<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the Fiscal Year Ended DECEMBER 31, 1996
Commission File Number
2-74063
REAL ESTATE ASSOCIATES LIMITED IV
A CALIFORNIA LIMITED PARTNERSHIP
I.R.S. Employer Identification No. 95-3718731
9090 WILSHIRE BLVD., SUITE 201, BEVERLY HILLS, CALIFORNIA 90211
Registrant's Telephone Number, Including Area Code (310) 278-2191
Securities Registered Pursuant to Section 12(b) or 12(g) of the Act:
NONE
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed with the Commission by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding twelve months (or such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X No_______________
------------
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [X]
<PAGE> 2
PART I.
ITEM 1. BUSINESS:
Real Estate Associates Limited IV ("REAL IV" or the "Partnership") is a limited
partnership which was formed under the laws of the State of California on
August 24, 1981. On March 12, 1982, REAL IV offered 3,000 units consisting of
6,000 Limited Partnership Interests and Warrants to purchase a maximum of 6,000
Additional Limited Partnership Interests through a public offering managed by
Lehman Brothers, Inc.
The general partners of Real IV are National Partnership Investments Corp.
("NAPICO"), a California corporation (the "Corporate General Partner"), and
Coast Housing Investment Associates ("CHIA"). CHIA is a limited partnership
formed under the California Limited Partnership Act and consists of Messrs.
Nicholas G. Ciriello, an unrelated individual, as general partner, and Charles
H. Boxenbaum as limited partner. The business of REAL IV is conducted
primarily by its general partners as REAL IV has no employees of its own.
Casden Investment Corporation ("CIC") owns 100 percent of NAPICO's stock. The
current members of NAPICO's Board of Directors are Charles H. Boxenbaum, Bruce
E. Nelson, Alan I. Casden, Henry C. Casden and Brian D. Goldberg.
REAL IV holds limited partnership interests in twenty-two local limited
partnerships as of December 31, 1996 and a general partner interest in Real
Estate Associates II ("REA II") which in turn holds limited partnership
interests in an additional seven limited partnerships. Therefore, REAL IV
holds directly or indirectly through REA II investments in twenty-nine local
limited partnerships. The general partners of REA II are REAL IV and NAPICO.
Each of the local partnerships own a low income housing project which is
subsidized and/or has a mortgage note payable to or insured by agencies of the
federal or local government.
In order to stimulate private investment in low income housing, the federal
government and certain state and local agencies have provided significant
ownership incentives, including interest subsidies, rent supplements, and
mortgage insurance, with the intent of reducing certain market risks and
providing investors with certain tax benefits, plus limited cash distributions
and the possibility of long-term capital gains. There remains, however,
significant risks. The long-term nature of investments in government assisted
housing limits the ability of REAL IV to vary its portfolio in response to
changing economic, financial and investment conditions. These investments are
also subject to changes in local economic circumstances and housing patterns,
as well as rising operating costs, vacancies, rent collection difficulties,
energy shortages and other factors which have an impact on real estate values.
These projects also require greater management expertise and may have higher
operating expenses than conventional housing projects.
The partnerships in which REAL IV has invested were, at least initially,
organized by private developers who acquired the sites, or options thereon, and
applied for applicable mortgage insurance and subsidies. REAL IV became the
principal limited partner in these local limited partnerships pursuant to
arm's-length negotiations with these developers, or others, who act as general
partners. As a limited partner, REAL IV's liability for obligations of the
local limited partnership is limited to its investment. The local general
partner of the local limited partnership retains responsibility for developing,
constructing, maintaining, operating and managing the project. Under certain
circumstances, REAL IV has the right to replace the general partner of the
local limited partnerships.
Although each of the partnerships in which REAL IV has invested generally owns
a project which must compete in the market place for tenants, interest
subsidies and rent supplements from governmental agencies make it possible to
offer these dwelling units to eligible "low income" tenants at a cost
significantly below the market rate for comparable conventionally financed
dwelling units in the area.
