================================================================================


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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


                                    FORM 8-K

                Current Report Pursuant to Section 13 or 15(d) OF

                       THE SECURITIES EXCHANGE ACT OF 1934

Date of Report                                          Commission file number
September 15, 2000                                              1-6686
                                                           -----------------


                    THE INTERPUBLIC GROUP OF COMPANIES, INC.
             (Exact name of registrant as specified in its charter)

           Delaware                                             13-1024020
-------------------------------                             --------------------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                              Identification  No.)

1271 Avenue of the Americas, New York, New York                    10020
-----------------------------------------------                  ---------
(Address of principal executive offices)                         (Zip Code)


       Registrant's telephone number, including area code: (212) 399-8000
                                ----------------

Item 5.  OTHER EVENTS

On July 17,  2000 the  Company  filed a  current  report on Form 8-K in which it
restated its financial  statements as previously  presented in Form 10-K for the
year ended December 31, 1999.  Effective July 26, 2000, upon the announcement of
results for the second quarter of 2000, the  consolidated  financial  statements
became the historical results of the company.

This Current Report is identical to the filing made on July 17, 2000, except for
the removal of references to the financial statements as being "supplemental".

As  discussed  in  Note  15 of  the  consolidated  financial  statements  of The
Interpublic Group of Companies,  Inc. (the "Company"), in April 2000 the Company
acquired NFO Worldwide, Inc. ("NFO") in a transaction accounted for as a pooling
of  interests.  This  report on Form 8-K  includes  the  Company's  consolidated
financial  statements and other  financial  information  restated to reflect the
effect of the pooling of NFO. Additionally,  the results of several other recent
acquisitions,  all of which have been  accounted  for as poolings of  interests,
have been included in the restated financial statements. Other than NFO, none of
the other acquisitions was, individually or in aggregate, material.
<PAGE>


Item 7.     FINANCIAL STATEMENTS AND EXHIBITS

Exhibit 99  Financial Statements, Financial Information and Exhibits

            Financial Highlights

            Management's Discussion and Analysis of Financial
            Condition and Results of Operations

Consolidated Financial Statements

            Report of Independent Accountants
                 - PricewaterhouseCoopers LLP
                 - Arthur Andersen LLP
                 - Soteriou Banerji
                 - Ernst & Young
                 - Ernst & Young LLP


              Consolidated Balance Sheet
              December 31, 1999 and 1998

              Consolidated Statement of Income for the Years Ended
              December 31, 1999, 1998 and 1997

              Consolidated  Statement  of Cash  Flows  for the Years
              Ended December 31, 1999, 1998 and 1997

              Consolidated Statement of Stockholders' Equity and
              Comprehensive Income For the Years Ended December 31, 1999, 1998
              and 1997

            Notes to Consolidated Financial Statements

            Selected Financial Data For Five Years

            Results by Quarter (Unaudited)

Consolidated Financial Statement Schedule

            Schedule VIII: Valuation and Qualifying Accounts

Consolidated Financial Statements

            Consolidated Balance Sheet
               March 31, 2000 (unaudited) and December 31, 1999

            Consolidated  Statement of Income for the Three Months
               Ended March 31, 2000 and 1999 (unaudited)

            Consolidated Statement of Comprehensive Income for
               the Three Months Ended March 31, 2000 and 1999 (unaudited)

            Consolidated Statement of Cash Flows for the
               Three Months Ended March 31, 2000 and 1999 (unaudited)

            Notes to Consolidated Financial Statements (unaudited)

            Management's Discussion and Analysis of
             Financial Condition and Results of Operations (unaudited)
<PAGE>

Exhibit 11  COMPUTATION OF EARNINGS PER SHARE

            For the Years Ended December 31, 1995, 1996, 1997, 1998 and 1999

            For the Three Months Ended March 31, 2000 and 1999

Exhibit 23  CONSENT OF INDEPENDENT ACCOUNTANTS

            PricewaterhouseCoopers LLP

            Arthur Andersen LLP

               Soteriou Banerji

            Ernst & Young

            Ernst & Young LLP

Exhibit 27  RESTATED FINANCIAL DATA SCHEDULE

            For the Three Months Ended March 31, 2000 and 1999

            For the Years Ended December 31, 1999, 1998 and 1997

<PAGE>


                                   SIGNATURES

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

                         THE INTERPUBLIC GROUP OF COMPANIES, INC.
                                        (Registrant)





Date:  September 15, 2000     BY /S/  FREDERICK MOLZ
                              ----------------------
                              Frederick Molz
                              Vice President and Controller




<PAGE>
                              FINANCIAL HIGHLIGHTS
                  (Amounts in Thousands Except Per Share Data)
--------------------------------------------------------------------------------
December 31
                                                                        Percent
                                                                      Increase/

                                        1999            1998         (decrease)
--------------------------------------------------------------------------------
Operating Data
 Revenue                            $ 4,892,912     $  4,167,788          17.4%
 Net Income                         $   315,243     $    333,593          (5.5%)
 Net Income Excluding
   Restructuring(1)                 $   366,680     $    333,593           9.9%
Per Share Data(2)
 Diluted EPS                        $      1.04     $       1.12          (7.1%)
 Diluted EPS Excluding
   Restructuring (1)                $      1.21     $       1.12           8.0%
 Cash Dividends                     $       .33     $        .29          13.8%
 Share Price at December 31         $  57 11/16     $     39 7/8          44.7%
 Weighted-average shares
  Diluted                               302,914          299,214           1.2%
  Diluted Excluding
   Restructuring(1)                     309,607          299,214           3.5%
Financial Position

 Cash and Cash Equivalents          $ 1,006,011     $    780,429          28.9%
 Total Assets                       $ 9,166,604     $  7,464,808          22.8%
 Book Value Per Share(2)            $      5.85     $       4.81          21.6%
 Return on Average
  Stockholders' Equity:
    As Reported                           19.7%            25.7%
    Excluding Restructuring(1)            22.6%            25.7%

Revenue

1999                               $4,892,912
1998                               $4,167,788
1997                               $3,582,601
Diluted Earnings Per Share(2)
1999 As Reported                       $ 1.04
1999 Excluding Restructuring(1)        $ 1.21
1998                                   $ 1.12
1997                                   $  .77
Cash Dividends Per Share(2)
1999                                   $  .33
1998                                   $  .29
1997                                   $  .25
Return On Average Stockholders' Equity
1999 As Reported                        19.7%
1999 Excluding Restructuring(1)         22.6%
1998                                    25.7%
1997                                    21.0%

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note 15).

-----------------
[FN]
(1)  Excludes the impact of restructuring and other merger-related costs.
(2) All  share  data  for  1998  and 1997  has  been  adjusted  to  reflect  the
two-for-one stock split effective July 15, 1999.
</FN>
<PAGE>


          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


RESULTS OF OPERATIONS

As discussed in Note 15, the Company  acquired NFO Worldwide,  Inc.  ("NFO"),  a
leading  provider of research  based  marketing  information  and counsel to the
business community,  in a transaction accounted for as a pooling of interests in
April 2000. The Company's  consolidated financial statements and other financial
information  have been  restated  to  reflect  the  effect  of the NFO  pooling.
Additionally,  results of several other recent  acquisitions,  all of which have
been  accounted for as poolings of interests  have been included in the restated
financial  statements.  The following discussion relates to the combined results
of the Company after giving effect to the pooled companies.

The Company  reported net income of $315.2 million or $1.04 diluted earnings per
share  for  the  year  ended   December  31,  1999.   Excluding  the  impact  of
restructuring  and  other  merger  related  costs,  which  are  described  in  a
subsequent section of this discussion, net income would have been $366.7 million
or $1.21 diluted earnings per share, compared to $333.6 million or $1.12 diluted
earnings per share for the year ended  December  31, 1998 and $220.2  million or
$.77 diluted earnings per share for the year ended December 31, 1997.

The  following  table sets forth net income and  earnings  per share  before and
after the restructuring and other merger related costs:

(Dollars in thousands)
                                          1999            1998            1997
                                          ----            ----            ----

Net income as reported                $  315,243      $  333,593      $  220,211
Earnings per share

    Basic                             $     1.08      $     1.15      $      .79
    Diluted                           $     1.04      $     1.12      $      .77

Net income before restructuring
  and other merger related costs      $  366,680      $  333,593      $  220,211
Earnings per share

    Basic                             $     1.26      $     1.15      $      .79
    Diluted                           $     1.21      $     1.12      $      .77


Revenue
-------
Worldwide  revenue for 1999 was $4.9  billion,  an  increase of $725  million or
17.4% over 1998. Domestic revenue, which represented 51% of worldwide revenue in
1999, increased $367 million or 17.4% over 1998.  International  revenue,  which
represented  49% of worldwide  revenue in 1999,  increased $358 million or 17.4%
over 1998.  International  revenue would have increased 22% excluding the effect
of the strengthening of the U.S. dollar against major  currencies.  The increase
in  worldwide  revenue is a result of both  growth from new  business  gains and
growth from  acquisitions.  Exclusive of  acquisitions,  worldwide  revenue on a
constant dollar basis increased 9% over 1998.

<PAGE>
Revenue from other specialized  marketing services,  which include media buying,
market research,  relationship (direct) marketing,  public relations, sports and
event   marketing,   healthcare   marketing  and   e-business   consulting   and
communications,  comprised approximately 45% of total worldwide revenue in 1999,
compared to 39% in 1998.

Worldwide  revenue for 1998 was $4.2  billion,  an  increase of $585  million or
16.3% over 1997.  Domestic revenue,  which represented 51% of worldwide revenue,
increased $283 million or 15.5% over 1997.  International revenue increased $302
million or 17.2% over  1997.  International  revenue  would have  increased  23%
excluding  the effect of the  strengthening  of the U.S.  dollar  against  major
currencies.

Operating Expenses
------------------
Worldwide operating expenses for 1999, excluding  restructuring and other merger
related  costs,  were $4.2  billion,  an increase of 17.9% over 1998.  Operating
expenses  outside the United States increased  16.7%,  while domestic  operating
expenses  increased 19.2%.  These increases were commensurate with the increases
in revenue. Worldwide operating expenses for 1998 were $3.6 billion, an increase

of 13.6% over 1997, comprised of an 18.1% increase in international expenses and
a 9.1% increase in domestic expenses.

Significant  portions of the Company's expenses relate to employee  compensation
and various employee  incentive and benefit programs,  which are based primarily
upon operating results.  Salaries and related expenses were $2.7 billion in 1999
or 55.2% of revenue as compared to $2.3  billion in 1998 or 55.4% of revenue and
$2.0  billion  in 1997 or 56.0% of  revenue.  The year over year  increase  is a
result of growth from acquisitions and new business gains.

In  1997,  as part of its  continuing  cost  containment  efforts,  the  Company
announced that it was curtailing  its domestic  pension plan effective  April 1,
1998, and recorded pre-tax charges of approximately  $16.7 million.  The Company
continues to sponsor a domestic defined contribution plan.

Office and general expenses were $1.5 billion in 1999, $1.3 billion in 1998, and
$1.2 billion in 1997.  The year over year  increase is a result of the continued
growth  of the  Company,  which  reflects  in part an  increase  in the level of
goodwill and other intangible asset amortization related to acquisitions.

In the fourth quarter of 1999, NFO recorded  special charges of $22 million as a
result of the difficult  competitive  environment due to client consolidation in
the  financial  services  industry.  Approximately  $16  million of the  special
charges  related  to the  write-off  of  intangible  assets  which  were  deemed
permanently impaired.

Income from Operations
----------------------
Income from operations for 1999 was $562 million.  Excluding  restructuring  and
other merger related costs, income from operations for 1999 was $646 million, an
increase of $80 million or 14% over 1998.  Amortization of intangible assets was
$99  million  for  1999   compared  to  $61  million  for  1998.   Exclusive  of
acquisitions,  foreign  exchange  fluctuations  and  amortization  of intangible
assets, income from operations increased 16% for 1999 compared to 1998.

Income from  operations  for 1998 was $566  million  compared to $379 million in
1997,  an increase of 50%. The increase is a result of growth from  acquisitions
and new business gains.

Special Compensation Charges
----------------------------
During 1997, Hill, Holliday,  Connors,  Cosmopolous,  Inc. ("Hill Holliday"),  a
company acquired in a pooling of interests  transaction in the second quarter of
1998, recorded special compensation charges of approximately $32 million.

<PAGE>
Restructuring and Other Merger Related Costs
--------------------------------------------
In October  1999,  the Company  announced  the merger of two of its  advertising
networks.  The networks  affected,  Lowe & Partners Worldwide and Ammirati Puris
Lintas were combined to form a new agency  network called Lowe Lintas & Partners
Worldwide.  The merger involves the  consolidation  of operations in Lowe Lintas
agencies  in  approximately  24 cities in 22  countries  around the world.  Once
complete, the newly merged agency network will have offices in over 80 countries
around the world.

During  the  fourth  quarter  of  1999,   the  Company  began   execution  of  a
comprehensive  restructuring  plan in  connection  with  the  merger.  The  plan
includes  headcount  reductions,  consolidation  of real  estate and the sale or
disposition of certain investments,  and is expected to be completed by June 30,
2000. The Company is pleased with the progress of the merger to date and expects
the total costs to be in line with its original estimate.

The total pre-tax cost of the restructuring  plan is expected to be between $170
and $190 million,  ($100 to $115 million,  net of tax). In the fourth quarter of
1999, the Company recognized pre-tax costs of $84.2 million ($51.4 million,  net
of tax or $.17 per diluted share),  with the remainder expected to be recognized
in the first two quarters of 2000.

A summary of the components of the total  restructuring and other merger related
costs,  together  with an  analysis  of the cash and  non-cash  elements,  is as
follows:

(Dollars in millions)

                                               1999            Cash    Non-Cash
                                              ---------------------------------
TOTAL BY TYPE
-------------
   Severance and termination costs            $44.9           $27.0       $17.9
   Fixed asset write-offs                      11.1              --        11.1
   Lease termination costs                      3.8             3.8          --
   Investment write-offs and other             24.4             1.1        23.3
                                              ---------------------------------
Total                                         $84.2           $31.9       $52.3
                                              =================================


The severance and termination costs recorded in 1999 relate to approximately 230
employees who have been terminated or notified that they will be terminated. The
employee   groups   affected   include   executive   and  regional   management,
administrative,  account  management,  creative and media production  personnel,
principally  in the U.S.  and  U.K.  The  charge  related  to these  individuals
includes  the cost of  voluntary  programs  in certain  locations  and  includes
substantially all senior executives that will be terminated.  As of December 31,
1999, the amount accrued related to severance and termination was  approximately
$42.6 million.  During the fourth quarter of 1999, cash payments of $2.3 million
were made.

The fixed  assets  write-off  relates  largely to the  abandonment  of leasehold
improvements  as part of the merger.  The amount  recognized  in 1999 relates to
fixed asset write-offs in 6 offices principally in the United States.

Lease termination costs relate to the offices vacated as part of the merger. The
lease  terminations  are expected to be completed by mid-to-late  2000, with the
cash  portion to be paid out over a period of up to five  years.  As of December
31,  1999,  the  amount  accrued  related  to these  termination  costs was $3.8
million.

<PAGE>
The  investment  write-offs  relate to the loss on sale or  closing  of  certain
business  units.  In 1999,  $23  million  has been  recorded  as a result of the
decision  to sell or  abandon  4  European  businesses.  In the  aggregate,  the
businesses  being  sold or  abandoned  represent  an  immaterial  portion of the
revenue  and  operations  of Lowe Lintas & Partners.  The  write-off  amount was
computed based upon the difference between the estimated sales proceeds (if any)
and the  carrying  value of the related  assets.  These  sales or  closures  are
expected to be completed by mid 2000.

The Company expects to benefit from the resulting  reduction in employee related
costs, compensation,  benefits and space occupancy. These benefits will begin to
be realized in the second half of 2000.  It is  anticipated  that a  significant
portion  of the  savings  will be  offset by  investments  in  creative  talent,
technology and other  capabilities to support the  acceleration of growth in the
future.  The Company  anticipates  that beginning 2001 its after-tax  results of
operations will benefit by between $20 to $25 million.

Interest Expense
----------------
Interest expense was $81 million in 1999, $64 million in 1998 and $60 million in
1997.  The  increase  in 1999 was  attributable  to the  issuance  of the  1.87%
Convertible  Subordinated  Notes due 2006,  issued in June 1999,  in addition to
other  borrowings  to fund a  portion  of the  acquisition  of  Infratest  Burke
Aktiengesellschaft  Holdings,  one of the top custom marketing research firms in
Europe, in November 1998.

Other Income, Net
-----------------
Other income, net primarily  consists of interest income,  investment income and
net gains from equity  investments.  Other income,  net included  gains from the
Company's   investments  in  various  interactive  based  companies,   including
Nicholson NY, Inc.,  Lycos and USWEB in 1999,  gains related to  investments  in
USWEB, CKS Group,  Inc. and Lycos in 1998, and gains on the sale of investments,
including All American Communications,  Inc. and CKS Group, Inc. in 1997. In the
aggregate,  annual net equity  gains  remained  relatively  constant  during the
three-year period.

Other Items
-----------
Income applicable to minority interests increased by $5.5 million in 1999 and by
$3.7 million in 1998. The 1999 and 1998 increase was primarily due to the strong
performance of companies that were not wholly owned,  as well as the acquisition
of additional such entities during 1999 and 1998.

The  Company's  effective  income tax rate was 41.6% in 1999,  40.8% in 1998 and
45.3% in 1997. The higher rate in 1997 was largely  attributable  to the special
compensation charges recorded by Hill Holliday.

Cash Based Earnings
-------------------
Management believes that cash based earnings are a relevant measure of financial
performance as it better  illustrates  the Company's  performance and ability to
support growth. The Company defines cash based earnings as net income,  adjusted
to exclude amortization of intangible assets, net of tax where applicable.  Cash
based  earnings are not  calculated  in the same manner by all companies and are
intended to supplement, not replace, the other measures calculated in accordance
with generally accepted accounting principles. Cash based earnings for the three
years ending December 31, 1999, 1998, and 1997 were as follows:

<PAGE>
(Amounts in thousands except per share data)

                                         1999           1998            1997
                                       ---------------------------------------
Net income as reported                 $315,243       $333,593        $220,211
Restructuring and other

  merger related costs, net of tax       51,437             --              --
                                       ---------------------------------------

Net income, as adjusted                 366,680        333,593         220,211
Add back amortization

  of intangible assets                   99,326         61,396          45,682
Less related tax effect                 (13,031)        (6,146)         (5,228)
                                       ---------------------------------------

Cash based earnings (as
  defined above)                       $452,975       $388,843        $260,665
                                       =======================================

Per share amounts (diluted)               $1.49          $1.30            $.90


LIQUIDITY AND CAPITAL RESOURCES

The Company's financial position remained strong during 1999, with cash and cash
equivalents at December 31, 1999, of $1.0 billion, an increase of $225.6 million
over the 1998 year-end balance. Working capital at December 31, 1999, was $170.9
million,  which was $70.6 million  higher than the level at the end of 1998. The
increase  in  working   capital  was   largely   attributable   to  proceeds  of
approximately  $300 million from the 1.87%  Convertible  Subordinated  Notes due
2006 issued in June, 1999.

Historically,  cash flow from  operations has been the primary source of working
capital and  management  believes  that it will continue to be so in the future.
Net cash provided by operating  activities  was $592  million,  $527 million and
$283  million  for  the  years  ended   December  31,  1999,   1998,  and  1997,
respectively. The Company's working capital is used primarily to provide for the
operating needs of its  subsidiaries,  which includes payments for space or time
purchased from various media on behalf of clients.  The Company's practice is to
bill and collect from its clients in sufficient  time to pay the amounts due for
media on a timely basis. Other uses of working capital include the repurchase of
the Company's common stock, payment of cash dividends,  capital expenditures and
acquisitions.

The Company  acquires shares of its stock on an ongoing basis.  During 1999, the
Company purchased approximately 6.5 million shares of its common stock, compared
to 4.9 million shares in 1998. The Company repurchases its stock for the purpose
of fulfilling its obligations under various compensation plans.

The Company,  excluding pooled entities,  paid $90.4 million ($.33 per share) in
dividends to stockholders in 1999, as compared to $76.9 million ($.29 per share)
paid during 1998.

The  Company's  capital  expenditures  in 1999 were $177.1  million  compared to
$156.4 million in 1998 and $122.4 million in 1997. The primary purposes of these
expenditures were to upgrade computer and  telecommunications  systems to better
serve clients and to modernize offices.

<PAGE>
During 1999, the Company paid  approximately  $559 million in cash and stock for
new acquisitions,  including a number of marketing  communications  companies to
complement its existing  agency systems and to optimally  position itself in the
ever-broadening  communications  marketplace.  This amount includes the value of
stock issued for pooled companies.

The Company and its subsidiaries maintain credit facilities in the United States
and in countries  where they conduct  business to manage their future  liquidity
requirements.  The Company's  available  short-term  credit facilities were $510
million,  of which $80 million  were  utilized at December  31,  1999,  and $576
million, of which $118 million were utilized at December 31, 1998.

Return  on  average  stockholders'  equity  was 19.7% in 1999 and 25.7% in 1998.
Excluding  restructuring  and other  merger  related  costs,  return on  average
stockholders'  equity  was  22.6% in 1999.  The  decline  in 1999 was  primarily
attributable  to a $159  million  increase in net  unrealized  holding  gains on
equity investments, which are included in stockholders' equity.

As discussed in Note 12, revenue from international  operations was 49% of total
revenue in 1999, 1998 and 1997. The Company continuously  evaluates and attempts
to mitigate its exposure to foreign exchange,  economic and political risks. The
notional value and fair value of all outstanding  forwards and options contracts
at the  end of  the  year  were  not  significant.  In  addition,  the  economic
developments in Brazil,  which did not have a significant negative impact on the
Company,  were  partially  offset by the  favorable  impact due to the  economic
recovery in Japan.

The Company is not aware of any significant  occurrences  that could  negatively
impact its liquidity. However, should such a trend develop, the Company believes
that there are sufficient funds available under its existing lines of credit and
from internal cash-generating capabilities to meet future needs.

OTHER MATTERS
Internet-Services Companies
---------------------------
During 1999, the Company expanded its investment in internet-service and related
companies. In December 1999, the Company announced the establishment of Zentropy
Partners,  a new global  internet-services  company that integrates the building
and marketing of digital  businesses.  At its formation,  Zentropy  Partners had
annualized revenue exceeding $50 million and was positioned to serve clients out
of 11 offices in Europe and North America.

In April 1999, the Company invested $20 million for a minority  interest in Icon
Medialab International AB ("Icon"), a Swedish based internet consultancy.  Later
in  the  year,  the  Company  increased  its  investment  in  Icon  through  the
contribution  of other  investments and through  additional  cash purchases.  At
December 31, 1999, the fair market value of the Company's investment in Icon was
$322 million.

On October 19, 1999, NFO announced the formation of  InsightExpress,  LLC, a new
Internet company formed to provide  real-time  consumer input to the desktops of
decision-makers  in companies of all sizes worldwide.  InsightExpress is a fully
automated  web-enabled  survey  system that will allow its customers to test new
ideas, screen new concepts, gauge customer satisfaction,  survey employees, test
advertising,  and gather  insight into the needs,  attitudes,  and  behaviors of
consumers.  InsightExpress  is  designed  to  provide  these  capabilities  at a
fraction  of the time and the cost of existing  market  research  methods  while
leveraging the worldwide  client  experience and panel expertise of NFO. To fund
its development and growth,  InsightExpress has raised a total of $25 million in
new venture capital from General Atlantic Partners and Engage Technologies.

<PAGE>
In addition to the above,  the Company  maintains  internet-service  and related
divisions at several of its major  operating  divisions  and has made  strategic
investments in fourteen  companies whose objectives revolve around consulting on
the use of technology to benefit customers.

Year 2000 Issue
---------------
Pursuant to the Year 2000 issue,  the Company had developed  programs to address
the possible  exposures  related to the impact of computer  systems  incorrectly
recognizing the year 2000 or "00" as 1900. As a result of  implementation of its
programs,  the Company did not experience any significant  Year 2000 disruptions
during the  transition  from 1999 to 2000,  and since entering 2000, the Company
has not experienced any significant  Year 2000  disruptions to its business.  In
addition, the Company is not aware of any significant  disruptions impacting its
customers  or  suppliers.  The Company  will  continue  to monitor its  computer
systems over the next several months.  However,  the Company does not anticipate
any  significant  impact  related  to Year 2000  problems  that may  affect  its
internal  computer  systems.  The  Company  will also  continue  to monitor  the
activities  of its business  partners and critical  suppliers  and has developed
contingency plans should business partners or critical suppliers  experience any
Year 2000 disruptions in the coming months.

Costs incurred to achieve Year 2000  readiness,  which included  modification to
existing systems,  replacement of non-compliant systems and consulting resources
totaled $73 million.  A total of $47 million was capitalized  (related primarily
to hardware and software that  provided  both Year 2000  readiness and increased
the functionality of certain systems), and $26 million was expensed.

Cautionary Statement
--------------------
Statements  by the Company in this  document are  forward-looking  statements as
defined  in  the  Private  Securities  Litigation  Reform  Act  of  1995.  These
forward-looking  statements are subject to certain risks and uncertainties  that
could cause actual results to differ  materially  from those  anticipated in the
forward-looking statements.

New Accounting Guidance
-----------------------
In June 1998,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and Hedging  Activities"  (SFAS 133),  which had an initial adoption date by the
Company of January 1, 2000. In June 1999,  the FASB  postponed the adoption date
of SFAS 133 until  January 1, 2001.  The Company  does not believe the effect of
adopting  SFAS 133 will be material  to its  financial  condition  or results of
operations.

Conversion to the Euro
----------------------
On January 1, 1999,  certain member countries of the European Union  established
fixed  conversion  rates  between  their  existing  currencies  and the European
Union's common currency (the "Euro").  The Company  conducts  business in member
countries.  The  transition  period  for the  introduction  of the Euro  will be
between January 1, 1999, and June 30, 2002. The Company is addressing the issues
involved with the  introduction of the Euro. The major  important  issues facing
the Company include:  converting  information  technology  systems;  reassessing
currency  risk;  negotiating  and amending  contracts;  and  processing  tax and
accounting records.

Based upon progress to date, the Company  believes that use of the Euro will not
have a  significant  impact on the  manner  in which it  conducts  its  business
affairs  and  processes  its  business  and  accounting  records.   Accordingly,
conversion to the Euro has not, and is not expected to have a material effect on
the Company's financial condition or results of operations.
<PAGE>


                        REPORT OF INDEPENDENT ACCOUNTANTS

                                                     1301 Avenue of the Americas
                                                        New York, New York 10019


To the Board of Directors and Stockholders of
The Interpublic Group of Companies, Inc.

In our opinion, based upon our audits and the reports of the other auditors
the  accompanying  consolidated  balance  sheets  and the  related  consolidated
statements  of  income,   of  cash  flows,  and  of  stockholders'   equity  and
comprehensive  income present fairly,  in all material  respects,  the financial
position of The Interpublic  Group of Companies,  Inc. and its subsidiaries (the
"Company")  at December 31, 1999 and 1998,  and the results of their  operations
and their cash flows for each of the three  years in the period  ended  December
31, 1999, in conformity with  accounting  principles  generally  accepted in the
United  States.  These  financial  statements  are  the  responsibility  of  the
Company's  management;  our  responsibility  is to  express  an opinion on these
financial  statements  based  on our  audits.  We did not  audit  the  financial
statements  of  International  Public  Relations  plc  ("IPR"),  a  wholly-owned
subsidiary,  which statements reflect revenues constituting  approximately 6% of
the related 1997  consolidated  financial  statement total. We did not audit the
financial  statements  of  Hill,  Holliday,  Connors,  Cosmopulos,  Inc.  ("Hill
Holiday"),  a wholly-owned  subsidiary which  statements  reflect total net loss
constituting  approximately  15%  of the  related  1997  consolidated  financial
statement total. Additionally,  we did not audit the financial statements of NFO
Worldwide,  Inc. ("NFO"),  a wholly-owned  subsidiary,  which statements reflect
total assets  constituting  approximately  5% of the related  1999  consolidated
financial  statements  total.  Those  statements  were audited by other auditors
whose  reports  thereon  have been  furnished  to us, and our opinion  expressed
herein,  insofar as it relates to the amounts included for IPR, Hill Holiday and
NFO, is based  solely on the reports of the other  auditors.  We  conducted  our
audits of these  statements in  accordance  with  auditing  standards  generally
accepted in the United States,  which require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and  disclosures in the financial  statements,  assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall  financial  statement  presentation.  We believe that our
audits and the  reports of other  auditors  provide a  reasonable  basis for the
opinion expressed above.

PricewaterhouseCoopers LLP
New York, New York

February 22, 2000, except for Note 15
which is as of July 13, 2000

<PAGE>


                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders of NFO Worldwide, Inc.:

We have  audited  the  consolidated  balance  sheets of NFO  Worldwide,  Inc. (a
Delaware corporation) and subsidiaries as of December 31, 1999 and 1998, and the
related consolidated statements of income,  stockholders' equity, and cash flows
for each of the years in the three year period ended  December  31, 1999.  These
financial statements (not presented separately herein) are the responsibility of
the Company's  management.  Our responsibility is to express an opinion on these
financial  statements  based on our audits.  We did not audit the 1997 financial
statements  of  The  MBL  Group  plc,  included  in the  consolidated  financial
statements of NFO Worldwide, Inc., which statements reflect total revenues of 26
percent of the related 1997  consolidated  total,  after  adjustment  to reflect
translation into U.S. dollars and accounting  principles  generally  accepted in
the United States. The financial statements of The MBL Group plc, prior to those
adjustments,  were  audited by other  auditors  whose  report  thereon  has been
furnished to us, and our opinion expressed herein,  insofar as it relates to the
amounts  included  for The MBL Group plc,  is based  solely on the report of the
other auditors.

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  and the  report of other  auditors
provide a reasonable basis for our opinion.

In our opinion,  based on our audits and the report of the other  auditors,  the
consolidated  financial  statements  referred to above  present  fairly,  in all
material  respects,   the  financial   position  of  NFO  Worldwide,   Inc.  and
subsidiaries  as of  December  31,  1999  and  1998,  and the  results  of their
operations  and their cash flows for each of the years in the three year  period
ended  December 31, 1999, in conformity  with  accounting  principles  generally
accepted in the United States.

Our audits were made for the  purpose of forming an opinion on the  consolidated
financial  statements taken as a whole. The schedule referred to in Item 14 (not
presented  separately herein) is presented for the purpose of complying with the
Securities and Exchange  Commission's  rules and is not part of the consolidated
financial  statements.   This  schedule  has  been  subjected  to  the  auditing
procedures applied in our audits of the consolidated  financial  statements and,
in our  opinion,  based on our audit and the  report of other  auditors,  fairly
states in all material  respects  the  financial  data  required to be set forth
therein in relation to the consolidated financial statements taken as a whole.

Arthur Andersen LLP
New York, New York,

February 25, 2000

<PAGE>


         REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF THE MBL GROUP plc

We have audited the financial statements of The MBL Group plc for the year ended
December 31, 1997, which have been prepared under the historical cost convention
and in accordance with generally accepted  accounting  principles  applicable in
the United Kingdom.

Respective Responsibilities of Directors and Auditors

The  Company's  directors  are  responsible  for the  preparation  of  financial
statements.  It is our responsibility to form an independent  opinion,  based on
our audit, on those statements and to report our opinion to you.

Basis of Opinion

We conducted  our audit in  accordance  with  Auditing  Standards  issued by the
Auditing  Practices Board which are  substantially the same as those followed in
the United States. An audit includes  examination,  on a test basis, of evidence
relevant to the amounts and  disclosures  in the financial  statements.  It also
includes an assessment of the  significant  estimates and judgements made by the
directors in the  preparation  of the financial  statements,  and of whether the
accounting policies are appropriate to the Company's circumstances, consistently
applied and adequately disclosed.

We  planned  and  performed  our audit so as to obtain all the  information  and
explanations  which  we  considered  necessary  in  order  to  provide  us  with
sufficient evidence to give reasonable  assurance that the financial  statements
are  free  from  material  misstatement,   whether  caused  by  fraud  or  other
irregularity  or error.  In forming our opinion,  we also  evaluated the overall
adequacy of the presentation of information in the financial statements.

Opinion

In our  opinion,  the  financial  statements  give a true and  fair  view of the
group's  profit and cash flows for the year ended  December 31,  1997,  and have
been  properly  prepared  in  accordance  with  generally  accepted   accounting
principles in the United Kingdom.

Soteriou Banerji
Registered Auditors and Chartered Accountants
253 Gray's Inn Road
London, WC1X 8QT

Date February 23, 1998

<PAGE>


REPORT OF  INDEPENDENT  AUDITORS TO THE  SHAREHOLDERS  AND BOARD OF DIRECTORS OF
INTERNATIONAL PUBLIC RELATIONS PLC

We have audited the consolidated statements of income,  shareholders' equity and
cash  flows of  International  Public  Relations  plc and  subsidiaries  for the
fourteen-month  period ended 31 December 1997, all expressed in pounds sterling.
These financial  statements,  which are not separately presented herein, are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audit.

We conducted our audit in accordance  with United  Kingdom  auditing  standards,
which do not differ in any  significant  respect  from United  States  generally
accepted  auditing  standards.  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 audit provides a reasonable  basis
for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  consolidated   results  of  operations  and  the
consolidated  cash flows of International  Public Relations plc and subsidiaries
for the  fourteen-month  period ended 31 December 1997 in conformity with United
States generally accepted accounting principles.

Ernst & Young
London
3 February 1999

<PAGE>


                         REPORT OF INDEPENDENT AUDITORS

Board of Directors

Hill, Holliday, Connors, Cosmopulos, Inc.

We have audited the consolidated statements of operations,  stockholders' equity
(deficit)  and cash  flows of Hill,  Holliday,  Connors,  Cosmopulos,  Inc.  and
Subsidiaries  (the Company) for the twelve months ended  December 31, 1997,  not
separately  presented herein.  These financial statements are the responsibility
of the  Company's  management.  Our  responsibility  is to express an opinion on
these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
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 audit provides a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the consolidated  results of operations and
cash flows of Hill, Holliday, Connors, Cosmopulos, Inc. and Subsidiaries for the
twelve-month  period  ended  December  31,  1997 in  conformity  with  generally
accepted accounting principles.

