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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


Form 10-Q

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

For the quarterly period ended September 30, 2002


OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______________ to ______________

Commission File Number 0-28672

OPTIKA INC.
(Exact name of registrant as specified in its charter)

Delaware 95-4154552
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

7450 Campus Drive, 2nd Floor 80920
Colorado Springs, CO (Zip Code)
(Address of principal executive offices)

(719) 548-9800
(Registrant's telephone number,
including area code)

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

8,326,486 shares of the Registrant's Common Stock, $.001 par value
per share, were outstanding as of November 13, 2002.
================================================================================

INDEX

PAGE
PART I - FINANCIAL INFORMATION

Item 1 - Condensed Consolidated Financial Statements

Condensed Consolidated Balance Sheets as of September 30, 2002 and
December 31, 2001(Unaudited) 1

Condensed Consolidated Statements of Operations for the three-month
and nine-month periods ended September 30, 2002 and 2001 (Unaudited) 2

Condensed Consolidated Statements of Cash Flows for the nine-month
periods ended September 30, 2002 and 2001 (Unaudited) 3

Notes to Condensed Consolidated Financial Statements (Unaudited) 4

Item 2 - Management's Discussion and Analysis of Financial Condition and
Results of Operations 6

Item 3 - Quantitative and Qualitative Disclosures About Market Risk 14

Item 4 - Controls and Procedures 15


PART II - OTHER INFORMATION

Item 6 - Exhibits and Reports on Form 8-K 15

Signatures and Certifications 16





OPTIKA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)

September 30, December 31,
2002 2001
---------------- ---------------

(unaudited)
Assets
Current assets:
Cash and cash equivalents........................................... $ 1,953 $ 1,746
Short-term investments.............................................. 5,962 5,950
Accounts receivable, net of allowance for doubtful accounts of $118
at September 30, 2002 and $110 at December 31, 2001............... 3,666 4,035
Other current assets................................................ 523 537
---------------- ---------------
Total current assets.......................................... 12,104 12,268
---------------- ---------------

Property and equipment, net............................................ 996 1,364
Other assets........................................................... 217 269
---------------- ---------------
$ 13,317 $ 13,901
================ ===============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable.................................................... $ 315 $ 486
Accrued expenses.................................................... 607 1,210
Accrued compensation expense........................................ 548 861
Deferred revenue.................................................... 4,893 3,949
---------------- ---------------
Total current liabilities.................................... 6,363 6,506
---------------- ---------------

Stockholders' equity:
Common stock; $.001 par value; 25,000,000 shares authorized;
8,326,486 and 8,214,713 shares issued and outstanding at September
30, 2002 and December 31, 2001, respectively...................... 8 8
Preferred stock; Series A-1 convertible, $.001 par value; 731,851
shares authorized, issued and outstanding at September 30, 2002
and December 31, 2001............................................. 5,199 5,199
Additional paid-in capital........................................... 29,162 29,051
Accumulated deficit.................................................. (27,415) (26,863)
---------------- ---------------
Total stockholders' equity.................................. 6,954 7,395
---------------- ---------------
$ 13,317 $ 13,901
================ ===============

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






OPTIKA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except per share amounts)

Three Months Ended Nine Months Ended
September 30, September 30,
---------------------------- -------------------------
2002 2001 2002 2001
---- ---- ---- ----

Revenues:
Licenses........................................ $ 1,635 $ 1,373 $ 3,948 $ 4,432
Maintenance and other........................... 3,015 2,498 9,051 7,644
--------- -------- -------- --------
Total revenues............................... 4,650 3,871 12,999 12,076
--------- -------- -------- --------
Cost of revenues:
Licenses........................................ 214 234 432 547
Maintenance and other........................... 911 860 2,730 2,848
--------- -------- -------- --------
Total cost of revenues....................... 1,125 1,094 3,162 3,395
--------- -------- -------- --------

Gross profit....................................... 3,525 2,777 9,837 8,681
--------- -------- -------- --------
Operating expenses:
Sales and marketing............................. 1,865 1,757 5,514 6,628
Research and development........................ 1,262 1,275 3,836 4,287
General and administrative...................... 384 389 1,150 1,391
Restructuring and other non-recurring charges... - - - 1,071
--------- -------- -------- --------
Total operating expenses..................... 3,511 3,421 10,500 13,377
--------- -------- -------- --------

Income (loss) from operations...................... 14 (644) (663) (4,696)
Other income, net.................................. 31 87 108 284
--------- -------- -------- --------

Income (loss) before income tax provision.......... 45 (557) (555) (4,412)
Income taxes....................................... - - (3) 6
--------- -------- -------- --------
Net income (loss).................................. 45 (557) (552) (4,418)
Preferred stock dividend........................... - - - (447)
Accretion of preferred stock and beneficial
conversion feature............................... - - - (250)
Increase to income available to common stockholders
from the exchange of preferred stock............. - - - 6,196
--------- -------- -------- --------
Net income (loss) applicable to common stockholders $ 45 $ (557) $ (552) $ 1,081
========= ======== ======== ========
Basic net income (loss) per common share........... $ 0.01 $ (0.07) $ (0.07) $ 0.13
========= ======== ======== ========
Basic weighted average number of common shares
outstanding...................................... 8,314 8,200 8,280 8,174
========= ======== ======== ========

Diluted net loss per common share.................. $ 0.00 $ (0.07) $ (0.07) $ (0.49)
========= ======== ======== ========
Diluted weighted average number of common shares
outstanding...................................... 9,263 8,200 8,280 8,973
========= ======== ======== ========


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





OPTIKA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(In thousands)

Nine Months Ended September 30,
---------------------------------
2002 2001
---- ----

Cash Flows From Operating Activities:
Net loss............................................................... $ (552) $ (4,418)
Adjustments to reconcile net loss to net cash provided (used) by
operating activities:
Depreciation and amortization....................................... 515 789
Loss on disposal of fixed assets.................................... (3) 193
Deferred tax expense................................................ -- --
Changes in assets and liabilities:
Accounts receivable, net......................................... 369 115
Other assets..................................................... 66 180
Accounts payable................................................. (171) (610)
Accrued expenses................................................. (916) 345
Deferred revenue................................................. 944 (405)
---------------- ---------------
Net cash provided (used) by operations.......................... 252 (3,811)
---------------- ---------------