<PAGE> 3
During 1996, the projects in which REAL IV had invested were substantially
rented. The following is a schedule of the status as of December 31, 1996, of
the projects owned by local limited partnerships in which REAL IV, either
directly or indirectly, has invested.
SCHEDULE OF PROJECTS OWNED BY LOCAL LIMITED PARTNERSHIPS
IN WHICH REAL IV HAS AN INVESTMENT
DECEMBER 31, 1996
<TABLE>
<CAPTION>
Units Authorized
For Rental
Assistance Under
Section 8/or
Other Rent
No. of Supplement Units Percentage of
Name & Location Units Program Occupied Total Units
- --------------- ------ --------------- -------- -----------
<S> <C> <C> <C> <C> <C>
Alliance Towers
Alliance, OH 101 101/ 0 100 99%
Antelope Valley Apartments
Lancaster, CA 121 121/ 0 120 99%
Armitage Commons
Chicago, IL 104 104/ 0 104 100%
Barnesboro Family Project
Barnesboro, PA 62 62/ 0 52 84%
Baughman Towers
Philippi, WV 104 104/ 0 104 100%
Beacon Hill/
Hillsdale Place
Hillsdale, MI 199 199/ 0 197 99%
Branford Elderly II
Branford, CT 44 44/ 0 44 100%
Buckingham Apartments
Los Angeles, CA 83 83/ 0 83 100%
Coatesville Towers
Coatesville, PA 90 90/ 0 90 100%
Daniel Scott Commons
Chester, PA 72 72/ 0 70 97%
Ethel Arnold Bradley Gardens
Los Angeles, CA 81 81/ 0 81 100%
Glenoaks Townhouses
Los Angeles, CA 48 48/ 0 48 100%
</TABLE>
<PAGE> 4
SCHEDULE OF PROJECTS OWNED BY LOCAL LIMITED PARTNERSHIPS
IN WHICH REAL IV HAS AN INVESTMENT
DECEMBER 31, 1996
(CONTINUED)
<TABLE>
<CAPTION>
Units Authorized
For Rental
Assistance Under
Section 8/or
Other Rent
No. of Supplement Units Percentage of
Name & Location Units Program Occupied Total Units
- --------------- ------ --------------- -------- ------------
<S> <C> <C> <C> <C>
Lakeland Place
Waterford, MI 200 200/ 0 200 100%
Loch Haven Apartments
Lauderhill, FL 208 None 206 99%
Ninety-Five Vine Street
Hartford, CT 31 31/ 0 29 94%
Oakridge Park Apartments
North Biloxi, MS 40 0/ 40 39 98%
O'Fallon Apartments
O'Fallon, IL 132 132/ 0 132 100%
One Madison Avenue
Madison, ME 27 27/ 0 27 100%
Pacific Coast Villa
Long Beach, CA 50 50/ 0 50 100%
Queensbury Heights
Middlesboro, KY 64 0/ 64 60 94%
Rosewood Apartments
Camarillo, CA 150 None 144 96%
Sandwich Apartments
Sandwich, IL 90 90/ 0 90 100%
Scituate Vista
Cranston, RI 232 230/ 0 232 100%
Sterling Village
San Bernardino, CA 80 80/ 0 80 100%
Villa del Sol
Norwalk, CA 121 None 104 87%
</TABLE>
<PAGE> 5
SCHEDULE OF PROJECTS OWNED BY LOCAL LIMITED PARTNERSHIPS
IN WHICH REAL IV HAS AN INVESTMENT
DECEMBER 31, 1996
(CONTINUED)
<TABLE>
<CAPTION>
Units Authorized
For Rental
Assistance Under
Section 8/or
Other Rent
No. of Supplement Units Percentage of
Name & Location Units Program Occupied Total Units
- --------------- ------ ---------------- -------- ------------
<S> <C> <C> <C> <C>
Village of Albany/
Village of Brodhead
Albany & Brodhead, WI 32 0/ 32 28 88%
Vista Park Chino
Chino, CA 40 40/ 0 40 100%
Wasco Arms Apartments
Wasco, CA 78 78/ 0 78 100%
Wright Park Phase II
Rome, NY 99 20/ 20 21 22%
------ ----------- ------
TOTALS 2,783 2,087/156 2,650 95%
===== ========= =====
</TABLE>
<PAGE> 6
ITEM 2. PROPERTIES:
Through its investment in local limited partnerships, REAL IV holds interests
in real estate properties. See Item 1 and Schedule XI for information
pertaining to these properties.