Ernst & Young LLP
Boston, Massachusetts
March 13, 1998

<PAGE>


                              FINANCIAL STATEMENTS
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                                   DECEMBER 31
                  (Dollars in Thousands Except Per Share Data)


ASSETS                                                1999            1998
                                                   --------------------------

CURRENT ASSETS:
Cash and cash equivalents (includes
  certificates of deposit: 1999-$150,343;
  1998-$152,064)                                   $1,006,011      $  780,429
Marketable securities                                  36,765          31,733
Receivables (net of allowance for doubtful
  accounts:  1999-$60,505; 1998-$54,060)            4,401,704       3,628,137
Expenditures billable to clients                      332,833         299,134
Prepaid expenses and other current assets             146,019         154,596
                                                   --------------------------

   Total current assets                             5,923,332       4,894,029
                                                   --------------------------

OTHER ASSETS:
Investment in unconsolidated affiliates                61,987          62,244
Deferred taxes on income                                   --          91,424
Other investments and miscellaneous assets            718,939         361,980
                                                   --------------------------

   Total other assets                                 780,926         515,648
                                                   --------------------------

FIXED ASSETS, AT COST:
Land and buildings                                    164,678         117,105
Furniture and equipment                               777,368         736,822
                                                   --------------------------
                                                      942,046         853,927
Less: accumulated depreciation                        504,371         437,026
                                                   --------------------------
                                                      437,675         416,901
Unamortized leasehold improvements                    145,071         117,785
                                                   --------------------------

   Total fixed assets                                 582,746         534,686
                                                   --------------------------

Intangible assets (net of accumulated
 amortization: 1999-$607,417; 1998-$525,792)        1,879,600       1,520,445
                                                   --------------------------


TOTAL ASSETS                                       $9,166,604      $7,464,808
                                                   ==========================

<PAGE>


                              FINANCIAL STATEMENTS
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                                   DECEMBER 31
                  (Dollars in Thousands Except Per Share Data)

LIABILITIES AND STOCKHOLDERS' EQUITY                      1999             1998
                                                          ----             ----
CURRENT LIABILITIES:
Payable to banks                                    $  262,397       $  214,955
Accounts payable                                     4,568,343        3,651,307
Accrued expenses                                       761,210          709,086
Accrued income taxes                                   160,484          218,381
                                                    ---------------------------
Total current liabilities                            5,752,434        4,793,729
                                                    ---------------------------
NONCURRENT LIABILITIES:
Long-term debt                                         524,183          498,184
Convertible subordinated debentures
  and notes                                            518,490          207,927
Deferred compensation and reserve
  for termination allowances                           344,999          321,834
Deferred taxes on income                                44,744               --
Accrued postretirement benefits                         50,226           49,919
Other noncurrent liabilities                            87,548          101,097
Minority interests in consolidated
  subsidiaries                                          81,612           59,246
                                                    ---------------------------
Total noncurrent liabilities                         1,651,802        1,238,207
                                                    ---------------------------
STOCKHOLDERS' EQUITY:
Preferred Stock, no par value
  shares authorized:  20,000,000
  shares issued:  none

Common Stock, $.10 par value
  shares authorized:  550,000,000
  shares issued:
    1999 - 309,996,727;
    1998 - 304,028,927                                  31,000           30,403
Additional paid-in capital                             784,646          574,994
Retained earnings                                    1,389,971        1,169,070
Accumulated other comprehensive
  loss, net of tax                                     (76,695)        (160,970)
                                                     --------------------------
                                                     2,128,922        1,613,497
Less:
Treasury stock, at cost:
1999 - 8,909,904 shares;
1998 - 6,411,028 shares                                289,519          109,277
Unamortized expense of restricted stock grants          77,035           71,348
                                                     --------------------------
Total stockholders' equity                           1,762,368        1,432,872
                                                     --------------------------
Commitments and contingencies

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY          $9,166,604       $7,464,808
                                                    ===========================

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See note 15).

All share data for 1998 has been adjusted to reflect the two-for-one stock split
effective July 15, 1999.

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

<PAGE>

                              FINANCIAL STATEMENTS
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                  CONSOLIDATED STATEMENT OF INCOME
                             YEAR ENDED DECEMBER 31
                  (Amounts in Thousands Except Per Share Data)

                                             1999           1998           1997
                                      -----------------------------------------

Revenue                               $ 4,892,912    $ 4,167,788    $ 3,582,601

Salaries and related expenses           2,698,214      2,310,001      2,006,860
Office and general expenses             1,548,500      1,291,795      1,164,920
Special compensation charges                   --             --         32,229
Restructuring and other merger
   related costs                           84,183             --             --
                                      -----------------------------------------
Total operating expenses                4,330,897      3,601,796      3,204,009
                                      -----------------------------------------

Income from operations                    562,015        565,992        378,592

Interest expense                          (81,241)       (64,137)       (59,651)
Other income, net                         102,741         98,031        116,882
                                      -----------------------------------------

Income before provision

  for income taxes                        583,515        599,886        435,823

Provision for income taxes                242,726        244,981        197,219
                                      -----------------------------------------

Income of consolidated companies          340,789        354,905        238,604

Income applicable to

  minority interests                      (33,991)       (28,503)       (24,759)
Equity in net income of
  unconsolidated affiliates                 8,445          7,191          6,366
                                      -----------------------------------------
Net Income                            $   315,243    $   333,593    $   220,211
                                      -----------------------------------------

Per Share Data:
  Basic EPS                           $      1.08    $      1.15    $       .79
  Diluted EPS                         $      1.04    $      1.12    $       .77

Weighted average shares:
  Basic                                   292,067        288,831        277,871
  Diluted                                 302,914        299,214        295,677


All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note 15).

All share data for 1998 and 1997 has been  adjusted to reflect  the  two-for-one
stock split effective July 15, 1999.

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

<PAGE>


<TABLE>
                              FINANCIAL STATEMENTS
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                CONSOLIDATED STATEMENT OF CASH FLOWS
                             YEAR ENDED DECEMBER 31
                             (Dollars in Thousands)
<CAPTION>
                                                        1999         1998         1997
                                                    -------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                 <C>           <C>          <C>
Net income                                          $  315,243    $ 333,593    $ 220,211
Adjustments to reconcile net income to
   cash provided by operating activities:
Depreciation and amortization of fixed assets          125,432      109,109       88,300
Amortization of intangible assets                       99,326       61,396       45,682
Amortization of restricted stock awards                 25,926       20,272       16,222
Stock bonus plans/ESOP                                      --           --        1,389
Provision for (benefit of) deferred income taxes         9,316      (11,972)       7,432
Noncash pension plan charges                                --           --       16,700
Equity in net income of unconsolidated affiliates       (8,445)      (7,191)      (6,366)
Income applicable to minority interests                 33,991       28,503       24,759
Translation losses/(gains)                                 690        1,034         (319)
Special compensation charges                                --           --       31,553
Net gain on investments                                (43,390)     (40,465)     (44,626)
Restructuring costs, non-cash                           52,264           --           --
Other                                                   (5,152)      11,404      (10,452)
Change in assets and liabilities,
   net of acquisitions:
Receivables                                           (812,923)    (252,001)    (348,730)
Expenditures billable to clients                       (24,413)     (31,199)     (51,247)
Prepaid expenses and other assets                     (118,673)     (42,109)     (27,623)
Accounts payable and accrued expenses                  986,713      305,685      301,423
Accrued income taxes                                   (64,423)      26,870          435
Deferred compensation and reserve for
   termination allowances                               20,496       14,537       18,571
                                                    ------------------------------------
Net cash provided by operating activities              591,978      527,466      283,314
                                                    ------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions, net                                     (248,406)    (255,995)    (110,317)
Capital expenditures                                  (177,084)    (156,426)    (122,443)
Proceeds from sales of assets                           72,538       28,326      114,494
Net (purchases of) proceeds from
   marketable securities                                (9,114)       3,934          324
Investment in unconsolidated affiliates                (10,531)     (16,725)      (9,191)
                                                    -------------------------------------
Net cash used in investing activities                 (372,597)    (396,886)    (127,133)
                                                    -------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in short-term borrowings                       47,592       15,304       31,188
Proceeds from long-term debt                           400,152      220,494      280,801
Payments of long-term debt                             (70,037)     (96,968)     (36,161)
Proceeds from ESOP                                          --        7,420           --
Treasury stock acquired                               (300,524)    (164,928)    (144,094)
Issuance of common stock                                66,130       35,239       38,664
Cash dividends - Interpublic                           (90,424)     (76,894)     (61,242)
Cash dividends - pooled companies                       (3,137)      (8,036)     (16,516)
                                                    ------------------------------------
Net cash provided by (used in) financing activities     49,752      (68,369)      92,640
                                                    ------------------------------------
Effect of exchange rates on
  cash and cash equivalents                            (43,551)      10,998      (43,279)
                                                    ------------------------------------
Increase in cash and cash equivalents                  225,582       73,209      205,542
Cash and cash equivalents at beginning of year         780,429      707,220      501,678
                                                     -----------------------------------
Cash and cash equivalents at end of year            $1,006,011    $ 780,429    $ 707,220
                                                    ====================================

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note 15).

The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>

<TABLE>
                                                              FINANCIAL STATEMENTS
                                         THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                              CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
                                               FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 1999
                                                             (Dollars in Thousands)
<CAPTION>
                                                                  Accumulated                 Unamortized
                              Common    Additional                      Other                     Expense   Unearned
                               Stock       Paid-In   Retained   Comprehensive  Treasury     of Restricted       ESOP
                    (par value $.10)       Capital   Earnings   Income (loss)     Stock      Stock Grants       Plan       Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                            <C>      <C>          <C>          <C>            <C>           <C>            <C>        <C>
BALANCES, DECEMBER 31, 1998    $30,403  $574,994     $1,169,070   $(160,970)     $(109,277)    $(71,348)      $     --   $1,432,872
 Comprehensive income:
 Net income                                          $  315,243                                                          $  315,243
 Adjustment for minimum pension
   liability                                                         18,596                                                  18,596
Change in market value of
   securities available-for-sale                                    158,607                                                 158,607
 Foreign currency translation

   adjustment                                                       (92,928)                                                (92,928)
-----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive income                                                                                                 $399,518
Cash dividends - IPG                                    (90,424)                                                            (90,424)
Cash dividends - pooled companies                        (3,137)                                                             (3,137)
Equity adjustments - pooled companies                      (594)                                                               (594)
Awards of stock under
  Company plans:
 Achievement stock and

   incentive awards                          198                                       333                                      531
 Restricted stock,
   net of forfeitures               66    36,902                                    (7,927)      (5,687)                     23,354
Employee stock purchases            40    19,068                                                                             19,108
Exercise of stock options,
  including tax benefit            276    81,539                                                                             81,815
Purchase of Company's own stock                                                   (300,524)                                (300,524)
Issuance of shares
  for acquisitions                        63,447                                   127,876                                  191,323
Par value of shares issued
  for two-for-one stock split      187                     (187)                                                                 --
Other issuances                     28     8,498                                                                              8,526
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1999    $31,000  $784,646     $1,389,971   $ (76,695)     $(289,519)    $(77,035)      $     --   $1,762,368
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

<TABLE>
                                                              FINANCIAL STATEMENTS
                                         THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                              CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
                                               FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 1999
                                                             (Dollars in Thousands)
<CAPTION>
                                                                  Accumulated                 Unamortized
                              Common    Additional                      Other                     Expense   Unearned
                               Stock       Paid-In   Retained   Comprehensive  Treasury     of Restricted       ESOP
                    (par value $.10)       Capital   Earnings   Income (loss)     Stock      Stock Grants       Plan       Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                            <C>      <C>          <C>        <C>             <C>          <C>            <C>          <C>
BALANCES, DECEMBER 31, 1997    $29,972  $432,619     $920,622   $(159,064)      $      --    $(56,634)      $(7,420)     $1,160,095
Comprehensive income:
 Net income                                          $333,593                                                            $  333,593
 Adjustment for minimum pension
   liability                                                      (24,013)                                                  (24,013)
 Change in market value of
   securities available-for-sale                                   (2,576)                                                   (2,576)
 Foreign currency translation

   adjustment                                                      24,683                                                    24,683
-----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive income                                                                                               $  331,687
Cash dividends - IPG                                  (76,894)                                                              (76,894)
Cash dividends - pooled companies                      (8,036)                                                               (8,036)
Awards of stock under
 Company plans:
 Achievement stock and

   incentive awards                          274                                      110                                       384
 Restricted stock,
   net of forfeitures               63    36,619                                   (2,406)    (14,714)                       19,562
Employee stock purchases            26    13,325                                                                             13,351
Exercise of stock options,
  including tax benefit            123    42,518                                                                             42,641
Purchase of Company's own stock                                                  (164,928)                                 (164,928)
Issuance of shares
  for acquisitions                        36,714                                   57,947                                    94,661
Conversion of convertible

   debentures                        3     1,002                                                                              1,005
Payments from ESOP                                                                                            7,420           7,420
Par value of shares issued
  for two-for-one stock split      215                   (215)                                                                   --
Other issuances                      1    11,923                                                                             11,924
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1998    $30,403 $ 574,994   $1,169,070   $(160,970)      $(109,277)   $(71,348)      $    --      $1,432,872
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>
<TABLE>
                                                              FINANCIAL STATEMENTS
                                         THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                              CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
                                               FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 1999
                                                             (Dollars in Thousands)
<CAPTION>
                                                                  Accumulated                 Unamortized
                              Common    Additional                      Other                     Expense   Unearned
                               Stock       Paid-In   Retained   Comprehensive  Treasury     of Restricted       ESOP
                    (par value $.10)       Capital   Earnings   Income (loss)     Stock      Stock Grants       Plan       Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                            <C>      <C>          <C>        <C>             <C>          <C>            <C>          <C>
BALANCES, DECEMBER 31, 1996    $14,909  $273,537     $792,527   $ (93,572)      $      --    $(47,350)      $(7,800)     $  932,251
Comprehensive income:
 Net income                                          $220,211                                                            $  220,211
 Adjustment for minimum pension
   liability                                                           72                                                        72
 Change in market value of
   securities available-for-sale                                   12,465                                                    12,465
 Foreign currency translation

   adjustment                                                     (78,029)                                                  (78,029)
-----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive income                                                                                                 $154,719
Cash dividends - IPG                                  (61,242)                                                              (61,242)
Cash dividends - pooled companies                     (16,516)                                                              (16,516)
Awards of stock under
 Company plans:
 Achievement stock and

   incentive awards                          787                                      175                                       962
 Restricted stock,
   net of forfeitures               53    27,821                                   (3,664)     (9,284)                       14,926
Employee stock purchases            23     9,684                                                                              9,707
Exercise of stock options,
  including tax benefit            126    40,855                                                                             40,981
Purchase of Company's own stock                                                  (144,094)                                 (144,094)
Issuance of shares
  for acquisitions                       (72,129)                                 147,583                                    75,454
Conversion of convertible

  debentures                       443   118,357                                                                            118,800
Par value of shares issued
  for three-for-two stock split     59                                                                                           59
Payments from ESOP                                                                                              380             380
Special compensation charges              27,324                                                                             27,324
Deferred stock bonus charges              (4,876)                                                                            (4,876)
Par value of shares issued for
  two-for-one stock split       14,358                (14,358)                                                                   --
Other issuances                      1    11,259                                                                             11,260
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1997    $29,972  $432,619     $920,622   $(159,064)      $      --    $(56,634)      $(7,420)     $1,160,095
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note 15).

All  share  data for  1999,  1998 and 1997 has  been  adjusted  to  reflect  the
two-for-one stock split effective July 15, 1999.
<PAGE>


             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Operations
The Company is a worldwide  provider of advertising agency and related services.
The   Company   conducts   business   through   the   following    subsidiaries:
McCann-Erickson  WorldGroup,  The Lowe Group,  DraftWorldwide,  Initiative Media
Worldwide,  International  Public Relations,  Octagon,  Zentropy  Partners,  NFO
Worldwide, Allied Communications Group, and other related companies. The Company
also has arrangements  through  association with local agencies in various parts
of the world.  Other  specialized  marketing  services  conducted by the Company
include media buying, market research,  relationship (direct) marketing,  public
relations,  sports and event  marketing,  healthcare  marketing  and  e-business
consulting and communications.

Principles of Consolidation
The consolidated  financial  statements  include the accounts of the Company and
its  subsidiaries,  most of which are wholly owned. The Company also has certain
investments in unconsolidated affiliates that are carried on the equity basis.

The Company's  consolidated  financial statements,  including the related notes,
have been restated as of the earliest period presented to include the results of
operations,  financial  position  and cash flows of the 2000 pooled  entities in
addition to all prior pooled entities.

The accompanying income statements have been prepared in a format different than
that used in the  originally  filed Form 10-K for the three years ended December
31, 1999. The changes made principally  relate to the introduction of a new line
item - "Income from operations".  Amounts previously  included in "Other income,
net" as part of "Gross  Income" are now included  elsewhere in the  Consolidated
Statement of Income.

Short-term and Long-term Investments
The Company's investments in marketable and equity securities are categorized as
available-for-sale  securities,  as defined by Statement of Financial Accounting
Standards No. 115 (SFAS 115),  "Accounting  for Certain  Investments in Debt and
Equity  Securities".  Unrealized holding gains and losses are reflected as a net
amount within stockholders'  equity until realized.  The cost of securities sold
is based on the average cost of securities  when  computing  realized  gains and
losses.

Use of Estimates
The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent assets and liabilities at the date of the financial  statements,  and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

Translation of Foreign Currencies
Balance  sheet  accounts  are  translated   principally  at  rates  of  exchange
prevailing  at the  end  of  the  year  except  for  fixed  assets  and  related
depreciation  in  countries  with  highly   inflationary   economies  which  are
translated  at rates in  effect on dates of  acquisition.  Revenue  and  expense
accounts are translated at average rates of exchange in effect during each year.
Translation  adjustments  are included  within  stockholders'  equity except for
countries with highly inflationary economies, in which case they are included in
current operations.

<PAGE>
Revenues and Agency Costs
Revenues are generally  recognized when media  placements  appear and production
costs are incurred.  Salaries and other agency costs are  generally  expensed as
incurred.

Depreciation and Amortization
Depreciation  is  computed  principally  using  the  straight-line  method  over
estimated  useful lives of the related  assets,  ranging  generally from 3 to 20
years for furniture and equipment and from 10 to 45 years for various  component
parts of buildings.

Leasehold  improvements  and  rights  are  amortized  over the terms of  related
leases. Company policy provides for the capitalization of all major expenditures
for renewal and  improvements  and for current charges to income for repairs and
maintenance.

Long-lived Assets
The excess of purchase price over the fair value of net tangible assets acquired
is  amortized  on a  straight-line  basis over  periods not  exceeding 40 years.
Customer lists are amortized on a  straight-line  basis over the expected useful
life of the customer lists (generally 5 to 46 years).

The Company  evaluates the  recoverability  of the carrying  value of long-lived
assets  whenever events or changes in  circumstances  indicate that the net book
value of an operation  may not be  recoverable.  If the sum of projected  future
undiscounted  cash flows of an  operation is less than its  carrying  value,  an
impairment loss is recognized.  The impairment loss is measured by the excess of
the  carrying  value over fair value based on estimated  discounted  future cash
flows or other valuation measures.

During 1999, the Company recorded a pre-tax charge of $16 million related to the
write-off of goodwill and customer lists within NFO's North  American  financial
services   division.   Undiscounted  and  discounted  cash  flow  analyses  were
performed,  resulting in the  determination  by management  that the  intangible
assets within this division were deemed to be permanently impaired.

Income Taxes
Deferred  income taxes reflect the impact of temporary  differences  between the
amount of assets and liabilities recognized for financial reporting purposes and
such amounts recognized for income tax purposes.

Earnings per Common and Common Equivalent Share
The  Company  applies  the  principles  of  Statement  of  Financial  Accounting
Standards No. 128 (SFAS 128),  "Earnings Per Share". Basic earnings per share is
based on the  weighted-average  number of common shares  outstanding during each
year.  Diluted  earnings  per  share  also  includes  common  equivalent  shares
applicable  to grants under the stock  incentive  and stock option plans and the
assumed conversion of convertible subordinated debentures and notes, if they are
determined to be dilutive.

Treasury Stock
Treasury  stock is acquired at market  value and is recorded at cost.  Issuances
are accounted for on a first-in, first-out basis.

Concentrations of Credit Risk
The  Company's  clients are in various  businesses,  located  primarily in North
America, Latin America, Europe and the Asia Pacific Region. The Company performs
ongoing  credit  evaluations  of its  clients.  Reserves  for credit  losses are
maintained at levels considered adequate by management.  The Company invests its
excess cash in deposits with major banks and in money market  securities.  These
securities typically mature within 90 days and bear minimal risk.

<PAGE>
Segment Reporting
The Company  provides  advertising  and many other closely  related  specialized
marketing services.  All of these services fall within one reportable segment as
defined in  Statement  of  Financial  Accounting  Standards  No. 131 (SFAS 131),
"Disclosures about Segments of an Enterprise and Related Information."

Accounting for Derivative Instruments and Hedging Activities
In June 1998, the FASB issued  Statement of Financial  Accounting  Standards No.
133, "Accounting for Derivative  Instruments and Hedging Activities" (SFAS 133),
which had an initial  adoption  date by the Company of January 1, 2000.  In June
1999,  the FASB  postponed  the adoption date of SFAS 133 until January 1, 2001.
SFAS 133 will require the Company to record all derivatives on the balance sheet
at fair value.  Changes in  derivative  fair values will either be recognized in
earnings  as offsets to the  changes  in fair  value of related  hedged  assets,
liabilities and firm  commitments or for forecasted  transactions,  deferred and
later   recognized  in  earnings  at  the  same  time  as  the  related   hedged
transactions.  The impact of SFAS 133 on the Company's financial statements will
depend on a variety of factors,  including  the future level of  forecasted  and
actual  foreign  currency  transactions,  the  extent of the  Company's  hedging
activities,  the type of hedging  instruments used and the effectiveness of such
instruments.  However,  the Company does not believe the effect of adopting SFAS
133 will be material to its financial condition or results of operations.

Reclassifications
Certain  amounts  for prior years have been  reclassified  to conform to current
year presentation.




NOTE 2:  STOCKHOLDERS' EQUITY
On July 15, 1999, the stockholders  approved a two-for-one stock split, effected
in the form of a payment of a 100  percent  stock  dividend to  stockholders  of
record on June 29,  1999.  The  number of shares of common  stock  reserved  for
issuance  pursuant to various plans under which stock is issued was increased by
100 percent. The two-for-one stock split has been reflected retroactively in the
consolidated  financial  statements and all per share data,  shares,  and market
prices of the  Company's  common stock  included in the  consolidated  financial
statements  and notes  thereto  have been  adjusted  to give effect to the stock
split.

Comprehensive Income
Accumulated other  comprehensive  income (loss) amounts are reflected net of tax
in the consolidated financial statements as follows:

<PAGE>
(Dollars in thousands)
                                                                        Total
                                                                     Accumulated
                                Foreign     Unrealized   Minimum        Other
                               Currency      Holding     Pension   Comprehensive
                               Translation    Gains/    Liability      Income/
                               Adjustment    (Losses)   Adjustment     (Loss)
                               -------------------------------------------------

Balances, December 31, 1996     $ (80,270)    $     --    $(13,302)   $ (93,572)
Current-period change             (78,029)      12,465          72      (65,492)
                                -----------------------------------------------

Balances, December 31, 1997     $(158,299)    $ 12,465    $(13,230)   $(159,064)
Current-period change              24,683       (2,576)    (24,013)      (1,906)
                                -----------------------------------------------

Balances, December 31, 1998     $(133,616)    $  9,889    $(37,243)   $(160,970)
Current-period change             (92,928)     158,607      18,596       84,275
                                -----------------------------------------------

Balances, December 31, 1999     $(226,544)    $168,496    $(18,647)   $ (76,695)
                                ===============================================


The foreign currency translation  adjustments are not tax-effected.  See Note 13
for additional discussion of unrealized holding gains on investments.




NOTE 3:  EARNINGS PER SHARE

In accordance with SFAS 128, the following is a reconciliation of the components
of the basic  and  diluted  EPS  computations  for  income  available  to common
stockholders for the year ended December 31:

<TABLE>
(Dollars in Thousands Except Per Share Data)
<CAPTION>
                                            1999                                1998                             1997
                               -----------------------------------------------------------------------------------------------------
                                                        Per                                  Per                              Per
                                                        Share                                Share                            Share
                               Income      Shares       Amount      Income     Shares        Amount   Income     Shares       Amount
                               -----------------------------------------------------------------------------------------------------
<S>                           <C>          <C>          <C>         <C>       <C>            <C>      <C>        <C>          <C>
BASIC EPS
Income available
 to common stockholders        $315,243    292,066,936  $1.08       $333,593  288,830,671    $1.15    $220,211   277,870,558  $.79

Effect of Dilutive Securities:
 Options                                     7,310,525                          6,923,813                          6,508,296
 Restricted stock                   631      3,536,805                   541    3,453,838                  447     3,277,294
 3 3/4% Convertible
    subordinated debentures          --             --                    --        5,320                5,929     8,020,582

DILUTED EPS                    $315,874    302,914,266  $1.04       $334,134  299,213,642    $1.12    $226,587   295,676,730  $.77
                               -----------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>
The  computation  of diluted EPS for 1999,  1998,  and 1997 excludes the assumed
conversion of the 1.80% Convertible  Subordinated Notes and the 1999 computation
also  excludes the 1.87%  Convertible  Subordinated  Notes (See Note 10) because
they were  antidilutive.  In the fourth  quarter of 1997,  the Company  redeemed
substantially all its 3 3/4% Convertible Subordinated Debentures due 2002.

All data for 1999,  1998,  and 1997 has been  restated to reflect the  aggregate
effect of the  acquisitions  accounted for as poolings of  interests.  (See Note
15).

All share data for 1998 and 1997 has been  adjusted to reflect  the  two-for-one
stock split effective July 15, 1999.




NOTE 4: ACQUISITIONS
The Company acquired a number of advertising and communications companies during
the three-year  period ended December 31, 1999.  The aggregate  purchase  price,
including  cash  and  stock  payments  for new  acquisitions  (including  pooled
entities),  was $559  million,  $820 million and $378 million in 1999,  1998 and
1997, respectively.  The aggregate purchase price for new acquisitions accounted
for as purchases and equity investments was $293 million, $405 million, and $144
million in 1999, 1998, and 1997, respectively.

1999
In 1999,  the Company paid $189 million in cash and issued  8,393,893  shares of
its common stock to acquire 56 companies. Of the acquisitions, 52 were accounted
for under the purchase  method of accounting  and 4 were accounted for under the
pooling  of  interests  method.  The  Company  also  recorded  a  liability  for
acquisition   related  deferred  payments  of  $28  million,   for  cases  where
contingencies related to acquisitions have been resolved.

For those entities accounted for as purchase transactions, the purchase price of
the acquisitions  has been allocated to assets acquired and liabilities  assumed
based on  estimated  fair  values.  The results of  operations  of the  acquired
companies  were included in the  consolidated  results of the Company from their
respective  acquisition dates which occurred  throughout the year. The companies
acquired  in  transactions  accounted  for as  purchases  included  The  Cassidy
Companies,  Inc.,  Spedic  France  S.A.,  Mullen  Advertising,   Inc.,  and  PDP
Promotions UK Ltd. None of the  acquisitions  was  significant  on an individual
basis.

In connection  with the 1999 purchase  transactions,  goodwill of  approximately
$254 million was  recorded.  The  purchase  price  allocations  made in 1999 are
preliminary and subject to adjustment.  Goodwill  related to the acquisitions is
being amortized on a straight-line basis over their estimated useful lives.

On  December  1, 1999,  the Company  acquired  Brands  Hatch  Leisure  Plc.  for
5,158,122  shares of stock.  The acquisition has been accounted for as a pooling
of interests.  Additionally,  during 1999 the Company  issued  641,596 shares to
acquire  3  other  companies  which  have  been  accounted  for as  poolings  of
interests.

The following  unaudited pro forma data  summarize the results of operations for
the periods indicated as if the 1999 purchase acquisitions had been completed as
of January 1, 1998. The pro forma data give effect to actual  operating  results
prior to the acquisition,  adjusted to include the estimated pro forma effect of
interest expense,  amortization of intangibles and income taxes. These pro forma
amounts do not purport to be  indicative of the results that would have actually
been  obtained if the  acquisitions  occurred as of the beginning of the periods
presented or that may be obtained in the future.

<PAGE>
For the year ended December 31, 1999

(Amounts in thousands except per share data)

                                    Pre-        Pro forma IPG
                                 acquisition      with 1999
                     IPG           results      acquisitions
                (as reported)    (unaudited)     (unaudited)
                -------------    -----------     -----------
Revenues          $4,892,912      $104,529       $4,997,441
Net income           315,243         7,101          322,344

Earnings per share:

     Basic              1.08                           1.10
     Diluted            1.04                           1.06


Net income  amounts  shown in the table above  include  restructuring  and other
merger related costs of $51.4 million, net of tax.

For the year ended December 31, 1998

(Amounts in thousands except per share data)

                                  Results      Pro forma IPG
                                  of 1999         with 1999
                     IPG        acquisitions    acquisitions
                (as reported)    (unaudited)     (unaudited)
                -------------    -----------     -----------
Revenues         $4,167,788       $446,833       $4,614,621
Net income          333,593         15,819          349,412

Earnings per share:

     Basic             1.15                            1.20
     Diluted           1.12                            1.17


1998
In 1998,  14,956,534  shares of the  Company's  common  stock  were  issued  for
acquisitions  accounted for as poolings of interests.  The companies  pooled and
the respective  shares of the Company's common stock issued were:  International
Public Relations Plc. - 5,280,346 shares,  Hill Holliday - 4,124,868 shares, The
Jack Morton Company - 4,271,992 shares,  Carmichael Lynch, Inc. - 973,808 shares
and KBA Marketing - 305,520 shares.

In 1998,  the Company paid $282 million in cash and issued  2,718,504  shares of
its common stock to acquire 77 companies,  all of which have been  accounted for
as purchases. These acquisitions included Gillespie, Ryan McGinn, CSI, Flammini,

Gingko,  Defederico,  Herrero Y Ochoa, Infratest Burke AG, CF Group,  MarketMind
Technologies,  and  Ross-Cooper-Lund.  The Company also recorded a liability for
acquisition related deferred payments of $24 million.

<PAGE>
1997
In  1997,  the  Company  issued  10,789,079  shares  of  its  common  stock  for
acquisitions  accounted  for as poolings  of  interests.  Some of the  companies
pooled and the  respective  shares of the  Company's  common  stock issued were:
Complete Medical Group - 1,417,578 shares, The MBL Group plc - 1,126,114 shares,
Prognostics - 1,425,123 shares, Integrated Communications Corporation- 1,170,108
shares,  Advantage  International  -  1,158,412  shares and  Ludgate - 1,078,918
shares.  Additional  companies  accounted  for as poolings of interests  include
Adler Boschetto Peebles, Barnett Fletcher, Davies Baron, Diefenbach Elkins, D.L.
Blair, Rubin Barney & Birger, Inc. and Technology Solutions Inc.

In 1997,  the  Company  also paid  $101.1  million in cash and issued  2,792,950
shares of its common  stock for  acquisitions  accounted  for as  purchases  and
equity  investments.   These  acquisitions  included  Marketing  Corporation  of
America,  Medialog, The Sponsorship Group,  Kaleidoscope and Addis Wechsler (51%
interest).  The Company  increased its interest in Campbell  Mithun Esty by 25%.
The Company also recorded a liability for acquisition  related deferred payments
of $38 million.

Deferred Payments
Certain of the Company's acquisition agreements provide for deferred payments by
the  Company,  contingent  upon  future  revenues  or profits  of the  companies
acquired.  Deferred  payments  of both cash and shares of the  Company's  common
stock for prior years'  acquisitions  were $210  million,  $84 million,  and $51
million in 1999, 1998 and 1997, respectively.  Such payments are capitalized and
recorded as goodwill.

Investments
During 1999,  the Company sold a portion of its  investments  in Lycos and USWEB
for combined  proceeds of approximately $56 million.  Additionally,  the Company
sold its minority  investment  in Nicholson  NY, Inc. to Icon for $19 million in
shares of Icon's common stock.

During 1998, the Company sold a portion of its investments in USWEB,  CKS Group,
Inc.  and Lycos with  combined  proceeds of  approximately  $20  million.  These
investments are being accounted for as available-for-sale  securities,  pursuant
to the requirements of SFAS 115.

During 1997,  the Company sold its  investment  in All American  Communications,
Inc. for approximately $77 million.

Restatement
As  discussed  in Note 15,  the  Company  acquired  NFO in April  2000 in a
transaction which was accounted for as a pooling of interests.  The accompanying
consolidated  financial  statements,  including  the  related  notes,  have been
restated  as of  the  earliest  period  presented  to  include  the  results  of
operations,  financial position and cash flows of NFO. Additionally, the results
of  several  other  recent  acquisitions  have  been  included  in the  restated
financial statements. Revenue and net income for the combining entities included
in the consolidated  statement of income for the years ending December 31, 1999,
1998 and 1997 are summarized below.

<PAGE>
                                            Revenue     Net Income/(Loss)
                                          ----------    -----------------
For the year ended December 31, 1999:

     As Reported                          $4,427,303       $ 321,921
     Pooled Companies                        465,609          (6,678)
     As Restated                          $4,892,912       $ 315,243

For the year ended December 31, 1998:

     As Reported                          $3,844,340       $ 309,905
     Pooled Companies                        323,448          23,688
     As Restated                          $4,167,788       $ 333,593

For the year ended December 31, 1997:

     As Reported                          $3,352,776       $ 200,378
     Pooled Companies                        229,825          19,833
     As Restated                          $3,582,601       $ 220,211



NOTE 5:  PROVISION FOR INCOME TAXES
The Company  accounts for income taxes under  Statement of Financial  Accounting
Standards No. 109 (SFAS 109), "Accounting for Income Taxes". SFAS 109 applies an
asset and  liability  approach  that  requires the  recognition  of deferred tax
assets and liabilities  with respect to the expected future tax  consequences of
events that have been recognized in the  consolidated  financial  statements and
tax returns.