Cash Flows From Investing Activities:
Capital expenditures................................................... (153) (28)
Proceeds from sales of equipment....................................... 9 7
Sale (purchase) of short-term investments, net......................... (12) 2,794
---------------- ---------------
Net cash provided (used) by investing activities................ (156) 2,773
---------------- ---------------

Cash Flows From Financing Activities:
Proceeds from issuance of common stock................................. 111 127
Expenditures for preferred stock exchange.............................. -- (151)
---------------- ---------------
Net cash provided (used) by financing activities............... 111 (24)
---------------- ---------------

Net increase (decrease) in cash and cash equivalents................... 207 (1,062)
Cash and cash equivalents at beginning of period....................... 1,746 2,192
---------------- ---------------
Cash and cash equivalents at end of period............................. $ 1,953 $ 1,130
================ ===============


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



OPTIKA INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

1. Basis of Presentation

The unaudited condensed consolidated financial statements included herein
reflect all adjustments, consisting only of normal recurring adjustments, which
in the opinion of management are necessary to fairly present our consolidated
financial position, results of operations, and cash flows for the periods
presented. Certain information and footnote disclosures normally included in
audited financial information prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the Securities
and Exchange Commission's rules and regulations. We have made certain
reclassifications, consistent with the Financial Accounting Standards Board's
Emerging Issues Task Force Topic No. D-103, "Income Statement Characterization
of Reimbursements Received for Out-of-Pocket Expenses Incurred", to prior
balances to conform to the current year presentation of out-of-pocket expenses
incurred. Accordingly, reimbursable expenses of $215,000 and $279,000 for the
nine months ended September 30, 2002 and 2001, respectively, and $91,000 and
$92,000 for the quarter ended September 30, 2002 and 2001, respectively, are now
reflected as revenue and cost of revenue. The consolidated results of operations
for the periods ending September 30, 2002, are not necessarily indicative of the
results to be expected for any subsequent quarter or for the entire fiscal year
ending December 31, 2002. These unaudited condensed consolidated financial
statements should be read in conjunction with the consolidated financial
statements and notes thereto for the year ended December 31, 2001, included in
the Annual Report on Form 10-K for the year ended December 31, 2001 of Optika
Inc. (the "Company").

2. Net Income (Loss) Per Common Share

Basic income (loss) per share is computed by dividing net income (loss) by
the weighted average number of common shares outstanding during the period.
Diluted loss per share is computed using the weighted average number of common
shares outstanding plus all dilutive potential common shares outstanding. During
the first nine months of 2002, 275,500 options to purchase our common stock were
granted. During the first nine months of 2001, 1,496,600 options to purchase our
common stock were granted.

Net income applicable to common stockholders during the three and nine
months ended September 30, 2001, includes certain adjustments included in the
earnings per share computation relating to the $15 million convertible preferred
stock private placement with Thomas Weisel Capital Partners L.P., which closed
in February 2000 and the exchange of those preferred shares in May 2001. These
results include an adjustment that is comprised of the accumulating 8% dividend
on the convertible preferred stock and an allocation of the discount associated
with the preferred stock issuance, prorated for the portion of the period that
the preferred stock was outstanding.

The following is the reconciliation of the numerators and denominators of
the basic and diluted income (loss) per share computations (in thousands except
per share data):
Three Months Ended Nine Months Ended
September 30, September 30,
2002 2001 2002 2001
Basic Net Income (Loss) Per Share:
Net income (loss) applicable to common
stockholders.......................... $ 45 $ (557) $ (552) $ 1,081
Basic weighted average common shares
outstanding........................... 8,314 8,200 8,280 8,174
Basic net income (loss) per common
share................................. $ 0.01 $ (0.07) $ (0.07) $ 0.13

Diluted Loss Per Share:
Net income (loss) applicable to common
stockholders.......................... $ 45 $ (557) $ (552) $ 1,081
Preferred stock dividend, accretion and
effect of exchange ................... -- -- -- (5,499)
------ ------ ------ -------
45 (557) (552) (4,418)
Weighted average common shares
outstanding........................... 8,314 8,200 8,280 8,174
Dilutive effect of stock options....... 71 -- -- --
Assumed conversion of preferred stock.. 878 -- -- 799
--- ------------------ -----
Diluted weighted average common shares
outstanding........................... 9,263 8,200 8,280 8,973
Diluted net loss per common share...... $ 0.00 $ (0.07) $ (0.07) $ (0.49)

In 2002 and 2001, 2.9 million and 2.8 million options and warrants,
respectively, were excluded from the dilutive stock calculation because of their
antidilutive effect on net loss per share.

3. Restructuring and other charges

On February 6, 2001, we reduced our workforce by 42 employees to align our
expenses more closely with revenues. This reduction in force resulted in
approximately $1.1 million of restructuring charges in the first quarter of
2001. This restructuring charge consisted of $652,000 of severance costs,
$240,000 of lease termination and $179,000 of asset write-offs. All costs have
been paid.

4. Contingencies

We are, from time to time, subject to certain claims, assertions or
litigation by outside parties as part of our ongoing business operations. The
outcome of any such contingencies are not expected to have a material adverse
effect upon our business, results of operations and financial condition. We are
currently not a party to any significant legal proceedings.







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

This report contains "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, Section 21E of the Securities
Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995.
Many of these forward-looking statements can be identified by the use of words
such as "may," "will," "expect," "anticipate," "believe," "estimate," "assume,"
"continue," "project," "plan," and similar words and phrases. These statements
include statements concerning adoption of the Acorde product family by our
customers, general economic conditions in the software industry, our
relationships with our partners, and the availability of competing products.
Forward-looking statements are subject to risks and uncertainties, including
those discussed below under the caption "Business Risks," that could cause
actual results or outcomes to differ materially from those expressed in the
forward-looking statements. Any forward-looking statement speaks only as of the
date on which it is made and, except to fulfill our obligations under the United
States securities laws, we undertake no obligation to update any such statement
to reflect events or circumstances after the date on which it is made.

