by Period (in thousands)
-------------------------------------------------------------------
Total Less than 1 1 - 3 Years 4 - 5 Years After 5
Year Years
----------- ----------- ----------- ----------- -----------

Revolving credit facilities ................ $ 61,699 $ 61,699 $ -- $ -- $ --
Long-term debt
Senior notes ,.......................... 109,190 -- -- 109,190 --
Senior subordinated notes .............. 20,000 -- -- 20,000 --
Operating leases ........................... 50,281 15,717 20,412 9,148 5,004
Other collateralized borrowings ............ 8,000 8,000 -- -- --
Other ...................................... 81 81 -- -- --
----------- ----------- ----------- ----------- -----------

Total contractual cash obligations ......... $ 249,251 $ 85,497 $ 20,412 $ 138,338 $ 5,004
=========== =========== =========== =========== ===========


We are highly leveraged, and borrowings under the credit facilities will
increase our debt service requirements. We believe that, based on current levels
of operations and anticipated improvements in operating results, cash flows from
operations and borrowings available under our credit facilities will allow us to
fund our liquidity and capital expenditure requirements for the foreseeable
future, including payment of interest and principal on our indebtedness. This
belief is based upon our historical growth rate and the anticipated benefits we
expect from operating efficiencies. We expect additional revenue growth to be
generated by increased check cashing revenues, growth in the consumer lending
business, the maturity of recently opened stores and the continued expansion of
new stores. We also expect operating expenses to increase, although the rate of
increase is expected to be less than the rate of revenue growth. Furthermore, we
do not believe that additional acquisitions or expansion are necessary to cover
our fixed expenses, including debt service. However, we cannot assure you that
we will generate sufficient cash flow from operations or that future borrowings
will be available under our credit facilities in an amount sufficient to meet
our debt service requirements or to make anticipated capital expenditures. We
may need to refinance all or a portion of our indebtedness on or prior to
maturity, under certain circumstances, and we cannot assure you that we will be
able to effect such refinancing on commercially reasonable terms or at all.

Impact of New Accounting Pronouncements

In January 2003, the Financial Accounting Standards Board, or FASB, issued
Interpretation No. 46, "Consolidation of Variable Interest Entities." This
Interpretation provides guidance on how to identify a variable interest entity
and determine when the assets, liabilities, noncontrolling interests and results
of operations of a variable interest entity need to be included in a company's
consolidated financial statements. A company that holds a variable interest in
an entity will need to consolidate the entity if the company's interest in the
variable interest entity is such that it will absorb a majority of the variable
interest entity's expected losses and/or receive a majority of the entity's
expected residual returns, if they occur. The new accounting provisions of this
Interpretation became effective upon issuance for all new variable interest
entities created after January 31, 2003, and to variable interest entities in
which an enterprise obtains an interest after that date. We have not entered
into any new transactions involving variable interest entities on or after
February 1, 2003. This pronouncement also must be applied effective July 1, 2003
to existing variable interest entities acquired by us prior to February 1, 2003.
The impact of this pronouncement is not expected to have a material effect on
our financial position or results of operation.

Impact of Inflation

We do not believe that inflation has a material impact on our earnings
from operations.


31


Seasonality

Our business is seasonal due to the impact of several tax-related
services, including cashing tax refund checks. Historically, we have generally
experienced our highest revenues and earnings during our third fiscal quarter
ending March 31, when revenues from these tax-related services peak. Due to the
seasonality of our business, results of operations for any fiscal quarter are
not necessarily indicative of the results of operations that may be achieved for
the full fiscal year. In addition, quarterly results of operations depend
significantly upon the timing and amount of revenues and expenses associated
with the addition of new stores.


32


Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Generally

In the operations of our subsidiaries and the reporting of our
consolidated financial results, we are affected by changes in interest rates and
currency exchange rates. The principal risks of loss arising from adverse
changes in market rates and prices to which we and our subsidiaries are exposed
relate to:

o interest rates on debt; and

o foreign exchange rates generating translation gains and
losses.

We and our subsidiaries have no market risk sensitive instruments entered
into for trading purposes, as defined by generally accepted accounting
principles. Information contained in this section relates only to instruments
entered into for purposes other than trading.

Interest Rates

Our outstanding indebtedness, and related interest rate risk, is managed
centrally by our finance department by implementing the financing strategies
approved by our board of directors. Our debt consists of fixed-rate senior notes
and senior subordinated notes. Our revolving credit facilities carry variable
rates of interest. As most of our average outstanding indebtedness carries a
fixed rate of interest, a change in interest rates is not expected to have a
significant impact on our consolidated financial position, results of operations
or cash flows.

Foreign Exchange Rates

Operations in the United Kingdom and Canada have exposed us to shifts in
currency valuations. From time to time we may elect to purchase put options in
order to protect earnings in the United Kingdom and Canada against foreign
exchange fluctuations. We did not purchase options of this kind during fiscal
2003. Out of the money put options may be purchased because they cost less than
completely averting the risk, and the maximum downside is limited to the
difference between the strike price and exchange rate at the date of purchase
and the price of the contracts.

Canadian operations account for approximately 166.6% of our fiscal 2003
consolidated pre-tax earnings, and U.K. operations account for approximately
52.9% of our fiscal 2003 consolidated pre-tax earnings. As currency exchange
rates change, translation of the financial results of the Canadian and U.K.
operations into U.S. dollars will be impacted. Changes in exchange rates have
resulted in cumulative translation adjustments increasing our net assets by $8.4
million. Our U.K. subsidiary has $8.0 million of collateralized borrowings
denominated in U.S. dollars that are subject to foreign currency transaction
gains and losses. These gains and losses are included in corporate expenses.

We estimate that a 10.0% change in foreign exchange rates by itself would
impact reported pre-tax earnings from continuing operations by approximately
$3.4 million for fiscal 2003 and $2.3 million for 2002. This impact represents
nearly 21.9% of our consolidated pre-tax earnings for fiscal 2003 and 14.0% of
our consolidated pre-tax earnings for fiscal 2002.


33


Item 8. FINANCIAL STATEMENTS

REPORT OF INDEPENDENT AUDITORS

The Board of Directors and Shareholders
DFG Holdings, Inc.

We have audited the accompanying consolidated balance sheets of Dollar Financial
Group, Inc. as of June 30, 2003 and 2002, and the related consolidated
statements of operations, shareholder's equity, and cash flows for each of the
three years in the period ended June 30, 2003. Our audits also included the
financial statement schedule listed in the Index at Item 15(a)(2). These
financial statements and schedule are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements and schedule based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards 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. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Dollar Financial
Group, Inc. at June 30, 2003 and 2002, and the consolidated results of its
operations and its cash flows for each of the three years in the period ended
June 30, 2003, in conformity with accounting principles generally accepted in
the United States. Also, in our opinion, the related financial statement
schedule, when considered in relation to the basic financial statements taken as
a whole, presents fairly in all material respects the information set forth
therein.

As discussed in Note 9 to the financial statements, in fiscal 2002 Dollar
Financial Group, Inc. changed its method of accounting for its goodwill.


/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
September 29, 2003


34


DOLLAR FINANCIAL GROUP, INC.

CONSOLIDATED BALANCE SHEETS
(In thousands except share amounts)




June 30,
--------------------
2002 2003
--------------------

Assets
Cash and cash equivalents ...................................... $ 86,633 $ 71,805
Loans and other receivables, net of reserve of $2,862 and $2,437 20,542 22,677
Loans receivable pledged ....................................... -- 8,000
Prepaid expenses ............................................... 6,745 6,358
Notes receivable--officers ..................................... 2,756 2,756
Due from parent ................................................ 3,606 4,573
Property and equipment, net of accumulated
depreciation of $30,119 and $39,309 ........................ 30,510 29,209
Goodwill and other intangibles, net of accumulated
amortization of $21,070 and $21,308 ........................ 132,264 144,125
Debt issuance costs, net of accumulated
amortization of $6,153 and $7,945 .......................... 6,292 5,200
Other .......................................................... 1,964 1,833
--------------------
$291,312 $296,536
====================

Liabilities and shareholder's equity
Accounts payable ............................................... $ 18,249 $ 17,245
Income taxes payable ........................................... 1,831 11
Accrued expenses ............................................... 7,932 9,419
Accrued interest payable ....................................... 1,539 1,656
Deferred tax liability ......................................... 55 838
Other collateralized borrowings ................................ -- 8,000
Revolving credit facilities .................................... 78,936 61,699
10-7/8% Senior Notes due 2006 .................................. 109,190 109,190

Subordinated notes payable and other ........................... 20,065 20,081
Shareholder's equity:
Common stock, $1 par value: 20,000 shares authorized;
100 shares issued and outstanding at June 30, 2002
and 2003 ................................................ -- --
Additional paid-in capital ................................. 50,957 50,957
Retained earnings .......................................... 6,903 9,034
Accumulated other comprehensive (loss) income .............. (4,345) 8,406
--------------------
Total shareholder's equity ..................................... 53,515 68,397
--------------------
$291,312 $296,536
====================


See accompanying notes.


35


DOLLAR FINANCIAL GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)



Year ended June 30,
------------------------------
2001 2002 2003
------------------------------

Revenues ...................................................... $195,499 $201,976 $219,388

Store and regional expenses:
Salaries and benefits ..................................... 57,453 65,295 69,799
Occupancy ................................................. 16,881 18,087 18,856
Depreciation .............................................. 5,829 6,522 5,859
Other ..................................................... 45,321 46,238 47,766
------------------------------
Total store and regional expenses ............................. 125,484 136,142 142,280

Establishment of reserves for new consumer lending arrangements -- 2,244 --
Corporate expenses ............................................ 22,500 24,516 31,241
Loss on store closings and sales and other restructuring ...... 926 1,435 3,987
Goodwill amortization ......................................... 4,710 -- --
Other depreciation and amortization ........................... 1,952 2,709 3,320
Interest expense, net of interest income of $470,
$254 and $173 ............................................. 20,361 18,694 20,168
Establishment of reserve for legal matter ..................... -- -- 2,750
------------------------------
Income before income taxes .................................... 19,566 16,236 15,642
Income tax provision .......................................... 12,876 10,199 13,511
------------------------------

Net income .................................................... $ 6,690 $ 6,037 $ 2,131
==============================


See accompanying notes.


36


DOLLAR FINANCIAL GROUP, INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY
(In thousands, except share data)



(Accumulated Accumulated
Common Stock Additional Deficit) Other Total
---------------------- Paid-in Retained Comprehensive Shareholder's
Shares Amount Capital Earnings (Loss) Income Equity
--------------------------------------------------------------------------------

Balance, June 30, 2000 ....... 100 $ -- $ 50,957 $ (5,824) $ (5,538) $ 39,595
Comprehensive income .........
Translation adjustment
for the year ended
June 30, 2001 ....... (3,661) (3,661)
Net income for the year
ended June 30, 2001 . 6,690 6,690
--------
Total comprehensive income ... 3,029
-----------------------------------------------------------------------------
Balance, June 30, 2001 ....... 100 -- 50,957 866 (9,199) 42,624
-----------------------------------------------------------------------------
Comprehensive income .........
Translation adjustment
for the year ended
June 30, 2002 ....... 4,854 4,854
Net income for the year
ended June 30, 2002 . 6,037 6,037
--------
Total comprehensive income ... 10,891
-----------------------------------------------------------------------------
Balance, June 30, 2002 ....... 100 -- 50,957 6,903 (4,345) 53,515
-----------------------------------------------------------------------------
Comprehensive income .........
Translation adjustment
for the year ended
June 30, 2003 ....... 12,751 12,751
Net income for the year
ended June 30, 2003 . 2,131 2,131
--------
Total comprehensive income ... 14,882
-----------------------------------------------------------------------------
Balance, June 30, 2003 ....... 100 $ -- $ 50,957 $ 9,034 $ 8,406 $ 68,397
=============================================================================


See accompanying notes.