The components of income before provision for income taxes are as follows:

(Dollars in thousands)                     1999            1998           1997
                                         ------            ----           ----
Domestic                                 $347,916        $315,682       $196,939
Foreign                                   235,599         284,204        238,884
                                         ---------------------------------------
Total                                    $583,515        $599,886       $435,823

The provision for income taxes consisted of:

Federal Income Taxes (Including
   Foreign Withholding Taxes):
  Current                                $ 92,018        $110,226       $ 75,736
  Deferred                                 19,891           4,335          3,683
                                         ---------------------------------------
                                          111,909         114,561         79,419
                                         ---------------------------------------
State and Local Income Taxes:
  Current                                  21,923          23,058         23,938
  Deferred                                  4,252             802            286
                                         ---------------------------------------
                                           26,175          23,860         24,224
                                         ---------------------------------------

Foreign Income Taxes:
  Current                                 119,469         123,669         90,113
  Deferred                                (14,827)        (17,109)         3,463
                                         ---------------------------------------
                                          104,642         106,560         93,576
                                         ---------------------------------------
Total                                    $242,726        $244,981       $197,219
                                         =======================================
<PAGE>

At December 31, 1999 and 1998 the deferred tax assets/(liabilities) consisted of
the following items:

(Dollars in thousands)                                      1999           1998
                                                            ----           ----

Postretirement/postemployment benefits                  $ 53,461       $ 47,875
Deferred compensation                                      4,940         34,285
Pension costs                                             10,036         13,715
Depreciation                                              (8,537)       (10,953)
Rent                                                      (8,674)        (6,424)
Interest                                                   4,100          4,598
Accrued reserves                                           9,399          9,155
Investments in equity securities                        (140,320)       (10,677)
Tax loss/tax credit carryforwards                         47,783         47,293
Restructuring and other merger related costs               9,497             --
Other                                                       (196)        (6,032)
                                                        -----------------------
Total deferred tax assets / (liabilities)                (18,511)       122,835
Deferred tax valuation allowance                          26,233         31,411
                                                        -----------------------
Net deferred tax assets / (liabilities)                 $(44,744)      $ 91,424
                                                        =======================


The valuation  allowance of $26.2 million and $31.4 million at December 31, 1999
and  1998,  respectively,  represents  a  provision  for  uncertainty  as to the
realization of certain  deferred tax assets,  including U.S. tax credits and net
operating loss carryforwards in certain jurisdictions. The change during 1999 in
the  deferred  tax  valuation  allowance  primarily  relates  to  changes in the
deferred  compensation  tax  item,  net  operating  loss  carryforwards  and tax
credits.   At  December  31,  1999,  there  were  $9.7  million  of  tax  credit
carryforwards  with  expiration  periods  through  2004 and net  operating  loss
carryforwards  with a tax  effect  of  $38.1  million  with  various  expiration
periods.

A  reconciliation  of the effective income tax rate as shown in the consolidated
statement of income to the federal statutory rate is as follows:

                                                    1999      1998      1997
                                                    ----      ----      ----
Statutory federal income tax rate                   35.0%     35.0%     35.0%
State and local income taxes,
  net of federal income tax benefit                  2.8       3.7       4.1
Impact of foreign operations, including
  withholding taxes                                  0.8       0.4       0.3
Goodwill and intangible assets                       3.6       2.8       2.7
Effect of pooled companies                           1.3      (0.5)      3.1
Other                                               (1.9)     (0.6)      0.1
                                                    ------------------------
Effective tax rate                                  41.6%     40.8%     45.3%
                                                    ------------------------

The total amount of  undistributed  earnings of foreign  subsidiaries for income
tax purposes  was  approximately  $585  million at December 31, 1999.  It is the
Company's   intention  to  reinvest   undistributed   earnings  of  its  foreign
subsidiaries and thereby indefinitely postpone their remittance. Accordingly, no
provision  has been made for foreign  withholding  taxes or United States income
taxes which may become payable if undistributed earnings of foreign subsidiaries
were paid as dividends to the Company.  The additional  taxes on that portion of
undistributed  earnings  which is available for  dividends  are not  practicably
determinable.
<PAGE>


NOTE 6: SUPPLEMENTAL CASH FLOW INFORMATION
Cash and Cash Equivalents

For purposes of the consolidated  statement of cash flows, the Company considers
all highly liquid investments with a maturity of three months or less to be cash
equivalents.

Income Tax and Interest Payments

Cash paid for income taxes was approximately $186 million, $200 million and $133
million  in  1999,  1998  and  1997,   respectively.   Interest   payments  were
approximately $57 million,  $40 million and $32 million in 1999, 1998, and 1997,
respectively.

Noncash Financing Activity

During  1997,  the Company  redeemed  all  outstanding  issues  under the 3 3/4%
Convertible   Subordinated  Debentures  due  2002.   Substantially  all  of  the
outstanding  debentures were converted into  approximately 8.6 million shares of
the Company's common stock.

Acquisitions

As more  fully  described  in Note  4,  the  Company  issued  8,393,893  shares,
17,942,578  shares,  and  10,518,628  shares of the  Company's  common  stock in
connection with acquisitions during 1999, 1998 and 1997,  respectively.  Details
of  businesses  acquired in  transactions  accounted  for as  purchases  were as
follows:

(Dollars in thousands)

                                             1999          1998         1997
                                             ----          ----         ----

Fair value of assets acquired             $627,005      $726,601     $303,969
Liabilities assumed                        148,637       319,676       90,303
                                          -----------------------------------
Net assets acquired                        478,368       406,925      213,666
Less: noncash consideration                186,210        91,077       96,814
Less: cash acquired                         43,752        59,853        6,535
                                          -----------------------------------
Net cash paid for acquisitions            $248,406      $255,995     $110,317
                                          ===================================


The amounts  shown above  exclude  future  deferred  payments due in  subsequent
years, but include cash deferred  payments of $120 million,  $55 million and $30
million made during 1999, 1998 and 1997, respectively.



<PAGE>
NOTE 7: INCENTIVE PLANS
The 1997  Performance  Incentive  Plan  ("1997 PIP Plan")  was  approved  by the
Company's  stockholders  in May 1997 and  includes  both  stock  and cash  based
incentive  awards.  The maximum  number of shares of the Company's  common stock
which may be  granted  in any year  under the 1997 PIP Plan is equal to 1.85% of
the total  number of shares of the  Company's  common stock  outstanding  on the
first day of the year adjusted for additional  shares as defined in the 1997 PIP
Plan document (excluding management incentive compensation  performance awards).
The 1997 PIP Plan also  limits the number of shares  available  with  respect to
awards  made to any one  participant  as well as  limiting  the number of shares
available  under certain  awards.  Awards made prior to the 1997 PIP Plan remain
subject to the respective terms and conditions of the predecessor plans.  Except
as otherwise noted,  awards under the 1997 PIP Plan have terms similar to awards
made under the respective predecessor plans.

Stock Options
Outstanding  options  are  generally  granted  at the fair  market  value of the
Company's common stock on the date of grant and are exercisable as determined by
the  Compensation  Committee  of  the  Board  of  Directors  (the  "Committee").
Generally,  options become exercisable between two and five years after the date
of grant and expire ten years from the grant date.

Following is a summary of stock option transactions during the three-year period
ended December 31:

                               1999                1998                1997
                        --------------------------------------------------------
                                  Weighted            Weighted          Weighted
                                   Average             Average           Average
                                  Exercise            Exercise          Exercise
(Shares in thousands)   Shares       Price   Shares      Price    Shares   Price
                        --------------------------------------------------------
Shares under option,
  beginning of year     29,505     $ 19      25,466     $ 13     25,230    $ 11
Options granted          4,743       39       8,399       32      4,830      19
Options exercised       (4,497)      11      (3,108)       8     (3,549)      8
Options cancelled       (2,124)      25      (1,252)      15     (1,045)     12
                        ------               ------              ------
Shares under option,
   end of year          27,627     $ 23      29,505     $ 19     25,466    $ 13
                        ======               ======              ======
Options exercisable
   at year-end           7,955     $ 13       6,954     $ 11      9,158    $  9

<PAGE>

The following table summarizes  information about stock options  outstanding and
exercisable at December 31, 1999:

(Shares in thousands)

                                 Weighted-
                                   Average   Weighted-                Weighted-
                      Number     Remaining     Average        Number    Average
Range of         Outstanding   Contractual    Exercise   Exercisable   Exercise
Exercise Prices  at 12/31/99          Life       Price   at 12/31/99      Price
-------------------------------------------------------------------------------
$ 4.33 to $9.99       2,990           2            $ 7         2,865        $ 8

 10.00 to 14.99       3,422           5             11         3,093         11

 15.00 to 24.99       9,996           7             17         1,666         20

 25.00 to 56.28      11,220           9             36           612         30


Employee Stock Purchase Plan
Under the Employee  Stock  Purchase Plan (ESPP),  employees may purchase  common
stock of the Company  through  payroll  deductions  not  exceeding  10% of their
compensation.  The  price  an  employee  pays for a share of stock is 85% of the
market  price  on the  last  business  day  of the  month.  The  Company  issued
approximately .5 million shares in 1999, 1998, and 1997, respectively, under the
ESPP. An additional  15.5 million  shares were reserved for issuance at December
31, 1999.

SFAS 123 Disclosures
The  Company  applies  the  disclosure  principles  of  Statement  of  Financial
Accounting   Standards  No.  123  (SFAS  123),   "Accounting   for   Stock-Based
Compensation".  As permitted by the provisions of SFAS 123, the Company  applies
APB  Opinion  25,  "Accounting  for Stock  Issued  to  Employees",  and  related
interpretations in accounting for its stock-based  employee  compensation plans.
If compensation  cost for the Company's stock option plans and its ESPP had been
determined  based on the fair  value at the grant  dates as defined by SFAS 123,
the  Company's  pro forma net income and  earnings  per share would have been as
follows:

(Dollars in Thousands Except Per Share Data)

                                       1999             1998              1997
                                       ----             ----              ----
Net Income            As reported    $315,243          $333,593         $220,211
                      Pro forma      $287,601          $315,770         $207,250

Earnings Per Share
        Basic         As reported    $   1.08          $   1.15         $    .79
                      Pro forma      $   0.98          $   1.09         $    .75
        Diluted       As reported    $   1.04          $   1.12         $    .77
                      Pro forma      $   0.95          $   1.06         $    .70


For  purposes  of this pro forma  information,  the fair value of shares  issued
under  the ESPP  was  based  on the 15%  discount  received  by  employees.  The
weighted-average  fair  value  (discount)  on the  date of  purchase  for  stock
purchased under this plan was $5.28,  $3.82,  and $2.68 in 1999, 1998, and 1997,
respectively.

<PAGE>

The weighted  average fair value of options granted during 1999,  1998, and 1997
was $12.94, $8.85, and $5.91, respectively. The fair value of each option grant

has been estimated on the date of grant using the  Black-Scholes  option-pricing
model with the following assumptions:

                                              1999           1998          1997
                                              ----           ----          ----
Expected option lives                       6 years        6 years       6 years
Risk free interest rate                      5.72%          4.87%         6.51%
Expected volatility                         19.73%         19.17%        19.17%
Dividend yield                                .81%           .95%          1.3%

As required by SFAS 123,  this pro forma  information  is based on stock  awards
beginning in 1995 and accordingly is not likely to be  representative of the pro
forma  effects in future  years  because  options  vest over  several  years and
additional awards generally are made each year.

Restricted Stock
Restricted  stock  issuances  are  subject to certain  restrictions  and vesting
requirements  as determined by the  Committee.  The vesting  period is generally
five to seven  years.  No monetary  consideration  is paid by a recipient  for a
restricted  stock  award  and the  grant  date  fair  value of these  shares  is
amortized over the restriction  periods. At December 31, 1999, there was a total
of 7.0 million shares of restricted  stock  outstanding.  During 1999,  1998 and
1997, the Company awarded .9 million shares,  1.3 million shares and 1.4 million
shares of  restricted  stock  with a  weighted-average  grant date fair value of
$40.03, $28.99 and $19.48, respectively.  The cost recorded for restricted stock
awards  in 1999,  1998 and 1997 was  $25.9  million,  $20.3  million,  and $16.2
million, respectively.

Performance Units
Performance  units have been awarded to certain key employees of the Company and
its  subsidiaries.  The ultimate value of these  performance units is contingent
upon the annual  growth in profits (as  defined) of the Company,  its  operating
components or both, over the performance  periods. The awards are generally paid
in cash.  The  projected  value of these  units is  accrued by the  Company  and
charged  to  expense  over  the  performance   period.   The  Company   expensed
approximately $27 million,  $20 million and $20 million in 1999, 1998, and 1997,
respectively.

Hill Holliday
Due to the merger of Hill Holliday and the Company,  Hill Holliday  recognized a
one-time compensation charge of approximately $32 million in 1997. Hill Holliday
had an Equity  Participation  Plan and  certain  other  agreements  for  various
members of management,  which provided for  participants to receive a portion of
the proceeds in the event of the sale or merger of Hill Holliday.  Also included
in the charge were costs  primarily  relating  to  consulting  and  supplemental
retirement agreements.



NOTE 8: RETIREMENT PLANS
Defined Benefit Pension Plans
Through March 31, 1998 the Company and certain of its domestic  subsidiaries had
a defined  benefit plan  ("Domestic IPG Plan") which covered  substantially  all
regular domestic employees. Effective April 1, 1998 this Plan was curtailed, and
participants  with five or less  years of  service  became  fully  vested in the
Domestic Plan.  Participants  with five or more years of service as of March 31,
1998 retain their vested  balances and participate in a new  compensation  plan.

<PAGE>
Under  the new plan,  each  participant's  account  is  credited  with an annual
allocation,  equal to the  projected  discounted  pension  benefit  accrual plus
interest,  while they continue to work for the Company.  Participants  in active
service are eligible to receive up to ten years of allocations  coinciding  with
the number of years of service  with the  Company  after  March 31,  1998.  As a
result of the change in the  Domestic  Plan,  the  Company  recorded  charges of
approximately $16.7 million in the fourth quarter of 1997.

Net periodic  pension  costs for the  Domestic IPG Plan for 1999,  1998 and 1997
were $1.3 million,  $.9 million and $15.0  million,  respectively.  The 1997 net
periodic pension cost included a $10 million  curtailment  charge and $4 million
of service costs.

Additionally,  NFO  maintains  a defined  benefit  plan  ("NFO  Plan")  covering
approximately one half of NFO's U.S.  employees.  The periodic pension costs for
this plan for  1999,  1998,  and 1997  were $.8  million,  $.6  million  and $.6
million, respectively.

The Company's  stockholders' equity balance includes a minimum pension liability
of $18.6 million, $37.2 million and $13.2 million at December 31, 1999, 1998 and
1997, respectively.

The Company also has several  foreign  pension plans in which benefits are based
primarily on years of service and  employee  compensation.  It is the  Company's
policy  to fund  these  plans in  accordance  with  local  laws and  income  tax
regulations.

Net periodic  pension costs for foreign  pension  plans for 1999,  1998 and 1997
included the following components:

(Dollars in thousands)

                                                   1999        1998        1997
                                                   ----        ----        ----
Service cost                                   $  9,619    $  6,847    $  5,460
Interest cost                                    11,759      10,908      10,633
Expected return on plan assets                   (9,380)     (9,437)    (10,537)
Amortization of unrecognized
transition obligation                               390         373         324
Amortization of
prior service cost                                  833         482         552
Recognized actuarial loss / (gain)                  508         (70)     (1,440)
Other                                                (9)         --          --
                                               --------------------------------
Net periodic pension cost                      $ 13,720    $  9,103    $  4,992
                                               --------------------------------


The following table sets forth the change in the benefit obligation,  the change
in plan assets,  the funded status and amounts  recognized for the pension plans
in the Company's consolidated balance sheet at December 31, 1999, and 1998:

<PAGE>
(Dollars in thousands)
                                         Domestic                  Foreign
                                       Pension Plans             Pension Plans
                               ------------------------------------------------
                                    1999         1998         1999         1998
                               ------------------------------------------------
Change in benefit obligation
Beginning obligation           $ 166,538    $ 141,376    $ 220,964    $ 179,016
Service cost                         768          627        9,619        6,847
Interest cost                      9,869       10,367       11,759       10,908
Benefits paid                    (12,671)     (12,899)     (12,777)      (9,447)
Participant contributions              -            -        2,410        1,606
Actuarial (gains) / losses       (12,626)      27,067       (7,264)      29,882
Currency effect                       --           --        1,440        5,245
Other                                 --           --          352       (3,093)
                               ------------------------------------------------
Ending obligation                151,878      166,538      226,503      220,964
                               ------------------------------------------------
Change in plan assets
Beginning fair value             129,755      122,157      161,975      145,942
Actual return on plan assets      15,354       12,292       30,651       17,363
Employer contributions             3,072        8,205        7,887        2,473
Participant contributions             --           --        2,410        1,606
Benefits paid                    (12,671)     (12,899)     (12,777)      (9,447)
Currency effect                       --           --          156        1,300
Other                                 --           --        2,437        2,738
                               ------------------------------------------------
Ending fair value                135,510      129,755      192,739      161,975
                               ------------------------------------------------
Funded status of the plans       (16,368)     (36,783)     (33,764)     (58,989)
Unrecognized net actuarial
  loss/(gain)                     18,927       38,439      (18,163)      11,536
Unrecognized prior service cost      (13)         (20)       3,704        2,921
Unrecognized transition cost          --           --        1,838        3,796
                               ------------------------------------------------
Net asset/(liability)
  recognized                   $   2,546    $   1,636   $  (46,385)   $ (40,736)
                               ------------------------------------------------

At December 31, 1999 and 1998,  the assets of the Domestic  Plan and the foreign
pension plans were primarily invested in fixed income and equity securities.

For the Domestic Plans, discount rates of 7.75% in 1999, 6.75% to 7% in 1998 and
7.25% to 7.5% in 1997 and salary  increase  assumptions of 4.5% in 1999 (the NFO
Plan)  4.5% to 6% in 1998 and 4.75% to 6% in 1997 were used in  determining  the
actuarial present value of the projected benefit obligation. The expected return
of Domestic Plan assets was 9% to 9.5% in 1999 and 9% to 10% in each of 1998 and
1997. For the foreign pension plans, discount rates ranging from 3.75% to 14% in
1999, 4% to 14% in 1998, and 3.5% to 14% in 1997 and salary increase assumptions
ranging  from 3% to 10% in 1999 and 2% to 10% in both 1998 and 1997 were used in
determining the actuarial present value of the projected benefit obligation. The
expected rates of return on the assets of the foreign  pension plans ranged from
2% to 14% in 1999, 2% to 14% in 1998 and 3.5% to 14% in 1997.

The projected benefit obligation,  accumulated benefit obligation and fair value
of plan assets for the Domestic  Plan were $152  million,  $152 million and $136
million,  respectively, as of December 31, 1999, and $167 million, $167 million,
and $130 million,  respectively,  as of December 31, 1998. The projected benefit
obligation,  accumulated benefit  obligation,  and fair value of plan assets for
the foreign pension plans with accumulated benefit obligations in excess of plan
assets were $90 million, $72 million and $9 million respectively, as of December
31,  1999,  and $81  million,  $74  million and $3 million  respectively,  as of
December 31, 1998.
<PAGE>

Other Benefit Arrangements
The Company also has special  unqualified  deferred  benefit  arrangements  with
certain key  employees.  Vesting is based upon the age of the  employee  and the
terms of the employee's  contract.  Life insurance contracts have been purchased
in amounts which may be used to fund these arrangements.

In addition to the defined  benefit  plans  described  above,  the Company  also
sponsors a defined  contribution plan ("Savings Plan") that covers substantially
all  domestic  employees  of the Company  and  participating  subsidiaries.  The
Savings Plan permits  participants  to make  contributions  on a pre-tax  and/or
after-tax  basis.  The Savings Plan allows  participants to choose among several
investment  alternatives.   The  Company  matches  a  portion  of  participants'
contributions based upon the number of years of service. The Company contributed
$12 million, $9.3 million and $7.2 million to the Savings Plan in 1999, 1998 and
1997, respectively.

Postretirement Benefit Plans
The Company and its  subsidiaries  provide  certain  postretirement  health care
benefits  for  employees  who were in the employ of the Company as of January 1,
1988,  and life  insurance  benefits for employees who were in the employ of the
Company as of December 1, 1961. The plans cover certain  domestic  employees and
certain key  employees  in foreign  countries.  Effective  January 1, 1993,  the
Company's plan covering  postretirement  medical benefits was amended to place a
cap on annual benefits payable to retirees.

The coverage is self-insured, but is administered by an insurance company.

The Company  accrues the expected  cost of  postretirement  benefits  other than
pensions over the period in which the active  employees become eligible for such
postretirement benefits.

The net periodic  expense for these  postretirement  benefits for 1999, 1998 and
1997 was $2.2 million, $3 million and $2.8 million, respectively.

The following table sets forth the change in benefit obligation,  change in plan
assets,  funded status and amounts  recognized for the Company's  postretirement
benefit plans in the consolidated balance sheet at December 31, 1999 and 1998:

<PAGE>
(Dollars in thousands)
                                                             1999         1998
                                                           ---------------------
Change in benefit obligation
Beginning obligation                                       $ 41,793    $ 42,863
Service cost                                                    477         785
Interest cost                                                 2,795       3,154
Participant contributions                                        90          77
Benefits paid                                                (2,020)     (1,722)
Plan amendments                                                  --         (68)
Actuarial gain                                               (4,300)     (3,296)
                                                           --------------------
Ending obligation                                            38,835      41,793
                                                           --------------------
Change in plan assets
Beginning fair value                                             --          --
Actual return on plan assets                                     --          --
Employer contributions                                        1,930       1,645
Participant contributions                                        90          77
Benefits paid                                                (2,020)     (1,722)
                                                           --------------------
Ending fair value                                                --          --
                                                           --------------------
Funded status of the plans                                  (38,835)    (41,793)
Unrecognized net actuarial gain                              (9,440)     (5,234)
Unrecognized prior service cost                              (1,952)     (2,893)
                                                           --------------------
Net amount recognized                                      $(50,227)   $(49,920)
                                                           --------------------

Discount  rates of 7.5% to 7.75%  in 1999,  6.75% in 1998 and  7.25% in 1997 and
salary increase assumption of 4% to 6% in 1999 and 1998, and 4.75% to 6% in 1997
were used in determining the accumulated postretirement benefit obligation. A 7%
to 7.4% and an 8% increase  in the cost of covered  health  care  benefits  were
assumed  for 1999 and 1998,  respectively.  This  rate is  assumed  to  decrease
incrementally  to  approximately  5.5% in the year 2002 and remain at that level
thereafter.  The  health  care  cost  trend  rate  assumption  does  not  have a
significant effect on the amounts reported.

Postemployment Benefits
In accordance with SFAS 112 "Employers' Accounting for Postemployment Benefits",
the Company  accrues costs  relating to certain  benefits  including  severance,
worker's compensation and health care coverage over an employee's service life.

The Company's  liability for postemployment  benefits totaled  approximately $64
million  and $50 million at December  31,  1999 and 1998,  respectively,  and is
included in deferred  compensation and reserve for termination  allowances.  The
net periodic  expense  recognized in 1999, 1998 and 1997 was  approximately  $34
million, $32 million and $31 million, respectively.
<PAGE>



NOTE 9: SHORT-TERM BORROWINGS
The  Company and its  domestic  subsidiaries  have lines of credit with  various
banks.  These credit lines  permit  borrowings  at  fluctuating  interest  rates
determined  by the banks.  Short-term  borrowings  by  subsidiaries  outside the
United States principally consist of drawings against bank overdraft  facilities
and lines of credit.  These  borrowings  bear interest at the  prevailing  local
rates.  Where  required,  the  Company has  guaranteed  the  repayment  of these
borrowings.  Unused  lines of  credit by the  Company  and its  subsidiaries  at
December  31,  1999  and  1998   aggregated   $430  million  and  $458  million,
respectively.  The  weighted-average  interest rate on  outstanding  balances at
December 31, 1999 was approximately  5.8%.  Current maturities of long-term debt
are included in the payable to banks balance.




NOTE 10:  LONG-TERM DEBT
Long-term debt at December 31 consisted of the following:

(Dollars in thousands)
                                                               1999       1998
                                                           ---------------------
Convertible Subordinated Notes - 1.87%                     $  304,076   $     --
Convertible Subordinated Notes - 1.80%                        214,414    207,927
Term loans - 4.20% to 7.91% (6.45% to 7.91% in 1998)          289,621    280,320
Senior Notes Payable to Banks under a Revolving Credit
  Agreement Due March 2003 - 4.3% to 6.9%                      35,603     53,045
Senior Notes Payable - 6.83% to 7.52%                         102,000     95,000
Subordinated Notes - 9.84%                                     25,000     17,000
Germany mortgage note payable - 7.64%                          26,779     31,680
Other mortgage notes payable and
  long-term loans - 2.80% to 9.84%                             69,092     44,037
                                                           ---------------------
                                                            1,066,585    729,009
Less: current portion                                          23,912     22,898
                                                           ---------------------
Long-term debt                                             $1,042,673   $706,111
                                                           =====================


On June 1, 1999,  the Company  issued $361  million  face amount of  Convertible
Subordinated  Notes due 2006. The 2006 notes were issued at an original price of
83% of the face amount,  generating proceeds of approximately $300 million.  The
notes are convertible into 6.4 million shares of the Company's common stock at a
conversion  rate of 17.616 shares per $1,000 face amount.  The fair value of the
2006 notes as of December  31,  1999,  was  approximately  $416  million and was
determined by obtaining quotes from brokers.

On  September  16,  1997,  the  Company  issued  $250  million  face  amount  of
Convertible  Subordinated  Notes due 2004 ("2004  Notes")  with a coupon rate of
1.80%.  The 2004  Notes  were  issued  at an  original  price of 80% of the face
amount,  generating  proceeds  of  approximately  $200  million.  The  notes are
convertible  into  6.7  million  shares  of  the  Company's  common  stock  at a
conversion  rate of 26.772 shares per $1,000 face amount.  The fair value of the
2004 Notes as of  December  31,  1999 was  approximately  $392  million  and was
determined by obtaining quotes from brokers.

On March 9, 1998,  the  Company  entered  into a $75  million  revolving  credit
agreement.  The $75 million  revolving credit facility has an ultimate  maturity
date of March 2003 and enables the Company to borrow in multiple  currencies  at
interest rates tied to LIBOR or the prime rate, at its option.
<PAGE>
In conjunction with the Infratest Burke  acquisition and the financing  thereof,
the Company  amended  its $75  million  revolving  credit  facility  and its $40
million  Senior  Notes,  each  originally  dated March 9, 1998.  The  amendments
provide,  among other things, that the Company obligations will be guaranteed by
certain  subsidiaries of the Company. In addition,  the amendments increased the
rates at which interest  annually  accrues under the  obligations  from 6.43% to
6.83%.

The Senior  Notes  Payable  consist of four  private  placements  of $40 million
Senior  Notes both dated March 9, 1998 due March 1, 2008,  $17 million  Series A
Senior Notes and $38 million  Series B Senior Notes dated  November 20, 1998 due
November 15, 2005 and November 15, 2008,  respectively,  and $7 million Series B
Senior Notes dated March 26 due November 15, 2008.

The Subordinated  Notes consist of the private  placement of $8 million on March
26,  1999,  and $17 million on November 20, 1998.  The  Subordinated  Notes bear
interest at the fixed annual rate of 9.84%,  mature  November 15, 2008,  and are
repayable in equal annual installments of $8.3 million beginning in 2006.

Under various loan agreements, the Company must maintain specified levels of net
worth and meet  certain  cash flow  requirements  and is limited in the level of
indebtedness.  The Company has complied with the limitations  under the terms of
these loan agreements.

Long-term  debt maturing over the next five years and  thereafter is as follows:
2000-$24 million;  2001-$44.8 million;  2002-$113.8 million; 2003-$83.4 million;
2004-$272.1 million, and $528.5 million thereafter.

See Note 13 for discussion of fair market value of the Company's long-term debt.



NOTE 11:  RESTRUCTURING AND OTHER MERGER RELATED COSTS
In October  1999,  the Company  announced  the merger of two of its  advertising
networks.  The networks  affected,  Lowe & Partners Worldwide and Ammirati Puris
Lintas were combined to form a new agency  network called Lowe Lintas & Partners
Worldwide.  The merger involves the  consolidation  of operations in Lowe Lintas
agencies  in  approximately  24 cities in 22  countries  around the world.  Once
complete, the newly merged agency network will have offices in over 80 countries
around the world.

During  the  fourth  quarter  of  1999,   the  Company  began   execution  of  a
comprehensive  restructuring  plan in  connection  with  the  merger.  The  plan
includes  headcount  reductions,  consolidation  of real  estate and the sale or
disposition of certain investments,  and is expected to be completed by June 30,
2000. The Company is pleased with the progress of the merger to date and expects
the total costs to be in line with its original estimate.

The total pre-tax cost of the restructuring  plan is expected to be between $170
and $190 million,  ($100 to $115 million,  net of tax). In the fourth quarter of
1999, the Company recognized pre-tax costs of $84.2 million ($51.4 million,  net
of tax or $.17 per diluted share),  with the remainder expected to be recognized
in the first two quarters of 2000.

A summary of the components of the total  restructuring and other merger related
costs,  together  with an  analysis  of the cash and  non-cash  elements,  is as
follows:
<PAGE>
(Dollars in millions)

                                               1999            Cash     Non-Cash
                                              ----------------------------------
TOTAL BY TYPE
-------------
   Severance and termination costs            $44.9           $27.0        $17.9
   Fixed asset write-offs                      11.1              --         11.1
   Lease termination costs                      3.8             3.8           --
   Investment write-offs and other             24.4             1.1         23.3
                                              ----------------------------------
Total                                         $84.2           $31.9        $52.3
                                              ==================================



The severance and termination costs recorded in 1999 relate to approximately 230
employees who have been terminated or notified that they will be terminated. The
employee   groups   affected   include   executive   and  regional   management,
administrative,  account  management,  creative and media production  personnel,
principally  in the U.S.  and  U.K.  The  charge  related  to these  individuals
includes  the cost of  voluntary  programs  in certain  locations  and  includes
substantially all senior executives that will be terminated.  As of December 31,
1999, the amount accrued related to severance and termination was  approximately
$42.6 million.  During the fourth quarter of 1999, cash payments of $2.3 million
were made.

The fixed  assets  write-off  relates  largely to the  abandonment  of leasehold
improvements  as part of the merger.  The amount  recognized  in 1999 relates to
fixed asset write-offs in 6 offices principally in the United States.

Lease termination costs relate to the offices vacated as part of the merger. The
lease  terminations  are expected to be completed by mid-to-late  2000, with the
cash  portion to be paid out over a period of up to five  years.  As of December
31,  1999,  the  amount  accrued  related  to these  termination  costs was $3.8
million.

The  investment  write-offs  relate to the loss on sale or  closing  of  certain
business  units.  In 1999,  $23  million  has been  recorded  as a result of the
decision  to sell or  abandon  4  European  businesses.  In the  aggregate,  the
businesses  being  sold or  abandoned  represent  an  immaterial  portion of the
revenue  and  operations  of Lowe Lintas & Partners.  The  write-off  amount was
computed based upon the difference between the estimated sales proceeds (if any)
and the  carrying  value of the related  assets.  These  sales or  closures  are
expected to be completed by mid 2000.


<PAGE>

NOTE 12:  GEOGRAPHIC AREAS
Long-lived assets and revenue are presented below by major geographic area:

(Dollars in thousands)
                                               1999         1998         1997
                                            -----------------------------------
Long-Lived Assets:
United States                               $1,665,097  $1,067,821   $  884,103
                                            -----------------------------------
International
United Kingdom                                 472,686     395,431      217,174
All other Europe                               603,189     550,807      472,710
Asia Pacific                                   107,215      92,581       78,862
Latin America                                   79,401      58,134       51,790
Other                                           80,246      54,632       43,982
                                            -----------------------------------
Total International                          1,342,737   1,151,585      864,518
                                            -----------------------------------
Total Consolidated                          $3,007,834  $2,219,406   $1,748,621
                                            -----------------------------------

Revenue:
United States                               $2,475,250  $2,107,908   $1,824,854
                                            -----------------------------------
International
United Kingdom                                 527,250     450,103      353,086
All other Europe                             1,140,532     902,602      748,720
Asia Pacific                                   346,205     325,758      348,707
Latin America                                  213,260     232,940      204,894
Other                                          190,415     148,477      102,340
                                            -----------------------------------
Total International                          2,417,662   2,059,880    1,757,747
                                            -----------------------------------
Total Consolidated                          $4,892,912  $4,167,788   $3,582,601
                                            -----------------------------------


Revenue is  attributed  to  geographic  areas  based on where the  services  are
performed.  Property and equipment is allocated  based upon  physical  location.
Intangible  assets,  other assets,  and  investments  are allocated based on the
location of the related operation.

The largest client of the Company  contributed  approximately  7% in 1999, 7% in
1998 and 9% in 1997 to revenue.  The Company's second largest client contributed
approximately 4% in 1999, 4% in 1998 and 4% in 1997 to revenue.

Dividends  received from foreign  subsidiaries were approximately $47 million in
1999, $51 million in 1998 and $41 million in 1997.

Consolidated net income includes losses from exchange and translation of foreign
currencies  of $5.6  million,  $3.2 million and $5.6  million in 1999,  1998 and
1997, respectively.



NOTE 13:  FINANCIAL INSTRUMENTS
Financial assets, which include cash and cash equivalents, marketable securities
and receivables,  have carrying values which  approximate fair value.  Long-term
equity securities, included in other investments and miscellaneous assets in the
Consolidated  Balance Sheet, are deemed to be  available-for-sale  as defined by
SFAS 115 and accordingly are reported at fair value,  with net unrealized  gains
and losses reported within stockholders' equity.
<PAGE>
The following table  summarizes net unrealized  gains and losses before taxes at
December 31:

(Dollars in millions)

                                              1999       1998       1997
                                             ---------------------------
   Cost                                      $172.3     $121.3     $61.1
   Unrealized gains / (losses)
     - gains                                  302.3       20.2      22.0
     - losses                                 (12.2)      (1.5)       --
                                             ---------------------------
   Net unrealized gains                       290.1       18.7      22.0
                                             ---------------------------
   Fair market value                         $462.4     $140.0     $83.1
                                             ===========================


Net of tax, net unrealized holding gains were $168 million,  $10 million and $12
million at December 31, 1999, 1998 and 1997, respectively.

The above pre-tax gain amounts are net of reclassifications of $13.1 million and
$6.5 million in 1999 and 1998, which represent  amounts  previously  recorded in
other comprehensive income.

During 1999, the Company expanded its investment in internet-service and related
companies.  In April  1999,  the  Company  invested  $20  million for a minority
interest  in Icon,  a Swedish  based  internet  consultancy.  Subsequently,  the
Company  increased its investment  through the contribution of other investments
and through  additional  cash  purchases.  At December 31, 1999, the fair market
value of the Company's investment in Icon was $322 million.

Financial  liabilities  with carrying  values  approximating  fair value include
accounts payable and accrued expenses, as well as payable to banks and long-term
debt. As of December 31, 1999, the 1.87% Convertible Subordinated Notes due 2006
had a cost basis of $304  million  with a market  value of $416  million.  As of
December 31, 1999, the 1.80% Convertible  Subordinated Notes due 2004 had a cost
basis of $214 million with a market  value of $392  million.  As of December 31,
1998,  the cost  basis of the 1.80%  Convertible  Subordinated  Notes  were $208
million with a market value of $283 million.  The fair values were determined by
obtaining quotes from brokers (refer to Note 10 for additional information on

long-term debt). As of December 31, 1999, the 6.83% to 7.52% Notes Payable had a
total cost  basis of $102  million  with a market  value of $88  million.  As of
December  31,  1998,  the 4.3% to 7.52%  Notes  Payable  had a total  cost basis
approximately  the same as the market  value.  The fair value was  determined by
using the expected  future cash flows  discounted  at market  interest  rates as
adjusted for conversion privileges.