ITEM 3. LEGAL PROCEEDINGS:
As of December 31, 1996, the Partnership's Corporate General Partner was a
plaintiff or defendant in several lawsuits. None of these suits were related to
REAL IV.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
Not applicable.
PART II.
ITEM 5. MARKET FOR THE REGISTRANT'S PARTNERSHIP INTERESTS AND RELATED
SECURITY HOLDER MATTERS:
The limited partnership interests are not traded on a public exchange but were
sold through a public offering managed by Lehman Brothers Inc. It is not
anticipated that any public market will develop for the purchase and sale of
any partnership interest. Limited partnership interests may be transferred
only if certain requirements are satisfied. At December 31, 1996, there were
2,703 registered holders of units in REAL IV. No distributions have been made
from the inception of the Partnership to December 31, 1996. The Partnership
has invested in certain government assisted projects under programs which in
many instances restrict the cash return available to project owners. The
Partnership was not designed to provide cash distributions to investors in
circumstances other than refinancing or disposition of its investments in
limited partnerships.
<PAGE> 7
ITEM 6. SELECTED FINANCIAL DATA:
<TABLE>
<CAPTION>
Year Ended December 31,
----------------------------------------------------------------------
1996 1995 1994 1993 1992
------------ ------------ ----------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Loss From Operations $ (636,501) $ (654,466) $ (680,262) $ (697,033) $ (705,158)
Distributions From
Limited Partnerships
Recognized as Income 1,107,630 1,222,286 1,053,488 948,374 737,962
Equity in Income (Loss)
of Limited Partnerships
and Amortization of
Acquisition Costs 483,414 487,116 314,015 372,206 174,023
----------- ----------- ---------- ---------- -----------
Net Income $ 954,543 $ 1,054,936 $ 687,241 $ 623,547 $ 206,827
=========== =========== ========== ========== ===========
Net Income per Limited
Partnership Interest $ 72 $ 80 $ 52 $ 47 $ 16
=========== =========== ========== ========== ===========
Total assets $ 9,774,550 $ 8,997,384 $7,954,058 $7,226,884 $ 6,588,593
=========== =========== ========== ========== ===========
Investments in Limited
Partnerships $ 3,098,674 $ 3,221,339 $3,234,884 $3,289,353 $ 3,070,307
=========== =========== ========== ========== ===========
Notes Payable $ 1,230,743 $ 1,230,743 $1,230,743 $1,230,743 $ 1,230,743
=========== =========== ========== ========== ===========
</TABLE>
<PAGE> 8
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS:
LIQUIDITY
The Partnership's primary sources of funds include interest income on money
market funds and certificates of deposit and distributions from local
partnerships in which the Partnership has invested.
Authorization was granted to Lakeland Place limited partnership to proceed with
the request for a $3,200,000 loan from the partnership's excess reserves. If
approval is granted, the loan is expected to close by June 1997 and the
proceeds used to retire existing debt.
CAPITAL RESOURCES
REAL IV received $16,500,000 in subscriptions for units of limited partnership
interests (at $5,000 per unit) during the period March 12, 1982 to July 15,
1982, pursuant to a registration statement on Form S-11. As of March 31, 1983,
REAL IV received an additional $16,500,000 in subscriptions pursuant to the
exercise of warrants and the sale of additional limited partnership interests.
