SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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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, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to ______________
Commission file number ____333-85755______
Belmont Financial Fund, Limited Partnership
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(Exact Name of Registrant as Specified in Its Charter)
Delaware 51-0387638
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
6916 N. 300 West, Fremont, IN 46737
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (219) 833-1505
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Former Name, Address and Fiscal Year, if Changed, Since Last Report
No such changes occurred
Indicate by check [X] 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 [ ]
Part 1 - FINANCIAL INFORMATION
Item 1. Financial Statements.
The unaudited financial statements for the Registrant for the third quarter
ended September 30, 2000, nine months ended September 30, 2000, and audited
results for the calendar year 1999 are attached hereto and made a part
hereof.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
By its prospectus dated May 26, 2000, the Registrant sold $754,466.33 of its
Units of Limited Partnership (the "Units") through Futures Investment Company
("FIC"), the broker/dealer selected by the Registrant's General Partner, and
commenced business July 11, 2000. The Registrant incurred $64,526 in
offering and organizational expenses, for which each Partner pays its pro
rata share as described in the Registrant's prospectus.
The Registrant initially employed Ansbacher Investment Management, Inc. as
its sole Commodity Trading Advisor ("CTA", as that term is defined by the
Commodity Exchange Act, 7 U.S.C. S1, et seq.) to trade the Registrant's
equity. As of September, 2000, Mangin Capital Management, Inc. was added as
a CTA to trade approximately 30% of the Registrant's total trading equity
(with the remaining 70% to go to Ansbacher).
By its fully amended and restated prospectus dated September 12, 2000, the
Registrant continues to sell its Units through FIC at the net asset value per
Unit as of the end of the last business day of the preceding month, until a
total of $7,000,000 in Units are sold or the offering terminates.
To obtain a return of invested capital or appreciation, if any, purchasers of
Units must look solely to the redemption feature of the Partnership or to the
General Partner, in its sole judgment, to elect to make distributions. There
is no current market for the Units sold and none is expected to develop nor
is the General Partner expected to make distributions.
Part II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) None (b) No reports on Form 8-K
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Form 10-Q for the
period ended September 30, 2000, to be signed on its behalf by the
undersigned, thereunto duly authorized.
Registrant: Bromwell Financial Fund, Limited
Partnership
By Belmont Capital Management,
Incorporated
Its General Partner
By: /s/ Shira Del Pacult
Ms. Shira Del Pacult
Sole Director, Sole Shareholder,
President, and Treasurer of the
General Partner
Date: November 14, 2000
BROMWELL FINANCIAL FUND,
LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
FOR THE THREE AND NINE MONTHS ENDED
SEPTEMBER 30, 2000 (Unaudited)
GENERAL PARTNER:
Belmont Capital Management, Inc.
5916 N. 300 West
Fremont, IN 46737
To The Partners
Bromwell Financial Fund, Limited Partnership
Dover, Kent County, Delaware
INDEPENDENT ACCOUNTANTS' REPORT
We have reviewed the accompanying unaudited balance sheet of Bromwell
Financial Fund, Limited Partnership as of September 30, 2000, and the related
statements of operations, partners' equity and cash flows for the three-month
and nine-month periods ended September 30, 2000. The preparation of these
financial statements are the responsibility of the Partnership's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and of making inquiries of persons responsible for
financial and accounting matters. It is substantially less in scope than an
audit conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications
that should be made to such financial statements for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the balance sheet of Bromwell Financial Fund, Limited
Partnership as of December 31, 1999, and the related statements of
operations, partners' equity and cash flows for the period from January 12,
1999 (inception) to December 31, 1999 (not presented herein); and in our
report dated February 22, 2000, we expressed an unqualified opinion on those
financial statements. In our opinion, the information set forth in the
accompanying balance sheet as of December 31, 1999 is fairly stated in all
material respects, in relation to the balance sheet from which it has been
derived.
Accountants: Frank L. Sassetti & Co.
Certified Public Accountants
By: /s/ Frank L. Sassetti & Co.
Frank L. Sassetti & Co.
Certified Public Accountants
November 6, 2000
Oak Park, Illinois
BROMWELL FINANCIAL FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
BALANCE SHEET
SEPTEMBER 30, 2000 AND DECEMBER 31, 1999
ASSETS
2000 (Unaudited) 1999
Cash $ 8,755 $ 1,554
Accrued interest receivable 1,861
Equity in Commodity Futures Trading Accounts -
Cash 824,569
Open options, short positions, at market
value (cost $(31,400)) (15,538)
$ 819,647 $ 1,554
LIABILITIES AND PARTNERS' EQUITY
LIABILITIES
Accrued trading commissions payable $ 4,157 $
Accrued management and incentive
fees payable 18,276
Accrued accounting and auditing
fees payable 1,817
Total Liabilities 24,250
PARTNERS' CAPITAL
Limited partners - (743.269 and 1 units) 795,397 777
General partner - (0 and 1 units) 777
Total Partners' Capital 795,397 1,554
$ 819,647 $ 1,554
The accompanying notes are an integral part
of the financial statements.