37


DOLLAR FINANCIAL GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)



Year ended June 30,
------------------------------
2001 2002 2003
------------------------------

Cash flows from operating activities:
Net income ............................................................. $ 6,690 $ 6,037 $ 2,131
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization ................................... 13,948 10,740 10,971
Loss on store closings and sales ................................ 926 1,154 3,987
Establishment of reserves for new consumer lending arrangements . -- 2,244 --
Deferred tax (benefit) provision ................................ 1,687 (873) 783
Change in assets and liabilities (net of effect of acquisitions):
(Increase) decrease in loans and other receivables ........... (10,665) 1,587 (9,118)
(Increase) decrease in prepaid expenses and other ............ (338) 260 891
Increase (decrease) in accounts payable, income taxes payable,
accrued expenses and accrued interest payable ............. 4,194 (6,696) (5,415)
------------------------------
Net cash provided by operating activities .............................. 16,442 14,453 4,230

Cash flows from investing activities:
Acquisitions, net of cash acquired ..................................... (20,346) (45) (3,251)
Gross proceeds from sales of property and equipment .................... 110 -- --
Additions to property and equipment .................................... (12,129) (10,063) (7,428)
------------------------------
Net cash used in investing activities .................................. (32,365) (10,108) (10,679)

Cash flows from financing activities:
Other debt payments .................................................... (284) (64) (401)
Other collateralized borrowings ........................................ -- -- 8,000
Repayment of advance from money transfer agent ......................... (1,000) -- --
Net increase (decrease) in revolving credit facilities ................. 18,246 11,112 (17,237)
Payments of debt issuance costs ........................................ (244) (571) (690)
Net increase in due from parent ........................................ (1,116) (1,068) (967)
------------------------------
Net cash provided by (used in) financing activities .................... 15,602 9,409 (11,295)
Effect of exchange rate changes on cash and cash equivalents ........... (515) 427 2,916
------------------------------
Net (decrease) increase in cash and cash equivalents ................... (836) 14,181 (14,828)
Cash and cash equivalents at beginning of year ......................... 73,288 72,452 86,633
------------------------------
Cash and cash equivalents at end of year ............................... $ 72,452 $ 86,633 $ 71,805
==============================

Supplemental disclosures of cash flow information
Interest paid .......................................................... $ 19,410 $ 17,472 $ 18,432
Income taxes paid ...................................................... $ 4,800 $ 16,035 $ 14,548


See accompanying notes


38


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2003

1. Organization and Business

The accompanying consolidated financial statements are those of Dollar Financial
Group, Inc. (the "Company") and its wholly-owned subsidiaries. The Company is a
wholly-owned subsidiary of DFG Holdings, Inc. ("Holdings"). The activities of
Holdings consist primarily of its investment in the Company. Holdings has no
employees or operating activities.

The Company, through its subsidiaries, provides retail financial services
through a network of 1,084 locations (of which 624 are Company-operated)
operating as Money Mart(R), The Money Shop, Loan Mart(R) and Insta-Cheques in
seventeen states, the District of Columbia, Canada and the United Kingdom. The
services provided at the Company's retail locations include check cashing,
short-term consumer loans, sale of money orders, money transfer services and
various other related services. Also, the Company's subsidiary Money Mart
Express(R) (formerly known as moneymart.com(TM)) services and originates
short-term consumer loans through 443 independent document transmitter locations
in 16 states.

2. Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the amounts reported in the consolidated financial
statements and accompanying notes. Actual results could differ from those
estimates.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the
Company and its wholly owned subsidiaries. All significant intercompany accounts
and transactions have been eliminated in consolidation.

Revenue recognition

Generally, revenue is recognized when services for the customer have been
provided which, in the case of check cashing and other retail products, is at
the point of sale. For the unsecured short-term loan service, all revenues are
recognized ratably over the life of the loan, offset by net write-offs.

Property and Equipment

Property and equipment are carried at cost less accumulated depreciation.
Depreciation is computed using either the straight-line or double declining
balance method over the estimated useful lives of the assets, which vary from
three to fifteen years.

Cash and Cash Equivalents

Cash includes cash in stores and demand deposits with financial institutions.
Cash equivalents are defined as short-term, highly liquid investments both
readily convertible to known amounts of cash and so near maturity that there is
insignificant risk of changes in value because of changes in interest rates.


39


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

2. Significant Accounting Policies (continued)

Intangible Assets

The Company adopted SFAS No. 142, "Goodwill and Other Intangible Assets"
effective July 1, 2001 and as a result has not amortized goodwill for the fiscal
years ended June 30, 2002 and 2003. SFAS 142 changes the accounting for certain
intangibles, including goodwill, from an amortization method to an
impairment-only approach. Under the provisions of SFAS 142, intangible assets,
including goodwill, that are not subject to amortization will be tested for
impairment annually, or more frequently if events or changes in circumstances
indicate that the asset might be impaired, using a two-step impairment
assessment. The first step of the goodwill impairment test, used to identify
potential impairment, compares the fair value of a reporting unit with its
carrying amount, including goodwill. If the fair value of a reporting unit
exceeds its carrying amount, goodwill of the reporting unit is considered not
impaired, and the second step of the impairment test is not necessary. If the
carrying amount of a reporting unit exceeds its fair value, the second step of
the goodwill impairment test is performed to measure the amount of impairment
loss if any (see Note 9). The Company has completed the required impairment
tests in fiscal 2002 and 2003 and determined that goodwill was not impaired.

Debt Issuance Costs

Debt issuance costs are amortized using the straight-line method over the
remaining term of the related debt (see Note 6).

Store and Regional Expenses

The direct costs incurred in operating the Company's stores have been classified
as store expenses. Store expenses include salaries and benefits of store and
regional employees, rent and other occupancy costs, depreciation of property and
equipment, bank charges, armored security costs, net returned checks, cash
shortages, cost of goods sold and other costs incurred by the stores. Excluded
from store operations are the corporate expenses of the Company, which include
salaries and benefits of corporate employees, professional fees and travel
costs.

Consumer Loan Loss Reserves and Check Cashing Returned Item Policy

The Company maintains a loan loss reserve for anticipated losses for loans the
Company makes directly as well as for fee adjustments for losses on loans the
Company originates and services for others. To estimate the appropriate level of
loan loss reserves, the Company considers the amount of outstanding loans owed
to the Company, as well as loans owed to banks and serviced by the Company,
historical loans charged off, current collection patterns and current economic
trends. As these conditions change, the Company may need to make additional
allowances in future periods.

A loss on consumer loans is charged against revenues during the period in which
the loss occurred. A recovery is credited to revenues during the period in which
the recovery is made. These net losses and changes in the loan loss reserve are
charged to revenues in the consolidated statements of operations.

The Company charges operating expense for losses on returned checks during the
period in which such checks are returned. Recoveries on returned checks are
credited to operating expense in the period during which recovery occurs. The
net expense for bad checks included in other store expenses in the accompanying
consolidated statements of operations was $8,186,000, $7,063,000 and $6,738,000
for the years ended June 30, 2001, 2002 and 2003, respectively.


40


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

2. Significant Accounting Policies (continued)

Income Taxes

The Company uses the liability method to account for income taxes. Accordingly,
deferred income taxes have been determined by applying current tax rates to
temporary differences between the amount of assets and liabilities determined
for income tax and financial reporting purposes.

The Company and its subsidiaries file a consolidated federal income tax return
with Holdings but the Company calculates its tax provision as if it were on a
stand-alone basis.

Employees' Retirement Plan

Retirement benefits are provided to substantially all full-time employees who
have completed 1,000 hours of service through a defined contribution retirement
plan. The Company will match 50% of each employee's contribution, up to 8% of
the employee's compensation. In addition, a discretionary contribution may be
made if the Company meets its financial objectives. The amount of contributions
charged to expense was $545,000, $614,000 and $775,000 for the years ended June
30, 2001, 2002 and 2003, respectively.

Advertising Costs

The Company expenses advertising costs as incurred. Advertising costs charged to
expense were $6,061,000, $5,844,000 and $6,922,000 for the years ended June 30,
2001, 2002 and 2003, respectively.

Fair Value of Financial Instruments

The carrying values of the revolving credit facilities approximate fair values,
as these obligations carry a variable interest rate. The fair value of the
Company's Senior Notes is based on quoted market prices and the fair value of
the Senior Subordinated Notes is based on the value of the Senior Notes (see
Note 6). The Company's other financial instruments consist of cash and cash
equivalents, loan and other receivables, which are short-term in nature and
their fair value approximates their carrying value. Because these are short term
in nature, their fair value approximates their carrying value.

Foreign Currency Translation and Transactions

The Company operates check cashing and financial services outlets in Canada and
the United Kingdom. The financial statements of these foreign businesses have
been translated into U.S. dollars in accordance with accounting principles
generally accepted in the United States. All balance sheet accounts are
translated at the current exchange rate and income statement items are
translated at the average exchange rate for the period; resulting translation
adjustments are made directly to a separate component of shareholder's equity.
Gains or losses resulting from foreign currency transactions are included in
corporate expenses.


41


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

2. Significant Accounting Policies (continued)

Franchise Fees and Royalties

The Company recognizes initial franchise fees upon fulfillment of all
significant obligations to the franchisee. Royalties from franchisees are
accrued as earned. The standard franchise agreements grant to the franchisee the
right to develop and operate a store and use the associated trade names,
trademarks, and service marks within the standards and guidelines established by
the Company. Initial franchise fees included in revenues were $216,000, $59,000
and $283,000 for the years ended June 30, 2001, 2002 and 2003, respectively.

Pending Accounting Pronouncements

In January 2003, the Financial Accounting Standards Board ("FASB") issued FASB
Interpretation No. 46 ("FIN 46"), "Consolidation of Variable Interest Entities."
This interpretation provides guidance on how to identify a variable interest
entity ("VIE") and determine when the assets, liabilities, noncontrolling
interests, and results of operations of a VIE need to be included in a company's
consolidated financial statements. A company that holds a variable interest in
an entity will need to consolidate the entity if the company's interest in the
VIE is such that it will absorb a majority of the VIE's expected losses and/or
receive a majority of the entity's expected residual returns, if they occur. The
new accounting provisions of this interpretation became effective upon issuance
for all new VIE's created after January 31, 2003, and to variable interest
entities in which an enterprise obtains an interest after that date. The company
has not entered into any new transactions involving VIE's on or after February
1, 2003. This pronouncement also must be applied effective July 1, 2003, to
existing VIE's acquired by the Company prior to February 1, 2003. The impact of
this pronouncement is not expected to have a material effect on the Company's
financial position or results of operation.

3. DFG Holdings, Inc.

As discussed in Note 1, the Company is a wholly-owned subsidiary of Holdings.
The activities of Holdings consist primarily of its investment in the Company
and the issuance of $120.6 million aggregate principal amount of 13% Senior
Discount Notes.

Common Stock

Holdings has 100,000 shares authorized; of which 19,864.93 shares were issued
and outstanding (106.71 are held in treasury) at June 30, 2003.

Dividends

Under the terms of the Company's Revolving Credit Facility discussed in Note 6,
the Company is permitted to declare, pay, or make cash dividends to Holdings
under certain circumstances. The Revolving Credit Facility permits the Company
to remit cash to Holdings for the payment of certain of Holdings' expenses. At
June 30, 2002 and 2003 Holdings owed the Company $3.6 million and $4.6 million,
respectively for such advances.


42


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

3. DFG Holdings, Inc. (continued)

Stock Options

Holdings' Stock Incentive Plan (the "Plan") states that 1,413.32 shares of
Holdings' common stock may be awarded to employees or consultants of the
Company. The awards, at the discretion of Holdings' Board of Directors, may be
issued as nonqualified stock options or incentive stock options. Stock
appreciation rights ("SAR") may also be granted in tandem with the nonqualified
stock options or the incentive stock options. Exercise of the SARs cancels the
option for an equal number of shares and exercise of the nonqualified stock
options or incentive stock options cancels the SARs for an equal number of
shares. The number of shares issued under the Plan is subject to adjustment as
specified in the Plan provisions. No options may be granted after February 15,
2009. The options are exercisable in 20% increments annually on the first,
second, third, fourth and fifth anniversary of the grant date and have a term of
ten years from the date of issuance.

The following table presents information on stock options:

Price
Shares Per Share
------ -------------

Options outstanding at June 30, 2000
(293.03 shares exercisable) 979 $ 3,225

Granted 218 7,250
Exercised -- --
Forfeited (45) 3,225
------

Options outstanding at June 30, 2001
(416.83 shares exercisable) 1,152 $3,225/$7,250

Granted -- --
Exercised -- --
Forfeited (46) 3,225
------

Options outstanding at June 30, 2002
(652.03 shares exercisable) 1,106 $3,225/$7,250

Granted -- --
Exercised -- --
Forfeited (134) 3,225/$7,250
------

Options outstanding at June 30, 2003
(784.03 shares exercisable) 972 $3,225/$7,250
======


43


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

3. DFG Holdings, Inc. (continued)

The following table presents information on stock options by exercise
price:



Options Outstanding Options Exercisable
------------------------------------------------- -------------------------

Number Weighted Average Number
Exercise Outstanding at Remaining Contractual Exercisable at
Price June 30, 2003 Life (Years) June 30, 2003
-------- -------------------- ------------------------- -------------------------

$ 3,225 868 0.7 742.43
$ 7,250 104 3.0 41.60
------- -------------------- ------------------------- -------------------------
972 1.0 784.03
==================== ========================= =========================


Holdings has elected to follow Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB 25) and related interpretations
in accounting for its employee stock options because the alternative fair value
accounting provided for under FASB Statement No. 123, "Accounting for
Stock-Based Compensation," requires use of option valuation models that were not
developed for use in valuing employee stock options. Under APB 25, because the
exercise price of the Company's employee stock options equals the estimated
market price of the underlying stock on the date of grant, no compensation
expense is recognized.

Pro forma information regarding net income and earnings per share is required by
Statement No. 123; however, the effect of applying Statement No. 123 to
Holdings' stock-based awards results in net income that is not materially
different from amounts reported.