RESULTS OF OPERATIONS
The Partnership was formed to provide various benefits to its partners as
discussed in Item 1. It is anticipated that the local limited partnerships in
which REAL IV has invested could produce tax losses for as long as 20 years.
The Partnership will seek to defer income taxes from capital gains by not
selling any projects or project interests within 10 years, except to qualified
tenant cooperatives, or when proceeds of the sale would supply sufficient cash
to enable the partners to pay applicable taxes.
Tax benefits will decline over time as the advantages of accelerated
depreciation are greatest in the earlier years, as deductions for interest
expense will decrease as mortgage principal is amortized, and as the Tax Reform
Act of 1986 limits the deductions available.
The Partnership accounts for its investments in the local limited partnerships
on the equity method, thereby adjusting its investment balance by its
proportionate share of the income or loss of the local limited partnerships.
Losses incurred after the limited partnership investment account is reduced to
zero are not recognized.
Distributions received from limited partnerships are recognized as return of
capital until the investment balance has been reduced to zero or to a negative
amount equal to future capital contributions required. Subsequent
distributions received are recognized as income.
Except for certificates of deposit and money market funds, the Partnership's
investments are entirely interests in other limited partnerships owning
government assisted projects. Available cash not invested in Limited
Partnerships is invested in funds earning interest income as reflected in the
statements of operations. These money market funds and certificates of deposit
can be converted to cash to meet obligations as they arise. The Partnership
intends to continue investing available funds in this manner.
A recurring partnership expense is the annual management fee. The fee is
payable to the Corporate General Partner of the Partnership and is calculated
as a percentage of the Partnership's invested assets. The management fee is
paid to the corporate general partner for its continuing management of
Partnership affairs. The fee is payable beginning with the month following the
Partnership's initial investment in a local limited partnership.
<PAGE> 9
Operating expenses, exclusive of management fees and interest, consist
substantially of professional fees for services rendered to the Partnership.
The Partnership, as a limited partner in the local limited partnerships in
which it has invested, is subject to the risks incident to the management and
ownership of improved real estate. The Partnership investments are also
subject to adverse general economic conditions, and, accordingly, the status of
the national economy, including substantial unemployment and concurrent
inflation, could increase vacancy levels, rental payment defaults, and
operating expenses, which in turn, could substantially increase the risk of
operating losses for the projects.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA:
The Financial Statements and Supplementary Data are listed under Item 14.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE:
Not applicable.
<PAGE> 10
REAL ESTATE ASSOCIATES LIMITED IV
(A California limited partnership)
FINANCIAL STATEMENTS,
FINANCIAL STATEMENT SCHEDULES
AND INDEPENDENT PUBLIC ACCOUNTANTS' REPORT
DECEMBER 31, 1996
<PAGE> 11
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Partners of
Real Estate Associates Limited IV
(A California limited partnership)
We have audited the accompanying balance sheets of Real Estate Associates
Limited IV (a California limited partnership) as of December 31, 1996 and 1995,
and the related statements of operations, partners' equity (deficiency) and
cash flows for each of the three years in the period ended December 31, 1996.
Our audits also included the financial statement schedules listed in the index
on item 14. These financial statements and financial statement schedules are
the responsibility of the management of the Partnership. Our responsibility is
to express an opinion on these financial statements and financial statement
schedules based on our audits. We did not audit the financial statements of
certain limited partnerships, the investments in which are reflected in the
accompanying financial statements using the equity method of accounting. The
investments in these limited partnerships represent 23 percent and 22 percent
of total assets as of December 31, 1996 and 1995, respectively, and the equity
in income of these limited partnerships represents 23 percent, 27 percent and
20 percent of the total net income of the Partnership for the years ended
December 31, 1996, 1995 and 1994, respectively, and represent a substantial
portion of the investee information in Note 2 and the financial statement
schedules. The financial statements of these limited partnerships are audited
by other auditors. Their reports have been furnished to us and our opinion,
insofar as it relates to the amounts included for these limited partnerships,
is based solely on the reports of the other auditors.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits 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 our audits and the reports of other
auditors provide a reasonable basis for our opinion.