BROMWELL FINANCIAL FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
STATEMENT OF OPERATIONS
FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2000
(Unaudited)
Three Months Nine Months
Ended Ended
September 30, 2000 September 30, 2000
REVENUES
Realized gain from trading options $147,495 $147,495
Unrealized gains on open options 15,862 15,862
Interest income 3,258 3,258
Total Revenues 166,615 166,615
EXPENSES
Commissions 16,579 16,579
Management and incentive fees 22,232 22,232
Professional accounting and legal fees 8,428 8,428
Other operating and administrative
expenses 653 1,373
Total Expenses 47,892 48,612
NET INCOME $118,723 $118,003
NET INCOME -
Limited partnership unit $ 180 $ 537
General partnership unit $ 189 $ 90
The accompanying notes are an integral part
of the financial statements.
BROMWELL FINANCIAL FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
STATEMENT OF PARTNERS' EQUITY
FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2000
(Unaudited)
THREE MONTHS ENDED SEPTEMBER 30, 2000
LIMITED PARTNERS GENERAL PARTNERS TOTAL PARTNERS' EQUITY
Amount Units Amount Units Amount Units
Balance
July 1, 2000 $ (1,048) 1.00 $ 605 4.50 $ (443) 5.50
Partner
contributions 743,641 743.27 743,641 743.27
Syndication costs
paid (61,024) (61,024)
Withdrawals of
2.00 units (1,000) (1.00) (4,500) (4.50) (5,500) (5.50)
Re-allocation of
syndication costs (3,215) 3,215
Net income 118,043 680 118,723
Balance
Sep. 30, 2000 $795,397 743.27 $ $ 795,397 743.27
NINE MONTHS ENDED SEPTEMBER 30, 2000
Balance
January 1, 2000 $ 777 1.00 $ 777 1.00 $ 1,554 2.00
Partner
contributions 743,641 743.27 3,500 3.50 747,141 746.77
Syndication costs
paid (65,801) (65,801)
Withdrawals of
2.00 units (1,000) (1.00) (4,500) (4.50) (5,500) (5.50)
Net income 117,780 223 118,003
Balance
Sep. 30, 2000 $795,397 743.27 $ $ 795,397 743.27
Value per unit $ 1,070.13
Total partnership units 743.27
The accompanying notes are an integral part
of the financial statements.
BROMWELL FINANCIAL FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2000
(Unaudited)
Three Months Nine Months
Ended Ended
Sep. 30, 2000 Sep. 30, 2000
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 118,723 $ 118,003
Adjustments to reconcile net income to
net cash used in operating activities -
Changes in operating assets and liabilities -
Equity in Commodity Futures
Trading Accounts (809,031) (809,031)
Accrued interest receivable (1,861) (1,861)
Accrued commissions payable 4,157 4,157
Management and incentive fees payable 18,276 18,276
Accounting and auditing fees payable 967 1,817
Net Cash Used In
Operating Activities (668,769) (668,639)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of units, net
of sales commissions 743,641 747,141
Syndication and registration costs (61,024) (65,801)
Partner cash redemptions (5,500) (5,500)
Net Cash Provided By
Financing Activities 677,117 675,840
NET INCREASE IN CASH 8,348 7,201
CASH
Beginning of period 407 1,554
End of period $ 8,755 $ 8,755
The accompanying notes are an integral part
of the financial statements.
BROMWELL FINANCIAL FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
September 30, 2000
(Unaudited)
1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
Bromwell Financial Fund, Limited Partnership (the Fund) was formed
January 12, 1999 under the laws of the State of Delaware. The Fund is
engaged in the speculative trading of futures contracts in commodities, which
commenced in July, 2000. Belmont Capital Management, Inc. and Shira Pacult
are the general partners and commodity pool operators of Bromwell Financial
Fund, Limited Partnership. The commodity trading advisors (CTAs) are
Ansbacher Investment Management, Inc. and Mangin Capital Management, Inc.,
which have the authority to trade so much of the Fund's equity as is
allocated to it by the General Partners.
Income Taxes - In accordance with the generally accepted method of
presenting partnership financial statements, the financial statements do not
include assets and liabilities of the partners, including their obligation
for income taxes on their distributive shares of the net income of the Fund
or their rights to refunds on its net loss.
Registration Costs - Costs incurred for the initial filings with the
Securities and Exchange Commission, Commodity Futures Trading Commission,
National Futures Association (the "NFA") and the states where the offering
was made were accumulated, deferred and charged against the gross proceeds of
offering at the initial closing as part of the offering expenses. Recurring
registration costs, if any, will be charged to expense as incurred.