4. Acquisitions

The acquired entities described below ("Acquisitions") were accounted for by the
purchase method of accounting. The results of operations of the acquired
companies are included in the Company's statements of operations for the periods
in which they were owned by the Company. The total purchase price for each
acquisition has been allocated to assets acquired and liabilities assumed based
on estimated fair values.


44


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

4. Acquisitions (continued)

On August 1, 2000, the Company purchased all of the outstanding shares of West
Coast Chequing Centres, LTD which operated six stores in British Columbia. The
aggregate purchase price for this acquisition was $1.5 million and was funded
through excess internal cash. The excess of the purchase price over the fair
value of identifiable net assets acquired was $1.4 million.

On August 7, 2000, the Company purchased substantially all of the assets of Fast
'n Friendly Check Cashing , which operated 8 stores in Maryland. The aggregate
purchase price for this acquisition was $700,000 and was funded through the
Company's revolving credit facility. The excess of the purchase price over fair
value of identifiable net assets acquired was $660,000. Additional consideration
of $150,000 was subsequently paid in fiscal year 2001 based on a revenue based
earn-out agreement.

On August 28, 2000, the Company purchased substantially all of the assets of
Ram-Dur Enterprises, Inc. d/b/a AAA Check Cashing Centers , which operated five
stores in Tucson, Arizona. The aggregate purchase price for this acquisition was
$1.3 million and was funded through the Company's revolving credit facility. The
excess purchase price over fair value of identifiable net assets acquired was
$1.2 million.

On December 5, 2000, the Company purchased all of the outstanding shares of
Fastcash Ltd., which operated 13 company owned stores and 27 franchises in the
United Kingdom. The aggregate purchase price for this acquisition was $3.1
million and was funded through the Company's revolving credit facility. The
excess of the purchase price over the fair value of the identifiable assets
acquired was $2.7 million. Additional consideration of $2.0 million was
subsequently paid during fiscal 2003 based upon a future results of operations
earn-out agreement.


45


4. Acquisitions (continued)

The following unaudited pro forma information for the year ended 2001 presents
the results of operations as if the Acquisitions had occurred on July 1, 2000.
The pro forma operating results include the results of operations for these
acquisitions for the indicated periods and reflect the amortization of
intangible assets arising from the acquisitions and increased interest expense
on acquisition debt. Pro forma results of operations are not necessarily
indicative of the results of operations that would have occurred had the
purchase been made on the date above or the results which may occur in the
future.

Year ended June 30,
(Unaudited)
---------------------------
2001
---------------------------
(dollars in thousands)
Total revenue............................. $ 197,084
Net income................................ $ 6,874

5. Property and Equipment

Property and equipment at June 30, 2002 and 2003 consist of (in thousands):

June 30,
-------------------------
2002 2003
-------------------------

Land and buildings ......................... $ 146 $ 157
Leasehold improvements ..................... 17,874 20,871
Equipment and furniture .................... 42,609 47,490
-------------------------
60,629 68,518
Less accumulated depreciation .............. 30,119 39,309
-------------------------
Total property and equipment ............... $30,510 $29,209
=========================

Depreciation expense amounted to $7,497,000, $8,835,000 and $9,006,000 for the
years ended June 30, 2001, 2002 and 2003, respectively.


46


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

6. Debt

The Company has debt obligations at June 30, 2002 and 2003 as follows (in
thousands):



June 30,
-------------------
2002 2003
-------------------

Revolving credit facility; interest at one-day Eurodollar, as defined, plus
3.50% and 4.00% at June 30, 2002 and 2003, respectively (5.31% and 5.125% at
June 30, 2002 and 2003, respectively) of the outstanding daily balances
payable monthly; principal due in full on June 30, 2004; weighted average
interest rate of 5.14% and 5.36% for the years ended
June 30, 2002 and 2003, respectively .......................................... $ 68,600 $ 60,764
Canadian overdraft credit facility; interest at Canadian prime,
as defined, plus 0.50% (4.25% and 5.00% at June 30, 2002 and 2003,
respectively) of the outstanding daily balances payable monthly; weighted
average interest rate of 4.56% and 4.62%
for the years ended June 30, 2002 and 2003, respectively ...................... 4,791 --
United Kingdom overdraft facility; interest at the LIBOR Rate,
as defined, plus 1.00% at June 30, 2002 and 2003, (5.00% and 4.75% at June
30, 2002 and 2003 respectively) of the outstanding daily balances payable
quarterly; weighted average interest rate of 5.32% and 4.90% for the years
ended June 30, 2002 and 2003, respectively .................................... 5,545 935
Other collateralized borrowings; interest rate of 15.6% subject
to loss rates on the related UK loans pledged and can increase to a maximum
of 32.4% per annum ............................................................ -- 8,000
10-7/8% Senior Notes due November 15, 2006; interest payable semiannually on
May 15 and November 15 ........................................................ 109,190 109,190
10-7/8% Senior Subordinated Notes due December 31, 2006; interest payable
semiannually on June 30 and December 30 ....................................... 20,000 20,000
Other ............................................................................ 65 81
-------------------
$208,191 $198,970
===================



47


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

6. Debt (continued)

The Company has $109.2 million of 10-7/8% senior notes due 2006 (the "Notes"),
which are registered under the Securities Act of 1933, as amended. The payment
obligations under the Notes are jointly and severally guaranteed, on a full and
unconditional basis, by each of the Company's existing subsidiaries (the
"Guarantors"). There are no restrictions on the Company's and the guarantor
subsidiaries' ability to obtain funds from their subsidiaries by dividend or by
loan. Separate financial statements of each guarantor subsidiary have not been
presented because management has determined that they would not be material to
investors.

Subject to restrictions under the Company's credit facility ("Revolving Credit
Facility") discussed below, the Notes are redeemable at the option of the
Company, in whole or in part at the following redemption prices (plus accrued
and unpaid interest thereon, if any, to the date of redemption): during the
twelve-month period beginning November 2002 - 103.625%; 2003 - 101.813%; and
2004 - 100.000%. Upon the occurrence of a change of control, as defined, each
holder of Notes has the right to require the Company to repurchase all or any
part of such holder's Notes at an offer price in cash equal to 101% of the
aggregate principal amount thereof, plus accrued and unpaid interest thereon, if
any, to the date of purchase.

On November 15, 2002, the Company negotiated an amendment to the Revolving
Credit Facility. This amendment modified one of its financial covenants and
modified the pricing of the credit facility. The modified pricing structure
increased the Company's interest rate under the facility from the one-day
Eurodollar rate, as defined, plus 3.50%, to interest at the one-day Eurodollar
rate plus 4.00%. Amounts outstanding under the Revolving Credit Facility bear
interest at either (i) the higher of (a) the federal funds rate plus 0.50% per
annum and (b) the rate publicly announced by Wells Fargo, San Francisco, as its
"prime rate," plus 2.75% at June 30, 2003, (ii) the LIBOR Rate (as defined
therein) plus 4.00% at June 30, 2003, or (iii) the one day Eurodollar Rate (as
defined therein) plus 4.00% at June 30, 2003, determined at the Company's
option. Amounts outstanding under the Revolving Credit Facility are secured by a
first priority lien on substantially all properties and assets of the Company
and its current and future subsidiaries. The Company's obligations under the
Revolving Credit Facility are guaranteed by each of the Company's direct and
indirect subsidiaries.

The Company's borrowing capacity under the Revolving Credit Facility is limited
to the total commitment of $77 million less letters of credit totaling $9.0
million issued by Wells Fargo Bank, which secures certain of the Company's
contractual obligations. Additionally, the Revolving Credit Facility contains
provisions for an additional reduction in the facility of $5.0 million during
the period April 1 to December 14 of any calendar year following November 15,
2002. At June 30, 2003 the Company's borrowing capacity was $63 million. The
Revolving Credit Facility also contains a provision for a reduction of $1.5
million by September 30, 2003 and an additional $1.5 million by December 31,
2003. The borrowings under the Revolving Credit Facility as of June 30, 2003
were $60.8 million.

On November 15, 2002, the Company entered into an agreement with a third party
to sell, without recourse subject to certain obligations, a participation
interest in a portion of short-term consumer loans originated by the Company in
the United Kingdom. Pursuant to the agreement, the Company will retain servicing
responsibilities and earn servicing fees which are subject to reduction if the
related loans are not collected. The transfer of assets is treated as a
financing under FAS 140 and the proceeds are included in "Other collateralized
borrowings " on the balance sheet. The agreement gives the third party a first
priority lien, charge and security interest in the assets pledged. At June 30,
2003 the Company had $8.0 million of loans receivable pledged under this
agreement. The agreement provides for collateralized borrowings up to $10
million. Under the agreement, the third party retains the right to reduce the
amount of borrowings to no less than $4.0 million. The Company pays an annual
interest rate of 15.6% on the amount borrowed which varies subject to loss rates
on the related loans. The agreement expires on September 30, 2004; however the
term of the agreement is automatically renewed each year for a term of twelve
months, unless either party terminates it.


48


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

6. Debt (continued)

Also, the Company has $20 million aggregate principal amount of its 10 7/8%
Senior Subordinated Notes Due 2006 (the "Senior Subordinated Notes")
outstanding.

The Notes, the Revolving Credit Facility and the Senior Subordinated Notes
contain certain financial and other restrictive covenants, which, among other
things, require the Company to achieve certain financial ratios, limit capital
expenditures, restrict payment of dividends and require certain approvals in the
event the Company wants to increase the borrowings. At June 30, 2003, the
Company believes it is in compliance with all covenants.

In connection with the Company's Canadian subsidiary, the Company established a
Canadian dollar overdraft credit facility to fund peak working capital needs for
its Canadian operations. The overdraft credit facility, which has no stated
maturity date, provides for a commitment of up to approximately $4.8 million of
which $4.8 million and $0.0 million were outstanding as of June 30, 2002 and
2003, respectively. Amounts outstanding under the facility bear interest at
Canadian prime plus 0.50% and are secured by the pledge of a cash collateral
account of an equivalent balance. The Company's United Kingdom operations also
have a British pound overdraft facility that bears interest at 1.00% for the
years ended June 30, 2002 and 2003 over the LIBOR Rate and which provides for a
commitment of approximately $6.2 million of which $5.5 million and $900,000 was
outstanding as of June 30, 2002 and 2003, respectively. The overdraft facility
is secured by a $6.0 million letter of credit issued by Wells Fargo Bank under
the Revolving Credit Facility.

The fair market value of the Company's 10 7/8% Senior Notes and the Company's 10
7/8% Senior Subordinated Notes due 2006 at June 30, 2002 and 2003 was
approximately $113,687,200 and $122,730,500 based on quoted market prices.

Interest of $19,410,000, $17,472,000 and $18,432,000 was paid for the years
ended June 30, 2001, 2002 and 2003, respectively.


49


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

7. Income Taxes

The provision for income taxes for the years ended June 30, 2001, 2002 and 2003
consists of the following (in thousands):

Year ended June 30,
--------------------------------
2001 2002 2003
--------------------------------
Federal:
Current ...... $ 2,911 $ 1,136 $ (603)
Deferred ..... 1,834 (872) 705
--------------------------------
4,745 264 102

Foreign taxes:
Current ...... 7,557 9,550 13,088
Deferred ..... (192) (74) --
--------------------------------
7,365 9,476 13,088

State:
Current ...... 721 386 243
Deferred ..... 45 73 78
--------------------------------
766 459 321
--------------------------------
$ 12,876 $ 10,199 $ 13,511
================================

The significant components of the Company's deferred tax assets and liabilities
at June 30, 2002 and 2003 are as follows (in thousands):

June 30,
------------------
2002 2003
------------------
Deferred tax assets:
Loss reserves ................................. $ 995 $ 834
Foreign withholding taxes ..................... 94 21
Depreciation .................................. 1,914 2,547
Accrued compensation .......................... 328 573
Reserve for store closings .................... 122 560
Foreign tax credits ........................... 230 230
Other accrued expenses ........................ 535 405
Other ......................................... 36 14
------------------
4,254 5,184
Deferred tax liabilities:
Amortization and other temporary differences .. 4,309 6,022
------------------
Net deferred tax liability ....................... $ (55) $ (838)
==================


50


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

7. Income Taxes (continued)

The Company did not record any valuation allowances against deferred tax assets
at June 30, 2002 or 2003. Although realization is not assured, management has
determined, based on the Company's history of earnings and its expectation for
the future, that taxable income of the Company will more likely than not be
sufficient to fully utilize its deferred tax assets.

A reconciliation of the provision for income taxes with amounts determined by
applying the federal statutory tax rate to income before income taxes is as
follows (in thousands):



Year ended June 30,
-------------------------------
2001 2002 2003
-------------------------------

Tax provision at federal statutory rate ........... $ 6,848 $ 5,682 $ 5,475
Add (deduct):
State tax provision, net of federal tax benefit 498 299 199
Foreign taxes ................................. 2,323 1,673 2,419
US tax on foreign earnings .................... 3,189 2,370 5,162
Amortization of nondeductible intangible assets 93 -- --
Other permanent differences ................... (75) 175 256
-------------------------------
Tax provision at effective tax rate ............... $ 12,876 $ 10,199 $ 13,511
===============================


Foreign, federal and state income taxes of approximately $4,800,000, $16,035,000
and $14,548,000 were paid during the years ended June 30, 2001, 2002 and 2003,
respectively.