Overview

Optika(R) Inc. is a leading provider of imaging, workflow and collaboration
software. Optika's Acorde family of enterprise content management (ECM) software
solutions, including Acorde Context(TM), Acorde Process(TM) and Acorde
Resolve(TM), allow companies to effectively and cost-efficiently manage
paper-intensive or complex business processes and transactions. Acorde provides
the ability to access and store multiple formats of business content, both
digital and non-digital; automate processes across the organization and
externally with partners and customers; and enable online collaboration around
these paper-intensive or complex processes in real and near time. Built on a
three-tier, scalable and extensible platform, Acorde delivers a variety of
client desktops, including Windows and Web and easily integrates with enterprise
resource planning (ERP), line-of-business (LOB) and other third-party
applications. The Acorde product family allows organizations to improve
processing efficiency, reduce operating costs and increase customer and trading
partner service and satisfaction.

The license of our software products is typically an executive-level
decision by prospective end-users and generally requires our sales staff and our
Advantage Partner's, or APs, to engage in a lengthy and complex sales cycle
(typically between six and twelve months from the initial contact date). We
distribute our products through a direct sales force and a network of APs. For
2001, approximately 67% of our license revenues were derived from our APs and
the remaining license fees were derived from direct sales. However, no
individual customer accounted for more than 10% of our total revenues. For the
years ended December 31, 2001, 2000 and 1999, we generated approximately 12%,
15% and 17%, respectively, of our total revenues from international sales. Our
revenues consist primarily of license revenues, which are comprised of one-time
fees for the license of our products, service revenues, and maintenance
revenues, which are comprised of fees for upgrades and technical support. Our
APs, which are responsible for the installation and integration of the software
for their customers, enter into sales agreements with the end-user, and license
software directly from us. We license software directly to the end-user through
software license agreements. Annual maintenance agreements are also entered into
between the APs and the end-user, and the APs then purchase maintenance services
directly from us. For 2001 and 2000, approximately 39% and 33%, respectively, of
our total revenues were derived from software licenses and approximately 44% and
47%, respectively, of our total revenues were derived from maintenance
agreements. For 2001 and 2000, other revenues, which are comprised of training,
consulting and implementation services, and third-party hardware and software
products, accounted for 17% and 20%, respectively, of our total revenues.

Critical Accounting Policies

Our significant accounting policies are described in Note 1 in the Notes to
Consolidated Financial Statements included in our Annual Report on Form 10-K for
the year ended December 31, 2001. The accounting policies used in preparing our
interim consolidated financial statements for the periods ending September 30,
2002 are the same as those described in our Annual Report on Form 10-K.

Our critical accounting policies are those having the most impact to the
reporting of our financial condition and results and those requiring significant
judgments and estimates. These policies include those related to (1) revenue
recognition, (2) income taxes, (3) accounting for preferred stock, and (4)
restructuring charges. Our critical accounting policies are described in more
detail in the section entitled "Management's Discussion and Analysis of
Financial Condition and Results of Operations" in our Annual Report on Form 10-K
for the year ended December 31, 2001. With respect to these critical accounting
policies, our management believes that the application of judgments and
assessments is consistently applied and produces financial information which
fairly depicts the results of operations for all periods presented.

Results of Operations

Three and Nine Months Ended September 30, 2002 Compared to the Three and Nine
Months Ended September 30, 2001

Revenues

Total revenues increased 8% to $13.0 million, for the nine months ended
September 30, 2002, from $12.1 million, for the nine months ended September 30,
2001. Total revenues increased 20% to $4.7 million for the quarter ended
September 30, 2002 from $3.9 million for the quarter ended September 30, 2001.

Licenses. License revenues decreased 11% to $3.9 million, during the nine
months ended September 30, 2002, from $4.4 million, for the nine months ended
September 30, 2001, and increased 19% to $1.6 million during the quarter ended
September 30, 2002 from $1.4 million for the quarter ended September 30, 2001.
License revenues represented 30% and 37% of the total revenues for the nine
months ended September 30, 2002 and 2001, respectively and represented 35% of
the total revenues for both quarters ended September 30, 2002 and 2001. The
decrease in license revenues during the first nine months of 2002 is primarily
due to decreases in sales made by APs in North America as a result of the
sluggish economy. License revenues generated outside of the United States
accounted for approximately 9% of our total license revenues for the nine months
ended September 30, 2002, compared to 10% for the same period in 2001, and 8%
and 10% for the quarters ended September 30, 2002 and 2001, respectively. The
decrease in international license revenues as a percentage of total license
revenue is a result of lower than expected European license revenues.

Maintenance and Other. Maintenance revenues, exclusive of other revenue,
increased 6% to $5.7 million during the nine months ended September 30, 2002,
from $5.4 million for the nine months ended September 30, 2001 and increased 13%
to $2.0 million for the three months ended September 30, 2002, from 1.8 million
for the three months ended September 30, 2001. Maintenance revenue represented
44% and 45% of the total revenues for the nine months ended September 30, 2002
and 2001, respectively and represented 43% and 45% of the total revenues for the
quarter ended September 30, 2002 and 2001, respectively. This annual increase
was primarily a result of the maintenance revenues received from new customers
and the impact of an overall pricing increase implemented at the beginning of
the year. Other revenue, consisting primarily of consulting services, training
and consulting fees represented 26% and 18% of total revenues for the nine
months ended September 30, 2002 and 2001, respectively, and 22% and 20% of total
revenues for the quarters ended September 30, 2002 and 2001, respectively. The
increase in other revenue as a percentage of total revenue was primarily due to
increased consulting, project management and implementation services resulting
from our strong direct license revenue in 2002.