The Company occasionally uses forwards and options to hedge a portion of its net
investment in foreign  subsidiaries  and certain  intercompany  transactions  in
order to  mitigate  the impact of changes in foreign  exchange  rates on working
capital.  The  notional  value and fair value of all  outstanding  forwards  and
options  contracts at the end of the year as well as the net cost of all settled
contracts during the year were not significant.

The  Company's  management  continuously  evaluates and attempts to mitigate its
exposure  to foreign  exchange,  economic  and  political  risks.  The  economic
developments  in  Brazil  did not  have a  significant  negative  impact  on the
Company,  and were  partially  offset by a favorable  impact due to the economic
recovery in Japan.


<PAGE>

NOTE 14:  COMMITMENTS AND CONTINGENCIES
At December 31, 1999 the Company's  subsidiaries operating primarily outside the
United States were  contingently  liable for discounted notes receivable of $7.4
million.

The Company and its subsidiaries lease certain  facilities and equipment.  Gross
rental expense amounted to approximately $290 million for 1999, $255 million for
1998 and $224  million for 1997,  which was reduced by sublease  income of $17.2
million in 1999, $16.4 million in 1998 and $30.7 million in 1997.

Minimum rental commitments for the rental of office premises and equipment under
noncancellable  leases,  some of which  provide  for rental  adjustments  due to
increased  property taxes and operating  costs for 2000 and  thereafter,  are as
follows:

(Dollars in thousands)

                                 Gross Rental         Sublease
                                  Commitment           Income
                                  ----------           ------
Period
2000                               $194,653            $17,206
2001                                172,181             15,180
2002                                143,518             10,224
2003                                113,457              6,335
2004                                 95,446              1,390
2005 and thereafter                 379,485              2,014


Certain of the Company's acquisition agreements provide for deferred payments by
the  Company,  contingent  upon  future  revenues  or profits  of the  companies
acquired.  Such contingent amounts would not be material taking into account the
future revenues or profits of the companies acquired.

The  Company  and  certain  of  its   subsidiaries  are  party  to  various  tax
examinations, some of which have resulted in assessments. The Company intends to
vigorously defend any and all assessments and believes that additional taxes (if
any) that may ultimately  result from the settlement of such assessments or open
examinations  would  not have a  material  adverse  effect  on the  consolidated
financial statements.

The  Company is  involved  in legal and  administrative  proceedings  of various
types.  While any  litigation  contains an element of  uncertainty,  the Company
believes that the outcome of such proceedings or claims will not have a material
adverse effect on the Company.




NOTE 15:  RECENT EVENT
In April 2000,  the Company  issued  approximately  12.6  million  shares of its
common stock in connection with the acquisition of NFO Worldwide,  Inc. ("NFO").
The acquisition has been accounted for as a pooling of interests.  The Company's
consolidated  financial  statements,  including  the  related  notes,  have been
restated  as of  the  earliest  period  presented  to  include  the  results  of
operations,  financial position and cash flows of NFO. Additionally, the results
of several other recent  acquisitions,  all of which have been  accounted for as
poolings of interests,  have been included in the restated financial statements.
Other  than  NFO,  none  of  the  other  acquisitions  was  individually,  or in
aggregate, material.


<PAGE>
<TABLE>
                                                 SELECTED FINANCIAL DATA FOR FIVE YEARS
                                              (Amounts in Thousands Except Per Share Data)
<CAPTION>
                                       1999            1998         1997         1996         1995
                                       ----            ----         ----         ----         ----
<S>                                   <C>           <C>          <C>         <C>           <C>
OPERATING DATA
Revenue                               $ 4,892,912   $ 4,167,788  $ 3,582,601  $ 3,053,926  $ 2,650,192
Operating expenses                      4,246,714     3,601,796    3,171,780    2,695,038    2,353,970
Restructuring and other merger
  related costs                            84,183            --           --           --           --
Write-down of goodwill and other
related assets                                 --            --           --           --       38,687
Special compensation charge                    --            --       32,229           --           --
Interest expense                           81,241        64,137       59,651       53,321       49,105
Provision for income taxes                242,726       244,981      197,219      166,244      133,941
Net Income                            $   315,243   $   333,593  $   220,211  $   228,914  $   145,975

PER SHARE DATA
Basic

Net Income                            $      1.08   $      1.15  $       .79  $       .82  $       .54
Weighted-average shares                   292,067       288,831      277,871      278,294      272,378

Diluted

Net Income                            $      1.04   $      1.12  $       .77  $       .80  $       .52
Weighted-average shares                   302,914       299,214      295,677      294,876      280,382

FINANCIAL POSITION
Working capital                       $   170,898   $   100,300  $   244,365  $   149,919  $   118,147
Total assets                          $ 9,166,604   $ 7,464,808  $ 6,220,906  $ 5,253,456  $ 4,721,440
Total long-term debt                  $ 1,042,673   $   706,111  $   553,494  $   423,459  $   363,966
Book value per share                  $      5.85   $      4.81  $      3.87  $      3.42  $      2.85

OTHER DATA
Cash dividends - Interpublic          $    90,424   $    76,894    $  61,242    $  51,786  $    46,124
Cash dividends
  per share - Interpublic             $       .33   $       .29    $     .25    $     .22  $       .20
Number of employees                        41,900        37,700       32,600       27,000       25,200
                                      ----------------------------------------------------------------
</TABLE>

All data has been restated to reflect the aggregate  effect of the  acquisitions
accounted for as poolings of interests. (See Note 15).

All share data for prior periods have been  adjusted to reflect the  two-for-one
stock split effective July 15, 1999.


<PAGE>
<TABLE>
                                                         RESULTS BY QUARTER (UNAUDITED)
                                                  (Amounts in Thousands Except Per Share Data)
<CAPTION>
                               1st Quarter               2nd Quarter            3rd Quarter                  4th Quarter


                          1999           1998         1999         1998           1999           1998          1999          1998
                       -------------------------------------------------------------------------------------------------------------
<S>                    <C>           <C>           <C>           <C>           <C>           <C>           <C>           <C>
Revenue                $1,022,434    $  874,605    $1,231,113    $1,083,202    $1,151,406    $  968,307    $1,487,959    $1,241,674
Operating expenses        931,027       802,293       979,470       866,999     1,020,492       866,458     1,315,725     1,066,046
Restructuring and other
  merger related charges       --            --            --            --            --            --        84,183            --
Income from operations     91,407        72,312       251,643       216,203       130,914       101,849        88,051       175,628
Interest expense          (17,453)      (13,492)      (20,559)      (15,770)      (21,692)      (17,104)      (21,537)      (17,771)
Other income, net          12,722        10,944        29,115        24,343        14,962        15,044        45,942        47,700
Income before provision
  for income taxes         86,676        69,764       260,199       224,776       124,184        99,789       112,456       205,557
Provision for

  income taxes             35,578        26,570       103,989        91,194        52,005        42,124        51,154        85,093
Net equity interests       (2,386)       (2,405)       (6,203)       (5,231)       (4,404)       (4,072)      (12,553)       (9,604)
                       ------------------------------------------------------------------------------------------------------------
Net income             $   48,712    $   40,789    $  150,007    $  128,351    $   67,775    $   53,593    $   48,749    $  110,860
                       ============================================================================================================

Per share data:
  Basic EPS            $      .17     $     .14    $      .51    $      .44    $      .23    $      .19    $      .17    $      .38
  Diluted EPS          $      .16     $     .14    $      .49    $      .43    $      .22    $      .18    $      .16    $      .37
Cash dividends per

 share - Interpublic   $     .075     $    .065    $     .085    $     .075    $     .085    $     .075    $     .085    $     .075

Weighted-Average Shares:
  Basic                   290,532       288,034       292,201       289,323       292,762       288,841       292,772       289,125
  Diluted                 301,776       298,536       311,456       307,132       303,373       298,572       303,865       306,000

Stock price:
  High                        $40      $31 5/16      $43 5/16       $32 1/4      $44 1/16      $32 7/16      $58 1/16       $39 7/8
  Low                     $34 7/8     $23 27/32     $34 19/32    $ 27 21/32       $36 1/2      $26 3/32       $35 3/4       $23 1/2
                       ------------------------------------------------------------------------------------------------------------

</TABLE>

All data has been restated to reflect the aggregate  effect of the  acquisitions
accounted for as poolings of interests. (See Note 15).

All share data for 1998 has been adjusted to reflect the two-for-one stock split
effective July 15, 1999.



<PAGE>
                                                                   SCHEDULE VIII

          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                        VALUATION AND QUALIFYING ACCOUNTS

              For the Years Ended December 31, 1999, 1998 and 1997

================================================================================

                             (Dollars in thousands)

COLUMN A     COLUMN B      COLUMN C   COLUMN D       COLUMN E           COLUMN F
--------------------------------------------------------------------------------

                                    Additions
                                    ---------

                                         Charged
              Balance at  Charged to    to Other                         Balance
               Beginning     Costs &   Accounts-   Deductions-            at End
Description    of Period    Expenses    Describe      Describe         of Period

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

Allowance for
  Doubtful  Accounts -
  deducted from
  Receivables in the
  Consolidated
  Balance Sheet:

1999         $54,060       $23,909    $5,148(5)      $(23,721)(3)       $60,505
                                       2,934(7)        (1,215)(2)
                                                         (610)(4)

1998         $44,581       $20,421    $6,699(1)      $(17,038)(3)       $54,060
                                       2,111(5)        (3,310)(4)

                                         596(2)

1997         $37,496       $16,904    $2,256(1)      $ (2,680)(2)       $44,581
                                         848(5)        (7,869)(3)
                                                       (2,374)(4)


-------------------
[FN]

  (1)  Allowance for doubtful accounts of acquired and newly consolidated
       companies.
  (2)  Foreign currency translation adjustment.
  (3)  Principally amounts written off.
  (4)  Reversal of previously recorded allowances on accounts receivable.
  (5)  Miscellaneous.
</FN>


<PAGE>
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                             (Dollars in Thousands)
                                     ASSETS

                                                    March 31,    December 31,
                                                      2000          1999
                                                   (unaudited)
                                                   --------------------------
CURRENT ASSETS:
Cash and cash equivalents (includes
  certificates of deposit: 2000-$89,519;
  1999-$150,343)                                   $  692,745      $1,006,011
Marketable securities                                  47,982          36,765
Receivables (net of allowance for doubtful
  accounts:  2000-$61,257; 1999-$60,505)            4,328,723       4,401,704
Expenditures billable to clients                      379,653         332,833
Prepaid expenses and other current assets             162,634         146,019
                                                   --------------------------
   Total current assets                             5,611,737       5,923,332
                                                   --------------------------

OTHER ASSETS:
Investment in unconsolidated affiliates                64,965          61,987
Deferred taxes on income                                8,133              --
Other investments and miscellaneous assets            649,049         718,939
                                                   --------------------------
   Total other assets                                 722,147         780,926
                                                   --------------------------

FIXED ASSETS, AT COST:
Land and buildings                                    160,037         164,678
Furniture and equipment                               785,516         777,368
                                                   --------------------------
                                                      945,553         942,046
Less: accumulated depreciation                        517,334         504,371
                                                   --------------------------
                                                      428,219         437,675
Unamortized leasehold improvements                    148,603         145,071
                                                   --------------------------
   Total fixed assets                                 576,822         582,746
                                                   --------------------------

Intangible assets (net of accumulated
 amortization: 2000-$626,449; 1998-$607,417)        1,920,348       1,879,600
                                                   --------------------------

TOTAL ASSETS                                       $8,831,054      $9,166,604
                                                   ==========================



<PAGE>
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                  (Dollars in Thousands Except Per Share Data)
                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                                     March 31,     December 31,
                                                       2000           1999
                                                    (unaudited)
                                                    ------------   ------------
CURRENT LIABILITIES:
Payable to banks                                    $  382,155       $  262,397
Accounts payable                                     4,351,836        4,568,343
Accrued expenses                                       660,750          761,210
Accrued income taxes                                   161,401          160,484
                                                    ---------------------------
Total current liabilities                            5,556,142        5,752,434
                                                    ---------------------------
NONCURRENT LIABILITIES:
Long-term debt                                         493,516          524,183
Convertible subordinated debentures
  and notes                                            522,068          518,490
Deferred compensation and reserve
  for termination allowances                           352,998          344,999
Deferred taxes on income                                    --           44,744
Accrued postretirement benefits                         50,289           50,226
Other noncurrent liabilities                            92,264           87,548
Minority interests in consolidated
  subsidiaries                                          83,014           81,612
                                                    ---------------------------
Total noncurrent liabilities                         1,594,149        1,651,802
                                                    ---------------------------
STOCKHOLDERS' EQUITY:
Preferred Stock, no par value
  shares authorized:  20,000,000
  shares issued:  none

Common Stock, $.10 par value
  shares authorized:  550,000,000
  shares issued:
    2000 - 311,019,156;
    1999 - 309,996,727                                  31,102           31,000
Additional paid-in capital                             843,627          784,646
Retained earnings                                    1,403,377        1,389,971
Accumulated other comprehensive
  loss, net of tax                                    (168,660)         (76,695)
                                                     --------------------------
                                                     2,109,446        2,128,922
Less:
Treasury stock, at cost:
2000 - 9,001,600 shares;
1999 - 8,909,904  shares                               338,222          289,519
Unamortized expense of restricted
  stock grants                                          90,461           77,035
                                                     --------------------------
Total stockholders' equity                           1,680,763        1,762,368
                                                     --------------------------
Commitments and contingencies

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY          $8,831,054       $9,166,604
                                                    ===========================

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note e).

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

<PAGE>
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                  CONSOLIDATED STATEMENT OF INCOME
                           THREE MONTHS ENDED MARCH 31
                  (Amounts in Thousands Except Per Share Data)
                                   (unaudited)

                                                2000             1999
                                                ----             ----
 Revenue                                    $1,198,211       $1,022,434
                                            ----------       ----------

 Salaries and related expenses                 693,584          588,597
 Office and general expenses                   393,162          342,430
 Restructuring and other merger
   related costs                                36,051               --
                                            ----------       ----------
   Total operating expenses                  1,122,797          931,027
                                            ----------       ----------

 Income from operations                         75,414           91,407

 Interest expense                              (20,377)         (17,453)
 Other income, net                              16,796           12,722
                                            ----------       ----------

 Income before provision for income taxes       71,833           86,676

 Provision for income taxes                     30,881           35,578
                                            ----------       ----------
 Income of consolidated companies               40,952           51,098

 Income applicable to minority interests        (5,422)          (3,753)
 Equity in net income of
   unconsolidated affiliates                     1,765            1,367
                                            ----------       ----------
 Net income                                 $   37,295       $   48,712
                                            ==========       ==========

 Earnings per share:
   Basic                                     $     .13         $    .17
   Diluted                                   $     .12         $    .16

 Dividend per share - Interpublic            $     .085        $    .075

 Weighted average shares:
   Basic                                       293,897          290,532
   Diluted                                     304,597          301,776


All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note e).

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



<PAGE>
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
           CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                           THREE MONTHS ENDED MARCH 31
                             (Dollars in Thousands)
                                   (unaudited)

                                                   2000           1999
                                                   ----           ----
 Net Income                                      $  37,295      $  48,712
                                                 ---------      ---------
 Other Comprehensive Income, net of tax:

 Foreign Currency Translation Adjustments          (31,777)       (64,555)

 Net Unrealized Gains (Losses) on Securities       (60,188)        22,773
                                                 ---------      ---------
 Other Comprehensive Income                        (91,965)       (41,782)
                                                 ---------      ---------
 Comprehensive Income                            $ (54,670)      $  6,930
                                                 =========      =========

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note e).

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



<PAGE>

          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                CONSOLIDATED STATEMENT OF CASH FLOWS
                           THREE MONTHS ENDED MARCH 31
                             (Dollars in Thousands)
                                   (unaudited)

                                                          2000          1999
                                                       -----------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                             $  37,295       $ 48,712
Adjustments to reconcile net income to cash
     used in operating activities:
   Depreciation and amortization of fixed assets          34,996         26,738
   Amortization of intangible assets                      23,409         17,099
   Amortization of restricted stock awards                 6,965          5,929
   Equity in net income of unconsolidated affiliates      (1,765)        (1,367)
   Income applicable to minority interests                 5,422          3,753
   Translation losses                                        559            923
   Net gain from sale of investments                      (5,597)          (486)
   Other                                                   7,681        (13,009)
   Restructuring charges, non-cash                        15,781             --

Changes in assets and liabilities, net of acquisitions:
   Receivables                                            39,951        (24,938)
   Expenditures billable to clients                      (47,972)       (49,038)
   Prepaid expenses and other assets                     (17,527)       (32,240)
   Accounts payable and other liabilities               (278,047)      (164,641)
   Accrued income taxes                                   (4,234)       (10,639)
   Deferred income taxes                                  (5,288)        (2,177)
   Deferred compensation and reserve for
     termination allowances                               11,658          3,992
                                                       ------------------------
Net cash used in operating activities                   (176,713)      (191,389)
                                                       ------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Acquisitions, net                                     (57,324)       (55,286)
   Capital expenditures                                  (33,667)       (32,880)
   Proceeds from sale of investments                       7,700          1,436
   Net purchases of marketable securities                (12,872)       (18,104)
   Other investments and miscellaneous assets            (49,790)           236
   Investments in unconsolidated affiliates                   --         (5,494)
                                                       ------------------------
Net cash used in investing activities                   (145,953)      (110,092)
                                                       ------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Increase in short-term borrowings                      115,417       209,956
   Proceeds from long-term debt                            15,496        73,165
   Payments of long-term debt                             (34,468)      (30,251)
   Treasury stock acquired                                (64,305)      (79,474)
   Issuance of common stock                                18,828        26,556
   Cash dividends - Interpublic                           (23,890)      (20,450)
                                                       -------------------------
Net cash provided by financing activities                  27,078       179,502
Effect of exchange rates on cash
  and cash equivalents                                    (17,678)      (30,003)
                                                       ------------------------
Decrease in cash and cash equivalents                    (313,266)     (151,982)
Cash and cash equivalents at beginning of year          1,006,011       780,429
                                                       ------------------------
Cash and cash equivalents at end of period             $  692,745     $ 628,447
                                                       ========================

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note e).

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

<PAGE>


          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


     (a)  In the opinion of  management,  the  consolidated  balance sheet as of
          March 31,  2000,  the  consolidated  income  statements  for the three
          months ended March 31, 2000 and 1999,  the  consolidated  statement of
          comprehensive  income for the three  months  ended  March 31, 2000 and
          1999,  and the  consolidated  statement  of cash  flows  for the three
          months ended March 31, 2000 and 1999,  contain all adjustments  (which
          include only normal recurring adjustments) necessary to present fairly
          the financial position,  results of operations and cash flows at March
          31,  2000  and for all  periods  presented.  Certain  information  and
          footnote   disclosures   normally  included  in  financial  statements
          prepared in accordance with generally accepted  accounting  principles
          have been omitted.  It is suggested that these consolidated  financial
          statements  be read in  conjunction  with the  consolidated  financial
          statements  and notes  thereto  included in The  Interpublic  Group of
          Companies,  Inc.'s (the "Company")  December 31, 1999 annual report to
          stockholders.

          The Company's consolidated financial statements, including the related
          notes,  have been  restated as of the  earliest  period  presented  to
          include the results of operations,  financial  position and cash flows
          of the 2000 pooled  entities in addition to all material  prior pooled
          entities.

          The  accompanying  income  statements  have been  prepared in a format
          different to that used in the originally filed Form 10-Q for the three
          months ended March 31, 1999.  The changes made  principally  relate to
          the  introduction  of a new  line  item -  "Income  from  operations".
          Amounts previously  included in "Other income,  net" as part of "Gross
          Income" are now included  elsewhere in the  Consolidated  Statement of
          Income.  The  quarterly  data  reflected  in  the  restated  financial
          statements as of and for the year ended  December 31, 1999 reflect the
          change made.

     (b)  The Company considers all highly liquid investments with a maturity of
          three months or less to be cash equivalents.  Income tax cash payments
          were  approximately  $21 million and $39.1  million in the first three
          months of 2000 and 1999,  respectively.  Interest  payments during the
          first three months of 2000 and 1999 were  approximately  $12.8 million
          and $8.1 million, respectively.

     (c)  In  October  1999,  the  Company  announced  the  merger of two of its
          advertising networks. The networks affected, Lowe & Partners Worldwide
          and Ammirati  Puris Lintas were combined to form a new agency  network
          called  Lowe  Lintas & Partners  Worldwide.  The merger  involves  the
          consolidation  of operations in Lowe Lintas agencies in  approximately
          24 cities in 22 countries around the world.  Once complete,  the newly
          merged  agency  network will have offices in over 80 countries  around
          the world.

          Since the fourth  quarter of 1999,  the Company has been executing the
          restructuring  in connection with the merger.  As of the current date,
          substantially  all of the  restructuring  activities in the U.S.,  the
          U.K.  and  most  European  and  Latin  American  countries  have  been
          completed.
<PAGE>
          In  the  first  quarter  of  2000,  the  Company   recognized  pre-tax
          restructuring  costs of $36.1 million  ($20.7 million net of tax). The
          Company   expects  the   remaining   pre-tax  costs  to  complete  the
          restructuring to approximate  $50-$70  million,  which is in line with
          the Company's  original plan. The remaining costs focus principally on
          finalizing the restructuring in Germany and several smaller markets.

          The total  restructuring  costs of $36.1 million include cash costs of
          $20.3 million.

          A  summary  of the  components  of the total  restructuring  and other
          merger related costs is as follows:
<TABLE>
<CAPTION>
               (Dollars in millions)

                                                                  1st Quarter 2000
                                             -----------------------------------------------------------
                                               Balance       Expense        Cash     Asset     Balance
                                             at 12/31/99   recognized       Paid  Write-offs  at 3/31/00
                                             -----------------------------------------------------------
<S>                                             <C>            <C>          <C>      <C>         <C>
                TOTAL BY TYPE
                Severance and
                  termination  costs            $43.6          $14.4        $ 9.6       --       $48.4
                Fixed asset write-offs           11.1            5.4           --     16.5          --
                Lease  termination costs          3.8            4.9          1.7       --         7.0
                Investment write-offs
                  and other                      23.4           11.4           .3     32.6         1.9
                                             -----------------------------------------------------------
                Total                           $81.9          $36.1        $11.6    $49.1       $57.3
                                             ===========================================================
</TABLE>

          The  severance  and  termination  costs  recorded  in 2000  relate  to
          approximately  265 employees who have been terminated or notified that
          they  will  be  terminated.   The  employee  groups  affected  include
          management,  administrative,  account  management,  creative and media
          production  personnel,  principally  in the U.S. and several  European
          countries.

          The fixed  asset  write-offs  relate  largely  to the  abandonment  of
          leasehold improvements as part of the merger. The amount recognized in
          2000 relates to fixed asset  write-offs  in 3 offices,  the largest of
          which is in the U.K.

          Lease  termination  costs relate to the offices vacated as part of the
          merger.  The  lease  terminations  are  expected  to be  completed  by
          mid-to-late  2000,  with the cash portion to be paid out over a period
          of up to five years.

          The  investment  write-offs  relate to the loss on sale or  closing of
          certain  business  units. In 2000, $9.3 million has been recorded as a
          result of the decision to sell or abandon 2 businesses located in Asia
          and Europe.  In the aggregate,  the businesses being sold or abandoned
          represent an immaterial  portion of the revenue and operations of Lowe
          Lintas & Partners.  The write-off  amount was computed  based upon the
          difference  between  the  estimated  sales  proceeds  (if any) and the
          carrying  value of the related  assets.  These  sales or closures  are
          expected to be completed by mid 2000.
<PAGE>
     (d)  In June 1998, the Financial  Accounting  Standards  Board (the "FASB")
          issued   Statement  of  Financial   Accounting   Standards   No.  133,
          "Accounting for Derivative  Instruments and Hedging  Activities" (SFAS
          133),  which had an initial  adoption date of January 1, 2000. In June
          1999,  the FASB  postponed the adoption date of SFAS 133 until January
          1, 2001.  SFAS 133 will require the Company to record all  derivatives
          on the balance sheet at fair value.  Changes in derivative fair values
          will  either be  recognized  in  earnings as offsets to the changes in
          fair value of related hedged assets,  liabilities and firm commitments
          or, for  forecasted  transactions,  deferred and later  recognized  in
          earnings  at the same time as the  related  hedged  transactions.  The
          impact of SFAS 133 on the Company's  financial  statements will depend
          on a variety of factors,  including the future level of forecasted and
          actual  foreign  currency  transactions,  the extent of the  Company's
          hedging  activities,  the types of  hedging  instruments  used and the
          effectiveness  of such  instruments.  However,  the  Company  does not
          believe  the  effect  of  adopting  SFAS 133 will be  material  to its
          financial condition or results of operations.

     (e)  In April 2000, the Company issued approximately 12.6 million shares of
          its common stock in connection  with the acquisition of NFO Worldwide,
          Inc.  ("NFO").  The acquisition has been accounted for as a pooling of
          interests. The Company's consolidated financial statements,  including
          the  related  notes,  have been  restated  as of the  earliest  period
          presented to include the results of operations, financial position and
          cash flows of NFO.  Additionally,  the results of several other recent
          acquisitions,  all of which have been  accounted  for as  poolings  of
          interests,  have been included in the restated  financial  statements.
          Other than NFO, none of the other acquisitions was individually, or in
          aggregate, material.

          Additionally,  on April 20,  2000,  the Company  acquired  substantial
          assets of the Communications Division of Caribiner International, Inc.
          for  approximately  $90  million  in  cash.  The  acquisition  will be
          accounted for as a purchase.  As the acquisitions  occurred subsequent
          to the end of the first quarter, the financial statements presented in
          this  Form  10-Q do not  include  the  results  of  operations  of the
          acquired entities.
<PAGE>


  Item 2

           THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                   FINANCIAL CONDITION AND RESULTS OF OPERATIONS


 RESULTS OF OPERATIONS

The Company  reported net income of $37.3  million or $.12 diluted  earnings per
share  for the three  months  ended  March 31,  2000.  Excluding  the  impact of
restructuring  and other merger related costs,  which are discussed  below,  net
income was $58.0 million or $.19 diluted  earnings per share,  compared to $48.7
million or $.16 diluted  earnings per share for the three months ended March 31,
1999.

Worldwide  revenue for the three  months  ended March 31,  2000  increased  $176
million,  or 17%, to $1.2 billion compared to the same period in 1999.  Domestic
revenue  increased $133 million or 25% during the first quarter of 2000 compared
to 1999.  International  revenue  increased  $43  million or 9% during the first
quarter of 2000 compared to 1999. International revenue would have increased 15%
excluding the effect of the  strengthening of the U.S.  dollar.  The increase in
worldwide  revenue  is a result of both new  business  growth  and  growth  from
acquisitions.  Exclusive of acquisitions, worldwide revenue on a constant dollar
basis  increased  13% for the first  quarter of 2000  compared to the prior year
quarter.

Revenue from other specialized  marketing services,  which include media buying,
market  research,  relationship  (direct)  marketing,  sales  promotion,  public
relations,  sports and event  marketing,  healthcare  marketing  and  e-business
consulting  and  communications,   comprised  approximately  47%  of  the  total
worldwide revenue for the three months ended March 31, 2000, compared to 43% for
the prior year quarter.

Worldwide operating expenses for the first quarter 2000, excluding restructuring
and other merger  related costs were $1.1  billion,  an increase of 17% over the
prior year quarter. This increase is consistent with the 17% increase in revenue
for the same period.  Salaries and related  expenses were $694 million or 58% of
revenue  for the first  quarter of 2000 as  compared  to $590  million or 58% of
revenue for the first  quarter of 1999.  Office and general  expenses  were $393
million for the first  quarter of 2000  compared  to $341  million for the first
quarter of 1999.

Income  from  operations  was  $75.4  million  for the  first  quarter  of 2000.
Excluding  restructuring and other merger related costs,  income from operations
was $111.4 million for the first quarter of 2000,  compared to $91.4 million for
the first quarter of 1999, an increase of 22%. Amortization of intangible assets
was $23 million for the first  quarter of 2000,  compared to $17 million for the
first quarter of 1999. Exclusive of acquisitions,  foreign exchange fluctuations
and amortization of intangible assets,  income from operations increased 22% for
the first quarter of 2000 compared to the first quarter of 1999.

In October  1999,  the Company  announced  the merger of two of its  advertising
networks.  The networks  affected,  Lowe & Partners Worldwide and Ammirati Puris
Lintas were combined to form a new agency  network called Lowe Lintas & Partners
Worldwide.  The merger involves the  consolidation  of operations in Lowe Lintas
agencies  in  approximately  24 cities in 22  countries  around the world.  Once
complete, the newly merged agency network will have offices in over 80 countries
around the world.
<PAGE>
Since  the  fourth   quarter  of  1999,  the  Company  has  been  executing  the
restructuring   in  connection  with  the  merger.   As  of  the  current  date,
substantially all of the restructuring activities in the U.S., the U.K. and most
European and Latin American countries have been completed.

In the first quarter of 2000, the Company recognized pre-tax restructuring costs
of $36.1 million ($20.7  million net of tax). The Company  expects the remaining
pre-tax costs to complete the  restructuring  to  approximate  $50-$70  million,
which is in line with the Company's  original  plan.  The remaining  costs focus
principally  on  finalizing  the  restructuring  in Germany and several  smaller
markets.

The total  restructuring  costs of $36.1  million  include  cash  costs of $20.3
million.

A summary of the components of the total  restructuring and other merger related
costs is as follows:

<TABLE>

(Dollars in millions)

<CAPTION>
                                                  1st Quarter 2000
                             -----------------------------------------------------------
                               Balance       Expense        Cash     Asset     Balance
                             at 12/31/99   recognized       Paid  Write-offs  at 3/31/00
                             -----------------------------------------------------------
<S>                              <C>           <C>          <C>       <C>         <C>
TOTAL BY TYPE
Severance and
  termination  costs            $43.6          $14.4        $ 9.6       --       $48.4
Fixed asset write-offs           11.1            5.4           --     16.5          --
Lease  termination costs          3.8            4.9          1.7       --         7.0
Investment write-offs
  and other                      23.4           11.4           .3     32.6         1.9
                             -----------------------------------------------------------
Total                           $81.9          $36.1        $11.6    $49.1       $57.3
                             ===========================================================
</TABLE>

The severance and termination costs recorded in 2000 relate to approximately 265
employees who have been terminated or notified that they will be terminated. The
employee groups affected include management, administrative, account management,
creative and media  production  personnel,  principally  in the U.S. and several
European countries.

The fixed  asset  write-offs  relate  largely to the  abandonment  of  leasehold
improvements  as part of the merger.  The amount  recognized  in 2000 relates to
fixed asset write-offs in 3 offices, the largest of which is in the U.K.

Lease termination costs relate to the offices vacated as part of the merger. The
lease  terminations  are expected to be completed by mid-to-late  2000, with the
cash portion to be paid out over a period of up to five years.

The  investment  write-offs  relate to the loss on sale or  closing  of  certain
business  units.  In 2000,  $9.3  million  has been  recorded as a result of the
decision  to sell or abandon 2  businesses  located in Asia and  Europe.  In the
aggregate,  the  businesses  being sold or  abandoned  represent  an  immaterial
portion of the revenue and  operations of Lowe Lintas & Partners.  The write-off
amount was  computed  based upon the  difference  between  the  estimated  sales
proceeds (if any) and the carrying value of the related  assets.  These sales or
closures are expected to be completed by mid 2000.
<PAGE>
Other income, net, consists of interest income,  investment income and net gains
from equity  investments,  all of which have increased at comparable  rates over
the prior year quarter.

The  effective  tax rate for the three  months  ended  March 31, 2000 was 43.0%,
compared to 41.0% in 1999.  The  difference  between the effective and statutory
rates is  primarily  due to foreign  losses  with no tax  benefit,  losses  from
translation of foreign currencies which provided no tax benefit, state and local
taxes,  foreign  withholding  taxes  on  dividends  and  nondeductible  goodwill
expense.

LIQUIDITY AND CAPITAL RESOURCES

Working  capital  at March 31,  2000 was $55.8  million,  a  decrease  of $115.5
million from December 31, 1999. The decrease is partly due to  expenditures  for
additional strategic long-term investments and a net reduction in long-term debt
during  the first  quarter  of 2000.  The  ratio of  current  assets to  current
liabilities was slightly above 1 to 1 at March 31, 2000.

Historically,  cash flow from  operations has been the primary source of working
capital and  management  believes  that it will continue to be so in the future.
Net cash used in operating  activities was $177 million for the first quarter of
2000 and $191  million  for the first  quarter of 1999.  The  Company's  working
capital  is  used   primarily  to  provide  for  the  operating   needs  of  its
subsidiaries,  which include  payments for space or time  purchased from various
media on behalf of its clients.  The  Company's  practice is to bill and collect
from its  clients in  sufficient  time to pay the  amounts due media on a timely
basis.  Other uses of working  capital  include the  payment of cash  dividends,
acquisitions,  capital  expenditures  and the  reduction of long-term  debt.  In
addition,  during the first three months of 2000, the Company acquired 1,080,200
shares of its own stock for the purpose of fulfilling the Company's  obligations
under its various compensation plans.

OTHER MATTERS

Acquisitions
------------
In April 2000,  the Company  issued  approximately  12.6  million  shares of its
common stock in connection with the acquisition of NFO Worldwide,  Inc. ("NFO").
The  acquisition  is  accounted  for as a pooling of  interests.  The  Company's
consolidated  financial  statements,  including  the  related  notes,  have been
restated  as of  the  earliest  period  presented  to  include  the  results  of
operations,  financial position and cash flows of NFO. Additionally, the results
of several other recent  acquisitions,  all of which have been  accounted for as
poolings of interests,  have been included in the restated financial statements.
Other  than  NFO,  none  of  the  other  acquisitions  was  individually,  or in
aggregate, material.

Year 2000 Issue
---------------
Subsequent to completion of the Company's  Year 2000  compliance  programs,  the
Company  has not  experienced  any  significant  Year  2000  disruptions  to its
business  nor has the  Company  been made aware of any  significant  disruptions
impacting its customers or critical suppliers.

Cautionary Statement
--------------------
Statements by the Company in this  document,  that are not matters of historical
fact,  are  forward-looking  statements  as  defined in the  Private  Securities
Litigation Reform Act of 1995. These  forward-looking  statements are subject to
certain  risks and  uncertainties  that  could  cause  actual  results to differ
materially from those anticipated in the forward-looking statements.
<PAGE>
New Accounting Guidance
-----------------------
In June 1998,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and  Hedging  Activities"  (SFAS  133),  which had an initial  adoption  date of
January 1, 2000. In June 1999,  the FASB postponed the adoption date of SFAS 133
until January 1, 2001.  The Company does not believe the effect of adopting SFAS
133 will be material to its financial condition or results of operations.

Conversion to the Euro
----------------------
On January 1, 1999,  certain member countries of the European Union  established
fixed  conversion  rates  between  their  existing  currencies  and the European
Union's common currency (the "Euro").  The Company  conducts  business in member
countries.  The transition  period for the  introduction  of the Euro is between
January  1, 1999,  and June 30,  2002.  The  Company  is  addressing  the issues
involved with the  introduction of the Euro. The major  important  issues facing
the Company include:  converting  information  technology  systems;  reassessing
currency  risk;  negotiating  and amending  contracts;  and  processing  tax and
accounting records.