51


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

8. Loss on Store Closings and Sales and Other Restructuring

During the fiscal year ended June 30, 2003, the Company closed 27
underperforming stores and consolidated and relocated certain non-operating
functions to reduce costs and increase efficiencies. Costs incurred with the
restructuring are comprised of severance and other retention benefits to
employees who were involuntarily terminated and store closure costs related to
the locations the Company will no longer utilize. During the fiscal year ended
June 30, 2003, the Company recorded costs for severance and other retention
benefits of $1.7 million and store closure costs of $1.6 million consisting
primarily of lease obligations and leasehold improvement write-offs. These
charges were expensed within "Loss on store closings and sales and other
restructuring" on the Consolidated Statements of Operations. The restructuring
was completed by the fiscal year end. All of the locations that were closed and
for which the workforce was reduced are included in the United States geographic
segment. The Company, as required, adopted Financial Accounting Standards Board
Statement No. 146, Accounting for Costs Associated with Disposal or Exit
Activities, on January 1, 2003.

Following is a reconciliation of the beginning and ending balances of the
restructuring liability (in millions):

Severance and
Other Store Closure
Retention Benefits Costs Total
------------------ ----- -----

Balance at June 30, 2002 $ -- $ -- $ --

Charge recorded in earnings 1.7 1.6 3.3
Amounts paid (0.5) (0.8) (1.3)
Non-cash charges -- (0.6) (0.6)
------ ------ ------
Balance at June 30, 2003 $ 1.2 $ 0.2 $ 1.4
====== ====== ======

The Company also expenses costs related to the closure of stores in the normal
course of its business. Costs directly expensed for the years ended June 2003,
2002 and 2001 were $722,000, $1,435,000 and $926,000, respectively.

9. Goodwill and Other Intangibles

In accordance with the adoption provisions of SFAS No. 142, the Company is
required to perform goodwill impairment tests on at least an annual basis. There
can be no assurance that future goodwill impairment tests will not result in a
charge to earnings. During fiscal 2003 the Company paid $2.0 million in
additional consideration based upon a future results of operations earn-out
agreement related to one of its United Kingdom acquisitions. This amount has
been included as goodwill on the Consolidated Balance Sheet. The Company has
covenants not to compete, which are deemed to have a definite life and will
continue to be amortized. Amortization for these intangibles for the years ended
June 30, 2003, 2002 and 2001 was $173,000, $225,000 and $284,000, respectively.
The estimated aggregate amortization expense for each of the five succeeding
fiscal years ending June 30, is:

Year Amount
---------------------------------------
2004 $ 95,000
2005 20,000
2006 --
2007 --
2008 --


52


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

9. Goodwill and Other Intangibles (continued)

The following table reflects the components of intangible assets (in thousands):



June 30, 2002 June 30, 2003
-------------------------------- --------------------------------
Gross Carrying Accumulated Gross Carrying Accumulated
Amount Amortization Amount Amortization
-------------------------------- --------------------------------

Non-amortized intangible assets:
Cost in excess of net assets acquired $ 150,954 $ 18,977 $ 162,987 $ 18,977

Amortized intangible assets:
Covenants not to compete 2,380 2,093 2,446 2,331


The following table reflects the results of operations as if SFAS No. 142 had
been adopted as of July 1, 2000 (in thousands):

Year Ended
June 30, 2001
------------------

Reported net income $ 6,690

Goodwill amortization, net of tax 3,947
------------

Adjusted net income $ 10,637
============

The changes in the carrying amount of goodwill and other intangibles by
reportable segment for the fiscal years ended June 30, 2002 and 2003 are as
follows:



United United
States Canada Kingdom Total
---------------------------------------------------------------

Balance at June 30, 2001 ..................... $ 56,655 $ 34,103 $ 38,797 $ 129,555
Amortization of other intangibles......... (354) (39) (3) (396)
Acquisitions ............................. 59 -- (14) 45
Foreign currency translation adjustments . -- (76) 3,141 3,065
Reclassification ......................... 184 (2) (187) (5)

---------------------------------------------------------------
Balance at June 30, 2002 ..................... 56,544 33,986 41,734 132,264
Amortization of other intangibles......... (238) -- -- (238)
Acquisitions ............................. -- -- 3,251 3,251
Foreign currency translation adjustments . -- 4,662 3,578 8,240
Reclassification ......................... 303 305 -- 608

---------------------------------------------------------------
Balance at June 30, 2003 ..................... $ 56,609 $ 38,953 $ 48,563 $ 144,125
===============================================================



53


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

10. Commitments

The Company occupies office and retail space and uses certain equipment under
operating lease agreements. Rent expense amounted to $14,320,000, $15,265,000
and $16,067,000 for the years ended June 30, 2001, 2002 and 2003, respectively.
Most leases contain standard renewal clauses.

Minimum obligations under noncancelable operating leases for the year ended June
30 are as follows (in thousands):

Year Amount
---- ------------

2004............................. $ 15,717
2005............................. 12,397
2006............................. 8,015
2007............................. 5,444
2008............................. 3,704
Thereafter....................... 5,004
------------
$ 50,281
============

11. Contingent Liabilities

The Company is a defendant in four putative class-action lawsuits, all of which
were commenced by the same plaintiffs' law firm, alleging violations of
California's wage-and-hour laws. The named plaintiffs in these suits, which are
pending in the Superior Court of the State of California, are our former
employees Vernell Woods (commenced August 22, 2000), Juan Castillo (commenced
May 1, 2003), Stanley Chin (commenced May 7, 2003) and Kenneth Williams
(commenced June 3, 2003). Each of these suits seeks an unspecified amount of
damages and other relief in connection with allegations that the Company
misclassified California store (Woods) and regional (Castillo) managers as
"exempt" from a state law requiring the payment of overtime compensation, that
the Company failed to provide employees with meal and rest breaks required under
a new state law (Chin) and that the Company computed bonuses payable to store
managers using an impermissible profit-sharing formula (Williams). In January
2003, without admitting liability, the Company sought to settle the Woods case,
which the Company believes to be the most significant of these suits, by
offering each individual putative class member an amount intended in good faith
to settle his or her claim. As of June 30, 2003, 92% of these settlement offers
had been accepted. Plaintiffs' counsel is presently disputing through
arbitration the validity of the settlements accepted by the individual putative
class members. The Company believes that it has meritorious defenses to the
challenge and to the claims of the non-settling putative Woods class members and
plan to defend them vigorously. The Company believes that it has adequately
provided for the costs associated with this matter. The Company is vigorously
defending the Castillo, Chin and Williams lawsuits and believes it has
meritorious defenses to the claims asserted in those matters. The Company
believes the outcome of such litigation will not significantly affect its
financial results.

On January 29, 2003, a former customer, Kurt MacKinnon, commenced an action
against the Company's Canadian subsidiary and 26 other Canadian lenders on
behalf of a purported class of British Columbia residents who, plaintiff claims,
were overcharged in payday-loan transactions. The action, which is pending in
the Supreme Court of British Columbia, alleges violations of laws proscribing
usury and unconscionable trade practices and seeks restitution and damages,
including punitive damages, in an unknown amount. On March 25, 2003, the Company
moved to stay the action as against it and to compel arbitration of plaintiff's
claims as required by his agreement with the Company. The Company is presently
awaiting a decision on that motion. The Company believes it has meritorious
defenses to the action and intend to defend it vigorously. The Company believes
the outcome of such litigation will not significantly affect its financial
results.


54


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

11. Contingent Liabilities (continued)

On October 30, 2002, the Oklahoma Administrator of Consumer Credit issued an
administrative order revoking the supervised-lending license of the Company's
Oklahoma subsidiary on the ground that certain loans marketed by the subsidiary
and made by County Bank did not conform with Oklahoma internal usury laws. The
Administrator's order also requires the subsidiary to refund certain purportedly
excess finance charges collected by County Bank. The Administrator's order is
presently on appeal to the Oklahoma District Court. On August 20, 2003, that
court denied the Administrator's motion to require the subsidiary to desist from
further loan-origination activities pending appeal. The subsidiary is also
appealing a federal court's abstention from ruling on this matter to the United
States Court of Appeals for the Tenth Circuit. The Company is presently unable
to evaluate the likelihood of any particular outcome of this matter but, in the
Company's opinion, the outcome of such litigation will not significantly affect
the Company's financial results.

In addition to the litigation discussed above, the Company is involved in
routine litigation and administrative proceedings arising in the ordinary course
of business. In the opinion of management, the outcome of such litigation and
proceedings will not significantly affect the Company's Consolidated Financial
Statements.

12. Contractual Agreements

The Company has contracts with various governmental agencies for benefits
distribution and retail merchant services which contributed 2%, 1% and 1% of
consolidated gross revenues for the years ended June 30, 2001, 2002 and 2003,
respectively. During the year ended June 30, 2001, the State of New York
completed a statewide implementation of an electronic benefit transfer system.
As a result, the Company's contract to perform such services was terminated. The
Company's contracts for governmental benefits distribution and merchant services
distribution with state and local governments generally have initial terms of
five years and currently expire on various dates through December 31, 2004. The
contracts provide the governmental agencies the opportunity to extend the
contract for additional periods and contain clauses which allow the governmental
agencies to cancel the contract at any time, subject to 30 to 60 days' written
advance notice.

13. Credit Risk

At June 30, 2002 and 2003, the Company had 22 and 19, respectively, bank
accounts in major U.S. financial institutions in the aggregate amount of
$5,652,000 and $10,873,000, respectively, which exceeded Federal Deposit
Insurance Corporation deposit protection limits. The Canadian Federal Banking
system provides customers with similar deposit insurance through the Canadian
Deposit Insurance Corporation ("CDIC"). At June 30, 2002 and 2003, the Company's
Canadian subsidiary had 13 bank accounts totaling $22,545,000 and $15,039,000,
respectively, which exceeded CDIC limits. At June 30, 2002 and 2003 the
Company's United Kingdom operations had thirty six and thirty bank accounts,
respectively, totaling $6,251,000 and $6,085,000. These financial institutions
have strong credit ratings, and management believes credit risk relating to
these deposits is minimal.

Since June 13, 2002, the Company has acted as a servicer for County Bank and,
effective October 18, 2002, for First Bank, marketing unsecured short-term loans
to customers with established bank accounts and verifiable sources of income.
Loans are made for amounts up to $500, with terms of 7 to 23 days. Under these
programs, the Company earns servicing fees, which are subject to reduction if
the related loans are not collected. The Company maintains a reserve for these
estimated reductions. In addition, the Company maintains a reserve for
anticipated losses for loans it makes directly. In order to estimate the
appropriate level of these reserves, the Company analyzes the amount of
outstanding loans owed to the Company, as well as loans owed to banks and
serviced by the Company, the historical loans charged off, current collection
patterns and current economic trends. As these conditions change, additional
allowances might be required in future periods.


55


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

13. Credit Risk (continued)

During the year ended June 30, 2002 Eagle National Bank ("Eagle") discontinued
the business of offering short-term consumer loans through the Company's
locations and document transmitters. The Company had previously acted for Eagle
marketing unsecured short-term loans. Under this program, the Company earned
origination and servicing fees. Eagle originated or extended approximately $399
million of loans through the Company's locations and document transmitters
during the fiscal year ended June 30, 2002.

The Company also originates unsecured short-term loans to customers on its own
behalf in Canada, the United Kingdom and certain U.S. markets. In the United
States, these loans are made for amounts up to $500, with terms of 7 to 37 days.
The Company bears the entire risk of loss related to these loans. In Canada,
loans are issued to qualified borrowers based on a percentage of the borrowers'
income with terms of 1 to 35 days. The Company issues loans in the United
Kingdom for up to (pound)500, with a term of 28 days. The Company originated or
extended approximately $428 million and $285 million of the loans through the
Company's locations and document transmitters during fiscal years ended June 30,
2003 and 2002, respectively. On November 15, 2002, the Company entered into an
agreement with a third party to sell, without recourse, subject to certain
obligations, a participation interest in a portion of short-term consumer loans
originated by the Company in the United Kingdom. The transfer of assets is
treated as a financing under FAS 140 and the proceeds are included in Other
collateralized borrowings on the balance sheet. The Agreement gives the third
party a first priority lien, charge, and security interest in the assets
pledged. The Agreement provides for collateralized borrowings up to $10.0
million against which $8.0 million of the loans receivable had been pledged at
June 30, 2003. Under the Agreement, the third party retains the right to reduce
the amount of borrowings to no less than $4.0 million. The Company pays an
annual interest rate of 15.6% on the amount borrowed, which is subject to loss
rates on the related loans. The Agreement expires on September 30, 2004; however
the term of the Agreement is automatically renewed each year for a term of
twelve months, unless either party terminates it.