Cost of Revenues

Licenses. Cost of licenses consists primarily of royalty payments to
third-party vendors and costs of product media, duplication, packaging and
fulfillment. Cost of licenses decreased to $432,000, or 11% of license revenues,
from $547,000, or 12% of license revenues, for the nine months ended September
30, 2002 and 2001 respectively, and decreased to $214,000 or 13% of license
revenues from $234,000, or 17% of license revenues, for the quarters ended
September 30, 2002 and 2001, respectively. The absolute dollar decrease in cost
of licenses is attributable to the decreased third party royalty payments on our
software sales.

Maintenance and Other. Costs of maintenance and other consists of the
direct and indirect costs of providing software maintenance and support,
training and consulting services to our APs, OEMs and end-users, and the cost of
third-party software products. Cost of maintenance and other decreased to $2.7
million, or 30% of maintenance and other revenues, from $2.8 million or 37% of
maintenance and other revenues for the nine months ended September 30, 2002 and
2001, respectively. Cost of maintenance and other increased to $911,000, or 30%
of maintenance and other revenues, to $860,000, or 34% of maintenance and other
revenues, for the quarters ended September 30, 2002 and 2001, respectively. Cost
of maintenance and other decreased as a percentage of maintenance and other
revenue as a result of decreased third-party contracting to fulfill consulting
service contracts in 2002.

Operating Expenses

Sales and Marketing. Sales and marketing expenses consist primarily of
salaries, commissions and other related expenses for sales and marketing
personnel, marketing, advertising and promotional expenses. Sales and marketing
expenses decreased to $5.5 million, or 42% of total revenues, for the nine
months ended September 30, 2002 from $6.6 million, or 55% of total revenues, for
the nine months ended September 30, 2001. Sales and marketing expenses increased
to $1.9 million, or 40% of total revenues, for the quarter ended September 30,
2002 from $1.8 million, or 45% of total revenues, for the quarter ended
September 30, 2001. The nine-month year over year decrease in sales and
marketing expenses is due to our restructuring activities in February 2001. We
anticipate that sales and marketing expenses will increase in future quarters.

Research and Development. Research and development expenses consist
primarily of salaries and other related expenses for research and development
personnel, contractors, as well as the cost of facilities and equipment.
Research and development expenses decreased to $3.8 million, or 30% of total
revenues, for the nine months ended September 30, 2002 from $4.3 million, or 36%
of total revenues, for the nine months ended September 30, 2001. Research and
development expenses remained constant at $1.3 million, or 27% of total
revenues, for the quarter ended September 30, 2002 from $1.3 million, or 33% of
total revenues, for the quarter ended September 30, 2001. The nine-month year
over year decrease in research and development is primarily the result of
restructuring activities in February 2001. We anticipate that research and
development expenses will continue at approximately this level throughout the
year.

General and Administrative. General and administrative expenses consist
primarily of salaries and other related expenses of administrative, executive
and financial personnel, and outside professional fees. General and
administrative expenses decreased to $1.2 million, or 9% of total revenues, for
the nine months ended September 30, 2002 from $1.4 million, or 12% of total
revenues, for the nine months ended September 30, 2001. General and
administrative expenses decreased to $384,000, or 8% of total revenues, for the
quarter ended September 30, 2002 from $389,000, or 10% of total revenues, for
the quarter ended September 30, 2001. The nine-month year over year decrease in
general and administrative costs primarily is the result of the restructuring
activities in February 2001. We anticipate that general and administrative
expenses will increase in future quarters.

Restructuring and Other Non-Recurring Charges. On February 6, 2001, we
reduced our workforce by 42 employees to align our expenses more closely with
revenues. This reduction in force resulted in approximately $1.1 million of
restructuring charges to earnings in the first quarter of 2001. This
restructuring charge consisted of $652,000 of severance costs, $240,000 of lease
terminations and $179,000 of asset write-offs. All costs were paid as of
September 30, 2002. Our operating expenses were reduced by $750,000 to $1.0
million per quarter as a result of this restructuring.

Other Income, net. Other income, net consists primarily of interest earned
on our investing activities. Net other income was $108,000 during the nine
months ended September 30, 2002 compared to net other income of $284,000 during
the nine months ended September 30, 2001. Net other income was $31,000 during
the quarter ended September 30, 2002 compared to net other income of $87,000
during the quarter ended September 30, 2001. The decrease in net other income
was the result of decreased interest income due to a lower investment base and a
decline in interest rates.

Benefit from Income Taxes. We have recorded a valuation allowance against
our carryforward tax benefits to the extent that we believe that it is more
likely than not all of such benefits will not be realized in the near term. We
perform our assessment of benefit realization and the associated valuation
allowance on a quarterly basis. Our assessment of this valuation allowance was
made using all available evidence, both positive and negative. In particular we
considered both our historical results and our projections of profitability for
only reasonably foreseeable future periods. Our realization of the recorded net
deferred tax assets is dependent on future taxable income and therefore, we
cannot be assured that such benefits will be realized. Based on management's
current projections, we will continue to evaluate releasing a portion of the
valuation allowance over the next year if planned operating results are
achieved.

Liquidity and Capital Resources

Cash and cash equivalents, including short-term investments, at September
30, 2002 was $7.9 million, increasing by approximately $219,000 from December
31, 2001. This increase is primarily the result of strong accounts receivable
collections.

For the nine months ended September 30, 2002, net cash provided by
operating activities was $252,000 compared to net cash used by operating
activities of $3.8 million for the nine months ended September 30, 2001. Cash
provided by operating activities for the nine months ended September 30, 2002 is
primarily due to strong accounts receivable collections.

Cash used by investing activities was $156,000 for the nine months ended
September 30, 2002 compared to cash provided by investing activities of $2.8
million for the nine months ended September 30, 2001. The cash provided by
investing activities is primarily due to the sale of marketable securities
during the first nine months of 2001.

Cash provided by financing activities was $111,000 for the nine months
ended September 30, 2002. Cash used by financing activities was $24,000 for the
nine months ended September 30, 2001. Cash provided by financing activities in
2002 resulted primarily from the proceeds of sales of common stock through our
employee stock purchase plan.