Based upon progress to date, the Company  believes that use of the Euro will not
have a  significant  impact on the  manner  in which it  conducts  its  business
affairs  and  processes  its  business  and  accounting  records.   Accordingly,
conversion to the Euro has not, and is not expected to have a material effect on
the Company's financial condition or results of operations.
[{"type": "8-K", "sequence": "1", "filename": "0001.txt", "description": "FORM 8-K", "secsgml_size_bytes": 196702}]
{"company-data": {"conformed-name": "INTERPUBLIC GROUP OF COMPANIES INC", "cik": "0000051644", "assigned-sic": "7311", "irs-number": "131024020", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-06686", "film-number": "723715"}, "business-address": {"street1": "1271 AVE OF THE AMERICAS", "city": "NEW YORK", "state": "NY", "zip": "10020", "phone": "2123998000"}, "mail-address": {"street1": "136 MADISON AVENUE, 6TH FLOOR", "street2": "4TH FLOOR", "city": "NEW YORK", "state": "NY", "zip": "10016"}, "former-company": {"former-conformed-name": "MCCANN ERICKSON INC", "date-changed": "19710715"}}
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM 8-K

                Current Report Pursuant to Section 13 or 15(d) OF

                       THE SECURITIES EXCHANGE ACT OF 1934

Date of Report                                          Commission file number
September 15, 2000                                              1-6686
                                                           -----------------

                    THE INTERPUBLIC GROUP OF COMPANIES, INC.
             (Exact name of registrant as specified in its charter)

           Delaware                                             13-1024020
-------------------------------                             --------------------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                              Identification  No.)

1271 Avenue of the Americas, New York, New York                    10020
-----------------------------------------------                  ---------
(Address of principal executive offices)                         (Zip Code)

       Registrant's telephone number, including area code: (212) 399-8000
                                ----------------

Item 5.  OTHER EVENTS

On July 17,  2000 the  Company  filed a  current  report on Form 8-K in which it
restated its financial  statements as previously  presented in Form 10-K for the
year ended December 31, 1999.  Effective July 26, 2000, upon the announcement of
results for the second quarter of 2000, the  consolidated  financial  statements
became the historical results of the company.

This Current Report is identical to the filing made on July 17, 2000, except for
the removal of references to the financial statements as being "supplemental".

As  discussed  in  Note  15 of  the  consolidated  financial  statements  of The
Interpublic Group of Companies,  Inc. (the "Company"), in April 2000 the Company
acquired NFO Worldwide, Inc. ("NFO") in a transaction accounted for as a pooling
of  interests.  This  report on Form 8-K  includes  the  Company's  consolidated
financial  statements and other  financial  information  restated to reflect the
effect of the pooling of NFO. Additionally,  the results of several other recent
acquisitions,  all of which have been  accounted  for as poolings of  interests,
have been included in the restated financial statements. Other than NFO, none of
the other acquisitions was, individually or in aggregate, material.
Item 7.     FINANCIAL STATEMENTS AND EXHIBITS

Exhibit 99  Financial Statements, Financial Information and Exhibits

            Financial Highlights

            Management's Discussion and Analysis of Financial
            Condition and Results of Operations

Consolidated Financial Statements

            Report of Independent Accountants
                 - PricewaterhouseCoopers LLP
                 - Arthur Andersen LLP
                 - Soteriou Banerji
                 - Ernst & Young
                 - Ernst & Young LLP

              Consolidated Balance Sheet
              December 31, 1999 and 1998

              Consolidated Statement of Income for the Years Ended
              December 31, 1999, 1998 and 1997

              Consolidated  Statement  of Cash  Flows  for the Years
              Ended December 31, 1999, 1998 and 1997

              Consolidated Statement of Stockholders' Equity and
              Comprehensive Income For the Years Ended December 31, 1999, 1998
              and 1997

            Notes to Consolidated Financial Statements

            Selected Financial Data For Five Years

            Results by Quarter (Unaudited)

Consolidated Financial Statement Schedule

            Schedule VIII: Valuation and Qualifying Accounts

Consolidated Financial Statements

            Consolidated Balance Sheet
               March 31, 2000 (unaudited) and December 31, 1999

            Consolidated  Statement of Income for the Three Months
               Ended March 31, 2000 and 1999 (unaudited)

            Consolidated Statement of Comprehensive Income for
               the Three Months Ended March 31, 2000 and 1999 (unaudited)

            Consolidated Statement of Cash Flows for the
               Three Months Ended March 31, 2000 and 1999 (unaudited)

            Notes to Consolidated Financial Statements (unaudited)

            Management's Discussion and Analysis of
             Financial Condition and Results of Operations (unaudited)
Exhibit 11  COMPUTATION OF EARNINGS PER SHARE

            For the Years Ended December 31, 1995, 1996, 1997, 1998 and 1999

            For the Three Months Ended March 31, 2000 and 1999

Exhibit 23  CONSENT OF INDEPENDENT ACCOUNTANTS

            PricewaterhouseCoopers LLP

            Arthur Andersen LLP

               Soteriou Banerji

            Ernst & Young

            Ernst & Young LLP

Exhibit 27  RESTATED FINANCIAL DATA SCHEDULE

            For the Three Months Ended March 31, 2000 and 1999

            For the Years Ended December 31, 1999, 1998 and 1997
SIGNATURES

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

                         THE INTERPUBLIC GROUP OF COMPANIES, INC.
                                        (Registrant)

Date:  September 15, 2000     BY /S/  FREDERICK MOLZ
                              ----------------------
                              Frederick Molz
                              Vice President and Controller
FINANCIAL HIGHLIGHTS
                  (Amounts in Thousands Except Per Share Data)
--------------------------------------------------------------------------------
December 31
                                                                        Percent
                                                                      Increase/

                                        1999            1998         (decrease)
--------------------------------------------------------------------------------
Operating Data
 Revenue                            $ 4,892,912     $  4,167,788          17.4%
 Net Income                         $   315,243     $    333,593          (5.5%)
 Net Income Excluding
   Restructuring(1)                 $   366,680     $    333,593           9.9%
Per Share Data(2)
 Diluted EPS                        $      1.04     $       1.12          (7.1%)
 Diluted EPS Excluding
   Restructuring (1)                $      1.21     $       1.12           8.0%
 Cash Dividends                     $       .33     $        .29          13.8%
 Share Price at December 31         $  57 11/16     $     39 7/8          44.7%
 Weighted-average shares
  Diluted                               302,914          299,214           1.2%
  Diluted Excluding
   Restructuring(1)                     309,607          299,214           3.5%
Financial Position

 Cash and Cash Equivalents          $ 1,006,011     $    780,429          28.9%
 Total Assets                       $ 9,166,604     $  7,464,808          22.8%
 Book Value Per Share(2)            $      5.85     $       4.81          21.6%
 Return on Average
  Stockholders' Equity:
    As Reported                           19.7%            25.7%
    Excluding Restructuring(1)            22.6%            25.7%

Revenue

1999                               $4,892,912
1998                               $4,167,788
1997                               $3,582,601
Diluted Earnings Per Share(2)
1999 As Reported                       $ 1.04
1999 Excluding Restructuring(1)        $ 1.21
1998                                   $ 1.12
1997                                   $  .77
Cash Dividends Per Share(2)
1999                                   $  .33
1998                                   $  .29
1997                                   $  .25
Return On Average Stockholders' Equity
1999 As Reported                        19.7%
1999 Excluding Restructuring(1)         22.6%
1998                                    25.7%
1997                                    21.0%

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note 15).

-----------------
[FN]
(1)  Excludes the impact of restructuring and other merger-related costs.
(2) All  share  data  for  1998  and 1997  has  been  adjusted  to  reflect  the
two-for-one stock split effective July 15, 1999.
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

As discussed in Note 15, the Company  acquired NFO Worldwide,  Inc.  ("NFO"),  a
leading  provider of research  based  marketing  information  and counsel to the
business community,  in a transaction accounted for as a pooling of interests in
April 2000. The Company's  consolidated financial statements and other financial
information  have been  restated  to  reflect  the  effect  of the NFO  pooling.
Additionally,  results of several other recent  acquisitions,  all of which have
been  accounted for as poolings of interests  have been included in the restated
financial  statements.  The following discussion relates to the combined results
of the Company after giving effect to the pooled companies.

The Company  reported net income of $315.2 million or $1.04 diluted earnings per
share  for  the  year  ended   December  31,  1999.   Excluding  the  impact  of
restructuring  and  other  merger  related  costs,  which  are  described  in  a
subsequent section of this discussion, net income would have been $366.7 million
or $1.21 diluted earnings per share, compared to $333.6 million or $1.12 diluted
earnings per share for the year ended  December  31, 1998 and $220.2  million or
$.77 diluted earnings per share for the year ended December 31, 1997.

The  following  table sets forth net income and  earnings  per share  before and
after the restructuring and other merger related costs:

(Dollars in thousands)
                                          1999            1998            1997
                                          ----            ----            ----

Net income as reported                $  315,243      $  333,593      $  220,211
Earnings per share

    Basic                             $     1.08      $     1.15      $      .79
    Diluted                           $     1.04      $     1.12      $      .77

Net income before restructuring
  and other merger related costs      $  366,680      $  333,593      $  220,211
Earnings per share

    Basic                             $     1.26      $     1.15      $      .79
    Diluted                           $     1.21      $     1.12      $      .77

Revenue
-------
Worldwide  revenue for 1999 was $4.9  billion,  an  increase of $725  million or
17.4% over 1998. Domestic revenue, which represented 51% of worldwide revenue in
1999, increased $367 million or 17.4% over 1998.  International  revenue,  which
represented  49% of worldwide  revenue in 1999,  increased $358 million or 17.4%
over 1998.  International  revenue would have increased 22% excluding the effect
of the strengthening of the U.S. dollar against major  currencies.  The increase
in  worldwide  revenue is a result of both  growth from new  business  gains and
growth from  acquisitions.  Exclusive of  acquisitions,  worldwide  revenue on a
constant dollar basis increased 9% over 1998.
Revenue from other specialized  marketing services,  which include media buying,
market research,  relationship (direct) marketing,  public relations, sports and
event   marketing,   healthcare   marketing  and   e-business   consulting   and
communications,  comprised approximately 45% of total worldwide revenue in 1999,
compared to 39% in 1998.

Worldwide  revenue for 1998 was $4.2  billion,  an  increase of $585  million or
16.3% over 1997.  Domestic revenue,  which represented 51% of worldwide revenue,
increased $283 million or 15.5% over 1997.  International revenue increased $302
million or 17.2% over  1997.  International  revenue  would have  increased  23%
excluding  the effect of the  strengthening  of the U.S.  dollar  against  major
currencies.

Operating Expenses
------------------
Worldwide operating expenses for 1999, excluding  restructuring and other merger
related  costs,  were $4.2  billion,  an increase of 17.9% over 1998.  Operating
expenses  outside the United States increased  16.7%,  while domestic  operating
expenses  increased 19.2%.  These increases were commensurate with the increases
in revenue. Worldwide operating expenses for 1998 were $3.6 billion, an increase

of 13.6% over 1997, comprised of an 18.1% increase in international expenses and
a 9.1% increase in domestic expenses.

Significant  portions of the Company's expenses relate to employee  compensation
and various employee  incentive and benefit programs,  which are based primarily
upon operating results.  Salaries and related expenses were $2.7 billion in 1999
or 55.2% of revenue as compared to $2.3  billion in 1998 or 55.4% of revenue and
$2.0  billion  in 1997 or 56.0% of  revenue.  The year over year  increase  is a
result of growth from acquisitions and new business gains.

In  1997,  as part of its  continuing  cost  containment  efforts,  the  Company
announced that it was curtailing  its domestic  pension plan effective  April 1,
1998, and recorded pre-tax charges of approximately  $16.7 million.  The Company
continues to sponsor a domestic defined contribution plan.

Office and general expenses were $1.5 billion in 1999, $1.3 billion in 1998, and
$1.2 billion in 1997.  The year over year  increase is a result of the continued
growth  of the  Company,  which  reflects  in part an  increase  in the level of
goodwill and other intangible asset amortization related to acquisitions.

In the fourth quarter of 1999, NFO recorded  special charges of $22 million as a
result of the difficult  competitive  environment due to client consolidation in
the  financial  services  industry.  Approximately  $16  million of the  special
charges  related  to the  write-off  of  intangible  assets  which  were  deemed
permanently impaired.

Income from Operations
----------------------
Income from operations for 1999 was $562 million.  Excluding  restructuring  and
other merger related costs, income from operations for 1999 was $646 million, an
increase of $80 million or 14% over 1998.  Amortization of intangible assets was
$99  million  for  1999   compared  to  $61  million  for  1998.   Exclusive  of
acquisitions,  foreign  exchange  fluctuations  and  amortization  of intangible
assets, income from operations increased 16% for 1999 compared to 1998.

Income from  operations  for 1998 was $566  million  compared to $379 million in
1997,  an increase of 50%. The increase is a result of growth from  acquisitions
and new business gains.

Special Compensation Charges
----------------------------
During 1997, Hill, Holliday,  Connors,  Cosmopolous,  Inc. ("Hill Holliday"),  a
company acquired in a pooling of interests  transaction in the second quarter of
1998, recorded special compensation charges of approximately $32 million.
Restructuring and Other Merger Related Costs
--------------------------------------------
In October  1999,  the Company  announced  the merger of two of its  advertising
networks.  The networks  affected,  Lowe & Partners Worldwide and Ammirati Puris
Lintas were combined to form a new agency  network called Lowe Lintas & Partners
Worldwide.  The merger involves the  consolidation  of operations in Lowe Lintas
agencies  in  approximately  24 cities in 22  countries  around the world.  Once
complete, the newly merged agency network will have offices in over 80 countries
around the world.

During  the  fourth  quarter  of  1999,   the  Company  began   execution  of  a
comprehensive  restructuring  plan in  connection  with  the  merger.  The  plan
includes  headcount  reductions,  consolidation  of real  estate and the sale or
disposition of certain investments,  and is expected to be completed by June 30,
2000. The Company is pleased with the progress of the merger to date and expects
the total costs to be in line with its original estimate.

The total pre-tax cost of the restructuring  plan is expected to be between $170
and $190 million,  ($100 to $115 million,  net of tax). In the fourth quarter of
1999, the Company recognized pre-tax costs of $84.2 million ($51.4 million,  net
of tax or $.17 per diluted share),  with the remainder expected to be recognized
in the first two quarters of 2000.

A summary of the components of the total  restructuring and other merger related
costs,  together  with an  analysis  of the cash and  non-cash  elements,  is as
follows:

(Dollars in millions)

                                               1999            Cash    Non-Cash
                                              ---------------------------------
TOTAL BY TYPE
-------------
   Severance and termination costs            $44.9           $27.0       $17.9
   Fixed asset write-offs                      11.1              --        11.1
   Lease termination costs                      3.8             3.8          --
   Investment write-offs and other             24.4             1.1        23.3
                                              ---------------------------------
Total                                         $84.2           $31.9       $52.3
                                              =================================

The severance and termination costs recorded in 1999 relate to approximately 230
employees who have been terminated or notified that they will be terminated. The
employee   groups   affected   include   executive   and  regional   management,
administrative,  account  management,  creative and media production  personnel,
principally  in the U.S.  and  U.K.  The  charge  related  to these  individuals
includes  the cost of  voluntary  programs  in certain  locations  and  includes
substantially all senior executives that will be terminated.  As of December 31,
1999, the amount accrued related to severance and termination was  approximately
$42.6 million.  During the fourth quarter of 1999, cash payments of $2.3 million
were made.

The fixed  assets  write-off  relates  largely to the  abandonment  of leasehold
improvements  as part of the merger.  The amount  recognized  in 1999 relates to
fixed asset write-offs in 6 offices principally in the United States.

Lease termination costs relate to the offices vacated as part of the merger. The
lease  terminations  are expected to be completed by mid-to-late  2000, with the
cash  portion to be paid out over a period of up to five  years.  As of December
31,  1999,  the  amount  accrued  related  to these  termination  costs was $3.8
million.
The  investment  write-offs  relate to the loss on sale or  closing  of  certain
business  units.  In 1999,  $23  million  has been  recorded  as a result of the
decision  to sell or  abandon  4  European  businesses.  In the  aggregate,  the
businesses  being  sold or  abandoned  represent  an  immaterial  portion of the
revenue  and  operations  of Lowe Lintas & Partners.  The  write-off  amount was
computed based upon the difference between the estimated sales proceeds (if any)
and the  carrying  value of the related  assets.  These  sales or  closures  are
expected to be completed by mid 2000.

The Company expects to benefit from the resulting  reduction in employee related
costs, compensation,  benefits and space occupancy. These benefits will begin to
be realized in the second half of 2000.  It is  anticipated  that a  significant
portion  of the  savings  will be  offset by  investments  in  creative  talent,
technology and other  capabilities to support the  acceleration of growth in the
future.  The Company  anticipates  that beginning 2001 its after-tax  results of
operations will benefit by between $20 to $25 million.

Interest Expense
----------------
Interest expense was $81 million in 1999, $64 million in 1998 and $60 million in
1997.  The  increase  in 1999 was  attributable  to the  issuance  of the  1.87%
Convertible  Subordinated  Notes due 2006,  issued in June 1999,  in addition to
other  borrowings  to fund a  portion  of the  acquisition  of  Infratest  Burke
Aktiengesellschaft  Holdings,  one of the top custom marketing research firms in
Europe, in November 1998.

Other Income, Net
-----------------
Other income, net primarily  consists of interest income,  investment income and
net gains from equity  investments.  Other income,  net included  gains from the
Company's   investments  in  various  interactive  based  companies,   including
Nicholson NY, Inc.,  Lycos and USWEB in 1999,  gains related to  investments  in
USWEB, CKS Group,  Inc. and Lycos in 1998, and gains on the sale of investments,
including All American Communications,  Inc. and CKS Group, Inc. in 1997. In the
aggregate,  annual net equity  gains  remained  relatively  constant  during the
three-year period.

Other Items
-----------
Income applicable to minority interests increased by $5.5 million in 1999 and by
$3.7 million in 1998. The 1999 and 1998 increase was primarily due to the strong
performance of companies that were not wholly owned,  as well as the acquisition
of additional such entities during 1999 and 1998.

The  Company's  effective  income tax rate was 41.6% in 1999,  40.8% in 1998 and
45.3% in 1997. The higher rate in 1997 was largely  attributable  to the special
compensation charges recorded by Hill Holliday.

Cash Based Earnings
-------------------
Management believes that cash based earnings are a relevant measure of financial
performance as it better  illustrates  the Company's  performance and ability to
support growth. The Company defines cash based earnings as net income,  adjusted
to exclude amortization of intangible assets, net of tax where applicable.  Cash
based  earnings are not  calculated  in the same manner by all companies and are
intended to supplement, not replace, the other measures calculated in accordance
with generally accepted accounting principles. Cash based earnings for the three
years ending December 31, 1999, 1998, and 1997 were as follows:
(Amounts in thousands except per share data)

                                         1999           1998            1997
                                       ---------------------------------------
Net income as reported                 $315,243       $333,593        $220,211
Restructuring and other

  merger related costs, net of tax       51,437             --              --
                                       ---------------------------------------

Net income, as adjusted                 366,680        333,593         220,211
Add back amortization

  of intangible assets                   99,326         61,396          45,682
Less related tax effect                 (13,031)        (6,146)         (5,228)
                                       ---------------------------------------

Cash based earnings (as
  defined above)                       $452,975       $388,843        $260,665
                                       =======================================

Per share amounts (diluted)               $1.49          $1.30            $.90

LIQUIDITY AND CAPITAL RESOURCES

The Company's financial position remained strong during 1999, with cash and cash
equivalents at December 31, 1999, of $1.0 billion, an increase of $225.6 million
over the 1998 year-end balance. Working capital at December 31, 1999, was $170.9
million,  which was $70.6 million  higher than the level at the end of 1998. The
increase  in  working   capital  was   largely   attributable   to  proceeds  of
approximately  $300 million from the 1.87%  Convertible  Subordinated  Notes due
2006 issued in June, 1999.

Historically,  cash flow from  operations has been the primary source of working
capital and  management  believes  that it will continue to be so in the future.
Net cash provided by operating  activities  was $592  million,  $527 million and
$283  million  for  the  years  ended   December  31,  1999,   1998,  and  1997,
respectively. The Company's working capital is used primarily to provide for the
operating needs of its  subsidiaries,  which includes payments for space or time
purchased from various media on behalf of clients.  The Company's practice is to
bill and collect from its clients in sufficient  time to pay the amounts due for
media on a timely basis. Other uses of working capital include the repurchase of
the Company's common stock, payment of cash dividends,  capital expenditures and
acquisitions.

The Company  acquires shares of its stock on an ongoing basis.  During 1999, the
Company purchased approximately 6.5 million shares of its common stock, compared
to 4.9 million shares in 1998. The Company repurchases its stock for the purpose
of fulfilling its obligations under various compensation plans.

The Company,  excluding pooled entities,  paid $90.4 million ($.33 per share) in
dividends to stockholders in 1999, as compared to $76.9 million ($.29 per share)
paid during 1998.

The  Company's  capital  expenditures  in 1999 were $177.1  million  compared to
$156.4 million in 1998 and $122.4 million in 1997. The primary purposes of these
expenditures were to upgrade computer and  telecommunications  systems to better
serve clients and to modernize offices.
During 1999, the Company paid  approximately  $559 million in cash and stock for
new acquisitions,  including a number of marketing  communications  companies to
complement its existing  agency systems and to optimally  position itself in the
ever-broadening  communications  marketplace.  This amount includes the value of
stock issued for pooled companies.

The Company and its subsidiaries maintain credit facilities in the United States
and in countries  where they conduct  business to manage their future  liquidity
requirements.  The Company's  available  short-term  credit facilities were $510
million,  of which $80 million  were  utilized at December  31,  1999,  and $576
million, of which $118 million were utilized at December 31, 1998.

Return  on  average  stockholders'  equity  was 19.7% in 1999 and 25.7% in 1998.
Excluding  restructuring  and other  merger  related  costs,  return on  average
stockholders'  equity  was  22.6% in 1999.  The  decline  in 1999 was  primarily
attributable  to a $159  million  increase in net  unrealized  holding  gains on
equity investments, which are included in stockholders' equity.

As discussed in Note 12, revenue from international  operations was 49% of total
revenue in 1999, 1998 and 1997. The Company continuously  evaluates and attempts
to mitigate its exposure to foreign exchange,  economic and political risks. The
notional value and fair value of all outstanding  forwards and options contracts
at the  end of  the  year  were  not  significant.  In  addition,  the  economic
developments in Brazil,  which did not have a significant negative impact on the
Company,  were  partially  offset by the  favorable  impact due to the  economic
recovery in Japan.

The Company is not aware of any significant  occurrences  that could  negatively
impact its liquidity. However, should such a trend develop, the Company believes
that there are sufficient funds available under its existing lines of credit and
from internal cash-generating capabilities to meet future needs.

OTHER MATTERS
Internet-Services Companies
---------------------------
During 1999, the Company expanded its investment in internet-service and related
companies. In December 1999, the Company announced the establishment of Zentropy
Partners,  a new global  internet-services  company that integrates the building
and marketing of digital  businesses.  At its formation,  Zentropy  Partners had
annualized revenue exceeding $50 million and was positioned to serve clients out
of 11 offices in Europe and North America.

In April 1999, the Company invested $20 million for a minority  interest in Icon
Medialab International AB ("Icon"), a Swedish based internet consultancy.  Later
in  the  year,  the  Company  increased  its  investment  in  Icon  through  the
contribution  of other  investments and through  additional  cash purchases.  At
December 31, 1999, the fair market value of the Company's investment in Icon was
$322 million.

On October 19, 1999, NFO announced the formation of  InsightExpress,  LLC, a new
Internet company formed to provide  real-time  consumer input to the desktops of
decision-makers  in companies of all sizes worldwide.  InsightExpress is a fully
automated  web-enabled  survey  system that will allow its customers to test new
ideas, screen new concepts, gauge customer satisfaction,  survey employees, test
advertising,  and gather  insight into the needs,  attitudes,  and  behaviors of
consumers.  InsightExpress  is  designed  to  provide  these  capabilities  at a
fraction  of the time and the cost of existing  market  research  methods  while
leveraging the worldwide  client  experience and panel expertise of NFO. To fund
its development and growth,  InsightExpress has raised a total of $25 million in
new venture capital from General Atlantic Partners and Engage Technologies.
In addition to the above,  the Company  maintains  internet-service  and related
divisions at several of its major  operating  divisions  and has made  strategic
investments in fourteen  companies whose objectives revolve around consulting on
the use of technology to benefit customers.

Year 2000 Issue
---------------
Pursuant to the Year 2000 issue,  the Company had developed  programs to address
the possible  exposures  related to the impact of computer  systems  incorrectly
recognizing the year 2000 or "00" as 1900. As a result of  implementation of its
programs,  the Company did not experience any significant  Year 2000 disruptions
during the  transition  from 1999 to 2000,  and since entering 2000, the Company
has not experienced any significant  Year 2000  disruptions to its business.  In
addition, the Company is not aware of any significant  disruptions impacting its
customers  or  suppliers.  The Company  will  continue  to monitor its  computer
systems over the next several months.  However,  the Company does not anticipate
any  significant  impact  related  to Year 2000  problems  that may  affect  its
internal  computer  systems.  The  Company  will also  continue  to monitor  the
activities  of its business  partners and critical  suppliers  and has developed
contingency plans should business partners or critical suppliers  experience any
Year 2000 disruptions in the coming months.

Costs incurred to achieve Year 2000  readiness,  which included  modification to
existing systems,  replacement of non-compliant systems and consulting resources
totaled $73 million.  A total of $47 million was capitalized  (related primarily
to hardware and software that  provided  both Year 2000  readiness and increased
the functionality of certain systems), and $26 million was expensed.

Cautionary Statement
--------------------
Statements  by the Company in this  document are  forward-looking  statements as
defined  in  the  Private  Securities  Litigation  Reform  Act  of  1995.  These
forward-looking  statements are subject to certain risks and uncertainties  that
could cause actual results to differ  materially  from those  anticipated in the
forward-looking statements.

New Accounting Guidance
-----------------------
In June 1998,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and Hedging  Activities"  (SFAS 133),  which had an initial adoption date by the
Company of January 1, 2000. In June 1999,  the FASB  postponed the adoption date
of SFAS 133 until  January 1, 2001.  The Company  does not believe the effect of
adopting  SFAS 133 will be material  to its  financial  condition  or results of
operations.

Conversion to the Euro
----------------------
On January 1, 1999,  certain member countries of the European Union  established
fixed  conversion  rates  between  their  existing  currencies  and the European
Union's common currency (the "Euro").  The Company  conducts  business in member
countries.  The  transition  period  for the  introduction  of the Euro  will be
between January 1, 1999, and June 30, 2002. The Company is addressing the issues
involved with the  introduction of the Euro. The major  important  issues facing
the Company include:  converting  information  technology  systems;  reassessing
currency  risk;  negotiating  and amending  contracts;  and  processing  tax and
accounting records.

Based upon progress to date, the Company  believes that use of the Euro will not
have a  significant  impact on the  manner  in which it  conducts  its  business
affairs  and  processes  its  business  and  accounting  records.   Accordingly,
conversion to the Euro has not, and is not expected to have a material effect on
the Company's financial condition or results of operations.
REPORT OF INDEPENDENT ACCOUNTANTS

                                                     1301 Avenue of the Americas
                                                        New York, New York 10019

To the Board of Directors and Stockholders of
The Interpublic Group of Companies, Inc.

In our opinion, based upon our audits and the reports of the other auditors
the  accompanying  consolidated  balance  sheets  and the  related  consolidated
statements  of  income,   of  cash  flows,  and  of  stockholders'   equity  and
comprehensive  income present fairly,  in all material  respects,  the financial
position of The Interpublic  Group of Companies,  Inc. and its subsidiaries (the
"Company")  at December 31, 1999 and 1998,  and the results of their  operations
and their cash flows for each of the three  years in the period  ended  December
31, 1999, in conformity with  accounting  principles  generally  accepted in the
United  States.  These  financial  statements  are  the  responsibility  of  the
Company's  management;  our  responsibility  is to  express  an opinion on these
financial  statements  based  on our  audits.  We did not  audit  the  financial
statements  of  International  Public  Relations  plc  ("IPR"),  a  wholly-owned
subsidiary,  which statements reflect revenues constituting  approximately 6% of
the related 1997  consolidated  financial  statement total. We did not audit the
financial  statements  of  Hill,  Holliday,  Connors,  Cosmopulos,  Inc.  ("Hill
Holiday"),  a wholly-owned  subsidiary which  statements  reflect total net loss
constituting  approximately  15%  of the  related  1997  consolidated  financial
statement total. Additionally,  we did not audit the financial statements of NFO
Worldwide,  Inc. ("NFO"),  a wholly-owned  subsidiary,  which statements reflect
total assets  constituting  approximately  5% of the related  1999  consolidated
financial  statements  total.  Those  statements  were audited by other auditors
whose  reports  thereon  have been  furnished  to us, and our opinion  expressed
herein,  insofar as it relates to the amounts included for IPR, Hill Holiday and
NFO, is based  solely on the reports of the other  auditors.  We  conducted  our
audits of these  statements in  accordance  with  auditing  standards  generally
accepted in the United States,  which require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and  disclosures in the financial  statements,  assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall  financial  statement  presentation.  We believe that our
audits and the  reports of other  auditors  provide a  reasonable  basis for the
opinion expressed above.

PricewaterhouseCoopers LLP
New York, New York

February 22, 2000, except for Note 15
which is as of July 13, 2000
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders of NFO Worldwide, Inc.:

We have  audited  the  consolidated  balance  sheets of NFO  Worldwide,  Inc. (a
Delaware corporation) and subsidiaries as of December 31, 1999 and 1998, and the
related consolidated statements of income,  stockholders' equity, and cash flows
for each of the years in the three year period ended  December  31, 1999.  These
financial statements (not presented separately herein) are the responsibility of
the Company's  management.  Our responsibility is to express an opinion on these
financial  statements  based on our audits.  We did not audit the 1997 financial
statements  of  The  MBL  Group  plc,  included  in the  consolidated  financial
statements of NFO Worldwide, Inc., which statements reflect total revenues of 26
percent of the related 1997  consolidated  total,  after  adjustment  to reflect
translation into U.S. dollars and accounting  principles  generally  accepted in
the United States. The financial statements of The MBL Group plc, prior to those
adjustments,  were  audited by other  auditors  whose  report  thereon  has been
furnished to us, and our opinion expressed herein,  insofar as it relates to the
amounts  included  for The MBL Group plc,  is based  solely on the report of the
other auditors.

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  and the  report of other  auditors
provide a reasonable basis for our opinion.

In our opinion,  based on our audits and the report of the other  auditors,  the
consolidated  financial  statements  referred to above  present  fairly,  in all
material  respects,   the  financial   position  of  NFO  Worldwide,   Inc.  and
subsidiaries  as of  December  31,  1999  and  1998,  and the  results  of their
operations  and their cash flows for each of the years in the three year  period
ended  December 31, 1999, in conformity  with  accounting  principles  generally
accepted in the United States.

Our audits were made for the  purpose of forming an opinion on the  consolidated
financial  statements taken as a whole. The schedule referred to in Item 14 (not
presented  separately herein) is presented for the purpose of complying with the
Securities and Exchange  Commission's  rules and is not part of the consolidated
financial  statements.   This  schedule  has  been  subjected  to  the  auditing
procedures applied in our audits of the consolidated  financial  statements and,
in our  opinion,  based on our audit and the  report of other  auditors,  fairly
states in all material  respects  the  financial  data  required to be set forth
therein in relation to the consolidated financial statements taken as a whole.

Arthur Andersen LLP
New York, New York,

February 25, 2000
REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF THE MBL GROUP plc

We have audited the financial statements of The MBL Group plc for the year ended
December 31, 1997, which have been prepared under the historical cost convention
and in accordance with generally accepted  accounting  principles  applicable in
the United Kingdom.

Respective Responsibilities of Directors and Auditors

The  Company's  directors  are  responsible  for the  preparation  of  financial
statements.  It is our responsibility to form an independent  opinion,  based on
our audit, on those statements and to report our opinion to you.

Basis of Opinion

We conducted  our audit in  accordance  with  Auditing  Standards  issued by the
Auditing  Practices Board which are  substantially the same as those followed in
the United States. An audit includes  examination,  on a test basis, of evidence
relevant to the amounts and  disclosures  in the financial  statements.  It also
includes an assessment of the  significant  estimates and judgements made by the
directors in the  preparation  of the financial  statements,  and of whether the
accounting policies are appropriate to the Company's circumstances, consistently
applied and adequately disclosed.

We  planned  and  performed  our audit so as to obtain all the  information  and
explanations  which  we  considered  necessary  in  order  to  provide  us  with
sufficient evidence to give reasonable  assurance that the financial  statements
are  free  from  material  misstatement,   whether  caused  by  fraud  or  other
irregularity  or error.  In forming our opinion,  we also  evaluated the overall
adequacy of the presentation of information in the financial statements.

Opinion

In our  opinion,  the  financial  statements  give a true and  fair  view of the
group's  profit and cash flows for the year ended  December 31,  1997,  and have
been  properly  prepared  in  accordance  with  generally  accepted   accounting
principles in the United Kingdom.

Soteriou Banerji
Registered Auditors and Chartered Accountants
253 Gray's Inn Road
London, WC1X 8QT

Date February 23, 1998
REPORT OF  INDEPENDENT  AUDITORS TO THE  SHAREHOLDERS  AND BOARD OF DIRECTORS OF
INTERNATIONAL PUBLIC RELATIONS PLC

We have audited the consolidated statements of income,  shareholders' equity and
cash  flows of  International  Public  Relations  plc and  subsidiaries  for the
fourteen-month  period ended 31 December 1997, all expressed in pounds sterling.
These financial  statements,  which are not separately presented herein, are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audit.

We conducted our audit in accordance  with United  Kingdom  auditing  standards,
which do not differ in any  significant  respect  from United  States  generally
accepted  auditing  standards.  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 audit provides a reasonable  basis
for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  consolidated   results  of  operations  and  the
consolidated  cash flows of International  Public Relations plc and subsidiaries
for the  fourteen-month  period ended 31 December 1997 in conformity with United
States generally accepted accounting principles.

Ernst & Young
London
3 February 1999
REPORT OF INDEPENDENT AUDITORS

Board of Directors

Hill, Holliday, Connors, Cosmopulos, Inc.