The Company had approximately $20.4 million and $18.2 million of loans on its
balance sheet at June 30, 2003 and 2002, respectively, which is reflected in
loans and other receivables. Loans and other receivables at June 30, 2003 and
2002 are reported net of a reserve of $2.4 million and $2.9 million,
respectively, related to consumer lending. Net write-offs for Company originated
loans which are netted against revenues on the Statements of Operations for the
fiscal years ended June 30, 2003, 2002 and 2001 were $9.7 million, $5.6 million
and $4.3 million, respectively. For the years ended June 30, 2003, 2002 and 2001
total consumer lending revenue, net earned by the Company was $81.5 million,
$69.8 million and $58.4 million, respectively.


56


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

14. Geographic Segment Information

All operations for which geographic data is presented below are in one principal
industry (check cashing and ancillary services) (in thousands):



United United
2001 States Canada Kingdom Total
-----------------------------------------------

Identifiable assets $ 140,024 $ 74,054 $ 62,094 $ 276,172
Goodwill and other intangibles, net 56,655 34,103 38,797 129,555
Sales to unaffiliated customers 116,504 49,635 29,360 195,499
Interest revenue 398 69 3 470
Interest expense 13,994 3,922 2,915 20,831
Depreciation and amortization 6,707 2,867 2,917 12,491
Income before income taxes 5,636 12,927 1,003 19,566
Income tax provision 6,016 6,258 602 12,876

2002
Identifiable assets 140,813 82,860 67,639 291,312
Goodwill and other intangibles, net 56,544 33,986 41,734 132,264
Sales to unaffiliated customers 112,934 55,469 33,573 201,976
Establishment of reserves for new consumer
lending arrangements 2,244 -- -- 2,244
Interest revenue 168 83 3 254
Interest expense 13,808 2,552 2,588 18,948
Depreciation and amortization 5,330 1,874 2,027 9,231
(Loss) income before income taxes (6,537) 17,672 5,101 16,236
Loss on store closings and sales and other
restructuring 281 -- -- 281
Income tax provision 353 8,105 1,741 10,199

2003
Identifiable assets 132,560 89,365 75,725 297,650
Goodwill and other intangibles, net 56,609 38,953 48,563 144,125
Sales to unaffiliated customers 110,472 67,023 41,893 219,388
Interest revenue 155 18 -- 173
Interest expense 17,770 (899) 3,470 20,341
Depreciation and amortization 5,377 1,837 1,965 9,179
Loss on store closing and sales and other
restructuring 3,987 -- -- 3,987
Establishment of reserve for legal matter 2,750 -- -- 2,750
(Loss) income before income taxes (18,688) 26,058 8,272 15,642
Income tax provision (benefit) (1,262) 12,069 2,704 13,511


15. Related Party Transactions

During fiscal 1999, certain members of management received loans aggregating
$2.9 million, of which $200,000 was repaid during the fiscal year ended June 30,
2001, which are secured by shares of Holdings stock. The loans accrue interest
at a rate of 6% per year and are due and payable in full on December 18, 2004
and April 1, 2005. In addition, as part of an employment agreement, the chief
executive officer was issued a loan in the amount of $4.3 million to purchase
additional shares of Holdings stock. The loan accrues interest at a rate of 6%
per year and is due and payable in full on December 18, 2004. The loan is
secured by a pledge of a portion of his shares of Holdings stock.


57


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

16. Subsidiary Guarantor Financial Information

As discussed in Note 6, the Company's payment obligations under the Senior Notes
are jointly and severally guaranteed on a full and unconditional basis by all of
the Company's existing and future subsidiaries (the "Guarantors"). The
subsidiaries' guarantees rank pari passu in right of payment with all existing
and future senior indebtedness of the Guarantors, including the obligations of
the Guarantors under the Revolving Credit Facility and any successor credit
facility. Pursuant to the Senior Notes or Senior Subordinated Notes, every
direct and indirect subsidiary of the Company, each of which is wholly owned,
serves as a guarantor of the Senior Notes.

There are no restrictions on the Company's and the Guarantors' ability to obtain
funds from their subsidiaries by dividend or by loan. Separate financial
statements of each Guarantor have not been presented because management has
determined that they would not be material to investors. The accompanying tables
set forth the condensed consolidating balance sheet at June 30, 2003, and the
consolidating statements of operations and cash flows for the fiscal year ended
June 30, 2003 of the Company (on a parent-company basis), combined domestic
Guarantors, combined foreign subsidiaries and the consolidated Company.


58


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

16. Subsidiary Guarantor Financial Information (continued)

Consolidating Balance Sheets

June 30, 2003

(In thousands)



Dollar Domestic Foreign
Financial Subsidiary Subsidiary
Group, Inc. Guarantors Guarantors Eliminations Consolidated
----------------------------------------------------------------------

Assets
Cash and cash equivalents ...................... $ 7,981 $ 26,213 $ 37,611 $ -- $ 71,805
Loans and other receivables, net ............... 10,847 1,111 11,043 (324) 22,677
Loans receivable pledged ....................... -- -- 8,000 -- 8,000
Income taxes receivable ........................ 19,417 -- -- (19,417) --
Prepaid expenses ............................... 804 1,111 4,443 -- 6,358
Deferred income taxes .......................... 1,064 -- -- (1,064) --
Notes receivable--officers ..................... 2,756 -- -- -- 2,756
Due from affiliates ............................ -- 83,738 -- (83,738) --
Due from parent ................................ 4,573 -- -- -- 4,573
Property and equipment, net .................... 5,884 8,260 15,065 -- 29,209
Goodwill and other intangibles, net ............ 58 56,551 87,516 -- 144,125
Debt issuance costs, net ....................... 4,990 -- 210 -- 5,200
Investment in subsidiaries ..................... 212,757 9,801 6,705 (229,263) --
Other .......................................... 58 599 1,176 -- 1,833
----------------------------------------------------------------------
$ 271,189 $ 187,384 $ 171,769 $ (333,806) $ 296,536
======================================================================

Liabilities and shareholder's equity
Accounts payable ............................... $ 148 $ 7,225 $ 9,872 $ -- $ 17,245
Income taxes payable ........................... -- 18,329 1,099 (19,417) 11
Accrued expenses ............................... 2,886 2,161 4,372 -- 9,419
Accrued interest payable ....................... 1,491 57 432 (324) 1,656
Deferred tax liability ......................... -- 1,902 -- (1,064) 838
Due to affiliates .............................. 17,215 -- 66,523 (83,738) --
Other collateralized borrowings ................ -- -- 8,000 -- 8,000
Revolving credit facilities .................... 60,764 -- 935 -- 61,699
10 7/8% Senior Notes due 2006 .................. 109,190 -- -- -- 109,190
Subordinated notes payable and other ........... 20,000 -- 81 -- 20,081
----------------------------------------------------------------------
211,694 29,674 91,314 (104,543) 228,139

Shareholder's equity:
Common stock ................................ -- -- -- -- --
Additional paid-in capital .................. 50,957 88,380 27,304 (115,684) 50,957
Retained earnings ........................... 9,034 68,059 45,520 (113,579) 9,034
Accumulated other comprehensive (loss) income (496) 1,271 7,631 -- 8,406
----------------------------------------------------------------------
Total shareholder's equity ..................... 59,495 157,710 80,455 (229,263) 68,397
----------------------------------------------------------------------
$ 271,189 $ 187,384 $ 171,769 $ (333,806) $ 296,536
======================================================================



59


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

16. Subsidiary Guarantor Financial Information (continued)

Consolidating Statements of Operations

Year ended June 30, 2003

(In thousands)



Dollar Domestic Foreign
Financial Subsidiary Subsidiary
Group, Inc. Guarantors Guarantors Eliminations Consolidated
-----------------------------------------------------------------

Revenues ................................... $ -- $ 110,472 $ 108,916 $ -- $ 219,388

Store and regional expenses:
Salaries and benefits ................... -- 41,520 28,279 -- 69,799
Occupancy ............................... -- 11,130 7,726 -- 18,856
Depreciation ............................ -- 3,255 2,604 -- 5,859
Other ................................... -- 29,198 18,568 -- 47,766
----------------------------------------------------------------
Total store and regional expenses .......... -- 85,103 57,177 -- 142,280

Corporate expenses ......................... 19,036 23 12,182 -- 31,241
Management fee ............................. (9,159) 7,779 1,380 -- --
Loss on store closings and sales and other
restructuring ........................... 3,485 407 95 -- 3,987
Other depreciation and amortization ........ 2,062 60 1,198 -- 3,320
Interest expense, net ...................... 16,648 966 2,554 -- 20,168
Establishment of reserve for legal matter .. -- 2,750 -- -- 2,750

----------------------------------------------------------------
(Loss) income before income taxes .......... (32,072) 13,384 34,330 -- 15,642
Income tax (benefit) provision ............. (11,100) 9,838 14,773 -- 13,511

----------------------------------------------------------------
(Loss) income before equity in net
income of subsidiaries .................. (20,972) 3,546 19,557 -- 2,131
Equity in net income of subsidiaries:
Domestic subsidiary guarantors .......... 3,546 -- -- (3,546) --
Foreign subsidiary guarantors ........... 19,557 -- -- (19,557) --
----------------------------------------------------------------
Net income ................................. $ 2,131 $ 3,546 $ 19,557 $ (23,103) $ 2,131
================================================================



60


DOLLAR FINANCIAL GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

16. Subsidiary Guarantor Financial Information (continued)

Consolidating Statements of Cash Flows
Year ended June 30, 2003
(In thousands)



Dollar Domestic Foreign
Financial Subsidiary Subsidiary
Group, Inc. Guarantors Guarantors Eliminations Consolidated
-------------------------------------------------------------------

Cash flows from operating activities
Net income ................................................... $ 2,131 $ 3,546 $ 19,557 $ (23,103) $ 2,131
Adjustments to reconcile net income
to net cash (used in) provided by
operating activities:
Undistributed income of subsidiaries .................... (23,103) -- -- 23,103 --
Depreciation and amortization ........................... 3,853 3,316 3,802 -- 10,971
Loss on store closings and sales ........................ 3,485 407 95 -- 3,987
Deferred tax provision .................................. 102 681 -- -- 783
Changes in assets and liabilities (net
of effect of acquisitions):
(Increase) decrease in loans
and other receivables ............................. (7,106) 6,060 (3,823) (4,249) (9,118)
(Increase) decrease in income taxes
receivable ........................................ (10,961) 1 -- 10,960 --
Decrease (increase) in prepaid expenses
and other ......................................... 96 800 (5) -- 891
(Decrease) increase in accounts payable, income taxes
income taxes payable, accrued
income taxes payable, accrued expenses
and accrued interest payable ...................... (5,469) 10,798 (4,033) (6,711) (5,415)
------------------------------------------------------------------

Net cash (used in) provided by operating
activities ................................................ (36,972) 25,609 15,593 -- 4,230

Cash flows from investing activities:
Acquisitions, net of cash acquired ........................... -- -- (3,251) -- (3,251)
Additions to property and equipment .......................... (874) (1,074) (5,480) -- (7,428)
Net increase in due from affiliates .......................... -- (39,727) -- 39,727 --
------------------------------------------------------------------

Net cash used in investing activities ....................... (874) (40,801) (8,731) 39,727 (10,679)

Cash flows from financing activities
Other debt payments .......................................... -- -- (401) -- (401)
Other collateralized borrowings .............................. -- -- 8,000 -- 8,000
Net decrease in revolving credit facilities .................. (7,836) -- (9,401) -- (17,237)
Payment of debt issuance costs ............................... (490) -- (200) -- (690)
Net increase in due from parent .............................. (967) -- -- -- (967)
Net increase (decrease) in due to affiliates ................. 53,374 -- (13,647) (39,727) --
------------------------------------------------------------------

Net cash provided by (used in) financing activities .......... 44,081 -- (15,649) (39,727) (11,295)

Effect of exchange rate changes on cash
and cash equivalents ...................................... -- -- 2,916 -- 2,916
------------------------------------------------------------------

Net increase (decrease) in cash and cash equivalents ......... 6,235 (15,192) (5,871) -- (14,828)
Cash and cash equivalents at beginning of year ............... 1,746 41,405 43,482 -- 86,633
------------------------------------------------------------------
Cash and cash equivalents at end of year ..................... $ 7,981 $ 26,213 $ 37,611 $ -- $ 71,805
==================================================================



61


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

None.

Item 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, our management
conducted an evaluation, with the participation of our chief executive officer
and chief financial officer, of the effectiveness of our disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934 (the "Exchange Act")). Based on this evaluation, our chief
executive officer and chief financial officer have concluded that our disclosure
controls and procedures are effective to ensure that information required to be
disclosed by us in the reports that we file or submit under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified
in Securities and Exchange Commission's rules and forms and that such
information is accumulated and communicated to management, including our chief
executive officer and chief financial officer, as appropriate to allow timely
decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting
during our fiscal quarter ended June 30, 2003, that has materially affected, or
is reasonably likely to materially affect, our internal control over financial
reporting.