Revenue Recognition - Commodity futures contracts are recorded on the
trade date and are reflected in the balance sheet at the difference between
the original contract amount and the market value on the last business day of
the reporting period.
Market value of commodity futures contracts is based upon exchange or
other applicable market best available closing quotations.
Use of Accounting 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 reported amounts of revenues and
expenses during the reporting period. Actual results could differ from these
estimates.
BROMWELL FINANCIAL FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
September 30, 2000
(Unaudited)
1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Statement of Cash Flows - For purposes of the Statement of Cash Flows,
the Fund considers only money market funds to be cash equivalents. As of the
balance sheet date, the Fund has no cash equivalents. Net cash provided by
operating activities include no cash payments for interest or income taxes
for the three and nine months ended September 30, 2000.
2. GENERAL PARTNER DUTIES
The responsibilities of the General Partners, in addition to directing
the trading and investment activity of the Fund, including suspending all
trading, includes executing and filing all necessary legal documents,
statements and certificates of the Fund, retaining independent public
accountants to audit the Fund, employing attorneys to represent the Fund,
reviewing the brokerage commission rates to determine reasonableness,
maintaining the tax status of the Fund as a limited partnership, maintaining
a current list of the names, addresses and numbers of units owned by each
Limited Partner and taking such other actions as deemed necessary or
desirable to manage the business of the Partnership.
If the net unit value of the partnership falls to less than 50% of the
greater of the original $1,000 selling price, less commissions and other
charges or such higher value earned through trading, then the General
Partners will immediately suspend all trading, provide all limited partners
with notice of the reduction and give all limited partners the opportunity,
for fifteen days after such notice, to redeem partnership interests.
3. THE LIMITED PARTNERSHIP AGREEMENT
The Limited Partnership Agreement provides, among other things, that
Capital Account - A capital account shall be established for each
partner. The initial balance of each partner's capital account shall be the
amount of the initial contributions to the partnership.
Monthly Allocations - Any increase or decrease in the Partnership's net
asset value as of the end of a month shall be credited or charged to the
capital account of each Partner in the ratio that the balance of each account
bears to the total balance of all accounts.
BROMWELL FINANCIAL FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
September 30, 2000
(Unaudited)
3. THE LIMITED PARTNERSHIP AGREEMENT - CONTINUED
Any distribution from profits or partners' capital will be made solely
at the discretion of the General Partners.
Allocation of Profit and Loss for Federal Income Tax Purposes - As of
the end of each fiscal year, the Partnership's realized capital gain or loss
and ordinary income or loss shall be allocated among the Partners, after
having given effect to the fees of the corporate General Partner and the
Commodity Trading Advisors and each Partner's share of such items are
includable in the Partner's personal income tax return.
Redemption - No partner may redeem or liquidate any units until after
the lapse of six months from the date of the investment. Thereafter, a
Limited Partner may withdraw, subject to certain restrictions, any part or
all of his units from the partnership at the net asset value per unit on the
last day of any month with prior written request to the General Partner. A
redemption fee payable to the Partnership of a percentage of the value of the
redemption request is charged pursuant to the following schedule:
4% if such request is received prior to the last trading day of the
month in which the redemption is to be effective from the sixth month to the
twelfth month after the date of the investment in the Fund.
3% if such request is received during the next six month period.
2% if such request is received during the next six month period.
1% if such request is received during the next six month period.
0% thereafter.
4. FEES
The Fund is charged the following fees on a monthly basis since the
commencement of trading.
A management fee of 1% (annual rate) of the Fund's net assets allocated
to each CTA to trade will be paid to each CTA and 3% of the Fund's net assets
allocated to all CTA's will be paid to the Fund's Corporate General Partner.
BROMWELL FINANCIAL FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
September 30, 2000
(Unaudited)
4. FEES - CONTINUED
An incentive fee of 20% of "new trading profits" will be paid to each
CTA. "New trading profits" includes all income earned by a CTA and expense
allocated to his activity. In the event that trading produces a loss, no
incentive fees will be paid and all losses will be carried over to the
following months until profits from trading exceed the loss. It is possible
for one CTA to be paid an incentive fee during a quarter of a year when the
Fund experienced a loss.
The Fund will pay fixed commissions of 11% (annual rate) of assets
assigned to be traded, payable monthly, to the introducing broker affiliated
with the General Partners. The Affiliated Introducing Broker will pay the
costs to clear the trades to the futures commission merchant and all PIT
Brokerage costs which shall include the NFA and exchange fees.
The General Partners have reserved the right to change the management
fee and the incentive fee at their sole discretion.
5. CONCENTRATIONS OF CREDIT RISK
The Fund maintains its cash balances at a high credit financial
institution. The balances may, at times, exceed federally insured credit
limits.