We have audited the consolidated statements of operations,  stockholders' equity
(deficit)  and cash  flows of Hill,  Holliday,  Connors,  Cosmopulos,  Inc.  and
Subsidiaries  (the Company) for the twelve months ended  December 31, 1997,  not
separately  presented herein.  These financial statements are the responsibility
of the  Company's  management.  Our  responsibility  is to express an opinion on
these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
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 audit provides a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the consolidated  results of operations and
cash flows of Hill, Holliday, Connors, Cosmopulos, Inc. and Subsidiaries for the
twelve-month  period  ended  December  31,  1997 in  conformity  with  generally
accepted accounting principles.

Ernst & Young LLP
Boston, Massachusetts
March 13, 1998
FINANCIAL STATEMENTS
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                                   DECEMBER 31
                  (Dollars in Thousands Except Per Share Data)

ASSETS                                                1999            1998
                                                   --------------------------

CURRENT ASSETS:
Cash and cash equivalents (includes
  certificates of deposit: 1999-$150,343;
  1998-$152,064)                                   $1,006,011      $  780,429
Marketable securities                                  36,765          31,733
Receivables (net of allowance for doubtful
  accounts:  1999-$60,505; 1998-$54,060)            4,401,704       3,628,137
Expenditures billable to clients                      332,833         299,134
Prepaid expenses and other current assets             146,019         154,596
                                                   --------------------------

   Total current assets                             5,923,332       4,894,029
                                                   --------------------------

OTHER ASSETS:
Investment in unconsolidated affiliates                61,987          62,244
Deferred taxes on income                                   --          91,424
Other investments and miscellaneous assets            718,939         361,980
                                                   --------------------------

   Total other assets                                 780,926         515,648
                                                   --------------------------

FIXED ASSETS, AT COST:
Land and buildings                                    164,678         117,105
Furniture and equipment                               777,368         736,822
                                                   --------------------------
                                                      942,046         853,927
Less: accumulated depreciation                        504,371         437,026
                                                   --------------------------
                                                      437,675         416,901
Unamortized leasehold improvements                    145,071         117,785
                                                   --------------------------

   Total fixed assets                                 582,746         534,686
                                                   --------------------------

Intangible assets (net of accumulated
 amortization: 1999-$607,417; 1998-$525,792)        1,879,600       1,520,445
                                                   --------------------------

TOTAL ASSETS                                       $9,166,604      $7,464,808
                                                   ==========================
FINANCIAL STATEMENTS
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                                   DECEMBER 31
                  (Dollars in Thousands Except Per Share Data)

LIABILITIES AND STOCKHOLDERS' EQUITY                      1999             1998
                                                          ----             ----
CURRENT LIABILITIES:
Payable to banks                                    $  262,397       $  214,955
Accounts payable                                     4,568,343        3,651,307
Accrued expenses                                       761,210          709,086
Accrued income taxes                                   160,484          218,381
                                                    ---------------------------
Total current liabilities                            5,752,434        4,793,729
                                                    ---------------------------
NONCURRENT LIABILITIES:
Long-term debt                                         524,183          498,184
Convertible subordinated debentures
  and notes                                            518,490          207,927
Deferred compensation and reserve
  for termination allowances                           344,999          321,834
Deferred taxes on income                                44,744               --
Accrued postretirement benefits                         50,226           49,919
Other noncurrent liabilities                            87,548          101,097
Minority interests in consolidated
  subsidiaries                                          81,612           59,246
                                                    ---------------------------
Total noncurrent liabilities                         1,651,802        1,238,207
                                                    ---------------------------
STOCKHOLDERS' EQUITY:
Preferred Stock, no par value
  shares authorized:  20,000,000
  shares issued:  none

Common Stock, $.10 par value
  shares authorized:  550,000,000
  shares issued:
    1999 - 309,996,727;
    1998 - 304,028,927                                  31,000           30,403
Additional paid-in capital                             784,646          574,994
Retained earnings                                    1,389,971        1,169,070
Accumulated other comprehensive
  loss, net of tax                                     (76,695)        (160,970)
                                                     --------------------------
                                                     2,128,922        1,613,497
Less:
Treasury stock, at cost:
1999 - 8,909,904 shares;
1998 - 6,411,028 shares                                289,519          109,277
Unamortized expense of restricted stock grants          77,035           71,348
                                                     --------------------------
Total stockholders' equity                           1,762,368        1,432,872
                                                     --------------------------
Commitments and contingencies

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY          $9,166,604       $7,464,808
                                                    ===========================

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See note 15).

All share data for 1998 has been adjusted to reflect the two-for-one stock split
effective July 15, 1999.

The accompanying notes are an integral part of these financial statements.
FINANCIAL STATEMENTS
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                  CONSOLIDATED STATEMENT OF INCOME
                             YEAR ENDED DECEMBER 31
                  (Amounts in Thousands Except Per Share Data)

                                             1999           1998           1997
                                      -----------------------------------------

Revenue                               $ 4,892,912    $ 4,167,788    $ 3,582,601

Salaries and related expenses           2,698,214      2,310,001      2,006,860
Office and general expenses             1,548,500      1,291,795      1,164,920
Special compensation charges                   --             --         32,229
Restructuring and other merger
   related costs                           84,183             --             --
                                      -----------------------------------------
Total operating expenses                4,330,897      3,601,796      3,204,009
                                      -----------------------------------------

Income from operations                    562,015        565,992        378,592

Interest expense                          (81,241)       (64,137)       (59,651)
Other income, net                         102,741         98,031        116,882
                                      -----------------------------------------

Income before provision

  for income taxes                        583,515        599,886        435,823

Provision for income taxes                242,726        244,981        197,219
                                      -----------------------------------------

Income of consolidated companies          340,789        354,905        238,604

Income applicable to

  minority interests                      (33,991)       (28,503)       (24,759)
Equity in net income of
  unconsolidated affiliates                 8,445          7,191          6,366
                                      -----------------------------------------
Net Income                            $   315,243    $   333,593    $   220,211
                                      -----------------------------------------

Per Share Data:
  Basic EPS                           $      1.08    $      1.15    $       .79
  Diluted EPS                         $      1.04    $      1.12    $       .77

Weighted average shares:
  Basic                                   292,067        288,831        277,871
  Diluted                                 302,914        299,214        295,677

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note 15).

All share data for 1998 and 1997 has been  adjusted to reflect  the  two-for-one
stock split effective July 15, 1999.

The accompanying notes are an integral part of these financial statements.
FINANCIAL STATEMENTS
          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                CONSOLIDATED STATEMENT OF CASH FLOWS
                             YEAR ENDED DECEMBER 31
                             (Dollars in Thousands)
1999         1998         1997
                                                    -------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                          $  315,243    $ 333,593    $ 220,211
Adjustments to reconcile net income to
   cash provided by operating activities:
Depreciation and amortization of fixed assets          125,432      109,109       88,300
Amortization of intangible assets                       99,326       61,396       45,682
Amortization of restricted stock awards                 25,926       20,272       16,222
Stock bonus plans/ESOP                                      --           --        1,389
Provision for (benefit of) deferred income taxes         9,316      (11,972)       7,432
Noncash pension plan charges                                --           --       16,700
Equity in net income of unconsolidated affiliates       (8,445)      (7,191)      (6,366)
Income applicable to minority interests                 33,991       28,503       24,759
Translation losses/(gains)                                 690        1,034         (319)
Special compensation charges                                --           --       31,553
Net gain on investments                                (43,390)     (40,465)     (44,626)
Restructuring costs, non-cash                           52,264           --           --
Other                                                   (5,152)      11,404      (10,452)
Change in assets and liabilities,
   net of acquisitions:
Receivables                                           (812,923)    (252,001)    (348,730)
Expenditures billable to clients                       (24,413)     (31,199)     (51,247)
Prepaid expenses and other assets                     (118,673)     (42,109)     (27,623)
Accounts payable and accrued expenses                  986,713      305,685      301,423
Accrued income taxes                                   (64,423)      26,870          435
Deferred compensation and reserve for
   termination allowances                               20,496       14,537       18,571
                                                    ------------------------------------
Net cash provided by operating activities              591,978      527,466      283,314
                                                    ------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions, net                                     (248,406)    (255,995)    (110,317)
Capital expenditures                                  (177,084)    (156,426)    (122,443)
Proceeds from sales of assets                           72,538       28,326      114,494
Net (purchases of) proceeds from
   marketable securities                                (9,114)       3,934          324
Investment in unconsolidated affiliates                (10,531)     (16,725)      (9,191)
                                                    -------------------------------------
Net cash used in investing activities                 (372,597)    (396,886)    (127,133)
                                                    -------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in short-term borrowings                       47,592       15,304       31,188
Proceeds from long-term debt                           400,152      220,494      280,801
Payments of long-term debt                             (70,037)     (96,968)     (36,161)
Proceeds from ESOP                                          --        7,420           --
Treasury stock acquired                               (300,524)    (164,928)    (144,094)
Issuance of common stock                                66,130       35,239       38,664
Cash dividends - Interpublic                           (90,424)     (76,894)     (61,242)
Cash dividends - pooled companies                       (3,137)      (8,036)     (16,516)
                                                    ------------------------------------
Net cash provided by (used in) financing activities     49,752      (68,369)      92,640
                                                    ------------------------------------
Effect of exchange rates on
  cash and cash equivalents                            (43,551)      10,998      (43,279)
                                                    ------------------------------------
Increase in cash and cash equivalents                  225,582       73,209      205,542
Cash and cash equivalents at beginning of year         780,429      707,220      501,678
                                                     -----------------------------------
Cash and cash equivalents at end of year            $1,006,011    $ 780,429    $ 707,220
                                                    ====================================

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note 15).

The accompanying notes are an integral part of these financial statements.
FINANCIAL STATEMENTS
                                         THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                              CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
                                               FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 1999
                                                             (Dollars in Thousands)
Accumulated                 Unamortized
                              Common    Additional                      Other                     Expense   Unearned
                               Stock       Paid-In   Retained   Comprehensive  Treasury     of Restricted       ESOP
                    (par value $.10)       Capital   Earnings   Income (loss)     Stock      Stock Grants       Plan       Total
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1998    $30,403  $574,994     $1,169,070   $(160,970)     $(109,277)    $(71,348)      $     --   $1,432,872
 Comprehensive income:
 Net income                                          $  315,243                                                          $  315,243
 Adjustment for minimum pension
   liability                                                         18,596                                                  18,596
Change in market value of
   securities available-for-sale                                    158,607                                                 158,607
 Foreign currency translation

   adjustment                                                       (92,928)                                                (92,928)
-----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive income                                                                                                 $399,518
Cash dividends - IPG                                    (90,424)                                                            (90,424)
Cash dividends - pooled companies                        (3,137)                                                             (3,137)
Equity adjustments - pooled companies                      (594)                                                               (594)
Awards of stock under
  Company plans:
 Achievement stock and

   incentive awards                          198                                       333                                      531
 Restricted stock,
   net of forfeitures               66    36,902                                    (7,927)      (5,687)                     23,354
Employee stock purchases            40    19,068                                                                             19,108
Exercise of stock options,
  including tax benefit            276    81,539                                                                             81,815
Purchase of Company's own stock                                                   (300,524)                                (300,524)
Issuance of shares
  for acquisitions                        63,447                                   127,876                                  191,323
Par value of shares issued
  for two-for-one stock split      187                     (187)                                                                 --
Other issuances                     28     8,498                                                                              8,526
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1999    $31,000  $784,646     $1,389,971   $ (76,695)     $(289,519)    $(77,035)      $     --   $1,762,368
-----------------------------------------------------------------------------------------------------------------------------------
FINANCIAL STATEMENTS
                                         THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                              CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
                                               FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 1999
                                                             (Dollars in Thousands)
Accumulated                 Unamortized
                              Common    Additional                      Other                     Expense   Unearned
                               Stock       Paid-In   Retained   Comprehensive  Treasury     of Restricted       ESOP
                    (par value $.10)       Capital   Earnings   Income (loss)     Stock      Stock Grants       Plan       Total
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1997    $29,972  $432,619     $920,622   $(159,064)      $      --    $(56,634)      $(7,420)     $1,160,095
Comprehensive income:
 Net income                                          $333,593                                                            $  333,593
 Adjustment for minimum pension
   liability                                                      (24,013)                                                  (24,013)
 Change in market value of
   securities available-for-sale                                   (2,576)                                                   (2,576)
 Foreign currency translation

   adjustment                                                      24,683                                                    24,683
-----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive income                                                                                               $  331,687
Cash dividends - IPG                                  (76,894)                                                              (76,894)
Cash dividends - pooled companies                      (8,036)                                                               (8,036)
Awards of stock under
 Company plans:
 Achievement stock and

   incentive awards                          274                                      110                                       384
 Restricted stock,
   net of forfeitures               63    36,619                                   (2,406)    (14,714)                       19,562
Employee stock purchases            26    13,325                                                                             13,351
Exercise of stock options,
  including tax benefit            123    42,518                                                                             42,641
Purchase of Company's own stock                                                  (164,928)                                 (164,928)
Issuance of shares
  for acquisitions                        36,714                                   57,947                                    94,661
Conversion of convertible

   debentures                        3     1,002                                                                              1,005
Payments from ESOP                                                                                            7,420           7,420
Par value of shares issued
  for two-for-one stock split      215                   (215)                                                                   --
Other issuances                      1    11,923                                                                             11,924
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1998    $30,403 $ 574,994   $1,169,070   $(160,970)      $(109,277)   $(71,348)      $    --      $1,432,872
-----------------------------------------------------------------------------------------------------------------------------------
FINANCIAL STATEMENTS
                                         THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                              CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
                                               FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 1999
                                                             (Dollars in Thousands)
Accumulated                 Unamortized
                              Common    Additional                      Other                     Expense   Unearned
                               Stock       Paid-In   Retained   Comprehensive  Treasury     of Restricted       ESOP
                    (par value $.10)       Capital   Earnings   Income (loss)     Stock      Stock Grants       Plan       Total
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1996    $14,909  $273,537     $792,527   $ (93,572)      $      --    $(47,350)      $(7,800)     $  932,251
Comprehensive income:
 Net income                                          $220,211                                                            $  220,211
 Adjustment for minimum pension
   liability                                                           72                                                        72
 Change in market value of
   securities available-for-sale                                   12,465                                                    12,465
 Foreign currency translation

   adjustment                                                     (78,029)                                                  (78,029)
-----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive income                                                                                                 $154,719
Cash dividends - IPG                                  (61,242)                                                              (61,242)
Cash dividends - pooled companies                     (16,516)                                                              (16,516)
Awards of stock under
 Company plans:
 Achievement stock and

   incentive awards                          787                                      175                                       962
 Restricted stock,
   net of forfeitures               53    27,821                                   (3,664)     (9,284)                       14,926
Employee stock purchases            23     9,684                                                                              9,707
Exercise of stock options,
  including tax benefit            126    40,855                                                                             40,981
Purchase of Company's own stock                                                  (144,094)                                 (144,094)
Issuance of shares
  for acquisitions                       (72,129)                                 147,583                                    75,454
Conversion of convertible

  debentures                       443   118,357                                                                            118,800
Par value of shares issued
  for three-for-two stock split     59                                                                                           59
Payments from ESOP                                                                                              380             380
Special compensation charges              27,324                                                                             27,324
Deferred stock bonus charges              (4,876)                                                                            (4,876)
Par value of shares issued for
  two-for-one stock split       14,358                (14,358)                                                                   --
Other issuances                      1    11,259                                                                             11,260
------------------------------------------------------------------------------------------------------------------------------------
BALANCES, DECEMBER 31, 1997    $29,972  $432,619     $920,622   $(159,064)      $      --    $(56,634)      $(7,420)     $1,160,095
-----------------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note 15).

All  share  data for  1999,  1998 and 1997 has  been  adjusted  to  reflect  the
two-for-one stock split effective July 15, 1999.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Operations
The Company is a worldwide  provider of advertising agency and related services.
The   Company   conducts   business   through   the   following    subsidiaries:
McCann-Erickson  WorldGroup,  The Lowe Group,  DraftWorldwide,  Initiative Media
Worldwide,  International  Public Relations,  Octagon,  Zentropy  Partners,  NFO
Worldwide, Allied Communications Group, and other related companies. The Company
also has arrangements  through  association with local agencies in various parts
of the world.  Other  specialized  marketing  services  conducted by the Company
include media buying, market research,  relationship (direct) marketing,  public
relations,  sports and event  marketing,  healthcare  marketing  and  e-business
consulting and communications.

Principles of Consolidation
The consolidated  financial  statements  include the accounts of the Company and
its  subsidiaries,  most of which are wholly owned. The Company also has certain
investments in unconsolidated affiliates that are carried on the equity basis.

The Company's  consolidated  financial statements,  including the related notes,
have been restated as of the earliest period presented to include the results of
operations,  financial  position  and cash flows of the 2000 pooled  entities in
addition to all prior pooled entities.

The accompanying income statements have been prepared in a format different than
that used in the  originally  filed Form 10-K for the three years ended December
31, 1999. The changes made principally  relate to the introduction of a new line
item - "Income from operations".  Amounts previously  included in "Other income,
net" as part of "Gross  Income" are now included  elsewhere in the  Consolidated
Statement of Income.

Short-term and Long-term Investments
The Company's investments in marketable and equity securities are categorized as
available-for-sale  securities,  as defined by Statement of Financial Accounting
Standards No. 115 (SFAS 115),  "Accounting  for Certain  Investments in Debt and
Equity  Securities".  Unrealized holding gains and losses are reflected as a net
amount within stockholders'  equity until realized.  The cost of securities sold
is based on the average cost of securities  when  computing  realized  gains and
losses.

Use of Estimates
The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent assets and liabilities at the date of the financial  statements,  and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

Translation of Foreign Currencies
Balance  sheet  accounts  are  translated   principally  at  rates  of  exchange
prevailing  at the  end  of  the  year  except  for  fixed  assets  and  related
depreciation  in  countries  with  highly   inflationary   economies  which  are
translated  at rates in  effect on dates of  acquisition.  Revenue  and  expense
accounts are translated at average rates of exchange in effect during each year.
Translation  adjustments  are included  within  stockholders'  equity except for
countries with highly inflationary economies, in which case they are included in
current operations.
Revenues and Agency Costs
Revenues are generally  recognized when media  placements  appear and production
costs are incurred.  Salaries and other agency costs are  generally  expensed as
incurred.

Depreciation and Amortization
Depreciation  is  computed  principally  using  the  straight-line  method  over
estimated  useful lives of the related  assets,  ranging  generally from 3 to 20
years for furniture and equipment and from 10 to 45 years for various  component
parts of buildings.

Leasehold  improvements  and  rights  are  amortized  over the terms of  related
leases. Company policy provides for the capitalization of all major expenditures
for renewal and  improvements  and for current charges to income for repairs and
maintenance.

Long-lived Assets
The excess of purchase price over the fair value of net tangible assets acquired
is  amortized  on a  straight-line  basis over  periods not  exceeding 40 years.
Customer lists are amortized on a  straight-line  basis over the expected useful
life of the customer lists (generally 5 to 46 years).

The Company  evaluates the  recoverability  of the carrying  value of long-lived
assets  whenever events or changes in  circumstances  indicate that the net book
value of an operation  may not be  recoverable.  If the sum of projected  future
undiscounted  cash flows of an  operation is less than its  carrying  value,  an
impairment loss is recognized.  The impairment loss is measured by the excess of
the  carrying  value over fair value based on estimated  discounted  future cash
flows or other valuation measures.

During 1999, the Company recorded a pre-tax charge of $16 million related to the
write-off of goodwill and customer lists within NFO's North  American  financial
services   division.   Undiscounted  and  discounted  cash  flow  analyses  were
performed,  resulting in the  determination  by management  that the  intangible
assets within this division were deemed to be permanently impaired.

Income Taxes
Deferred  income taxes reflect the impact of temporary  differences  between the
amount of assets and liabilities recognized for financial reporting purposes and
such amounts recognized for income tax purposes.

Earnings per Common and Common Equivalent Share
The  Company  applies  the  principles  of  Statement  of  Financial  Accounting
Standards No. 128 (SFAS 128),  "Earnings Per Share". Basic earnings per share is
based on the  weighted-average  number of common shares  outstanding during each
year.  Diluted  earnings  per  share  also  includes  common  equivalent  shares
applicable  to grants under the stock  incentive  and stock option plans and the
assumed conversion of convertible subordinated debentures and notes, if they are
determined to be dilutive.

Treasury Stock
Treasury  stock is acquired at market  value and is recorded at cost.  Issuances
are accounted for on a first-in, first-out basis.

Concentrations of Credit Risk
The  Company's  clients are in various  businesses,  located  primarily in North
America, Latin America, Europe and the Asia Pacific Region. The Company performs
ongoing  credit  evaluations  of its  clients.  Reserves  for credit  losses are
maintained at levels considered adequate by management.  The Company invests its
excess cash in deposits with major banks and in money market  securities.  These
securities typically mature within 90 days and bear minimal risk.
Segment Reporting
The Company  provides  advertising  and many other closely  related  specialized
marketing services.  All of these services fall within one reportable segment as
defined in  Statement  of  Financial  Accounting  Standards  No. 131 (SFAS 131),
"Disclosures about Segments of an Enterprise and Related Information."

Accounting for Derivative Instruments and Hedging Activities
In June 1998, the FASB issued  Statement of Financial  Accounting  Standards No.
133, "Accounting for Derivative  Instruments and Hedging Activities" (SFAS 133),
which had an initial  adoption  date by the Company of January 1, 2000.  In June
1999,  the FASB  postponed  the adoption date of SFAS 133 until January 1, 2001.
SFAS 133 will require the Company to record all derivatives on the balance sheet
at fair value.  Changes in  derivative  fair values will either be recognized in
earnings  as offsets to the  changes  in fair  value of related  hedged  assets,
liabilities and firm  commitments or for forecasted  transactions,  deferred and
later   recognized  in  earnings  at  the  same  time  as  the  related   hedged
transactions.  The impact of SFAS 133 on the Company's financial statements will
depend on a variety of factors,  including  the future level of  forecasted  and
actual  foreign  currency  transactions,  the  extent of the  Company's  hedging
activities,  the type of hedging  instruments used and the effectiveness of such
instruments.  However,  the Company does not believe the effect of adopting SFAS
133 will be material to its financial condition or results of operations.

Reclassifications
Certain  amounts  for prior years have been  reclassified  to conform to current
year presentation.

NOTE 2:  STOCKHOLDERS' EQUITY
On July 15, 1999, the stockholders  approved a two-for-one stock split, effected
in the form of a payment of a 100  percent  stock  dividend to  stockholders  of
record on June 29,  1999.  The  number of shares of common  stock  reserved  for
issuance  pursuant to various plans under which stock is issued was increased by
100 percent. The two-for-one stock split has been reflected retroactively in the
consolidated  financial  statements and all per share data,  shares,  and market
prices of the  Company's  common stock  included in the  consolidated  financial
statements  and notes  thereto  have been  adjusted  to give effect to the stock
split.

Comprehensive Income
Accumulated other  comprehensive  income (loss) amounts are reflected net of tax
in the consolidated financial statements as follows:
(Dollars in thousands)
                                                                        Total
                                                                     Accumulated
                                Foreign     Unrealized   Minimum        Other
                               Currency      Holding     Pension   Comprehensive
                               Translation    Gains/    Liability      Income/
                               Adjustment    (Losses)   Adjustment     (Loss)
                               -------------------------------------------------

Balances, December 31, 1996     $ (80,270)    $     --    $(13,302)   $ (93,572)
Current-period change             (78,029)      12,465          72      (65,492)
                                -----------------------------------------------

Balances, December 31, 1997     $(158,299)    $ 12,465    $(13,230)   $(159,064)
Current-period change              24,683       (2,576)    (24,013)      (1,906)
                                -----------------------------------------------

Balances, December 31, 1998     $(133,616)    $  9,889    $(37,243)   $(160,970)
Current-period change             (92,928)     158,607      18,596       84,275
                                -----------------------------------------------

Balances, December 31, 1999     $(226,544)    $168,496    $(18,647)   $ (76,695)
                                ===============================================

The foreign currency translation  adjustments are not tax-effected.  See Note 13
for additional discussion of unrealized holding gains on investments.

NOTE 3:  EARNINGS PER SHARE

In accordance with SFAS 128, the following is a reconciliation of the components
of the basic  and  diluted  EPS  computations  for  income  available  to common
stockholders for the year ended December 31:

(Dollars in Thousands Except Per Share Data)
1999                                1998                             1997
                               -----------------------------------------------------------------------------------------------------
                                                        Per                                  Per                              Per
                                                        Share                                Share                            Share
                               Income      Shares       Amount      Income     Shares        Amount   Income     Shares       Amount
                               -----------------------------------------------------------------------------------------------------
BASIC EPS
Income available
 to common stockholders        $315,243    292,066,936  $1.08       $333,593  288,830,671    $1.15    $220,211   277,870,558  $.79

Effect of Dilutive Securities:
 Options                                     7,310,525                          6,923,813                          6,508,296
 Restricted stock                   631      3,536,805                   541    3,453,838                  447     3,277,294
 3 3/4% Convertible
    subordinated debentures          --             --                    --        5,320                5,929     8,020,582

DILUTED EPS                    $315,874    302,914,266  $1.04       $334,134  299,213,642    $1.12    $226,587   295,676,730  $.77
                               -----------------------------------------------------------------------------------------------------
The  computation  of diluted EPS for 1999,  1998,  and 1997 excludes the assumed
conversion of the 1.80% Convertible  Subordinated Notes and the 1999 computation
also  excludes the 1.87%  Convertible  Subordinated  Notes (See Note 10) because
they were  antidilutive.  In the fourth  quarter of 1997,  the Company  redeemed
substantially all its 3 3/4% Convertible Subordinated Debentures due 2002.

All data for 1999,  1998,  and 1997 has been  restated to reflect the  aggregate
effect of the  acquisitions  accounted for as poolings of  interests.  (See Note
15).

All share data for 1998 and 1997 has been  adjusted to reflect  the  two-for-one
stock split effective July 15, 1999.

NOTE 4: ACQUISITIONS
The Company acquired a number of advertising and communications companies during
the three-year  period ended December 31, 1999.  The aggregate  purchase  price,
including  cash  and  stock  payments  for new  acquisitions  (including  pooled
entities),  was $559  million,  $820 million and $378 million in 1999,  1998 and
1997, respectively.  The aggregate purchase price for new acquisitions accounted
for as purchases and equity investments was $293 million, $405 million, and $144
million in 1999, 1998, and 1997, respectively.

1999
In 1999,  the Company paid $189 million in cash and issued  8,393,893  shares of
its common stock to acquire 56 companies. Of the acquisitions, 52 were accounted
for under the purchase  method of accounting  and 4 were accounted for under the
pooling  of  interests  method.  The  Company  also  recorded  a  liability  for
acquisition   related  deferred  payments  of  $28  million,   for  cases  where
contingencies related to acquisitions have been resolved.

For those entities accounted for as purchase transactions, the purchase price of
the acquisitions  has been allocated to assets acquired and liabilities  assumed
based on  estimated  fair  values.  The results of  operations  of the  acquired
companies  were included in the  consolidated  results of the Company from their
respective  acquisition dates which occurred  throughout the year. The companies
acquired  in  transactions  accounted  for as  purchases  included  The  Cassidy
Companies,  Inc.,  Spedic  France  S.A.,  Mullen  Advertising,   Inc.,  and  PDP
Promotions UK Ltd. None of the  acquisitions  was  significant  on an individual
basis.

In connection  with the 1999 purchase  transactions,  goodwill of  approximately
$254 million was  recorded.  The  purchase  price  allocations  made in 1999 are
preliminary and subject to adjustment.  Goodwill  related to the acquisitions is
being amortized on a straight-line basis over their estimated useful lives.

On  December  1, 1999,  the Company  acquired  Brands  Hatch  Leisure  Plc.  for
5,158,122  shares of stock.  The acquisition has been accounted for as a pooling
of interests.  Additionally,  during 1999 the Company  issued  641,596 shares to
acquire  3  other  companies  which  have  been  accounted  for as  poolings  of
interests.

The following  unaudited pro forma data  summarize the results of operations for
the periods indicated as if the 1999 purchase acquisitions had been completed as
of January 1, 1998. The pro forma data give effect to actual  operating  results
prior to the acquisition,  adjusted to include the estimated pro forma effect of
interest expense,  amortization of intangibles and income taxes. These pro forma
amounts do not purport to be  indicative of the results that would have actually
been  obtained if the  acquisitions  occurred as of the beginning of the periods
presented or that may be obtained in the future.
For the year ended December 31, 1999

(Amounts in thousands except per share data)

                                    Pre-        Pro forma IPG
                                 acquisition      with 1999
                     IPG           results      acquisitions
                (as reported)    (unaudited)     (unaudited)
                -------------    -----------     -----------
Revenues          $4,892,912      $104,529       $4,997,441
Net income           315,243         7,101          322,344

Earnings per share:

     Basic              1.08                           1.10
     Diluted            1.04                           1.06

Net income  amounts  shown in the table above  include  restructuring  and other
merger related costs of $51.4 million, net of tax.

For the year ended December 31, 1998

(Amounts in thousands except per share data)

                                  Results      Pro forma IPG
                                  of 1999         with 1999
                     IPG        acquisitions    acquisitions
                (as reported)    (unaudited)     (unaudited)
                -------------    -----------     -----------
Revenues         $4,167,788       $446,833       $4,614,621
Net income          333,593         15,819          349,412

Earnings per share:

     Basic             1.15                            1.20
     Diluted           1.12                            1.17

1998
In 1998,  14,956,534  shares of the  Company's  common  stock  were  issued  for
acquisitions  accounted for as poolings of interests.  The companies  pooled and
the respective  shares of the Company's common stock issued were:  International
Public Relations Plc. - 5,280,346 shares,  Hill Holliday - 4,124,868 shares, The
Jack Morton Company - 4,271,992 shares,  Carmichael Lynch, Inc. - 973,808 shares
and KBA Marketing - 305,520 shares.

In 1998,  the Company paid $282 million in cash and issued  2,718,504  shares of
its common stock to acquire 77 companies,  all of which have been  accounted for
as purchases. These acquisitions included Gillespie, Ryan McGinn, CSI, Flammini,

Gingko,  Defederico,  Herrero Y Ochoa, Infratest Burke AG, CF Group,  MarketMind
Technologies,  and  Ross-Cooper-Lund.  The Company also recorded a liability for
acquisition related deferred payments of $24 million.
1997
In  1997,  the  Company  issued  10,789,079  shares  of  its  common  stock  for
acquisitions  accounted  for as poolings  of  interests.  Some of the  companies
pooled and the  respective  shares of the  Company's  common  stock issued were:
Complete Medical Group - 1,417,578 shares, The MBL Group plc - 1,126,114 shares,
Prognostics - 1,425,123 shares, Integrated Communications Corporation- 1,170,108
shares,  Advantage  International  -  1,158,412  shares and  Ludgate - 1,078,918
shares.  Additional  companies  accounted  for as poolings of interests  include
Adler Boschetto Peebles, Barnett Fletcher, Davies Baron, Diefenbach Elkins, D.L.
Blair, Rubin Barney & Birger, Inc. and Technology Solutions Inc.

In 1997,  the  Company  also paid  $101.1  million in cash and issued  2,792,950
shares of its common  stock for  acquisitions  accounted  for as  purchases  and
equity  investments.   These  acquisitions  included  Marketing  Corporation  of
America,  Medialog, The Sponsorship Group,  Kaleidoscope and Addis Wechsler (51%
interest).  The Company  increased its interest in Campbell  Mithun Esty by 25%.
The Company also recorded a liability for acquisition  related deferred payments
of $38 million.

Deferred Payments
Certain of the Company's acquisition agreements provide for deferred payments by
the  Company,  contingent  upon  future  revenues  or profits  of the  companies
acquired.  Deferred  payments  of both cash and shares of the  Company's  common
stock for prior years'  acquisitions  were $210  million,  $84 million,  and $51
million in 1999, 1998 and 1997, respectively.  Such payments are capitalized and
recorded as goodwill.

Investments
During 1999,  the Company sold a portion of its  investments  in Lycos and USWEB
for combined  proceeds of approximately $56 million.  Additionally,  the Company
sold its minority  investment  in Nicholson  NY, Inc. to Icon for $19 million in
shares of Icon's common stock.

During 1998, the Company sold a portion of its investments in USWEB,  CKS Group,
Inc.  and Lycos with  combined  proceeds of  approximately  $20  million.  These
investments are being accounted for as available-for-sale  securities,  pursuant
to the requirements of SFAS 115.

During 1997,  the Company sold its  investment  in All American  Communications,
Inc. for approximately $77 million.

Restatement
As  discussed  in Note 15,  the  Company  acquired  NFO in April  2000 in a
transaction which was accounted for as a pooling of interests.  The accompanying
consolidated  financial  statements,  including  the  related  notes,  have been
restated  as of  the  earliest  period  presented  to  include  the  results  of
operations,  financial position and cash flows of NFO. Additionally, the results
of  several  other  recent  acquisitions  have  been  included  in the  restated
financial statements. Revenue and net income for the combining entities included
in the consolidated  statement of income for the years ending December 31, 1999,
1998 and 1997 are summarized below.
Revenue     Net Income/(Loss)
                                          ----------    -----------------
For the year ended December 31, 1999:

     As Reported                          $4,427,303       $ 321,921
     Pooled Companies                        465,609          (6,678)
     As Restated                          $4,892,912       $ 315,243

For the year ended December 31, 1998:

     As Reported                          $3,844,340       $ 309,905
     Pooled Companies                        323,448          23,688
     As Restated                          $4,167,788       $ 333,593

For the year ended December 31, 1997:

     As Reported                          $3,352,776       $ 200,378
     Pooled Companies                        229,825          19,833
     As Restated                          $3,582,601       $ 220,211

NOTE 5:  PROVISION FOR INCOME TAXES
The Company  accounts for income taxes under  Statement of Financial  Accounting
Standards No. 109 (SFAS 109), "Accounting for Income Taxes". SFAS 109 applies an
asset and  liability  approach  that  requires the  recognition  of deferred tax
assets and liabilities  with respect to the expected future tax  consequences of
events that have been recognized in the  consolidated  financial  statements and
tax returns.