In our opinion, based on our audits and the reports of other auditors, the
financial statements referred to above present fairly, in all material
respects, the financial position of Real Estate Associates Limited IV as of
December 31, 1996 and 1995, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 1996 in
conformity with generally accepted accounting principles. Also, in our
opinion, based on our audits and the reports of other auditors, such financial
statement schedules, when considered in relation to the basic financial
statements taken as a whole, present fairly in all material respects the
information set forth therein.
DELOITTE & TOUCHE LLP
Los Angeles, California
March 26, 1997
<PAGE> 12
[LOGO]
[COOPERS & LYBRAND LLP]
Report of Independent Accountants
To the Partners of
Alliance Towers
We have audited the accompanying balance sheets of Alliance Towers (An Ohio
Limited Partnership, FHA Project Number 042-35277-PM-L8) as of December 31,
1996 and 1995, and the related statements of operations, changes in partners'
deficit, and cash flows for the years then ended. These financial statements
are the responsibility of the Partnership's management. Our responsibility is
to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Alliance Towers as of December
31, 1996 and 1995, and the results of its operations, and its cash flows for
the years then ended in conformity with generally accepted accounting
principles.
In accordance with Government Auditing Standards, we have also issued a report
dated February 14, 1997 on our consideration of Alliance Towers' internal
control structure and a report dated February 14, 1997 on its compliance with
laws and regulations.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The other financial information indexed
on page 9 is presented for purposes of additional analysis, and is not a
required part of the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/s/ COOPERS & LYBRAND LLP
Cleveland, Ohio
February 14, 1997
<PAGE> 13
{LOGO}
{NANAS, STERN, BIERS, NEINSTEIN AND CO. LLP}
INDEPENDENT AUDITORS' REPORT
The Partners
Antelope Valley Apartments
Culver City, California
We have audited the accompanying balance sheet of Antelope Valley Apartments (a
California partnership),Project No. 1 22-35528-PM-L8, as of December 31, 1996
and the related statements of operations, partners' equity and cash flows for
the year then ended. These financial statements are the responsibility of the
Partnership'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
and Government Auditing Standards issued by the Comptroller General of 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Antelope Valley Apartments as
of December 31, 1996, and the results of its operations and its cash flows for
the year then ended in conformity with generally accepted accounting
principles.
In accordance with Government Auditing Standards we have also issued reports
dated January 28, 1997 on our consideration of Antelope Valley Apartments'
Internal Control Structure and on its compliance with requirements applicable
to U.S. Department of Housing and Urban Development financial assistance
programs.
/s/ NANAS, STERN, BIERS, NEINSTEIN AND CO. LLP
January 28, 1997
<PAGE> 14
[LOGO]
[ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]
INDEPENDENT AUDITORS' REPORT ON FINANCIAL STATEMENTS AND
ADDITIONAL FINANCIAL DATA REQUIRED BY
THE U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
To the Partners of
Armitage Commons Associates
We have audited the accompanying balance sheets of ARMITAGE COMMONS ASSOCIATES
(a limited partnership), FHA Project No. 071-35458-PM-L8 (the "Partnership") as
of December 31, 1996 and 1995, and the related statements of operations,
changes in partners' deficiency and cash flows for the years then ended. These
financial statements are the responsibility of the Partnership's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Armitage Commons Associates as
of December 31, 1996 and 1995, and the results of its operations, changes in
its partners' deficiency, and its cash flows for the years then ended, in
conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued a report
dated February 17, 1997 on our consideration of the Partnership's internal
control structure and a report dated February 17, 1997 on its compliance with
laws and regulations.