At September 30, 2002, our principal sources of liquidity include cash and
short-term investments of $7.9 million. In addition, we have a secured credit
facility for up to $3.0 million, bearing interest at the bank's prime rate. As
of September 30, 2002, we had $2.5 million available for borrowing and no other
debt outstanding.

We believe that our current cash and short-term investments, together with
anticipated cash flows from operations and our bank credit facility, will be
sufficient to meet our working capital and capital expenditure requirements for
at least the next 12 months.

Recent Accounting Pronouncements

In July 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible
Assets", which is effective January 1, 2002. SFAS No. 142 requires that goodwill
and other intangible assets with indefinite useful lives no longer be amortized,
but instead tested for impairment at least annually. The adoption of this
standard did not have a material impact on our consolidated financial position,
results of operations, or cash flows.

In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations", which is effective for fiscal years beginning after
June 15, 2002. SFAS No. 143 requires that the fair value of a liability for an
asset retirement obligation be recognized in the period in which it is incurred
if a reasonable estimate of fair value can be made. The adoption of this
standard did not have a material impact on our consolidated financial position,
results of operations, or cash flows.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets", which is effective for fiscal
years beginning after December 15, 2001. SFAS No. 144 establishes one accounting
model to be used for long-lived assets to be disposed of by sale and broadens
the presentation of discontinued operations to include more disposal
transactions. The adoption of this standard will not have a material impact on
our consolidated financial position, results of operations, or cash flows.

In May 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statement
No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections
as of April 2002," which is effective for certain transactions occurring after
May 15, 2002 and for financial statements issued on or after May 15, 2002. SFAS
No. 145 rescinds SFAS No. 4, "Reporting Gains and Losses from Extinguishment of
Debt," and an amendment of that statement, SFAS No. 64, "Extinguishments of Debt
Made to Satisfy Sinking-Fund Requirements." SFAS No. 145 also rescinds SFAS No.
44, "Accounting for Intangible Assets of Motor Carriers." SFAS No. 145 amends
SFAS No. 13, "Accounting for Leases," to eliminate an inconsistency between the
required accounting for sale-leaseback transactions and the required accounting
for certain lease modifications that have economic effects that are similar to
sale-leaseback transactions. This statement also amends other existing
authoritative pronouncements to make various technical corrections, clarify
meanings, or describe their applicability under changed conditions. The adoption
of SFAS No. 145 on May 15, 2002 did not have a material impact on the Company's
consolidated financial statements.

In June 2002, the FASB issued SFAS No. 146, "Accounting for Exit of
Disposal Activities." This statement addresses the recognition, measurement, and
reporting of costs associated with exit and disposal activities. SFAS No. 146 is
applicable to restructuring activities and costs related to terminating a
contract that is not a capital lease and one time benefit arrangements received
by employees who are involuntarily terminated. SFAS 146 supercedes EITF 94-3,
"Liability Recognition for Certain Employee Termination Benefits and Other Costs
to Exit an Activity (including Certain Costs Incurred in a Restructuring)."
Under SFAS No. 146 the cost associated with an exit or disposal activity is
recognized in the periods in which it is incurred rather than at the date the
Company committed to the exit plan. This statement is effective for exit or
disposal activities initiated after December 13, 2002 with earlier adoption
encouraged. Previously issued financial statements will not be restated. The
provisions of EITF 94-3 shall continue to apply for exit plans initiated prior
to the adoption of SFAS No. 146. Accordingly, the adoption of SFAS No. 146 will
not have a material impact on the Company's financial position, results of
operations, or cash flows. The provisions of SFAS No. 146 could impact the
accounting for any future exit and disposal activities, including the period in
which exit costs are recorded.

Business Risks

In evaluating our business, you should carefully consider the business
risks discussed in this section.

Operating Result Fluctuations. Our sales and other operating results have
varied significantly in the past and may vary significantly in the future as a
result of potential factors such as:

o The size and timing of significant orders and their fulfillment

o Rate of rollout, demand and customer adoption of our product offerings

o Ability of third party products embedded or to be embedded in our
products and our ability to negotiate license agreements with such
third parties on favorable terms

o Changes in pricing policies by us or our competitors

o The number, timing and significance of product enhancements and new
product announcements by us and our competitors

o Changes in the level of our operating expenses

o Warranty and customer support expenses

o Changes in our end-users' financial condition and budgetary processes

o Changes in our sales, marketing and distribution channels

o Product life cycles

o Software bugs and other product quality problems

o The cancellation of licenses during the warranty period or nonrenewal
of maintenance agreements

o Customization and integration problems with the end-user's legacy system

o Changes in our business strategy

o Changes in accounting pronouncements

o The level of international expansion and foreign currency exchange rates

o Seasonal trends

A significant portion of our revenues have been, and we believe will
continue to be, derived from a limited number of orders, and the timing of such
orders and their fulfillment have caused, and are expected to continue to cause,
material fluctuations in our operating results. Revenues are also difficult to
forecast because the markets for our products are rapidly evolving, and our
sales cycle and the sales cycle of our APs is lengthy and varies substantially
from end-user to end-user. To achieve our quarterly revenue objectives, we
depend upon obtaining orders in any given quarter for shipment in that quarter.
Product orders are typically shipped shortly after receipt. Consequently, order
backlog at the beginning of any quarter has in the past represented only a small
portion of that quarter's revenues. Furthermore, we have often recognized most
of our revenues in the last month, or even in the last weeks or days, of a
quarter. Accordingly, a delay in shipment near the end of a particular quarter
may cause revenues in a particular quarter to fall significantly below our
expectations and may materially adversely affect our operating results for such
quarter. Conversely, to the extent that significant revenues occur earlier than
expected, operating results for subsequent quarters may fail to keep pace with
results of previous quarters or even decline. We also have recorded generally
lower sales in the first quarter than in the immediately preceding fourth
quarter, as a result of, among other factors, end-users' purchasing and
budgeting practices and our sales commission practices. To the extent that
future international operations constitute a higher percentage of total
revenues, we anticipate that we may also experience relatively weaker demand in
the third quarter as a result of reduced sales in Europe during the summer
months. Significant portions of our expenses are relatively fixed in the short
term. Accordingly, if revenue levels fall below expectations, operating results
are likely to be disproportionately and adversely affected. As a result of these
and other factors, we believe that our quarterly operating results will vary in
the future, and that period-to-period comparisons of our results of operations
are not necessarily meaningful and should not be relied upon as indications of
future performance. Furthermore, due to all of the foregoing factors, it is
likely that in some future quarter our operating results will be below the
expectations of public market analysts and investors. In such event, the price
of our common stock would likely decline and such decline could be significant.