The components of income before provision for income taxes are as follows:

(Dollars in thousands)                     1999            1998           1997
                                         ------            ----           ----
Domestic                                 $347,916        $315,682       $196,939
Foreign                                   235,599         284,204        238,884
                                         ---------------------------------------
Total                                    $583,515        $599,886       $435,823

The provision for income taxes consisted of:

Federal Income Taxes (Including
   Foreign Withholding Taxes):
  Current                                $ 92,018        $110,226       $ 75,736
  Deferred                                 19,891           4,335          3,683
                                         ---------------------------------------
                                          111,909         114,561         79,419
                                         ---------------------------------------
State and Local Income Taxes:
  Current                                  21,923          23,058         23,938
  Deferred                                  4,252             802            286
                                         ---------------------------------------
                                           26,175          23,860         24,224
                                         ---------------------------------------

Foreign Income Taxes:
  Current                                 119,469         123,669         90,113
  Deferred                                (14,827)        (17,109)         3,463
                                         ---------------------------------------
                                          104,642         106,560         93,576
                                         ---------------------------------------
Total                                    $242,726        $244,981       $197,219
                                         =======================================
At December 31, 1999 and 1998 the deferred tax assets/(liabilities) consisted of
the following items:

(Dollars in thousands)                                      1999           1998
                                                            ----           ----

Postretirement/postemployment benefits                  $ 53,461       $ 47,875
Deferred compensation                                      4,940         34,285
Pension costs                                             10,036         13,715
Depreciation                                              (8,537)       (10,953)
Rent                                                      (8,674)        (6,424)
Interest                                                   4,100          4,598
Accrued reserves                                           9,399          9,155
Investments in equity securities                        (140,320)       (10,677)
Tax loss/tax credit carryforwards                         47,783         47,293
Restructuring and other merger related costs               9,497             --
Other                                                       (196)        (6,032)
                                                        -----------------------
Total deferred tax assets / (liabilities)                (18,511)       122,835
Deferred tax valuation allowance                          26,233         31,411
                                                        -----------------------
Net deferred tax assets / (liabilities)                 $(44,744)      $ 91,424
                                                        =======================

The valuation  allowance of $26.2 million and $31.4 million at December 31, 1999
and  1998,  respectively,  represents  a  provision  for  uncertainty  as to the
realization of certain  deferred tax assets,  including U.S. tax credits and net
operating loss carryforwards in certain jurisdictions. The change during 1999 in
the  deferred  tax  valuation  allowance  primarily  relates  to  changes in the
deferred  compensation  tax  item,  net  operating  loss  carryforwards  and tax
credits.   At  December  31,  1999,  there  were  $9.7  million  of  tax  credit
carryforwards  with  expiration  periods  through  2004 and net  operating  loss
carryforwards  with a tax  effect  of  $38.1  million  with  various  expiration
periods.

A  reconciliation  of the effective income tax rate as shown in the consolidated
statement of income to the federal statutory rate is as follows:

                                                    1999      1998      1997
                                                    ----      ----      ----
Statutory federal income tax rate                   35.0%     35.0%     35.0%
State and local income taxes,
  net of federal income tax benefit                  2.8       3.7       4.1
Impact of foreign operations, including
  withholding taxes                                  0.8       0.4       0.3
Goodwill and intangible assets                       3.6       2.8       2.7
Effect of pooled companies                           1.3      (0.5)      3.1
Other                                               (1.9)     (0.6)      0.1
                                                    ------------------------
Effective tax rate                                  41.6%     40.8%     45.3%
                                                    ------------------------

The total amount of  undistributed  earnings of foreign  subsidiaries for income
tax purposes  was  approximately  $585  million at December 31, 1999.  It is the
Company's   intention  to  reinvest   undistributed   earnings  of  its  foreign
subsidiaries and thereby indefinitely postpone their remittance. Accordingly, no
provision  has been made for foreign  withholding  taxes or United States income
taxes which may become payable if undistributed earnings of foreign subsidiaries
were paid as dividends to the Company.  The additional  taxes on that portion of
undistributed  earnings  which is available for  dividends  are not  practicably
determinable.
NOTE 6: SUPPLEMENTAL CASH FLOW INFORMATION
Cash and Cash Equivalents

For purposes of the consolidated  statement of cash flows, the Company considers
all highly liquid investments with a maturity of three months or less to be cash
equivalents.

Income Tax and Interest Payments

Cash paid for income taxes was approximately $186 million, $200 million and $133
million  in  1999,  1998  and  1997,   respectively.   Interest   payments  were
approximately $57 million,  $40 million and $32 million in 1999, 1998, and 1997,
respectively.

Noncash Financing Activity

During  1997,  the Company  redeemed  all  outstanding  issues  under the 3 3/4%
Convertible   Subordinated  Debentures  due  2002.   Substantially  all  of  the
outstanding  debentures were converted into  approximately 8.6 million shares of
the Company's common stock.

Acquisitions

As more  fully  described  in Note  4,  the  Company  issued  8,393,893  shares,
17,942,578  shares,  and  10,518,628  shares of the  Company's  common  stock in
connection with acquisitions during 1999, 1998 and 1997,  respectively.  Details
of  businesses  acquired in  transactions  accounted  for as  purchases  were as
follows:

(Dollars in thousands)

                                             1999          1998         1997
                                             ----          ----         ----

Fair value of assets acquired             $627,005      $726,601     $303,969
Liabilities assumed                        148,637       319,676       90,303
                                          -----------------------------------
Net assets acquired                        478,368       406,925      213,666
Less: noncash consideration                186,210        91,077       96,814
Less: cash acquired                         43,752        59,853        6,535
                                          -----------------------------------
Net cash paid for acquisitions            $248,406      $255,995     $110,317
                                          ===================================

The amounts  shown above  exclude  future  deferred  payments due in  subsequent
years, but include cash deferred  payments of $120 million,  $55 million and $30
million made during 1999, 1998 and 1997, respectively.
NOTE 7: INCENTIVE PLANS
The 1997  Performance  Incentive  Plan  ("1997 PIP Plan")  was  approved  by the
Company's  stockholders  in May 1997 and  includes  both  stock  and cash  based
incentive  awards.  The maximum  number of shares of the Company's  common stock
which may be  granted  in any year  under the 1997 PIP Plan is equal to 1.85% of
the total  number of shares of the  Company's  common stock  outstanding  on the
first day of the year adjusted for additional  shares as defined in the 1997 PIP
Plan document (excluding management incentive compensation  performance awards).
The 1997 PIP Plan also  limits the number of shares  available  with  respect to
awards  made to any one  participant  as well as  limiting  the number of shares
available  under certain  awards.  Awards made prior to the 1997 PIP Plan remain
subject to the respective terms and conditions of the predecessor plans.  Except
as otherwise noted,  awards under the 1997 PIP Plan have terms similar to awards
made under the respective predecessor plans.

Stock Options
Outstanding  options  are  generally  granted  at the fair  market  value of the
Company's common stock on the date of grant and are exercisable as determined by
the  Compensation  Committee  of  the  Board  of  Directors  (the  "Committee").
Generally,  options become exercisable between two and five years after the date
of grant and expire ten years from the grant date.

Following is a summary of stock option transactions during the three-year period
ended December 31:

                               1999                1998                1997
                        --------------------------------------------------------
                                  Weighted            Weighted          Weighted
                                   Average             Average           Average
                                  Exercise            Exercise          Exercise
(Shares in thousands)   Shares       Price   Shares      Price    Shares   Price
                        --------------------------------------------------------
Shares under option,
  beginning of year     29,505     $ 19      25,466     $ 13     25,230    $ 11
Options granted          4,743       39       8,399       32      4,830      19
Options exercised       (4,497)      11      (3,108)       8     (3,549)      8
Options cancelled       (2,124)      25      (1,252)      15     (1,045)     12
                        ------               ------              ------
Shares under option,
   end of year          27,627     $ 23      29,505     $ 19     25,466    $ 13
                        ======               ======              ======
Options exercisable
   at year-end           7,955     $ 13       6,954     $ 11      9,158    $  9
The following table summarizes  information about stock options  outstanding and
exercisable at December 31, 1999:

(Shares in thousands)

                                 Weighted-
                                   Average   Weighted-                Weighted-
                      Number     Remaining     Average        Number    Average
Range of         Outstanding   Contractual    Exercise   Exercisable   Exercise
Exercise Prices  at 12/31/99          Life       Price   at 12/31/99      Price
-------------------------------------------------------------------------------
$ 4.33 to $9.99       2,990           2            $ 7         2,865        $ 8

 10.00 to 14.99       3,422           5             11         3,093         11

 15.00 to 24.99       9,996           7             17         1,666         20

 25.00 to 56.28      11,220           9             36           612         30

Employee Stock Purchase Plan
Under the Employee  Stock  Purchase Plan (ESPP),  employees may purchase  common
stock of the Company  through  payroll  deductions  not  exceeding  10% of their
compensation.  The  price  an  employee  pays for a share of stock is 85% of the
market  price  on the  last  business  day  of the  month.  The  Company  issued
approximately .5 million shares in 1999, 1998, and 1997, respectively, under the
ESPP. An additional  15.5 million  shares were reserved for issuance at December
31, 1999.

SFAS 123 Disclosures
The  Company  applies  the  disclosure  principles  of  Statement  of  Financial
Accounting   Standards  No.  123  (SFAS  123),   "Accounting   for   Stock-Based
Compensation".  As permitted by the provisions of SFAS 123, the Company  applies
APB  Opinion  25,  "Accounting  for Stock  Issued  to  Employees",  and  related
interpretations in accounting for its stock-based  employee  compensation plans.
If compensation  cost for the Company's stock option plans and its ESPP had been
determined  based on the fair  value at the grant  dates as defined by SFAS 123,
the  Company's  pro forma net income and  earnings  per share would have been as
follows:

(Dollars in Thousands Except Per Share Data)

                                       1999             1998              1997
                                       ----             ----              ----
Net Income            As reported    $315,243          $333,593         $220,211
                      Pro forma      $287,601          $315,770         $207,250

Earnings Per Share
        Basic         As reported    $   1.08          $   1.15         $    .79
                      Pro forma      $   0.98          $   1.09         $    .75
        Diluted       As reported    $   1.04          $   1.12         $    .77
                      Pro forma      $   0.95          $   1.06         $    .70

For  purposes  of this pro forma  information,  the fair value of shares  issued
under  the ESPP  was  based  on the 15%  discount  received  by  employees.  The
weighted-average  fair  value  (discount)  on the  date of  purchase  for  stock
purchased under this plan was $5.28,  $3.82,  and $2.68 in 1999, 1998, and 1997,
respectively.
The weighted  average fair value of options granted during 1999,  1998, and 1997
was $12.94, $8.85, and $5.91, respectively. The fair value of each option grant

has been estimated on the date of grant using the  Black-Scholes  option-pricing
model with the following assumptions:

                                              1999           1998          1997
                                              ----           ----          ----
Expected option lives                       6 years        6 years       6 years
Risk free interest rate                      5.72%          4.87%         6.51%
Expected volatility                         19.73%         19.17%        19.17%
Dividend yield                                .81%           .95%          1.3%

As required by SFAS 123,  this pro forma  information  is based on stock  awards
beginning in 1995 and accordingly is not likely to be  representative of the pro
forma  effects in future  years  because  options  vest over  several  years and
additional awards generally are made each year.

Restricted Stock
Restricted  stock  issuances  are  subject to certain  restrictions  and vesting
requirements  as determined by the  Committee.  The vesting  period is generally
five to seven  years.  No monetary  consideration  is paid by a recipient  for a
restricted  stock  award  and the  grant  date  fair  value of these  shares  is
amortized over the restriction  periods. At December 31, 1999, there was a total
of 7.0 million shares of restricted  stock  outstanding.  During 1999,  1998 and
1997, the Company awarded .9 million shares,  1.3 million shares and 1.4 million
shares of  restricted  stock  with a  weighted-average  grant date fair value of
$40.03, $28.99 and $19.48, respectively.  The cost recorded for restricted stock
awards  in 1999,  1998 and 1997 was  $25.9  million,  $20.3  million,  and $16.2
million, respectively.

Performance Units
Performance  units have been awarded to certain key employees of the Company and
its  subsidiaries.  The ultimate value of these  performance units is contingent
upon the annual  growth in profits (as  defined) of the Company,  its  operating
components or both, over the performance  periods. The awards are generally paid
in cash.  The  projected  value of these  units is  accrued by the  Company  and
charged  to  expense  over  the  performance   period.   The  Company   expensed
approximately $27 million,  $20 million and $20 million in 1999, 1998, and 1997,
respectively.

Hill Holliday
Due to the merger of Hill Holliday and the Company,  Hill Holliday  recognized a
one-time compensation charge of approximately $32 million in 1997. Hill Holliday
had an Equity  Participation  Plan and  certain  other  agreements  for  various
members of management,  which provided for  participants to receive a portion of
the proceeds in the event of the sale or merger of Hill Holliday.  Also included
in the charge were costs  primarily  relating  to  consulting  and  supplemental
retirement agreements.

NOTE 8: RETIREMENT PLANS
Defined Benefit Pension Plans
Through March 31, 1998 the Company and certain of its domestic  subsidiaries had
a defined  benefit plan  ("Domestic IPG Plan") which covered  substantially  all
regular domestic employees. Effective April 1, 1998 this Plan was curtailed, and
participants  with five or less  years of  service  became  fully  vested in the
Domestic Plan.  Participants  with five or more years of service as of March 31,
1998 retain their vested  balances and participate in a new  compensation  plan.
Under  the new plan,  each  participant's  account  is  credited  with an annual
allocation,  equal to the  projected  discounted  pension  benefit  accrual plus
interest,  while they continue to work for the Company.  Participants  in active
service are eligible to receive up to ten years of allocations  coinciding  with
the number of years of service  with the  Company  after  March 31,  1998.  As a
result of the change in the  Domestic  Plan,  the  Company  recorded  charges of
approximately $16.7 million in the fourth quarter of 1997.

Net periodic  pension  costs for the  Domestic IPG Plan for 1999,  1998 and 1997
were $1.3 million,  $.9 million and $15.0  million,  respectively.  The 1997 net
periodic pension cost included a $10 million  curtailment  charge and $4 million
of service costs.

Additionally,  NFO  maintains  a defined  benefit  plan  ("NFO  Plan")  covering
approximately one half of NFO's U.S.  employees.  The periodic pension costs for
this plan for  1999,  1998,  and 1997  were $.8  million,  $.6  million  and $.6
million, respectively.

The Company's  stockholders' equity balance includes a minimum pension liability
of $18.6 million, $37.2 million and $13.2 million at December 31, 1999, 1998 and
1997, respectively.

The Company also has several  foreign  pension plans in which benefits are based
primarily on years of service and  employee  compensation.  It is the  Company's
policy  to fund  these  plans in  accordance  with  local  laws and  income  tax
regulations.

Net periodic  pension costs for foreign  pension  plans for 1999,  1998 and 1997
included the following components:

(Dollars in thousands)

                                                   1999        1998        1997
                                                   ----        ----        ----
Service cost                                   $  9,619    $  6,847    $  5,460
Interest cost                                    11,759      10,908      10,633
Expected return on plan assets                   (9,380)     (9,437)    (10,537)
Amortization of unrecognized
transition obligation                               390         373         324
Amortization of
prior service cost                                  833         482         552
Recognized actuarial loss / (gain)                  508         (70)     (1,440)
Other                                                (9)         --          --
                                               --------------------------------
Net periodic pension cost                      $ 13,720    $  9,103    $  4,992
                                               --------------------------------

The following table sets forth the change in the benefit obligation,  the change
in plan assets,  the funded status and amounts  recognized for the pension plans
in the Company's consolidated balance sheet at December 31, 1999, and 1998:
(Dollars in thousands)
                                         Domestic                  Foreign
                                       Pension Plans             Pension Plans
                               ------------------------------------------------
                                    1999         1998         1999         1998
                               ------------------------------------------------
Change in benefit obligation
Beginning obligation           $ 166,538    $ 141,376    $ 220,964    $ 179,016
Service cost                         768          627        9,619        6,847
Interest cost                      9,869       10,367       11,759       10,908
Benefits paid                    (12,671)     (12,899)     (12,777)      (9,447)
Participant contributions              -            -        2,410        1,606
Actuarial (gains) / losses       (12,626)      27,067       (7,264)      29,882
Currency effect                       --           --        1,440        5,245
Other                                 --           --          352       (3,093)
                               ------------------------------------------------
Ending obligation                151,878      166,538      226,503      220,964
                               ------------------------------------------------
Change in plan assets
Beginning fair value             129,755      122,157      161,975      145,942
Actual return on plan assets      15,354       12,292       30,651       17,363
Employer contributions             3,072        8,205        7,887        2,473
Participant contributions             --           --        2,410        1,606
Benefits paid                    (12,671)     (12,899)     (12,777)      (9,447)
Currency effect                       --           --          156        1,300
Other                                 --           --        2,437        2,738
                               ------------------------------------------------
Ending fair value                135,510      129,755      192,739      161,975
                               ------------------------------------------------
Funded status of the plans       (16,368)     (36,783)     (33,764)     (58,989)
Unrecognized net actuarial
  loss/(gain)                     18,927       38,439      (18,163)      11,536
Unrecognized prior service cost      (13)         (20)       3,704        2,921
Unrecognized transition cost          --           --        1,838        3,796
                               ------------------------------------------------
Net asset/(liability)
  recognized                   $   2,546    $   1,636   $  (46,385)   $ (40,736)
                               ------------------------------------------------

At December 31, 1999 and 1998,  the assets of the Domestic  Plan and the foreign
pension plans were primarily invested in fixed income and equity securities.

For the Domestic Plans, discount rates of 7.75% in 1999, 6.75% to 7% in 1998 and
7.25% to 7.5% in 1997 and salary  increase  assumptions of 4.5% in 1999 (the NFO
Plan)  4.5% to 6% in 1998 and 4.75% to 6% in 1997 were used in  determining  the
actuarial present value of the projected benefit obligation. The expected return
of Domestic Plan assets was 9% to 9.5% in 1999 and 9% to 10% in each of 1998 and
1997. For the foreign pension plans, discount rates ranging from 3.75% to 14% in
1999, 4% to 14% in 1998, and 3.5% to 14% in 1997 and salary increase assumptions
ranging  from 3% to 10% in 1999 and 2% to 10% in both 1998 and 1997 were used in
determining the actuarial present value of the projected benefit obligation. The
expected rates of return on the assets of the foreign  pension plans ranged from
2% to 14% in 1999, 2% to 14% in 1998 and 3.5% to 14% in 1997.

The projected benefit obligation,  accumulated benefit obligation and fair value
of plan assets for the Domestic  Plan were $152  million,  $152 million and $136
million,  respectively, as of December 31, 1999, and $167 million, $167 million,
and $130 million,  respectively,  as of December 31, 1998. The projected benefit
obligation,  accumulated benefit  obligation,  and fair value of plan assets for
the foreign pension plans with accumulated benefit obligations in excess of plan
assets were $90 million, $72 million and $9 million respectively, as of December
31,  1999,  and $81  million,  $74  million and $3 million  respectively,  as of
December 31, 1998.
Other Benefit Arrangements
The Company also has special  unqualified  deferred  benefit  arrangements  with
certain key  employees.  Vesting is based upon the age of the  employee  and the
terms of the employee's  contract.  Life insurance contracts have been purchased
in amounts which may be used to fund these arrangements.

In addition to the defined  benefit  plans  described  above,  the Company  also
sponsors a defined  contribution plan ("Savings Plan") that covers substantially
all  domestic  employees  of the Company  and  participating  subsidiaries.  The
Savings Plan permits  participants  to make  contributions  on a pre-tax  and/or
after-tax  basis.  The Savings Plan allows  participants to choose among several
investment  alternatives.   The  Company  matches  a  portion  of  participants'
contributions based upon the number of years of service. The Company contributed
$12 million, $9.3 million and $7.2 million to the Savings Plan in 1999, 1998 and
1997, respectively.

Postretirement Benefit Plans
The Company and its  subsidiaries  provide  certain  postretirement  health care
benefits  for  employees  who were in the employ of the Company as of January 1,
1988,  and life  insurance  benefits for employees who were in the employ of the
Company as of December 1, 1961. The plans cover certain  domestic  employees and
certain key  employees  in foreign  countries.  Effective  January 1, 1993,  the
Company's plan covering  postretirement  medical benefits was amended to place a
cap on annual benefits payable to retirees.

The coverage is self-insured, but is administered by an insurance company.

The Company  accrues the expected  cost of  postretirement  benefits  other than
pensions over the period in which the active  employees become eligible for such
postretirement benefits.

The net periodic  expense for these  postretirement  benefits for 1999, 1998 and
1997 was $2.2 million, $3 million and $2.8 million, respectively.

The following table sets forth the change in benefit obligation,  change in plan
assets,  funded status and amounts  recognized for the Company's  postretirement
benefit plans in the consolidated balance sheet at December 31, 1999 and 1998:
(Dollars in thousands)
                                                             1999         1998
                                                           ---------------------
Change in benefit obligation
Beginning obligation                                       $ 41,793    $ 42,863
Service cost                                                    477         785
Interest cost                                                 2,795       3,154
Participant contributions                                        90          77
Benefits paid                                                (2,020)     (1,722)
Plan amendments                                                  --         (68)
Actuarial gain                                               (4,300)     (3,296)
                                                           --------------------
Ending obligation                                            38,835      41,793
                                                           --------------------
Change in plan assets
Beginning fair value                                             --          --
Actual return on plan assets                                     --          --
Employer contributions                                        1,930       1,645
Participant contributions                                        90          77
Benefits paid                                                (2,020)     (1,722)
                                                           --------------------
Ending fair value                                                --          --
                                                           --------------------
Funded status of the plans                                  (38,835)    (41,793)
Unrecognized net actuarial gain                              (9,440)     (5,234)
Unrecognized prior service cost                              (1,952)     (2,893)
                                                           --------------------
Net amount recognized                                      $(50,227)   $(49,920)
                                                           --------------------

Discount  rates of 7.5% to 7.75%  in 1999,  6.75% in 1998 and  7.25% in 1997 and
salary increase assumption of 4% to 6% in 1999 and 1998, and 4.75% to 6% in 1997
were used in determining the accumulated postretirement benefit obligation. A 7%
to 7.4% and an 8% increase  in the cost of covered  health  care  benefits  were
assumed  for 1999 and 1998,  respectively.  This  rate is  assumed  to  decrease
incrementally  to  approximately  5.5% in the year 2002 and remain at that level
thereafter.  The  health  care  cost  trend  rate  assumption  does  not  have a
significant effect on the amounts reported.

Postemployment Benefits
In accordance with SFAS 112 "Employers' Accounting for Postemployment Benefits",
the Company  accrues costs  relating to certain  benefits  including  severance,
worker's compensation and health care coverage over an employee's service life.

The Company's  liability for postemployment  benefits totaled  approximately $64
million  and $50 million at December  31,  1999 and 1998,  respectively,  and is
included in deferred  compensation and reserve for termination  allowances.  The
net periodic  expense  recognized in 1999, 1998 and 1997 was  approximately  $34
million, $32 million and $31 million, respectively.
NOTE 9: SHORT-TERM BORROWINGS
The  Company and its  domestic  subsidiaries  have lines of credit with  various
banks.  These credit lines  permit  borrowings  at  fluctuating  interest  rates
determined  by the banks.  Short-term  borrowings  by  subsidiaries  outside the
United States principally consist of drawings against bank overdraft  facilities
and lines of credit.  These  borrowings  bear interest at the  prevailing  local
rates.  Where  required,  the  Company has  guaranteed  the  repayment  of these
borrowings.  Unused  lines of  credit by the  Company  and its  subsidiaries  at
December  31,  1999  and  1998   aggregated   $430  million  and  $458  million,
respectively.  The  weighted-average  interest rate on  outstanding  balances at
December 31, 1999 was approximately  5.8%.  Current maturities of long-term debt
are included in the payable to banks balance.

NOTE 10:  LONG-TERM DEBT
Long-term debt at December 31 consisted of the following:

(Dollars in thousands)
                                                               1999       1998
                                                           ---------------------
Convertible Subordinated Notes - 1.87%                     $  304,076   $     --
Convertible Subordinated Notes - 1.80%                        214,414    207,927
Term loans - 4.20% to 7.91% (6.45% to 7.91% in 1998)          289,621    280,320
Senior Notes Payable to Banks under a Revolving Credit
  Agreement Due March 2003 - 4.3% to 6.9%                      35,603     53,045
Senior Notes Payable - 6.83% to 7.52%                         102,000     95,000
Subordinated Notes - 9.84%                                     25,000     17,000
Germany mortgage note payable - 7.64%                          26,779     31,680
Other mortgage notes payable and
  long-term loans - 2.80% to 9.84%                             69,092     44,037
                                                           ---------------------
                                                            1,066,585    729,009
Less: current portion                                          23,912     22,898
                                                           ---------------------
Long-term debt                                             $1,042,673   $706,111
                                                           =====================

On June 1, 1999,  the Company  issued $361  million  face amount of  Convertible
Subordinated  Notes due 2006. The 2006 notes were issued at an original price of
83% of the face amount,  generating proceeds of approximately $300 million.  The
notes are convertible into 6.4 million shares of the Company's common stock at a
conversion  rate of 17.616 shares per $1,000 face amount.  The fair value of the
2006 notes as of December  31,  1999,  was  approximately  $416  million and was
determined by obtaining quotes from brokers.

On  September  16,  1997,  the  Company  issued  $250  million  face  amount  of
Convertible  Subordinated  Notes due 2004 ("2004  Notes")  with a coupon rate of
1.80%.  The 2004  Notes  were  issued  at an  original  price of 80% of the face
amount,  generating  proceeds  of  approximately  $200  million.  The  notes are
convertible  into  6.7  million  shares  of  the  Company's  common  stock  at a
conversion  rate of 26.772 shares per $1,000 face amount.  The fair value of the
2004 Notes as of  December  31,  1999 was  approximately  $392  million  and was
determined by obtaining quotes from brokers.

On March 9, 1998,  the  Company  entered  into a $75  million  revolving  credit
agreement.  The $75 million  revolving credit facility has an ultimate  maturity
date of March 2003 and enables the Company to borrow in multiple  currencies  at
interest rates tied to LIBOR or the prime rate, at its option.
In conjunction with the Infratest Burke  acquisition and the financing  thereof,
the Company  amended  its $75  million  revolving  credit  facility  and its $40
million  Senior  Notes,  each  originally  dated March 9, 1998.  The  amendments
provide,  among other things, that the Company obligations will be guaranteed by
certain  subsidiaries of the Company. In addition,  the amendments increased the
rates at which interest  annually  accrues under the  obligations  from 6.43% to
6.83%.

The Senior  Notes  Payable  consist of four  private  placements  of $40 million
Senior  Notes both dated March 9, 1998 due March 1, 2008,  $17 million  Series A
Senior Notes and $38 million  Series B Senior Notes dated  November 20, 1998 due
November 15, 2005 and November 15, 2008,  respectively,  and $7 million Series B
Senior Notes dated March 26 due November 15, 2008.

The Subordinated  Notes consist of the private  placement of $8 million on March
26,  1999,  and $17 million on November 20, 1998.  The  Subordinated  Notes bear
interest at the fixed annual rate of 9.84%,  mature  November 15, 2008,  and are
repayable in equal annual installments of $8.3 million beginning in 2006.

Under various loan agreements, the Company must maintain specified levels of net
worth and meet  certain  cash flow  requirements  and is limited in the level of
indebtedness.  The Company has complied with the limitations  under the terms of
these loan agreements.

Long-term  debt maturing over the next five years and  thereafter is as follows:
2000-$24 million;  2001-$44.8 million;  2002-$113.8 million; 2003-$83.4 million;
2004-$272.1 million, and $528.5 million thereafter.

See Note 13 for discussion of fair market value of the Company's long-term debt.

NOTE 11:  RESTRUCTURING AND OTHER MERGER RELATED COSTS
In October  1999,  the Company  announced  the merger of two of its  advertising
networks.  The networks  affected,  Lowe & Partners Worldwide and Ammirati Puris
Lintas were combined to form a new agency  network called Lowe Lintas & Partners
Worldwide.  The merger involves the  consolidation  of operations in Lowe Lintas
agencies  in  approximately  24 cities in 22  countries  around the world.  Once
complete, the newly merged agency network will have offices in over 80 countries
around the world.

During  the  fourth  quarter  of  1999,   the  Company  began   execution  of  a
comprehensive  restructuring  plan in  connection  with  the  merger.  The  plan
includes  headcount  reductions,  consolidation  of real  estate and the sale or
disposition of certain investments,  and is expected to be completed by June 30,
2000. The Company is pleased with the progress of the merger to date and expects
the total costs to be in line with its original estimate.

The total pre-tax cost of the restructuring  plan is expected to be between $170
and $190 million,  ($100 to $115 million,  net of tax). In the fourth quarter of
1999, the Company recognized pre-tax costs of $84.2 million ($51.4 million,  net
of tax or $.17 per diluted share),  with the remainder expected to be recognized
in the first two quarters of 2000.

A summary of the components of the total  restructuring and other merger related
costs,  together  with an  analysis  of the cash and  non-cash  elements,  is as
follows:
(Dollars in millions)

                                               1999            Cash     Non-Cash
                                              ----------------------------------
TOTAL BY TYPE
-------------
   Severance and termination costs            $44.9           $27.0        $17.9
   Fixed asset write-offs                      11.1              --         11.1
   Lease termination costs                      3.8             3.8           --
   Investment write-offs and other             24.4             1.1         23.3
                                              ----------------------------------
Total                                         $84.2           $31.9        $52.3
                                              ==================================

The severance and termination costs recorded in 1999 relate to approximately 230
employees who have been terminated or notified that they will be terminated. The
employee   groups   affected   include   executive   and  regional   management,
administrative,  account  management,  creative and media production  personnel,
principally  in the U.S.  and  U.K.  The  charge  related  to these  individuals
includes  the cost of  voluntary  programs  in certain  locations  and  includes
substantially all senior executives that will be terminated.  As of December 31,
1999, the amount accrued related to severance and termination was  approximately
$42.6 million.  During the fourth quarter of 1999, cash payments of $2.3 million
were made.

The fixed  assets  write-off  relates  largely to the  abandonment  of leasehold
improvements  as part of the merger.  The amount  recognized  in 1999 relates to
fixed asset write-offs in 6 offices principally in the United States.

Lease termination costs relate to the offices vacated as part of the merger. The
lease  terminations  are expected to be completed by mid-to-late  2000, with the
cash  portion to be paid out over a period of up to five  years.  As of December
31,  1999,  the  amount  accrued  related  to these  termination  costs was $3.8
million.

The  investment  write-offs  relate to the loss on sale or  closing  of  certain
business  units.  In 1999,  $23  million  has been  recorded  as a result of the
decision  to sell or  abandon  4  European  businesses.  In the  aggregate,  the
businesses  being  sold or  abandoned  represent  an  immaterial  portion of the
revenue  and  operations  of Lowe Lintas & Partners.  The  write-off  amount was
computed based upon the difference between the estimated sales proceeds (if any)
and the  carrying  value of the related  assets.  These  sales or  closures  are
expected to be completed by mid 2000.
NOTE 12:  GEOGRAPHIC AREAS
Long-lived assets and revenue are presented below by major geographic area:

(Dollars in thousands)
                                               1999         1998         1997
                                            -----------------------------------
Long-Lived Assets:
United States                               $1,665,097  $1,067,821   $  884,103
                                            -----------------------------------
International
United Kingdom                                 472,686     395,431      217,174
All other Europe                               603,189     550,807      472,710
Asia Pacific                                   107,215      92,581       78,862
Latin America                                   79,401      58,134       51,790
Other                                           80,246      54,632       43,982
                                            -----------------------------------
Total International                          1,342,737   1,151,585      864,518
                                            -----------------------------------
Total Consolidated                          $3,007,834  $2,219,406   $1,748,621
                                            -----------------------------------

Revenue:
United States                               $2,475,250  $2,107,908   $1,824,854
                                            -----------------------------------
International
United Kingdom                                 527,250     450,103      353,086
All other Europe                             1,140,532     902,602      748,720
Asia Pacific                                   346,205     325,758      348,707
Latin America                                  213,260     232,940      204,894
Other                                          190,415     148,477      102,340
                                            -----------------------------------
Total International                          2,417,662   2,059,880    1,757,747
                                            -----------------------------------
Total Consolidated                          $4,892,912  $4,167,788   $3,582,601
                                            -----------------------------------

Revenue is  attributed  to  geographic  areas  based on where the  services  are
performed.  Property and equipment is allocated  based upon  physical  location.
Intangible  assets,  other assets,  and  investments  are allocated based on the
location of the related operation.

The largest client of the Company  contributed  approximately  7% in 1999, 7% in
1998 and 9% in 1997 to revenue.  The Company's second largest client contributed
approximately 4% in 1999, 4% in 1998 and 4% in 1997 to revenue.

Dividends  received from foreign  subsidiaries were approximately $47 million in
1999, $51 million in 1998 and $41 million in 1997.

Consolidated net income includes losses from exchange and translation of foreign
currencies  of $5.6  million,  $3.2 million and $5.6  million in 1999,  1998 and
1997, respectively.

NOTE 13:  FINANCIAL INSTRUMENTS
Financial assets, which include cash and cash equivalents, marketable securities
and receivables,  have carrying values which  approximate fair value.  Long-term
equity securities, included in other investments and miscellaneous assets in the
Consolidated  Balance Sheet, are deemed to be  available-for-sale  as defined by
SFAS 115 and accordingly are reported at fair value,  with net unrealized  gains
and losses reported within stockholders' equity.
The following table  summarizes net unrealized  gains and losses before taxes at
December 31:

(Dollars in millions)

                                              1999       1998       1997
                                             ---------------------------
   Cost                                      $172.3     $121.3     $61.1
   Unrealized gains / (losses)
     - gains                                  302.3       20.2      22.0
     - losses                                 (12.2)      (1.5)       --
                                             ---------------------------
   Net unrealized gains                       290.1       18.7      22.0
                                             ---------------------------
   Fair market value                         $462.4     $140.0     $83.1
                                             ===========================

Net of tax, net unrealized holding gains were $168 million,  $10 million and $12
million at December 31, 1999, 1998 and 1997, respectively.

The above pre-tax gain amounts are net of reclassifications of $13.1 million and
$6.5 million in 1999 and 1998, which represent  amounts  previously  recorded in
other comprehensive income.

During 1999, the Company expanded its investment in internet-service and related
companies.  In April  1999,  the  Company  invested  $20  million for a minority
interest  in Icon,  a Swedish  based  internet  consultancy.  Subsequently,  the
Company  increased its investment  through the contribution of other investments
and through  additional  cash  purchases.  At December 31, 1999, the fair market
value of the Company's investment in Icon was $322 million.

Financial  liabilities  with carrying  values  approximating  fair value include
accounts payable and accrued expenses, as well as payable to banks and long-term
debt. As of December 31, 1999, the 1.87% Convertible Subordinated Notes due 2006
had a cost basis of $304  million  with a market  value of $416  million.  As of
December 31, 1999, the 1.80% Convertible  Subordinated Notes due 2004 had a cost
basis of $214 million with a market  value of $392  million.  As of December 31,
1998,  the cost  basis of the 1.80%  Convertible  Subordinated  Notes  were $208
million with a market value of $283 million.  The fair values were determined by
obtaining quotes from brokers (refer to Note 10 for additional information on

long-term debt). As of December 31, 1999, the 6.83% to 7.52% Notes Payable had a
total cost  basis of $102  million  with a market  value of $88  million.  As of
December  31,  1998,  the 4.3% to 7.52%  Notes  Payable  had a total  cost basis
approximately  the same as the market  value.  The fair value was  determined by
using the expected  future cash flows  discounted  at market  interest  rates as
adjusted for conversion privileges.