<PAGE> 15
Our audits were conducted for the purpose of forming an opinion on the
financial statements taken as a whole. The accompanying additional 1996
financial data shown on pages 13 through 20 are presented for purposes of
additional analysis and are not a required part of the Partnership's financial
statements. Such information has been subjected to the auditing procedures
applied in the audit of the 1996 financial statements and, in our opinion, is
fairly stated in all material respects in relation to the financial statements
taken as a whole.
/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
Los Angeles, California
February 17, 1997
<PAGE> 16
[LOGO]
[ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]
INDEPENDENT AUDITORS' REPORT ON FINANCIAL STATEMENTS
AND ADDITIONAL FINANCIAL DATA REQUIRED BY
THE PENNSYLVANIA HOUSING FINANCE AGENCY
To the Partners of
Barnesboro Associates
We have audited the balance sheet of BARNESBORO ASSOCIATES, PHFA Project Number
R-10468F, as of December 31, 1996 and 1995, and the statements of operations,
changes in partners' equity and cash flows for the year then ended. These
financial statements are the responsibility of the Partnership's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audits 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 our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Barnesboro Associates as of
December 31, 1996 and 1995, and the results of its operations, changes in
partners' equity and cash flows for the years then ended in conformity with
generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued a report
dated January 14, 1997, on our consideration of the Partnership's internal
control structure and a report dated January 14, 1997, on its compliance with
laws and regulations.
Our audits were performed for the purpose of forming an opinion on the
financial statements taken as a whole. The additional financial data on pages
13 through 21 are presented for purposes of additional analysis and are not a
required part of the financial statements. This information has been subjected
to the procedures applied in the audits of the financial statements and, in our
opinion, is stated fairly in all material respects in relation to the financial
statements taken as a whole.
/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
Chicago, Illinois
January 14, 1997
<PAGE> 17
[LOGO]
[COOPERS & LYBRAND LETTERHEAD]
Report of Independent Accountants
To the Partners of
Philippi Towers Limited Partnership
We have audited the accompanying balance sheets of Philippi Towers Limited
Partnership (A West Virginia Limited Partnership, FHA Project Number
045-35129-PM-WAH-L8) as of December 31, 1996 and 1995, and the related
statements of operations, changes in partners' deficit, and cash flows for the
years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Philippi Towers Limited
Partnership as of December 31, 1996 and 1995, and the results of its
operations, and its cash flows for the years then ended in conformity with
generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued a report
dated January 31, 1997 on our consideration of Philippi Towers Limited
Partnership's internal control structure and a report dated January 31, 1997 on
its compliance with laws and regulations.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The other financial information indexed
on page 9 is presented for purposes of additional analysis, and is not a
required part of the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, is fairly stated, in all material
respects, in relation to the basic financial statements taken as a whole.
/s/ COOPERS & LYBRAND LLP
Cleveland, Ohio
January 31, 1997
<PAGE> 18
[LOGO]
[COOPERS & LYBRAND LETTERHEAD]
Report of Independent Accountants
To the Partners of
Hillsdale Associates
Limited Dividend Housing Association
We have audited the accompanying balance sheets of Hillsdale Associates Limited
Dividend Housing Association (A Michigan Limited Partnership), MSHDA
Development Number 575. as of December 31,1996 and 1995, and the related
statements of operations, changes in partners' deficit. and cash flows for the
years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis.
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Hillsdale Associates Limited
Dividend Housing Association, MSHDA No. 575, as of December 31, 1996 and 1995,
and the results of its operations, and its cash flows for the years then ended
in conformity with generally accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information of Hillsdale
Associates Limited Dividend Housing Association, MSHDA No. 575, on pages 9
through 17 is presented for purposes of additional analysis and is not a
required part of the basic financial statements. This additional information is
the responsibility of the Partnership's management. Such information has been
subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
In accordance with Government Auditing Standards, we have also issued a report
dated January 28, 1997 on our consideration of Hillsdale Associates Limited
Dividend Housing Association's internal control structure and a report dated
January 28, 1997 on its compliance with laws and regulations.