PART III

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Directors and Officers

Our directors and officers and their respective ages and positions are set
forth below:



Name Age Position with Dollar Financial Group, Inc.
---- --- ------------------------------------------

Jeffrey Weiss...................... 60 Chairman of the Board of Directors and
Chief Executive Officer
Donald Gayhardt.................... 39 President, Chief Financial Officer and Director
Sydney Franchuk.................... 51 Senior Vice President and President - Canadian Operations
Cameron Hetherington............... 38 Senior Vice President and President - U.K. Operations
Peter Sokolowski................... 42 Vice President, Chief Credit Officer
Cyril Means........................ 36 Vice President, General Counsel
Melissa Soper...................... 36 Vice President, Human Resources
William Athas...................... 41 Director of Finance


The directors and officers of our parent company, DFG Holdings, Inc., and
their respective ages and positions are set forth below:



Name Age Position with DFG Holdings, Inc.
---- --- --------------------------------

Jeffrey Weiss...................... 60 Chairman of the Board of Directors and Chief Executive
Officer
Donald Gayhardt.................... 39 President, Chief Financial Officer and Director
Muneer Satter...................... 42 Director
Jonathan Seiffer................... 31 Director
Jonathan Sokoloff.................. 46 Director
Michael Solomon.................... 28 Director



62


Jeffrey Weiss has served as our and our parent company's Chairman and
Chief Executive Officer since an affiliate of Bear Stearns & Co. Inc. acquired
us in May 1990. Until June 1992, Mr. Weiss was also a Managing Director at Bear
Stearns with primary responsibility for the firm's investments in small to
mid-sized companies, in addition to serving as Chairman and Chief Executive
Officer for several of these companies. Mr. Weiss is the author of several
popular financial guides.

Donald Gayhardt has served as President of our company and our parent
company since December 1998 and Chief Financial Officer of both companies since
April 2001. He also served as Executive Vice President and Chief Financial
Officer of both companies from 1993 to 1997. In addition, he joined our board as
a director in 1990. Prior to joining us, Mr. Gayhardt was employed by Bear
Stearns from 1988 to 1993, most recently as an Associate Director in the
Principal Activities Group, where he had oversight responsibility for the
financial and accounting functions at a number of manufacturing, distribution
and retailing firms, including our company. Prior to joining Bear Stearns, Mr.
Gayhardt held positions in the mergers and acquisitions advisory and accounting
fields.

Sydney Franchuk has served as President of our Canadian operations since
November 1997. Previously, Mr. Franchuk held the position of Vice President of
Finance and Administration for National Money Mart Co. and Check Mart, an
affiliated company in the United States. Prior to joining us in 1985, Mr.
Franchuk was a public accountant with Woods & Company (now Ernst & Young LLP)
Chartered Accountants and is a Certified Management Accountant.

Cameron Hetherington has served as Managing Director of Dollar Financial
UK Ltd since March 1999. From July 1993 to September 1998, Mr. Hetherington was
employed our Canadian operations in a variety of senior management positions,
including National Operations Manager. From June 1983 to November 1992, Mr.
Hetherington served as a commissioned officer within the Australian Defence
Force in a variety of operational, training and administrative roles both
domestically and overseas.

Peter Sokolowski has been our Vice President--Chief Credit Officer since
October 2002 and has overall responsibility for the oversight of underwriting,
analysis and performance monitoring for our credit products. He also served as
our Vice President--Finance from 1991 to 2002. Prior to joining us, Mr.
Sokolowski worked in various financial positions in the commercial banking
industry.

Cyril Means has served as our Vice President and General Counsel since May
1999. Prior to joining us, Mr. Means served as Vice President and Corporate
Counsel to The Aegis Consumer Funding Group, Inc. from 1995 to 1997, and as
Executive Vice President and General Counsel of Aegis from 1997 to 1999, where
he was primarily responsible for the company's securitization facility and
credit lines. Prior to joining Aegis, Mr. Means held in-house legal positions in
the insurance, commercial real estate and entertainment fields.

Melissa Soper has been our Vice President--Human Resources since October
1996 and has overall responsibility for our human resources compliance to state
and federal labor laws. Prior to joining us, Ms. Soper served as a Director of
Human Resources for a national hotel chain.

William Athas has been our Director of Finance since January 2000 and has
overall responsibility for the accounting oversight at the holding company
level. Mr. Athas attained his CPA certification in 1989. Prior to joining us,
Mr. Athas has worked in public accounting as well as in various financial
positions in the non-ferrous metals industry.

Muneer Satter has been a director of our parent company since December
1998. He is a Managing Director in Goldman Sachs' Principal Investment Area in
New York. Prior to this assignment, he was head of Goldman Sachs' Principal
Investment Area in Europe and was based in London. He joined the firm in 1988
and became a managing director in 1996.

Jonathan Seiffer has been a director of our parent company since October
2001. He has been a partner of Leonard Green & Partners, L.P. since January
1999. From December 1997 to January 1999 he was a vice president of Leonard
Green & Partners, L.P. From October 1994 until December 1997, Mr. Seiffer was an
associate of Leonard Green & Partners, L.P. Prior to October 1994, Mr. Seiffer
was a member of the corporate finance department of Donaldson, Lufkin & Jenrette
Securities Corporation. He is also a director of Diamond Triumph Glass, Inc.,
Liberty Group Publishing, Inc. and several private companies.


63


Jonathan Sokoloff has been a director of our parent company since December
1998. Mr. Sokoloff has been an executive officer of Leonard Green & Partners,
L.P. since its formation in 1994. Since 1990, Mr. Sokoloff has been a partner in
a merchant banking firm affiliated with Leonard Green & Partners, L.P. Mr.
Sokoloff was previously a Managing Director at Drexel Burnham Lambert
Incorporated. Mr. Sokoloff is also a director of The Sports Authority, Rite Aid
Corporation, Diamond Triumph Auto Glass Inc. and several private companies.

Michael Solomon has been a director of our parent company since October
2002. He has been a vice president of Leonard Green & Partners, L.P., the
manager of Green Equity Investors II, L.P., since April 2002. From May 2000 to
April 2002, he was an associate with Leonard Green & Partners, L.P. Prior to May
2000, Mr. Solomon was an associate with the Financial Sponsors Group of Deutsche
Banc Alex. Brown.


64


Item 11. EXECUTIVE COMPENSATION

The following table sets forth information with respect to the
compensation of our Chief Executive Officer and each of our named executive
officers whose annual total salary and bonus in fiscal 2003 exceeded $100,000:

Summary Compensation Table



Annual Compensation
--------------------------------------------
Name and Other Annual All Other
Principal Position Year Salary ($) Bonus ($) Compensation ($) Compensation ($)
----------------------------------------------------------------------------------------------------------

Jeffrey Weiss................... 2003 650,000 -- 60,290(1) 8,414(3)
Chairman and 2002 650,000 -- 122,417(1) 5,625
Chief Executive Officer 2001 600,000 100,000 162,873(1) 6,000

Donald Gayhardt................. 2003 350,000 -- -- 3,264(3)
President and Chief 2002 350,000 -- -- 3,990
Financial Officer 2001 300,000 50,000 -- 6,187

Sydney Franchuk................. 2003 132,840 84,353 -- --
Senior Vice President and 2002 127,560 79,725 -- --
President - Canadian 2001 121,146 100,077 -- --
Operations

Cameron Hetherington............ 2003 186,695 56,008 64,458(2) 13,067(3)
Senior Vice President and 2002 128,980 46,985 53,907(2) 2,971
President - U.K. Operations 2001 116,044 37,766 53,811(2) --


(1) Amounts include $30,635 paid in fiscal 2003, $62,314 paid in fiscal 2002
and $70,581 paid in fiscal 2001 for life insurance premiums on policies
where we were not the named beneficiary. Perquisites and other personal
benefits provided to each other named executive officer did not exceed the
lesser of $50,000 or 10% of the total salary and bonus for the officer.

(2) Amounts represent housing and other living costs.

(3) Amounts represent payments relating to retirement plans.


65


Option/SAR Grants in Last Fiscal Year

No options or SARs were granted in the last fiscal year.

Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values



Shares Number of Securities Value of Unexercised
Acquired Value Underlying Unexercised In-the-Money Options at
Name on Exercise Realized Options at Fiscal Year End Fiscal Year End(1)
- -----------------------------------------------------------------------------------------------------------------
Exercisable/Unexercisable Exercisable/Unexercisable

Jeffrey Weiss.......... 0 $ 0 0/0 $0/$0
Donald Gayhardt........ 0 0 362/37 $1,458,761/$147,214
Sydney Franchuk........ 0 0 80/20 $322,000/$80,500
Cameron Hetherington... 0 0 80/20 $322,000/$80,500


(1) An assumed fair market value of $7,250 per share was used to calculate the
value of the options. As the shares are not traded in an established
public market, the value assigned is based on the last strike price
options were granted.

Employment Agreements

Jeffrey Weiss, our and our parent company's Chairman and Chief Executive
Officer, is employed under an employment agreement dated as of November 13,
1998. The agreement provides for an annual base salary of $500,000, to be
reviewed bi-annually, which may be increased at the discretion of our parent
company's Board of Directors. In addition, Mr. Weiss is eligible to receive an
annual bonus and incentive compensation, contingent upon our achievement of 100%
of targeted results (with certain adjustments to the extent we achieve results
short of or greater than the targeted results). Total compensation to Mr. Weiss
in any fiscal year, including salary, bonuses and annual incentive compensation,
will not exceed $1,200,000. Under certain circumstances, Mr. Weiss is entitled
to receive a severance benefit payment equal to the discounted value of any
unpaid base salary for the term of the agreement.

Mr. Weiss' employment agreement also provides for a five-year term,
beginning on December 19, 1998, unless the agreement is terminated. Mr. Weiss is
eligible to participate in all our fringe benefit programs offered from time to
time to senior management employees.

Under his employment agreement, Mr. Weiss has agreed that if his
employment is terminated, and in consideration of the payment of the
compensation and other benefits paid under the agreement, he will not compete
with us for a period of two years within the United States, Canada or any other
country in which we conduct business now or in the future.

Compensation Committee Interlocks and Insider Participation

Our board of directors does not have a compensation committee. All of the
members of the board of directors participated in deliberations concerning
executive compensation, including Jeffrey Weiss, our Chief Executive Officer,
and Donald Gayhardt, our President and Chief Financial Officer. No interlocking
relationship existed between the board of directors and the board of directors
or compensation committee of any other company.


66


Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

All of our issued and outstanding shares of capital stock are owned by our
parent company, DFG Holdings, Inc.

The following table sets forth the number of shares of our parent
company's common stock owned beneficially on June 30, 2003 by:

o each person that is the beneficial owner of more than 5% of our
parent company's common stock;

o all directors and nominees;

o the named executive officers; and

o all directors and executive officers as a group.

The address of each officer and director is c/o Dollar Financial Group,
Inc., 1436 Lancaster Avenue, Suite 310, Berwyn, Pennsylvania 19312, unless
otherwise indicated. On June 30, 2003, there were a total of 19,864.93 shares of
our parent company's common stock issued (106.71 are held in treasury).



Amount of
Name and Address of Beneficial Owner Beneficial Percent of
of DFG Holdings, Inc. Shares Ownership Class
- ----------------------------------------------------------------------------------------------

Green Equity Investors II, L.P. ............................. 13,014.94 63.36%
11111 Santa Monica Boulevard
Los Angeles, California 90025
Jeffrey Weiss................................................ 3,058.99 14.89
GS Mezzanine Partners, L.P. and
GS Mezzanine Partners Offshore, L.P. and associates..... 2,150.46 10.47
85 Broad Street
New York, New York 10004
Donald Gayhardt.............................................. 526.99(1) 2.57
Sydney Franchuk.............................................. 121.24(2) 0.59
Cameron Hetherington......................................... 80.00(3) 0.39
All directors and officers as a group (8 persons)............ 3,899.04(4) 18.98


(1) Includes options to purchase 362.43 shares of our parent company's common
stock which are currently exercisable.

(2) Includes options to purchase 80.00 shares of our parent company's common
stock which are currently exercisable.

(3) Includes options to purchase 80.00 shares of our parent company's common
stock which are currently exercisable.

(4) Includes options to purchase 554.43 shares of our parent company's common
stock which are currently exercisable. Excludes directors affiliated with
Green Equity Investors II, L.P.


67


Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Stockholders' Agreement

Our parent company entered into a stockholders' agreement on November 13,
1998 with certain stockholders, including Green Equity Investors II, L.P.,
Jeffrey Weiss, Donald Gayhardt, GS Mezzanine Partners, L.P. and GS Mezzanine
Partners Offshore, L.P. After November 13, 1998 certain additional stockholders
including Ares Leveraged Investment Fund, L.P. and Ares Leveraged Investment
Fund II, L.P., C.L. and Sheila Jeffrey, Bridge Street Fund 1998, L.P. and Stone
Street Fund 1998, L.P. agreed to be bound by the terms of the stockholders'
agreement. The stockholders' agreement will terminate ten (10) years from the
date of the agreement was made, though certain provisions may terminate before
then if there is a public offering of our parent company's stock.