Product Offerings. The Optika Acorde family of products account for
substantially all of our current license revenue. Our future financial
performance will depend in general on the acceptance of our product offerings,
and in particular on the successful development, introduction and customer
acceptance of new and enhanced versions of our products.

Capital Requirements. We believe that our existing cash balances and liquid
resources will be sufficient to fund our operating activities, capital
expenditures and other obligations through at least the next twelve months.
Recently capital market conditions have materially and adversely affected the
ability of many technology companies to raise additional capital in both private
and public markets. If market conditions do not improve and we are not
successful in generating sufficient cash flow from operations or in raising
additional capital when required in sufficient amounts and on terms acceptable
to us, we may be required to reduce our planned expenditures and scale back the
scope of our business plan, either of which could have a material adverse effect
on our business.

Key Employees. Most of our senior management team has joined us within the
last five years. These individuals may not be able to achieve and manage growth,
if any, or build an infrastructure necessary for us to operate. Our ability to
compete effectively and to manage any future growth will require that we
continue to assimilate new personnel and to train and manage our work force. Our
future performance depends to a significant degree upon the continuing
contributions of our key management, sales, marketing, customer support, and
product development personnel. We have at times experienced, and continue to
experience, difficulty in recruiting qualified personnel, particularly in sales,
software development and customer support. We believe that there may be only a
limited number of persons with the requisite skills to serve in those positions,
and that it may become increasingly difficult to hire such persons. Competitors
and others have in the past, and may in the future, attempt to recruit our
employees. We have from time to time experienced turnover of key management,
sales and technical personnel. The loss of key management, sales or technical
personnel, or the failure to attract and retain key personnel, could harm our
business.

Sales and Distribution Channels. Our future results of operations will
depend on the success of our marketing and distribution strategy, which relies,
to a significant degree, upon APs to sell and install our software, and provide
post-sales support. These relationships are usually established through formal
agreements that generally do not grant exclusivity, do not prevent the
distributor from carrying competing product lines and do not require the
distributor to purchase any minimum dollar amount of our software. Some APs may
not continue to represent Optika or sell our products. Other APs, some of which
have significantly greater financial, marketing and other resources than us, may
develop or market software products that compete with our products or may
otherwise discontinue their relationship with, or support of, us. Some of our
APs are small companies that have limited financial and other resources that
could impair their ability to pay us. Selling through indirect channels may
hinder our ability to forecast sales accurately, evaluate customer satisfaction
or recognize emerging customer requirements. Our future results of operations
also depend on the success of our efforts to build a direct sales force. We have
only limited experience in selling our products directly.

Product Updates and Releases. The markets for our products are
characterized by rapid technological change, changes in customer requirements,
frequent new product introductions and enhancements, and emerging industry
standards. Our future performance will depend in significant part upon our
ability to respond effectively to these developments. The introduction of
products embodying new technologies and the emergence of new industry standards
can render existing products obsolete, unmarketable or noncompetitive. We are
unable to predict the future impact of such technology changes on our products.
Moreover, the life cycles of our products are difficult to estimate. Our future
performance will depend in significant part upon our ability to enhance current
products, and to develop and introduce new products and enhancements that
respond to evolving customer requirements. The inability, for technological or
other reasons, to develop and introduce new products or enhancements in a timely
manner in response to changing customer requirements, technological change or
emerging industry standards, or maintain compatibility with heterogeneous
computing environments, would have a material adverse effect on our business and
results of operations.

Third Party Software. We license software from third parties, which is
incorporated into our products. These licenses expire from time to time. These
third-party software licenses may not continue to be available to us on
commercially reasonable terms. The loss of, or inability to maintain, any such
software licenses could result in shipment delays or reductions until equivalent
software could be developed, identified, licensed and integrated, which in turn
could materially and adversely affect our business and financial condition. In
addition, we generally do not have access to source code for the software
supplied by these third parties. Certain of these third parties are small
companies that do not have extensive financial and technical resources. If any
of these relationships were terminated or if any of these third parties were to
cease doing business, we may be forced to expend significant time and
development resources to replace the licensed software. Such an event would have
a material adverse effect upon our business and results of operations.

Sales Cycle. The license of our software products is typically an
executive-level decision by prospective end-users, and generally requires our
APs and us to engage in a lengthy and complex sales cycle (typically between six
and twelve months from the initial contact date). In addition, the
implementation by customers of our products may involve a significant commitment
of resources by such customers over an extended period of time. For these and
other reasons, the sales and customer implementation cycles are subject to a
number of significant delays over which we have little or no control. Our future
performance also depends upon the capital expenditure budgets of our customers
and the demand by such customers for our products. Certain industries to which
we sell our products, such as the financial services industry, are highly
cyclical. Our operations may in the future be subject to substantial
period-to-period fluctuations as a consequence of such industry patterns,
domestic and foreign economic and other conditions, and other factors affecting
capital spending. Such factors may have a material adverse effect on our
business and results of operations.