/s/ COOPERS & LYBRAND LLP
Cleveland, Ohio
January 28, 1997
<PAGE> 19
[LOGO]
[RIZZO & AMORE, P.C. LETTERHEAD]
To The General Partner
The Branford Group Limited Partnership
Woodbridge, Connecticut
We have audited the accompanying statement of financial position of The
Branford Group Limited Partnership (a limited partnership), Connecticut Housing
Finance Authority Project Number 81-019M as of December 31, 1996 and the
related statements of profit and loss, changes in partners' equity and cash
flows for the year then ended. These financial statements are the
responsibility of the partnership. 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
and Government Auditing Standards issued by the Comptroller General of 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 the 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 financial position of The Branford-Group Limited
Partnership as of December 31, 1995 and the results of operations, changes in
partners' equity and cash flows for the year then ended in conformity with
generally accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the financial
statements taken as a whole. The supplemental data included in the report
(shown on pages 15 through 21) are presented for the purpose of additional
analysis and are not a required part of the basic financial statements of The
Branford Group Limited Partnership. Such information has been subjected to the
same auditing procedures applied in the audit of the basic financial statements
and, in our opinion, is fairly presented in all material respects in relation
to the financial statements taken as a whole.
/s/ RIZZO & AMORE, P.C.
West Haven, Connecticut
February 24, 1997
<PAGE> 20
[LOGO]
[SUAREZ ACCOUNTANCY CORPORATION LETTERHEAD]
Independent Auditor's Report
To the General Partners
Buckingham Apartments
(a California Limited Partnership)
Los Angeles, California
I have audited the accompanying balance sheet of Buckingham Apartments (a
California Limited Partnership), FHA Project Number 122-35565-PM-L8, at
December 31, 1996, and the related statements of profit and loss (HUD Form No.
92410), changes in partners' deficit and cash flows for the year then ended.
These financial statements are the responsibility of the Partnership's
management. My responsibility is to express an opinion on these financial
statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards
and Government Auditing Standards issued by the Comptroller General of the
United States. Those standards require that I 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. I believe that my audit provides a reasonable basis for
my opinion.
In my opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Buckingham Apartments at
December 31, 1996, and the results of its operations and changes in partners'
deficit and cash flows for the year then ended, in conformity with generally
accepted accounting principles.
In accordance with Government Auditing Standards, I have also issued a report
dated January 9, 1997, on my consideration of Buckingham Apartments' internal
control structure and a report dated January 9, 1997, on its compliance with
laws and regulations.
<PAGE> 21
My audit was made for the purpose of forming an opinion on the financial
statements taken as a whole. The supporting data included in the report (shown
on pages 12 to 17) are presented for the purposes of additional analysis and
are not a required part of the financial statements of Buckingham Apartments.
Such information has been subjected to the auditing procedures applied in the
audit of the financial statements and, in my opinion, is fairly stated in all
material respects in relation to the financial statements taken as a whole.
/s/ SUAREZ ACCOUNTANCY CORPORATION
Certified Public Accountant
San Pedro, California
January 9, 1997
<PAGE> 22
[LOGO]
[COOPERS & LYBRAND LETTERHEAD]
Report of Independent Accountants
To the Partners of
Coatesville Towers Limited Partnership
We have audited the accompanying balance sheets of Coatesville Towers Limited
Partnership (A Pennsylvania Limited Partnership, FHA Project Number
034-35125-PM) as of December 31, 1996 and 1995, and the related statements of
operations, changes in partners' deficit, and cash flows for the years then
ended. These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Coatesville Towers Limited
Partnership as of December 31, 1996 and 1995, and the results of its
operations, and its cash flows for the years then ended in conformity with
generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued a report
dated January 29, 1997 on our consideration of Coatesville Towers Limited
Partnership's internal control structure and a report dated January 29, 1997 on
its compliance with laws and regulations.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The other financial information indexed
on page 10 is presented for purposes of additional analysis and is not a
required part of the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/s/ COOPERS & LYBRAND LLP
Cleveland, Ohio
January 29, 1997
<PAGE> 23
LOGO]
[FISHBEIN & COMPANY,P.C. LETTERHEAD]
Partners
Pennsylvania Housing Partners
INDEPENDENT AUDITOR'S REPORT
We have audited the accompanying balance sheets of PENNSYLVANIA HOUSING
PARTNERS (A Limited Partnership), DANIEL SCOTT COMMONS, FHA Project No.