The Company occasionally uses forwards and options to hedge a portion of its net
investment in foreign  subsidiaries  and certain  intercompany  transactions  in
order to  mitigate  the impact of changes in foreign  exchange  rates on working
capital.  The  notional  value and fair value of all  outstanding  forwards  and
options  contracts at the end of the year as well as the net cost of all settled
contracts during the year were not significant.

The  Company's  management  continuously  evaluates and attempts to mitigate its
exposure  to foreign  exchange,  economic  and  political  risks.  The  economic
developments  in  Brazil  did not  have a  significant  negative  impact  on the
Company,  and were  partially  offset by a favorable  impact due to the economic
recovery in Japan.
NOTE 14:  COMMITMENTS AND CONTINGENCIES
At December 31, 1999 the Company's  subsidiaries operating primarily outside the
United States were  contingently  liable for discounted notes receivable of $7.4
million.

The Company and its subsidiaries lease certain  facilities and equipment.  Gross
rental expense amounted to approximately $290 million for 1999, $255 million for
1998 and $224  million for 1997,  which was reduced by sublease  income of $17.2
million in 1999, $16.4 million in 1998 and $30.7 million in 1997.

Minimum rental commitments for the rental of office premises and equipment under
noncancellable  leases,  some of which  provide  for rental  adjustments  due to
increased  property taxes and operating  costs for 2000 and  thereafter,  are as
follows:

(Dollars in thousands)

                                 Gross Rental         Sublease
                                  Commitment           Income
                                  ----------           ------
Period
2000                               $194,653            $17,206
2001                                172,181             15,180
2002                                143,518             10,224
2003                                113,457              6,335
2004                                 95,446              1,390
2005 and thereafter                 379,485              2,014

Certain of the Company's acquisition agreements provide for deferred payments by
the  Company,  contingent  upon  future  revenues  or profits  of the  companies
acquired.  Such contingent amounts would not be material taking into account the
future revenues or profits of the companies acquired.

The  Company  and  certain  of  its   subsidiaries  are  party  to  various  tax
examinations, some of which have resulted in assessments. The Company intends to
vigorously defend any and all assessments and believes that additional taxes (if
any) that may ultimately  result from the settlement of such assessments or open
examinations  would  not have a  material  adverse  effect  on the  consolidated
financial statements.

The  Company is  involved  in legal and  administrative  proceedings  of various
types.  While any  litigation  contains an element of  uncertainty,  the Company
believes that the outcome of such proceedings or claims will not have a material
adverse effect on the Company.

NOTE 15:  RECENT EVENT
In April 2000,  the Company  issued  approximately  12.6  million  shares of its
common stock in connection with the acquisition of NFO Worldwide,  Inc. ("NFO").
The acquisition has been accounted for as a pooling of interests.  The Company's
consolidated  financial  statements,  including  the  related  notes,  have been
restated  as of  the  earliest  period  presented  to  include  the  results  of
operations,  financial position and cash flows of NFO. Additionally, the results
of several other recent  acquisitions,  all of which have been  accounted for as
poolings of interests,  have been included in the restated financial statements.
Other  than  NFO,  none  of  the  other  acquisitions  was  individually,  or in
aggregate, material.
SELECTED FINANCIAL DATA FOR FIVE YEARS
                                              (Amounts in Thousands Except Per Share Data)
1999            1998         1997         1996         1995
                                       ----            ----         ----         ----         ----
OPERATING DATA
Revenue                               $ 4,892,912   $ 4,167,788  $ 3,582,601  $ 3,053,926  $ 2,650,192
Operating expenses                      4,246,714     3,601,796    3,171,780    2,695,038    2,353,970
Restructuring and other merger
  related costs                            84,183            --           --           --           --
Write-down of goodwill and other
related assets                                 --            --           --           --       38,687
Special compensation charge                    --            --       32,229           --           --
Interest expense                           81,241        64,137       59,651       53,321       49,105
Provision for income taxes                242,726       244,981      197,219      166,244      133,941
Net Income                            $   315,243   $   333,593  $   220,211  $   228,914  $   145,975

PER SHARE DATA
Basic

Net Income                            $      1.08   $      1.15  $       .79  $       .82  $       .54
Weighted-average shares                   292,067       288,831      277,871      278,294      272,378

Diluted

Net Income                            $      1.04   $      1.12  $       .77  $       .80  $       .52
Weighted-average shares                   302,914       299,214      295,677      294,876      280,382

FINANCIAL POSITION
Working capital                       $   170,898   $   100,300  $   244,365  $   149,919  $   118,147
Total assets                          $ 9,166,604   $ 7,464,808  $ 6,220,906  $ 5,253,456  $ 4,721,440
Total long-term debt                  $ 1,042,673   $   706,111  $   553,494  $   423,459  $   363,966
Book value per share                  $      5.85   $      4.81  $      3.87  $      3.42  $      2.85

OTHER DATA
Cash dividends - Interpublic          $    90,424   $    76,894    $  61,242    $  51,786  $    46,124
Cash dividends
  per share - Interpublic             $       .33   $       .29    $     .25    $     .22  $       .20
Number of employees                        41,900        37,700       32,600       27,000       25,200
                                      ----------------------------------------------------------------
All data has been restated to reflect the aggregate  effect of the  acquisitions
accounted for as poolings of interests. (See Note 15).

All share data for prior periods have been  adjusted to reflect the  two-for-one
stock split effective July 15, 1999.
RESULTS BY QUARTER (UNAUDITED)
                                                  (Amounts in Thousands Except Per Share Data)
1st Quarter               2nd Quarter            3rd Quarter                  4th Quarter

                          1999           1998         1999         1998           1999           1998          1999          1998
                       -------------------------------------------------------------------------------------------------------------
Revenue                $1,022,434    $  874,605    $1,231,113    $1,083,202    $1,151,406    $  968,307    $1,487,959    $1,241,674
Operating expenses        931,027       802,293       979,470       866,999     1,020,492       866,458     1,315,725     1,066,046
Restructuring and other
  merger related charges       --            --            --            --            --            --        84,183            --
Income from operations     91,407        72,312       251,643       216,203       130,914       101,849        88,051       175,628
Interest expense          (17,453)      (13,492)      (20,559)      (15,770)      (21,692)      (17,104)      (21,537)      (17,771)
Other income, net          12,722        10,944        29,115        24,343        14,962        15,044        45,942        47,700
Income before provision
  for income taxes         86,676        69,764       260,199       224,776       124,184        99,789       112,456       205,557
Provision for

  income taxes             35,578        26,570       103,989        91,194        52,005        42,124        51,154        85,093
Net equity interests       (2,386)       (2,405)       (6,203)       (5,231)       (4,404)       (4,072)      (12,553)       (9,604)
                       ------------------------------------------------------------------------------------------------------------
Net income             $   48,712    $   40,789    $  150,007    $  128,351    $   67,775    $   53,593    $   48,749    $  110,860
                       ============================================================================================================

Per share data:
  Basic EPS            $      .17     $     .14    $      .51    $      .44    $      .23    $      .19    $      .17    $      .38
  Diluted EPS          $      .16     $     .14    $      .49    $      .43    $      .22    $      .18    $      .16    $      .37
Cash dividends per

 share - Interpublic   $     .075     $    .065    $     .085    $     .075    $     .085    $     .075    $     .085    $     .075

Weighted-Average Shares:
  Basic                   290,532       288,034       292,201       289,323       292,762       288,841       292,772       289,125
  Diluted                 301,776       298,536       311,456       307,132       303,373       298,572       303,865       306,000

Stock price:
  High                        $40      $31 5/16      $43 5/16       $32 1/4      $44 1/16      $32 7/16      $58 1/16       $39 7/8
  Low                     $34 7/8     $23 27/32     $34 19/32    $ 27 21/32       $36 1/2      $26 3/32       $35 3/4       $23 1/2
                       ------------------------------------------------------------------------------------------------------------
All data has been restated to reflect the aggregate  effect of the  acquisitions
accounted for as poolings of interests. (See Note 15).

All share data for 1998 has been adjusted to reflect the two-for-one stock split
effective July 15, 1999.
SCHEDULE VIII

          THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                        VALUATION AND QUALIFYING ACCOUNTS

              For the Years Ended December 31, 1999, 1998 and 1997

================================================================================

                             (Dollars in thousands)

COLUMN A     COLUMN B      COLUMN C   COLUMN D       COLUMN E           COLUMN F
--------------------------------------------------------------------------------

                                    Additions
                                    ---------

                                         Charged
              Balance at  Charged to    to Other                         Balance
               Beginning     Costs &   Accounts-   Deductions-            at End
Description    of Period    Expenses    Describe      Describe         of Period

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

Allowance for
  Doubtful  Accounts -
  deducted from
  Receivables in the
  Consolidated
  Balance Sheet:

1999         $54,060       $23,909    $5,148(5)      $(23,721)(3)       $60,505
                                       2,934(7)        (1,215)(2)
                                                         (610)(4)

1998         $44,581       $20,421    $6,699(1)      $(17,038)(3)       $54,060
                                       2,111(5)        (3,310)(4)

                                         596(2)

1997         $37,496       $16,904    $2,256(1)      $ (2,680)(2)       $44,581
                                         848(5)        (7,869)(3)
                                                       (2,374)(4)

-------------------
[FN]

  (1)  Allowance for doubtful accounts of acquired and newly consolidated
       companies.
  (2)  Foreign currency translation adjustment.
  (3)  Principally amounts written off.
  (4)  Reversal of previously recorded allowances on accounts receivable.
  (5)  Miscellaneous.
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                             (Dollars in Thousands)
                                     ASSETS

                                                    March 31,    December 31,
                                                      2000          1999
                                                   (unaudited)
                                                   --------------------------
CURRENT ASSETS:
Cash and cash equivalents (includes
  certificates of deposit: 2000-$89,519;
  1999-$150,343)                                   $  692,745      $1,006,011
Marketable securities                                  47,982          36,765
Receivables (net of allowance for doubtful
  accounts:  2000-$61,257; 1999-$60,505)            4,328,723       4,401,704
Expenditures billable to clients                      379,653         332,833
Prepaid expenses and other current assets             162,634         146,019
                                                   --------------------------
   Total current assets                             5,611,737       5,923,332
                                                   --------------------------

OTHER ASSETS:
Investment in unconsolidated affiliates                64,965          61,987
Deferred taxes on income                                8,133              --
Other investments and miscellaneous assets            649,049         718,939
                                                   --------------------------
   Total other assets                                 722,147         780,926
                                                   --------------------------

FIXED ASSETS, AT COST:
Land and buildings                                    160,037         164,678
Furniture and equipment                               785,516         777,368
                                                   --------------------------
                                                      945,553         942,046
Less: accumulated depreciation                        517,334         504,371
                                                   --------------------------
                                                      428,219         437,675
Unamortized leasehold improvements                    148,603         145,071
                                                   --------------------------
   Total fixed assets                                 576,822         582,746
                                                   --------------------------

Intangible assets (net of accumulated
 amortization: 2000-$626,449; 1998-$607,417)        1,920,348       1,879,600
                                                   --------------------------

TOTAL ASSETS                                       $8,831,054      $9,166,604
                                                   ==========================
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                  (Dollars in Thousands Except Per Share Data)
                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                                     March 31,     December 31,
                                                       2000           1999
                                                    (unaudited)
                                                    ------------   ------------
CURRENT LIABILITIES:
Payable to banks                                    $  382,155       $  262,397
Accounts payable                                     4,351,836        4,568,343
Accrued expenses                                       660,750          761,210
Accrued income taxes                                   161,401          160,484
                                                    ---------------------------
Total current liabilities                            5,556,142        5,752,434
                                                    ---------------------------
NONCURRENT LIABILITIES:
Long-term debt                                         493,516          524,183
Convertible subordinated debentures
  and notes                                            522,068          518,490
Deferred compensation and reserve
  for termination allowances                           352,998          344,999
Deferred taxes on income                                    --           44,744
Accrued postretirement benefits                         50,289           50,226
Other noncurrent liabilities                            92,264           87,548
Minority interests in consolidated
  subsidiaries                                          83,014           81,612
                                                    ---------------------------
Total noncurrent liabilities                         1,594,149        1,651,802
                                                    ---------------------------
STOCKHOLDERS' EQUITY:
Preferred Stock, no par value
  shares authorized:  20,000,000
  shares issued:  none

Common Stock, $.10 par value
  shares authorized:  550,000,000
  shares issued:
    2000 - 311,019,156;
    1999 - 309,996,727                                  31,102           31,000
Additional paid-in capital                             843,627          784,646
Retained earnings                                    1,403,377        1,389,971
Accumulated other comprehensive
  loss, net of tax                                    (168,660)         (76,695)
                                                     --------------------------
                                                     2,109,446        2,128,922
Less:
Treasury stock, at cost:
2000 - 9,001,600 shares;
1999 - 8,909,904  shares                               338,222          289,519
Unamortized expense of restricted
  stock grants                                          90,461           77,035
                                                     --------------------------
Total stockholders' equity                           1,680,763        1,762,368
                                                     --------------------------
Commitments and contingencies

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY          $8,831,054       $9,166,604
                                                    ===========================

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note e).

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                  CONSOLIDATED STATEMENT OF INCOME
                           THREE MONTHS ENDED MARCH 31
                  (Amounts in Thousands Except Per Share Data)
                                   (unaudited)

                                                2000             1999
                                                ----             ----
 Revenue                                    $1,198,211       $1,022,434
                                            ----------       ----------

 Salaries and related expenses                 693,584          588,597
 Office and general expenses                   393,162          342,430
 Restructuring and other merger
   related costs                                36,051               --
                                            ----------       ----------
   Total operating expenses                  1,122,797          931,027
                                            ----------       ----------

 Income from operations                         75,414           91,407

 Interest expense                              (20,377)         (17,453)
 Other income, net                              16,796           12,722
                                            ----------       ----------

 Income before provision for income taxes       71,833           86,676

 Provision for income taxes                     30,881           35,578
                                            ----------       ----------
 Income of consolidated companies               40,952           51,098

 Income applicable to minority interests        (5,422)          (3,753)
 Equity in net income of
   unconsolidated affiliates                     1,765            1,367
                                            ----------       ----------
 Net income                                 $   37,295       $   48,712
                                            ==========       ==========

 Earnings per share:
   Basic                                     $     .13         $    .17
   Diluted                                   $     .12         $    .16

 Dividend per share - Interpublic            $     .085        $    .075

 Weighted average shares:
   Basic                                       293,897          290,532
   Diluted                                     304,597          301,776

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note e).

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
           CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                           THREE MONTHS ENDED MARCH 31
                             (Dollars in Thousands)
                                   (unaudited)

                                                   2000           1999
                                                   ----           ----
 Net Income                                      $  37,295      $  48,712
                                                 ---------      ---------
 Other Comprehensive Income, net of tax:

 Foreign Currency Translation Adjustments          (31,777)       (64,555)

 Net Unrealized Gains (Losses) on Securities       (60,188)        22,773
                                                 ---------      ---------
 Other Comprehensive Income                        (91,965)       (41,782)
                                                 ---------      ---------
 Comprehensive Income                            $ (54,670)      $  6,930
                                                 =========      =========

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note e).

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                CONSOLIDATED STATEMENT OF CASH FLOWS
                           THREE MONTHS ENDED MARCH 31
                             (Dollars in Thousands)
                                   (unaudited)

                                                          2000          1999
                                                       -----------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                             $  37,295       $ 48,712
Adjustments to reconcile net income to cash
     used in operating activities:
   Depreciation and amortization of fixed assets          34,996         26,738
   Amortization of intangible assets                      23,409         17,099
   Amortization of restricted stock awards                 6,965          5,929
   Equity in net income of unconsolidated affiliates      (1,765)        (1,367)
   Income applicable to minority interests                 5,422          3,753
   Translation losses                                        559            923
   Net gain from sale of investments                      (5,597)          (486)
   Other                                                   7,681        (13,009)
   Restructuring charges, non-cash                        15,781             --

Changes in assets and liabilities, net of acquisitions:
   Receivables                                            39,951        (24,938)
   Expenditures billable to clients                      (47,972)       (49,038)
   Prepaid expenses and other assets                     (17,527)       (32,240)
   Accounts payable and other liabilities               (278,047)      (164,641)
   Accrued income taxes                                   (4,234)       (10,639)
   Deferred income taxes                                  (5,288)        (2,177)
   Deferred compensation and reserve for
     termination allowances                               11,658          3,992
                                                       ------------------------
Net cash used in operating activities                   (176,713)      (191,389)
                                                       ------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Acquisitions, net                                     (57,324)       (55,286)
   Capital expenditures                                  (33,667)       (32,880)
   Proceeds from sale of investments                       7,700          1,436
   Net purchases of marketable securities                (12,872)       (18,104)
   Other investments and miscellaneous assets            (49,790)           236
   Investments in unconsolidated affiliates                   --         (5,494)
                                                       ------------------------
Net cash used in investing activities                   (145,953)      (110,092)
                                                       ------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Increase in short-term borrowings                      115,417       209,956
   Proceeds from long-term debt                            15,496        73,165
   Payments of long-term debt                             (34,468)      (30,251)
   Treasury stock acquired                                (64,305)      (79,474)
   Issuance of common stock                                18,828        26,556
   Cash dividends - Interpublic                           (23,890)      (20,450)
                                                       -------------------------
Net cash provided by financing activities                  27,078       179,502
Effect of exchange rates on cash
  and cash equivalents                                    (17,678)      (30,003)
                                                       ------------------------
Decrease in cash and cash equivalents                    (313,266)     (151,982)
Cash and cash equivalents at beginning of year          1,006,011       780,429
                                                       ------------------------
Cash and cash equivalents at end of period             $  692,745     $ 628,447
                                                       ========================

All  periods  have  been  restated  to  reflect  the  aggregate  effect  of  the
acquisitions accounted for as poolings of interests. (See Note e).

The  accompanying  notes are an integral  part of these  consolidated  financial
statements
THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

     (a)  In the opinion of  management,  the  consolidated  balance sheet as of
          March 31,  2000,  the  consolidated  income  statements  for the three
          months ended March 31, 2000 and 1999,  the  consolidated  statement of
          comprehensive  income for the three  months  ended  March 31, 2000 and
          1999,  and the  consolidated  statement  of cash  flows  for the three
          months ended March 31, 2000 and 1999,  contain all adjustments  (which
          include only normal recurring adjustments) necessary to present fairly
          the financial position,  results of operations and cash flows at March
          31,  2000  and for all  periods  presented.  Certain  information  and
          footnote   disclosures   normally  included  in  financial  statements
          prepared in accordance with generally accepted  accounting  principles
          have been omitted.  It is suggested that these consolidated  financial
          statements  be read in  conjunction  with the  consolidated  financial
          statements  and notes  thereto  included in The  Interpublic  Group of
          Companies,  Inc.'s (the "Company")  December 31, 1999 annual report to
          stockholders.

          The Company's consolidated financial statements, including the related
          notes,  have been  restated as of the  earliest  period  presented  to
          include the results of operations,  financial  position and cash flows
          of the 2000 pooled  entities in addition to all material  prior pooled
          entities.

          The  accompanying  income  statements  have been  prepared in a format
          different to that used in the originally filed Form 10-Q for the three
          months ended March 31, 1999.  The changes made  principally  relate to
          the  introduction  of a new  line  item -  "Income  from  operations".
          Amounts previously  included in "Other income,  net" as part of "Gross
          Income" are now included  elsewhere in the  Consolidated  Statement of
          Income.  The  quarterly  data  reflected  in  the  restated  financial
          statements as of and for the year ended  December 31, 1999 reflect the
          change made.

     (b)  The Company considers all highly liquid investments with a maturity of
          three months or less to be cash equivalents.  Income tax cash payments
          were  approximately  $21 million and $39.1  million in the first three
          months of 2000 and 1999,  respectively.  Interest  payments during the
          first three months of 2000 and 1999 were  approximately  $12.8 million
          and $8.1 million, respectively.

     (c)  In  October  1999,  the  Company  announced  the  merger of two of its
          advertising networks. The networks affected, Lowe & Partners Worldwide
          and Ammirati  Puris Lintas were combined to form a new agency  network
          called  Lowe  Lintas & Partners  Worldwide.  The merger  involves  the
          consolidation  of operations in Lowe Lintas agencies in  approximately
          24 cities in 22 countries around the world.  Once complete,  the newly
          merged  agency  network will have offices in over 80 countries  around
          the world.

          Since the fourth  quarter of 1999,  the Company has been executing the
          restructuring  in connection with the merger.  As of the current date,
          substantially  all of the  restructuring  activities in the U.S.,  the
          U.K.  and  most  European  and  Latin  American  countries  have  been
          completed.
In  the  first  quarter  of  2000,  the  Company   recognized  pre-tax
          restructuring  costs of $36.1 million  ($20.7 million net of tax). The
          Company   expects  the   remaining   pre-tax  costs  to  complete  the
          restructuring to approximate  $50-$70  million,  which is in line with
          the Company's  original plan. The remaining costs focus principally on
          finalizing the restructuring in Germany and several smaller markets.

          The total  restructuring  costs of $36.1 million include cash costs of
          $20.3 million.

          A  summary  of the  components  of the total  restructuring  and other
          merger related costs is as follows:
(Dollars in millions)

                                                                  1st Quarter 2000
                                             -----------------------------------------------------------
                                               Balance       Expense        Cash     Asset     Balance
                                             at 12/31/99   recognized       Paid  Write-offs  at 3/31/00
                                             -----------------------------------------------------------
TOTAL BY TYPE
                Severance and
                  termination  costs            $43.6          $14.4        $ 9.6       --       $48.4
                Fixed asset write-offs           11.1            5.4           --     16.5          --
                Lease  termination costs          3.8            4.9          1.7       --         7.0
                Investment write-offs
                  and other                      23.4           11.4           .3     32.6         1.9
                                             -----------------------------------------------------------
                Total                           $81.9          $36.1        $11.6    $49.1       $57.3
                                             ===========================================================
The  severance  and  termination  costs  recorded  in 2000  relate  to
          approximately  265 employees who have been terminated or notified that
          they  will  be  terminated.   The  employee  groups  affected  include
          management,  administrative,  account  management,  creative and media
          production  personnel,  principally  in the U.S. and several  European
          countries.

          The fixed  asset  write-offs  relate  largely  to the  abandonment  of
          leasehold improvements as part of the merger. The amount recognized in
          2000 relates to fixed asset  write-offs  in 3 offices,  the largest of
          which is in the U.K.

          Lease  termination  costs relate to the offices vacated as part of the
          merger.  The  lease  terminations  are  expected  to be  completed  by
          mid-to-late  2000,  with the cash portion to be paid out over a period
          of up to five years.

          The  investment  write-offs  relate to the loss on sale or  closing of
          certain  business  units. In 2000, $9.3 million has been recorded as a
          result of the decision to sell or abandon 2 businesses located in Asia
          and Europe.  In the aggregate,  the businesses being sold or abandoned
          represent an immaterial  portion of the revenue and operations of Lowe
          Lintas & Partners.  The write-off  amount was computed  based upon the
          difference  between  the  estimated  sales  proceeds  (if any) and the
          carrying  value of the related  assets.  These  sales or closures  are
          expected to be completed by mid 2000.
(d)  In June 1998, the Financial  Accounting  Standards  Board (the "FASB")
          issued   Statement  of  Financial   Accounting   Standards   No.  133,
          "Accounting for Derivative  Instruments and Hedging  Activities" (SFAS
          133),  which had an initial  adoption date of January 1, 2000. In June
          1999,  the FASB  postponed the adoption date of SFAS 133 until January
          1, 2001.  SFAS 133 will require the Company to record all  derivatives
          on the balance sheet at fair value.  Changes in derivative fair values
          will  either be  recognized  in  earnings as offsets to the changes in
          fair value of related hedged assets,  liabilities and firm commitments
          or, for  forecasted  transactions,  deferred and later  recognized  in
          earnings  at the same time as the  related  hedged  transactions.  The
          impact of SFAS 133 on the Company's  financial  statements will depend
          on a variety of factors,  including the future level of forecasted and
          actual  foreign  currency  transactions,  the extent of the  Company's
          hedging  activities,  the types of  hedging  instruments  used and the
          effectiveness  of such  instruments.  However,  the  Company  does not
          believe  the  effect  of  adopting  SFAS 133 will be  material  to its
          financial condition or results of operations.

     (e)  In April 2000, the Company issued approximately 12.6 million shares of
          its common stock in connection  with the acquisition of NFO Worldwide,
          Inc.  ("NFO").  The acquisition has been accounted for as a pooling of
          interests. The Company's consolidated financial statements,  including
          the  related  notes,  have been  restated  as of the  earliest  period
          presented to include the results of operations, financial position and
          cash flows of NFO.  Additionally,  the results of several other recent
          acquisitions,  all of which have been  accounted  for as  poolings  of
          interests,  have been included in the restated  financial  statements.
          Other than NFO, none of the other acquisitions was individually, or in
          aggregate, material.

          Additionally,  on April 20,  2000,  the Company  acquired  substantial
          assets of the Communications Division of Caribiner International, Inc.
          for  approximately  $90  million  in  cash.  The  acquisition  will be
          accounted for as a purchase.  As the acquisitions  occurred subsequent
          to the end of the first quarter, the financial statements presented in
          this  Form  10-Q do not  include  the  results  of  operations  of the
          acquired entities.
Item 2

           THE INTERPUBLIC GROUP OF COMPANIES, INC. AND ITS SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                   FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 RESULTS OF OPERATIONS

The Company  reported net income of $37.3  million or $.12 diluted  earnings per
share  for the three  months  ended  March 31,  2000.  Excluding  the  impact of
restructuring  and other merger related costs,  which are discussed  below,  net
income was $58.0 million or $.19 diluted  earnings per share,  compared to $48.7
million or $.16 diluted  earnings per share for the three months ended March 31,
1999.

Worldwide  revenue for the three  months  ended March 31,  2000  increased  $176
million,  or 17%, to $1.2 billion compared to the same period in 1999.  Domestic
revenue  increased $133 million or 25% during the first quarter of 2000 compared
to 1999.  International  revenue  increased  $43  million or 9% during the first
quarter of 2000 compared to 1999. International revenue would have increased 15%
excluding the effect of the  strengthening of the U.S.  dollar.  The increase in
worldwide  revenue  is a result of both new  business  growth  and  growth  from
acquisitions.  Exclusive of acquisitions, worldwide revenue on a constant dollar
basis  increased  13% for the first  quarter of 2000  compared to the prior year
quarter.

Revenue from other specialized  marketing services,  which include media buying,
market  research,  relationship  (direct)  marketing,  sales  promotion,  public
relations,  sports and event  marketing,  healthcare  marketing  and  e-business
consulting  and  communications,   comprised  approximately  47%  of  the  total
worldwide revenue for the three months ended March 31, 2000, compared to 43% for
the prior year quarter.

Worldwide operating expenses for the first quarter 2000, excluding restructuring
and other merger  related costs were $1.1  billion,  an increase of 17% over the
prior year quarter. This increase is consistent with the 17% increase in revenue
for the same period.  Salaries and related  expenses were $694 million or 58% of
revenue  for the first  quarter of 2000 as  compared  to $590  million or 58% of
revenue for the first  quarter of 1999.  Office and general  expenses  were $393
million for the first  quarter of 2000  compared  to $341  million for the first
quarter of 1999.

Income  from  operations  was  $75.4  million  for the  first  quarter  of 2000.
Excluding  restructuring and other merger related costs,  income from operations
was $111.4 million for the first quarter of 2000,  compared to $91.4 million for
the first quarter of 1999, an increase of 22%. Amortization of intangible assets
was $23 million for the first  quarter of 2000,  compared to $17 million for the
first quarter of 1999. Exclusive of acquisitions,  foreign exchange fluctuations
and amortization of intangible assets,  income from operations increased 22% for
the first quarter of 2000 compared to the first quarter of 1999.

In October  1999,  the Company  announced  the merger of two of its  advertising
networks.  The networks  affected,  Lowe & Partners Worldwide and Ammirati Puris
Lintas were combined to form a new agency  network called Lowe Lintas & Partners
Worldwide.  The merger involves the  consolidation  of operations in Lowe Lintas
agencies  in  approximately  24 cities in 22  countries  around the world.  Once
complete, the newly merged agency network will have offices in over 80 countries
around the world.
Since  the  fourth   quarter  of  1999,  the  Company  has  been  executing  the
restructuring   in  connection  with  the  merger.   As  of  the  current  date,
substantially all of the restructuring activities in the U.S., the U.K. and most
European and Latin American countries have been completed.

In the first quarter of 2000, the Company recognized pre-tax restructuring costs
of $36.1 million ($20.7  million net of tax). The Company  expects the remaining
pre-tax costs to complete the  restructuring  to  approximate  $50-$70  million,
which is in line with the Company's  original  plan.  The remaining  costs focus
principally  on  finalizing  the  restructuring  in Germany and several  smaller
markets.

The total  restructuring  costs of $36.1  million  include  cash  costs of $20.3
million.

A summary of the components of the total  restructuring and other merger related
costs is as follows:

(Dollars in millions)
1st Quarter 2000
                             -----------------------------------------------------------
                               Balance       Expense        Cash     Asset     Balance
                             at 12/31/99   recognized       Paid  Write-offs  at 3/31/00
                             -----------------------------------------------------------
TOTAL BY TYPE
Severance and
  termination  costs            $43.6          $14.4        $ 9.6       --       $48.4
Fixed asset write-offs           11.1            5.4           --     16.5          --
Lease  termination costs          3.8            4.9          1.7       --         7.0
Investment write-offs
  and other                      23.4           11.4           .3     32.6         1.9
                             -----------------------------------------------------------
Total                           $81.9          $36.1        $11.6    $49.1       $57.3
                             ===========================================================
The severance and termination costs recorded in 2000 relate to approximately 265
employees who have been terminated or notified that they will be terminated. The
employee groups affected include management, administrative, account management,
creative and media  production  personnel,  principally  in the U.S. and several
European countries.

The fixed  asset  write-offs  relate  largely to the  abandonment  of  leasehold
improvements  as part of the merger.  The amount  recognized  in 2000 relates to
fixed asset write-offs in 3 offices, the largest of which is in the U.K.

Lease termination costs relate to the offices vacated as part of the merger. The
lease  terminations  are expected to be completed by mid-to-late  2000, with the
cash portion to be paid out over a period of up to five years.

The  investment  write-offs  relate to the loss on sale or  closing  of  certain
business  units.  In 2000,  $9.3  million  has been  recorded as a result of the
decision  to sell or abandon 2  businesses  located in Asia and  Europe.  In the
aggregate,  the  businesses  being sold or  abandoned  represent  an  immaterial
portion of the revenue and  operations of Lowe Lintas & Partners.  The write-off
amount was  computed  based upon the  difference  between  the  estimated  sales
proceeds (if any) and the carrying value of the related  assets.  These sales or
closures are expected to be completed by mid 2000.
Other income, net, consists of interest income,  investment income and net gains
from equity  investments,  all of which have increased at comparable  rates over
the prior year quarter.

The  effective  tax rate for the three  months  ended  March 31, 2000 was 43.0%,
compared to 41.0% in 1999.  The  difference  between the effective and statutory
rates is  primarily  due to foreign  losses  with no tax  benefit,  losses  from
translation of foreign currencies which provided no tax benefit, state and local
taxes,  foreign  withholding  taxes  on  dividends  and  nondeductible  goodwill
expense.

LIQUIDITY AND CAPITAL RESOURCES

Working  capital  at March 31,  2000 was $55.8  million,  a  decrease  of $115.5
million from December 31, 1999. The decrease is partly due to  expenditures  for
additional strategic long-term investments and a net reduction in long-term debt
during  the first  quarter  of 2000.  The  ratio of  current  assets to  current
liabilities was slightly above 1 to 1 at March 31, 2000.

Historically,  cash flow from  operations has been the primary source of working
capital and  management  believes  that it will continue to be so in the future.
Net cash used in operating  activities was $177 million for the first quarter of
2000 and $191  million  for the first  quarter of 1999.  The  Company's  working
capital  is  used   primarily  to  provide  for  the  operating   needs  of  its
subsidiaries,  which include  payments for space or time  purchased from various
media on behalf of its clients.  The  Company's  practice is to bill and collect
from its  clients in  sufficient  time to pay the  amounts due media on a timely
basis.  Other uses of working  capital  include the  payment of cash  dividends,
acquisitions,  capital  expenditures  and the  reduction of long-term  debt.  In
addition,  during the first three months of 2000, the Company acquired 1,080,200
shares of its own stock for the purpose of fulfilling the Company's  obligations
under its various compensation plans.

OTHER MATTERS

Acquisitions
------------
In April 2000,  the Company  issued  approximately  12.6  million  shares of its
common stock in connection with the acquisition of NFO Worldwide,  Inc. ("NFO").
The  acquisition  is  accounted  for as a pooling of  interests.  The  Company's
consolidated  financial  statements,  including  the  related  notes,  have been
restated  as of  the  earliest  period  presented  to  include  the  results  of
operations,  financial position and cash flows of NFO. Additionally, the results
of several other recent  acquisitions,  all of which have been  accounted for as
poolings of interests,  have been included in the restated financial statements.
Other  than  NFO,  none  of  the  other  acquisitions  was  individually,  or in
aggregate, material.

Year 2000 Issue
---------------
Subsequent to completion of the Company's  Year 2000  compliance  programs,  the
Company  has not  experienced  any  significant  Year  2000  disruptions  to its
business  nor has the  Company  been made aware of any  significant  disruptions
impacting its customers or critical suppliers.

Cautionary Statement
--------------------
Statements by the Company in this  document,  that are not matters of historical
fact,  are  forward-looking  statements  as  defined in the  Private  Securities
Litigation Reform Act of 1995. These  forward-looking  statements are subject to
certain  risks and  uncertainties  that  could  cause  actual  results to differ
materially from those anticipated in the forward-looking statements.
New Accounting Guidance
-----------------------
In June 1998,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and  Hedging  Activities"  (SFAS  133),  which had an initial  adoption  date of
January 1, 2000. In June 1999,  the FASB postponed the adoption date of SFAS 133
until January 1, 2001.  The Company does not believe the effect of adopting SFAS
133 will be material to its financial condition or results of operations.

Conversion to the Euro
----------------------
On January 1, 1999,  certain member countries of the European Union  established
fixed  conversion  rates  between  their  existing  currencies  and the European
Union's common currency (the "Euro").  The Company  conducts  business in member
countries.  The transition  period for the  introduction  of the Euro is between
January  1, 1999,  and June 30,  2002.  The  Company  is  addressing  the issues
involved with the  introduction of the Euro. The major  important  issues facing
the Company include:  converting  information  technology  systems;  reassessing
currency  risk;  negotiating  and amending  contracts;  and  processing  tax and
accounting records.

Based upon progress to date, the Company  believes that use of the Euro will not
have a  significant  impact on the  manner  in which it  conducts  its  business
affairs  and  processes  its  business  and  accounting  records.   Accordingly,
conversion to the Euro has not, and is not expected to have a material effect on
the Company's financial condition or results of operations.