Competition. The market for our product offerings is intensely competitive
and can be significantly affected by new product introductions and other market
activities of industry participants. We anticipate that the collaborative
commerce market will also be highly competitive and subject to competitive
forces that do not currently exist. Our competitors offer a variety of products
and services to address the document management market and the emerging market
for e-business solutions. Because our products are designed to operate in
non-proprietary computing environments and because of low barriers to entry in
the marketplace, we expect additional competition from established and emerging
companies, as the market for our products continues to evolve. Current and
potential competitors have established or may establish cooperative
relationships among themselves or with third parties, to increase the ability of
their products to address the needs of our prospective customers. In addition,
several competitors have recently made, or attempted to make, acquisitions to
enter the market or increase their market presence. Accordingly, new competitors
or alliances among competitors may emerge and rapidly acquire significant market
share. Increased competition may result in price reductions, reduced gross
margins and loss of market share, any of which would have a material adverse
effect on our business and results of operations.

Competitor Resources. Many of our current and potential competitors are
substantially larger than we are, have significantly greater financial,
technical and marketing resources and have established more extensive channels
of distribution. As a result, such competitors may be able to respond more
rapidly to new or emerging technologies and changes in customer requirements, or
to devote greater resources to the development, promotion and sale of their
products than we can. We expect our competitors to continue to improve the
performance of their current products and to introduce new products or new
technologies that provide added functionality and other features. Our failure to
keep pace with our competitors through new product introductions or enhancements
could cause a significant decline in our sales or loss of market acceptance of
our products and services, result in continued intense price competition, or
make our products and services or technologies obsolete or noncompetitive. To be
competitive, we will be required to continue to invest significant resources in
research and development, and in sales and marketing.

Intellectual Property. Our performance depends in part on our ability to
protect our proprietary rights to the technologies used in our principal
products. We rely on a combination of copyright and trademark laws, trade
secrets, confidentiality provisions and other contractual provisions to protect
our proprietary rights, which are measures that afford only limited protection.
Despite our efforts to protect our proprietary rights, unauthorized parties may
attempt to copy aspects of our products, or to obtain and use information that
we regard as proprietary. In addition, the laws of some foreign countries do not
protect our proprietary rights as fully as do the laws of the United States. Our
means of protecting our proprietary rights in the United States or abroad may
not be adequate, and competitors may independently develop similar technologies.
Third parties may claim infringement by our products of their intellectual
property rights. We expect that software product developers will increasingly be
subject to infringement claims if the number of products and competitors in our
industry segment grows and the functionality of products in different industry
segments overlaps. Any such claims, with or without merit, and regardless of the
outcome of any litigation, will be time consuming to defend, result in costly
litigation, divert management's attention and resources, cause product shipment
delays, or require us to enter into royalty or licensing agreements. Such
royalty or licensing agreements, if required, may not be available on terms
acceptable to us, if at all. A successful claim of infringement against our
products and failure or inability to license the infringed or similar technology
may adversely affect our business and results of operations.

International Operations. Sales outside the United States accounted for
approximately 12%, 15% and 17% of our revenues in 2001, 2000 and 1999,
respectively. We have only limited experience in developing localized versions
of our products and cannot assure you that we will be able to successfully
localize, market, sell and deliver our products internationally. Our inability
to successfully expand our international operations in a timely manner, or at
all, could materially and adversely affect our business and results of
operations. Our international revenues may be denominated in foreign currencies
or the U.S. dollar. We do not currently engage in foreign currency hedging
transactions; as a result, a decrease in the value of foreign currencies
relative to the U.S. dollar could result in losses from transactions denominated
in foreign currencies, could make our software less price-competitive, and could
have an adverse effect upon our business, results of operations, and financial
condition.

Product Liability. Our license agreements typically contain provisions
designed to limit our exposure to potential product liability claims. These
limitations of liability provisions may not be effective under the laws of
certain jurisdictions. The sale and support of our products may entail the risk
of such claims, and we cannot assure you that we will not be subject to such
claims in the future. A successful product liability claim against us could have
a material adverse effect upon our business and results of operations. Software
products such as those we offer frequently contain errors or failures,
especially when first introduced or when new versions are released. We have in
the past released products that contained defects, and have discovered software
errors in certain of our new products and enhancements after introduction. We
could in the future lose or delay recognition of revenues as a result of
software errors or defects, the failure of our products to meet customer
specifications or otherwise. Our products are typically intended for use in
applications that may be critical to a customer's business. As a result, we
expect that our customers and potential customers have a greater sensitivity to
product defects than the market for general software products. Despite our
testing and testing by current and potential customers, errors or defects may be
found in new products or releases after commencement of commercial shipments,
and our products may not meet customer specifications, resulting in loss or
deferral of revenues, diversion of resources, damage to our reputation, or
increased service and warranty and other costs, any of which could have a
material adverse effect upon our business and operating results.

Nasdaq National Market Listing. Our common stock is traded on the Nasdaq
National Market. Effective November 1, 2002, the Nasdaq National Market has
changed the minimum continued listing requirements to include a minimum $10.0
million in stockholders' equity requirement instead of the $4.0 million net
tangible assets previously required. For the period ended September 30, 2002,
our stockholders' equity was $7.0 million, which is below the $10.0 million
requirement. Consequently, we currently are not in compliance with the minimum
requirements to maintain our listing on the Nasdaq National Market. We intend to
seek an extension of time from Nasdaq to meet the new requirement and we
currently intend to pursue Nasdaq's appeal process to determine if our specific
facts warrant such an extension of time. If we should fail in our appeal
efforts, our listing will be transferred to the Nasdaq SmallCap Market, provided
that we continue to meet the listing requirements for that market, or, if we
fail to meet the listing requirements for the Nasdaq SmallCap Market, our
securities will be eligible for trading in the OTC market. Alternatively, in
order to maintain our listing on the Nasdaq National Market, we may pursue
alternative courses of action which would be intended to increase our
stockholders' equity. The effect of pursuing any such alternatives could, among
other things, negatively affect the share price of our common stock, the
liquidity of our stock or require the issuance of additional equity instruments
which could cause substantial dilution to existing stockholders.