Transfer Restrictions

The stockholders' agreement provides, among other things, for certain
restrictions on the disposition of our parent company's common stock. Common
stock of our parent company that is subject to the agreement may only be
transferred in accordance with the terms and conditions of the agreement. Any
other transfers of our stock will be void and of no force or effect. Any shares
of our parent company's common stock that are subsequently transferred to a
third party will remain subject to the terms and conditions of the stockholders'
agreement.

Tag-Along and First Option Rights

If, at any time, Green Equity Investors II, L.P. proposes to enter into an
agreement to sell or otherwise dispose of for value more than twenty percent
(20%) of the outstanding shares of our parent company then certain of our
executives will be given the opportunity to participate proportionately in (in
other words, "tag along" with) the sale. These tag-along provisions do not apply
to certain transactions specified in the stockholders' agreement.

If, at any time, an executive who is party to the stockholders' agreement
desires to sell for cash all or any part of his or her shares, he or she must
provide notice to Green Equity Investors or its assigns and our parent company.
Upon receiving notice, Green Equity Investors and our parent company will have
the option to purchase all, but not less than all, of such shares on the same
terms and conditions. If both Green Equity Investors and our parent company have
exercised this option, Green Equity Investors will have first priority.

Repurchase of Shares

If the employment of an executive who is party to the stockholders'
agreement is terminated by reason of his or her death or permanent disability,
our parent company and Green Equity Investors (with priority to our parent
company) will have the right and option to repurchase all of the shares then
owned by the executive. The price will be the fair market value of the shares at
the time the executive's employment is terminated as determined under the
stockholders' agreement.

Registration Rights

The stockholders' agreement also gives Green Equity Investors the right to
require our parent company to register all or part of its common stock under the
Securities Act. These demand registration rights can be exercised on the earlier
of 90 days after the first registration of shares of our parent company's common
stock under the Securities Act and the second anniversary of the stockholders'
agreement. Each remaining stockholder who is party to the stockholders'
agreement may then elect to include its shares of our parent's common stock in
the demand registration, or "piggyback" on the registration. Green Equity
Investor is entitled to three demand registrations.

If our parent company proposes to register any equity securities under the
Securities Act, it must include in the registration all shares of its common
stock that the stockholders' request to have registered, subject to the
condition that not all of the shares may be registered if only a reduced number
can be sold without having a significant negative impact on the offering.


68


Additional Stockholder Rights

If Green Equity Investors agrees to sell all or substantially all of its
shares to a third party, then it may demand that executives who are party to the
stockholders' agreement sell all, but not less than all, of their shares at the
same price and on the same terms and conditions.

Grant of Proxy

Each stockholder who is party to the stockholders' agreement has agreed to
vote its shares so that (1) so long as Jeffrey Weiss is the Chief Executive
Officer of our parent company, he will be elected to the board of directors of
our parent company and (2) so long as Green Equity Investors owns, directly or
indirectly, twenty percent (20%) or more of the then outstanding stock of our
parent company, it will be entitled to elect the remaining members of the board
of directors.

Indebtedness of Management

During fiscal 1999, we issued loans to certain members of management. The
funds were used to pay personal income tax expense associated with the exercise
of certain options and grants of certain stock in connection with the purchase
of our company by Green Equity Investors. The loans are secured by shares of our
parent company's stock. As of June 30, 2003, the following members of management
owed outstanding principal on these loans in excess of $60,000:

Maturity Outstanding Principal
Name Rate Date Amount
--------------------------------------------------------------------
Jeffrey Weiss 6.00% 12/18/2004 $2,000,000
Donald Gayhardt 6.00 12/18/2004 96,525
Sydney Franchuk 0.00 4/1/2005 69,258
Peter Sokolowski 6.00 12/18/2004 70,695

In addition, as part of his employment agreement, Jeffrey Weiss was issued
a loan in the amount of $4.3 million to purchase additional shares of our parent
company's stock. The loan accrues interest at a rate of 6% per year and is due
and payable in full on December 18, 2004. The loan is secured by a pledge of
shares in our parent company's stock.

Management Agreement

Under a management services agreement among Green Equity Investors, our
parent company and us, our parent company has agreed to pay Green Equity
Investors an annual management fee equal to 2.4% of the total amount invested by
Green Equity Investors in our parent company and reimbursement of any
out-of-pocket expenses incurred.


69


Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

This item is effective for filings for fiscal years ending after December
15, 2003 and therefore is not applicable to this filing.

PART IV

Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)(1) and (2) List of Financial Statements and Schedules

The following consolidated financial statements are submitted in response
to Item 14(a)(1) and (2):



Dollar Financial Group, Inc. Page
---------

Report of Independent Auditors................................................................ 33
Consolidated Balance Sheets, June 30, 2002 and 2003........................................... 34
Consolidated Statements of Operations, years ended June 30, 2001, 2002 and 2003............... 35
Consolidated Statements of Shareholder's Equity, years ended June 30, 2001, 2002 and 2003..... 36
Consolidated Statements of Cash Flows, years ended June 30, 2001, 2002 and 2003............... 37
Notes to Consolidated Financial Statements.................................................... 38
Schedule II - Valuation and Qualifying Accounts............................................... 79


All other Financial Statement Schedules for which provision is made in the
applicable accounting regulation of the Securities and Exchange Commission are
omitted because such schedules are not required under the related instructions,
are inapplicable, or the required information is given in the financial
statements.

[The remainder of this page intentionally left blank.]


70


(a)(3) Exhibits
Exhibit No. Description of Document
----------- -----------------------

3.1 (a)(i) Certificate of Incorporation of Dollar Financial Group, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(a)(ii) Certificate of Change of Dollar Financial Group, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(a)(iii) Certificate of Change of Certificate of Incorporation of
Dollar Financial Group, Inc. (Incorporated by reference to
Exhibit 3.1 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
(a)(iv) Certificate of Amendment of the Certificate of Incorporation
of Dollar Financial Group, Inc. (Incorporated by reference
to Exhibit 3.1 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
(b)(i) Articles of Incorporation of Albuquerque Investments, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(c)(i) Articles of Incorporation of Any Kind Check Cashing Centers,
Inc. (Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(c)(ii) Articles of Amendment to the Articles of Incorporation of
Any Kind Check Cashing Centers, Inc. (Incorporated by
reference to Exhibit 3.1 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(d)(i) Articles of Incorporation of Check Mart of Louisiana, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(e)(i) Certificate of Incorporation of Check Mart of New Jersey,
Inc. (Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(f)(i) Articles of Incorporation of Check Mart of New Mexico, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(f)(ii) Articles of Amendment to the Articles of Incorporation of
Check Mart of New Mexico, Inc. (Incorporated by reference to
Exhibit 3.1 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
(g)(i) Articles of Incorporation of Check Mart of Pennsylvania,
Inc. (Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(h)(i) Articles of Incorporation of Check Mart of Texas, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(i)(i) Articles of Incorporation of Check Mart of Utah, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(i)(ii) Articles of Amendment to the Articles of Incorporation of
Check Mart of Utah, Inc. (Incorporated by reference to
Exhibit 3.1 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
(j)(i) Articles of Incorporation of Check Mart of Washington, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(j)(ii) Articles of Amendment of Check Mart of Washington, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)


71


(a)(3) Exhibits
Exhibit No. Description of Document
----------- -----------------------

(k)(i) Articles of Incorporation of Check Mart of Washington, D.C.,
Inc. (Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(l)(i) Articles of Incorporation of Check Mart of Wisconsin, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(m)(I) Certificate of Incorporation of DFG Warehousing Co., Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(n)(i) Articles of Incorporation of Dollar Financial Insurance
Corp. (Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(o)(i) Certificate of Incorporation of Dollar Insurance
Administration Corp. (Incorporated by reference to Exhibit
3.1 to the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(p)(i) Articles of Incorporation of Financial Exchange Company of
Michigan, Inc. (Incorporated by reference to Exhibit 3.1 to
the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(p)(ii) Certificate of Amendment to the Articles of Incorporation of
Financial Exchange Company of Michigan, Inc. (Incorporated
by reference to Exhibit 3.1 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(q)(i) Articles of Incorporation of Financial Exchange Company of
Ohio, Inc. (Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(q)(ii) Certificate of Amendment by Incorporator (Incorporated by
reference to Exhibit 3.1 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(q)(iii) Certificate of Amendment (by Shareholders) (Incorporated by
reference to Exhibit 3.1 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(r)(i) Certificate of Incorporation of Financial Exchange Company
of Pennsylvania, Inc. (Incorporated by reference to Exhibit
3.1 to the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(r)(ii) Amendment "1" to Certificate of Incorporation of Financial
Exchange Company of Pennsylvania, Inc. (Incorporated by
reference to Exhibit 3.1 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(r)(iii) Amendment "2" to Certificate of Incorporation of Financial
Exchange Company of Pennsylvania, Inc. (Incorporated by
reference to Exhibit 3.1 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(s)(i) Certificate of Incorporation of Financial Exchange Company
of Pittsburgh, Inc. (Incorporated by reference to Exhibit
3.1 to the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(t)(i) Certificate of Incorporation of Financial Exchange Company
of Virginia, Inc. (Incorporated by reference to Exhibit 3.1
to the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(u)(i) Articles of Incorporation of L.M.S. Development Corporation
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(v)(i) Articles of Incorporation of Monetary Management Corp.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)


72


(a)(3) Exhibits
Exhibit No. Description of Document
----------- -----------------------

(w)(I) Certificate of Incorporation of Monetary Management
Corporation of Pennsylvania, Inc. (Incorporated by reference
to Exhibit 3.1 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
(x)(i) Articles of Incorporation of Monetary Management of
California, Inc. (Incorporated by reference to Exhibit 3.1
to the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(y)(i) Articles of Incorporation of Monetary Management of
Maryland, Inc. (Incorporated by reference to Exhibit 3.1 to
the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(z)(i) Certificate of Incorporation of Monetary Management of New
York, Inc. (Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(aa)(I) Articles of Incorporation of Pacific Ring Enterprises, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(bb)(i) Limited Partnership Certificate and Agreement of U.S. Check
Exchange Limited Partnership (Incorporated by reference to
Exhibit 3.1 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
(bb)(ii) First Amendment to Certificate and Agreement of Limited
Partnership of U.S. Check Exchange Limited Partnership
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(bb)(iii) Second Amendment Certificate of Limited Partnership
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(cc)(I) Articles of Incorporation of QTV Holdings, Inc.
(Incorporated by reference to Exhibit 3.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
3.2 (a)(i) Bylaws of Dollar Financial Group, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(b)(i) Bylaws of Albuquerque Investments, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(c)(i) Bylaws of Any Kind Check Cashing Centers, Inc. (Incorporated
by reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(d)(i) Bylaws of Check Mart of Louisiana, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(e)(i) Bylaws of Check Mart of New Jersey, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(f)(i) Bylaws of Check Mart of New Mexico, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(g)(i) Bylaws of Check Mart of Pennsylvania, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(h)(i) Bylaws of Check Mart of Texas, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(i)(i) Bylaws of Check Mart of Utah, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(j)(i) Bylaws of Check Mart of Washington, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(k)(i) Bylaws of Check Mart of Washington, D.C., Inc. (Incorporated
by reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(l)(i) Bylaws of Check Mart of Wisconsin, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)


73


(a)(3) Exhibits
Exhibit No. Description of Document
----------- -----------------------

(m)(i) Bylaws of DFG Warehousing Co., Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(n)(i) Bylaws of Dollar Financial Insurance Corp. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(o)(i) Bylaws of Dollar Insurance Administration Corp.
(Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(p)(i) Bylaws of Financial Exchange Company of Michigan, Inc.
(Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(q)(i) Code of Regulations of Financial Exchange Company of Ohio,
Inc. (Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(r)(i) Bylaws of Financial Exchange Company of Pennsylvania, Inc.
(Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(s)(i) Bylaws of Financial Exchange Company of Pittsburgh, Inc.
(Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(t)(i) Bylaws of Financial Exchange Company of Virginia, Inc.
(Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(u)(i) Bylaws of L.M.S. Development Corporation (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(v)(i) Bylaws of Monetary Management Corp. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(w)(i) Bylaws of Monetary Management Corporation of Pennsylvania,
Inc. (Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(x)(i) Bylaws of Monetary Management of California, Inc.
(Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(y)(i) Bylaws of Monetary Management of Maryland, Inc.
(Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(y)(ii) Amended and Restated Bylaws of Monetary Management of
Maryland, Inc. (Incorporated by reference to Exhibit 3.2 to
the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(z)(i) Bylaws of Monetary Management of New York, Inc.
(Incorporated by reference to Exhibit 3.2 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(aa)(i) Bylaws of Pacific Ring Enterprises, Inc. (Incorporated by
reference to Exhibit 3.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
(bb)(i) Bylaws of QTV Holdings, Inc. (Incorporated by reference to
Exhibit 3.2 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
4.1 Indenture, dated as of November 15, 1996, among the Company,
the Guarantors, and Fleet National Bank, as Trustee
(Incorporated by reference to Exhibit 4.1 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
4.2 Form of Notes (included in Exhibit 4.1) (Incorporated by
reference to Exhibit 4.2 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
4.3 A/B Exchange Registration Rights Agreement, dated as of
November 15, 1996, by and among the Company, the Guarantors,
and the Initial Purchasers (Incorporated by reference to
Exhibit 4.3 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)