Common Stock Price Volatility. The market price of our shares of common
stock has been, and is likely to continue to be, highly volatile and may be
significantly affected by factors such as:

o Actual or anticipated fluctuations in our operating results

o Announcements of technological innovations

o New products or new contracts by us or our competitors

o Sales of common stock by management, directors or other related parties

o Sales of significant amounts of common stock into the market

o Developments with respect to proprietary rights

o Conditions and trends in the software and other technology industries

o Adoption of new accounting standards affecting the software industry

o Changes in financial estimates by securities analysts and others

o General market conditions

o Other factors that may be unrelated to us or our performance

In addition, the stock market has from time to time experienced significant
price and volume fluctuations that have particularly affected the market prices
for the common stock of technology companies. These broad market fluctuations
may adversely affect the market price of our common stock. In the past,
following periods of volatility in the market price of a particular company's
securities, securities class action litigation has often been brought against
such company. Such litigation may be brought against us in the future. Such
litigation, regardless of its outcome, would result in substantial costs and a
diversion of management's attention and resources that could have a material
adverse effect upon our business and results of operations.

Change In Company Control. Certain provisions of our certificate of
incorporation, equity incentive plans, bylaws, and Delaware law may discourage
certain transactions involving a change in control of our company. Our
classified Board of Directors and the ability of the Board of Directors to issue
"blank check" preferred stock without further stockholder approval, may have the
effect of delaying, deferring or preventing a change in our control and may also
affect the market price of our stock. We also have a stockholders rights plan
under which all stockholders of record as of July 18, 2001 received one right
for each share of common stock then owned by them to purchase, upon the
occurrence of certain triggering events, one one-hundredth of a share of Series
B Preferred Stock at a price of $30, subject to adjustment. The rights are
exercisable only if a person or group acquires 15% or more of our common stock
in a transaction not approved by our Board of Directors. These provisions and
certain other provisions of our Amended and Restated Certificate of
Incorporation and certain provisions of our Amended and Restated Bylaws and of
Delaware law, could delay or make more difficult a merger, tender offer or proxy
contest.

ITEM 3. QUANTITIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As of September 30, 2002 we had $6.0 million in short-term investments that
are sensitive to market risks. Our investment portfolio is used to preserve our
capital until it is required to fund operations, including our research and
development activities. We do not own any derivative financial instruments. Due
to the nature of our investment portfolio we are primarily subject to interest
rate risk.

Our investment portfolio includes fixed rate debt instruments that are
primarily United States government and agency bonds of duration ranging from one
to five years. The market value of these bonds is subject to interest rate risk,
and could decline in value if interest rates increase. Any material change in
the interest rates would not have a material change in the market value of our
debt instruments. A hypothetical increase or decrease in market interest rates
by 10% from September 30, 2002 would cause the fair market value of these
short-term investments to change by an insignificant amount. Although the market
value of these short-term investments would change due to the interest rate
fluctuation, we have the ability to hold the investments to maturity, which
would reduce overall market risk.

Item 4. Controls and Procedures

Within the 90 days prior to the filing of this report, we carried out an
evaluation, under the supervision and with the participation of our Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the
design and operation of our disclosure controls and procedures. Our disclosure
controls and procedures are designed with the objective of ensuring that
information required to be disclosed in our reports filed under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the
time periods specified in the SEC's rules and forms. Based on this evaluation,
our Chief Executive Officer and Chief Financial Officer concluded that our
disclosure controls and procedures are effective in timely alerting them to
material information required to be included in our periodic SEC reports.

There have been no significant changes in our internal controls or in other
factors which could significantly affect internal controls subsequent to the
date of our most recent evaluation.


PART II - OTHER INFORMATION

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

a) Exhibits.

Exhibit No. Description
4.1* Amended and Restated Rights Agreement dated as of July 29, 2002 by
and between Optika Inc. and Computershare Trust Company, Inc. as
Rights Agent.
99.1 Certification of Chief Executive Officer.
99.2 Certification of Chief Financial Officer.

* Incorporated by reference to Exhibit 4.1 in Registrant's Current Report on
Form 8-K dated July 29, 2002 filed with the Securities and Exchange Commission
on August 13, 2002 (File No. 0-28672).

b) Reports on Form 8-K. During the quarter ended September 30, 2002, we
filed a Current Report on Form 8-K dated July 29, 2002 under Item 5.
Other Events and Item 7. Exhibits.







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.


OPTIKA INC.
(Registrant)


11/13/2002 /s/ Mark K. Ruport
--------------------- ------------------------------------------
(Date) Mark K. Ruport
President, Chief Executive Officer
and Chairman of the Board

11/13/2002 /s/ Steven M. Johnson
--------------------- ------------------------------------------
(Date) Steven M. Johnson
Chief Financial Officer, Executive Vice
President, Secretary and Chief Accounting
Officer

CERTIFICATIONS

I, Mark K. Ruport, President and Chief Executive Officer of Optika Inc.,
certify that:

1. I have reviewed this quarterly report on Form 10-Q of Optika Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

(a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;

(b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the filing
date of this quarterly report (the "Evaluation Date"); and

(c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

(a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's ability
to record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and

(b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's
internal controls; and

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 13, 2002
/s/ Mark K. Ruport
-----------------------------------
Mark K. Ruport
President and Chief Executive
Officer





I, Steven M. Johnson, Executive Vice President and Chief Financial Officer of
Optika Inc., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Optika Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

(a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;

(b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the filing
date of this quarterly report (the "Evaluation Date"); and

(c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

(a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's ability
to record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and

(b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's
internal controls; and

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 13, 2002
/s/ Steven M. Johnson
--------------------------------------
Steven M. Johnson
Executive Vice President and Chief
Financial Officer



EXHIBIT INDEX

Exhibit No. Description
4.1* Amended and Restated Rights Agreement dated as of July 29, 2002 by
and between Optika Inc. and Computershare Trust Company, Inc. as
Rights Agent.
99.1 Certification of Chief Executive Officer.
99.2 Certification of Chief Financial Officer.

* Incorporated by reference to Exhibit 4.1 in Registrant's Current Report on
Form 8-K dated July 29, 2002 filed with the Securities and Exchange Commission
on August 13, 2002 (File No. 0-28672).