74


(a)(3) Exhibits
Exhibit No. Description of Document
----------- -----------------------

10.1 (a) Asset Purchase Agreement, dated January 9, 1995, by and
among the Company, Happy's Check Cashing, and Adrian Rubin
(Incorporated by reference to Exhibit 10.1(a) to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
(b) Amendment No. 1 to the Asset Purchase Agreement, dated
February 20, 1995, by and among the Company, Happy's Check
Cashing, Chase Money Loan, Inc., and Adrian Rubin
(Incorporated by reference to Exhibit 10.1(b) to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
10.2 Purchase Agreement, dated July 28, 1995, by and among Monetary
Management Corporation, NCCI Corporation, Larry M.
Senderhauf, E. Rick Safford, and Fred T. Kampo, Jr.
(Incorporated by reference to Exhibit 10.2 to the
Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
10.3 (a) Site License and Services Agreement, dated April 30,
1996, by and between the Company and The Southland
Corporation (Incorporated by reference to Exhibit 10.3(a) to
the Registrant's Statement on Form S-4 (Registration
#333-18221) declared effective March 11, 1997)
(b) Asset Purchase Agreement, dated April 30, 1996, by and
between the Company and The Southland Corporation
(Incorporated by reference to Exhibit 10.3(b) to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
10.4 Employment Agreement, dated as of November 13, 1998, between
the Company, DFG Holdings, Inc., and Jeffrey Weiss
(Incorporated by reference to Exhibit 10.4 to the
Registrant's Statement on Form 10Q (Registration #333-18221)
declared effective December 31, 1998)
10.5 Employment Agreement, dated as of December 18, 1998, between
the Company, DFG Holdings, Inc., and Donald F. Gayhardt
(Incorporated by reference to Exhibit 10.5 to the
Registrant's Statement on Form 10Q (Registration #333-18221)
declared effective December
31, 1998)
10.6* Employment Agreement, dated as of July 21, 1997 between the
Company, DFG Holdings, Inc., and Richard S. Dorfman
10.7 Amended and Restated Shareholders Agreement, dated August 8,
1996, among WPG Corporate Development Associates IV, L.P.,
WPG Corporate Development Associates IV (Overseas), L.P.,
the individual fund shareholders signatory thereto, the GHB
Charitable Trust #1, Jeffrey Weiss, Donald F. Gayhardt,
Pegasus Partners L.P., PAG Dollar Investors, the warrant
holders signatory thereto, General Electric Capital
Corporation, and DFG Holdings, Inc. (Incorporated by
reference to Exhibit 10.7 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
10.8 Purchase Agreement, dated as of August 8, 1996, by and among
the Company, DFG Holdings, Inc., Any Kind Check Cashing
Centers, Inc., the shareholders signatory thereto, U.S.
Check Exchange Limited Partnership, the limited partners
signatory thereto, and George H. Brimhall (Incorporated by
reference to Exhibit 10.8 to the Registrant's Statement on
Form S-4 (Registration #333-18221) declared effective March
11, 1997)
10.9 Asset Purchase Agreement, dated August 28, 1996, by and
among Financial Exchange Company of Ohio, Inc., ABC Check
Cashing, Inc., and the shareholder signatory thereto
(Incorporated by reference to Exhibit 10.9 to the
Registrant's Statement on Form S-4 (Registration #333-18221)
declared effective March 11, 1997)
10.10 Asset Purchase Agreement, dated as of October 22, 1996, by and
among the Company, Cash-N-Dash Check Cashing, Inc., and the
shareholders signatory thereto (Incorporated by reference to
Exhibit 10.10 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
10.11 Stock Purchase Agreement, dated as of October 22, 1996, by
and among the Company, Manor Investment Co. Inc., and the
shareholders signatory thereto (Incorporated by reference to
Exhibit 10.11 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)


75


(a)(3) Exhibits
Exhibit No. Description of Document
----------- -----------------------

10.12 Amended and Restated Purchase Agreement, dated as of October
23, 1996, by and among Dollar Financial Canada Ltd., DFG
Holdings, Inc., National Money Mart, Inc., and the
shareholders signatory thereto (Incorporated by reference to
Exhibit 10.12 to the Registrant's Statement on Form S-4
(Registration #333-18221) declared effective March 11, 1997)
10.13 Credit Agreement, dated as of December 18, 1998, among the
Company, DFG Holdings, Inc. the lenders from time to time
party thereto, Wells Fargo Bank, National Association, as
administrative agent, First Union Capital Markets and Wells
Fargo as arrangers, First Union National Bank, as
syndication agent, and U.S. Bank National Association, as
documentation agent (Incorporated by reference to Exhibit
10.13 to the Registrant's Statement on Form 10Q
(Registration #333-18221) declared effective December 31,
1998)
10.14 Purchase Agreement, dated as of March 31, 1997, among Dollar
Financial Group, Inc., Dollar Financial Canada, LTD.,
Canadian Capital Corporation, Dollar Ontario LTD. And Gus E.
Baril, Leslie A. Baril and the Baril Family Trust. The
schedules to the Purchase Agreement and the exhibits thereto
have been omitted. The Company will furnish supplementally
to the Commission any of the schedules or exhibits upon
request
10.15 DFG Holdings, Inc. Stock Incentive Plan
10.16 Termination Agreement, dated June 30, 1997 re: Donald F.
Gayhardt, Jr.
10.17 Pledge and Security Agreement, dated as of December 18, 1998,
among the Company, Wells Fargo Bank, National Association,
as administrative agent for itself and the Lenders under the
Credit Agreement (Incorporated by reference to Exhibit 10.17
to the Registrant's Statement on Form 10Q (Registration
#333-18221) declared effective December 31, 1998)
10.18 Subordination Agreement, dated as of December 18, 1998, among
the Company, DFG Holdings, Inc., and Wells Fargo Bank,
National Association, as administrative agent for itself and
the Lenders under the Credit Agreement (Incorporated by
reference to Exhibit 10.18 to the Registrant's Statement on
Form 10Q (Registration #333-18221) declared effective
December 31, 1998)
10.19 Supplemental Security Agreement (Trademarks), dated as of
December 18, 1998, among the Company and Wells Fargo Bank,
National Association, as administrative agent for itself and
the Lenders under the Credit Agreement (Incorporated by
reference to Exhibit 10.19 to the Registrant's Statement on
Form 10Q (Registration #333-18221) declared effective
December 31, 1998)
10.20 Purchase Agreement, dated as of December 18, 1998, among the
Company, GS Mezzanine Partners, L.P., GS Mezzanine Partners
Offshore, L.P., Stone Street Fund 1998, L.P. Bridge Street
Fund 1998, L.P., Ares Leveraged Investment Fund, L.P., and
Ares Leveraged Investment Fund II, L.P., relating to the
$20,000,000 aggregate principal amount of 10 7/8% Senior
Subordinated Notes Due 2006 (Incorporated by reference to
Exhibit 10.20 to the Registrant's Statement on Form 10Q
(Registration #333-18221) declared effective December 31,
1998)
10.21 Exchange and Registration Rights Agreement, dated as of
December 18, 1998, among the Company, GS Mezzanine Partners,
L.P., GS Mezzanine Partners, L.P., GS Mezzanine Partners
Offshore, L.P., Stone Street Fund 1998, L.P., Bridge Street
Fund 1998, L.P., Ares Leveraged Investment Fund, L.P., and
Ares Leveraged Investment Fund II, L.P., relating to the
$20,000,000 aggregate principal amount of 10 7/8% Senior
Subordinated Notes Due 2006 (Incorporated by reference to
Exhibit 10.21 to the Registrant's Statement on Form 10Q
(Registration #333-18221) declared effective December 31,
1998)
10.22 Secured Note, dated December 18, 1998, made by Jeffrey Weiss in
favor of the Company (Incorporated by reference to Exhibit
10.22 to the Registrant's Statement on Form 10Q
(Registration #333-18221) declared effective December 31,
1998)
10.23 Pledge Agreement, dated December 18, 1998, between the Company
and Jeffrey Weiss (Incorporated by reference to Exhibit
10.23 to the Registrant's Statement on Form 10Q
(Registration #333-18221) declared effective December 31,
1998)
10.24 Agreement for the sale and purchase of shares of Instant
Cash Loans, LTD. dated February 10, 1999 with Dollar
Financial Group, Inc., DFG Acquisition, LTD., Henry Hallam,
Rachel Hallam and shareholders signatory thereto
(Incorporated by reference to Exhibit 10.24 of the
Registrant's Form 8K/A filed April 26, 1999, declared
effective February 25, 1999)


76


(a)(3) Exhibits
Exhibit No. Description of Document
----------- -----------------------

10.25 Purchase Agreement dated February 17, 1999 by and among
National Money Mart Company (a subsidiary of Dollar
Financial Group, Inc.), King Mortgage LTD. and Denis Wilner
to purchase the remaining 86.5% partnership interest in
Calgary Money Mart Partnership (Incorporated by reference to
Exhibit 10.25 of the Registrant's Form 8K/A filed April 26,
1999, declared effective February 25, 1999)
10.26 Agreement for the sale and purchase of shares in Cash A
Cheque Holdings Great Britain Limited between Luke Johnson
and others, Dollar Financial UK Limited and Dollar Financial
Group, Inc. (Incorporated by referenced to Exhibit 10.26 of
the Registrant's Form 8K/A filed September 20, 1999,
declared effective July 22, 1999)
10.27 Agreement for the sale and purchase of shares in Cash
Centres Corporation Limited between Edward Ford and others,
Dollar Financial UK Limited and Dollar Financial Group, Inc.
(Incorporated by reference to Exhibit 10.27 of the
Registrant's Form 8K/A filed February 28, 2000, declared
effective December 30, 1999)
10.28 Amended and Restated Nonexclusive Servicing and Indemnification
Agreement between County Bank and Dollar Financial Group,
Inc.**
10.29 Marketing and Servicing Agreement between First Bank of
Delaware and Dollar Financial Group, Inc.**
21.1 Subsidiaries of the Registrant (Incorporated by reference to
Exhibit 21.1 to the Registrant's Statement on Form 10Q
(Registration #333-18221) declared effective December 31,
1998)
31.1 Certification of Chief Executive Officer Pursuant to Title 17,
Code of Federal Regulations, Section 240.13a - 14(a) or
Section 240.15d - 14(a).
31.2 Certification of Chief Financial Officer Pursuant to Title 17,
Code of Federal Regulations, Section 240.13a - 14(a) or
Section 240.15d - 14(a).
32.1 Certification of Chief Executive Officer Pursuant to Title
18, United States Code, Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 Certification of Chief Financial Officer Pursuant to Title
18, United States Code, Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.


77


- --------------
* Management contracts or compensatory plans or arrangements required to be
filed as exhibits to this Form 10-K by Item 601 of Regulation S-K.

** Confidential treatment has been requested for certain confidential
portions of this exhibit; these confidential portions have been omitted
from this exhibit and filed separately with the Securities and Exchange
Commission.

(b) Reports on Form 8-K

On May 14, 2003, a Form 8-K was filed attaching a press release dated May
13, 2003 announcing the company's earnings for the third quarter 2003.


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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant named below has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Berwyn, Commonwealth of Pennsylvania on September 29, 2003.

DOLLAR FINANCIAL GROUP, INC.


By: /s/ DONALD GAYHARDT
-----------------------------------------
Donald Gayhardt
President and Chief Financial Officer

DOLLAR FINANCIAL GROUP, INC.



Signature Title Date
--------- ----- ----



/s/ JEFFREY A. WEISS Chairman of the Board of Directors September 29, 2003
- ------------------------------------- and Chief Executive Officer
Jeffrey A. Weiss (principal executive officer)


/s/ DONALD GAYHARDT President and Chief Financial Officer September 29, 2003
- ------------------------------------- (principal financial and accounting
Donald Gayhardt officer)



79



DOLLAR FINANCIAL GROUP, INC. (a)

Schedule II - Valuation and Qualifying Accounts

Year ended June 30,
--------------------------------
Consumer Loan Loss Reserves 2001 2002 2003
--------------------------------
(in thousands)

Balance at beginning of year ....... $ -- $ 600 $ 2,862

Provision charged to expense ....... -- 2,244 --
Provision charged to loan revenues . 4,895 5,554 9,216
Foreign currency translation ....... -- 18 75

Charge-offs ........................ (4,295) (5,554) (9,716)
--------------------------------
Balance at end of year ............. $ 600 $ 2,862 $ 2,437
================================

(a) This schedule should be read in conjunction with the Company's audited
consolidated financial statements and related notes thereto.


80