03435210-LD, as of December 31, 1996, 1995, and 1994, and the related
statements of profit and loss, partners' equity deficiency and cash flows for
the years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and "Government Auditing Standards" issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Pennsylvania Housing
Partners as of December 31, 1996, 1995, and 1994, and the results of its
operations and its cash flows for the years then ended in conformity with
generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental information
included in this report (shown on pages 15 through 24) is presented for
purposes of additional analysis and is not a required part of the basic
financial statements of the Partnership. Such information has been subjected
to the auditing procedures applied in the audits of the basic financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the financial statements taken as a whole.
In accordance with "Government Auditing Standards" and the "Consolidated
Audit Guide for Audits of HUD Programs" issued by the U.S. Department of
Housing and Urban Development, we have also issued a report dated January 10,
1997, on our consideration of Pennsylvania Housing Partners' internal control
structure and reports dated January 10, 1997, on its compliance with specific
requirements applicable to major HUD programs and affirmative fair housing
/s/ FISHBEIN & COMPANY, P.C.
<PAGE> 24
[LOGO]
[LITZ & COMPANY LETTERHEAD]
Normandie Avenue Development Company
aka Ethel Arnold Bradley Gardens Apartments
6330 San Vicente Boulevard, Suite 270
Los Angeles, California 90048
INDEPENDENT AUDITORS' REPORT
We have audited the accompanying balance sheet of Ethel Arnold Bradley
Gardens Apartments (HUD Project No. 122-35548-PM-L8) as of December 31, 1996,
and the related statements of profit and loss, changes in equity and cash flows
for the year then ended. These financial statements are the responsibility of
the Partnership'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 and Government Auditing Standards, issued by the Comptroller General
of 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of HUD Project No.
122-35548-PM-L8 as of December 31, 1996, and the results of its operations,
changes in equity and cash flows for the year then ended in conformity with
generally accepted accounting principles, applied on a basis consistent with
prior periods and with HUD requirements.
In accordance with Government Auditing Standards and the Consolidated Audit
Guide for Audits of HUD Programs issued by the U. S. Department of Housing and
Urban Development, we have also issued a report dated January 19, 1997 on our
consideration of Ethel Arnold Bradley Gardens Apartments' internal control
structure, and reports dated January 19, 1997 on its compliance with specific
requirements applicable to major HUD programs and specific requirements
applicable to Affirmative Fair Housing.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supporting information, as shown in
the attached Index, included in the report is presented for the purposes of
additional analysis and is not a required part of the basic financial
statements of HUD Project No. 122-35548-PM-L8. Such information has been
subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, is fairly stated in all material
respects in relation to the financial statements taken as a whole.
/s/ Litz & Company
January 19, 1997
Erica M. Kish, CPA
Litz & Company
8906 W. Olympic Boulevard
Beverly Hills, CA 90211
(213) 272-1505
95-3537761
<PAGE> 25
[LOGO]
[NANAS, STERN, BIERS, NEINSTEIN AND CO. LLP LETTERHEAD]
The Partners
Glenoaks Townhomes
Culver City, California
INDEPENDENT AUDITORS' REPORT
We have audited the accompanying balance sheet of Glenoaks Townhomes (a
California partnership), Project No. 122-35536-PM-L8, as of December 31, 1996
and the related statements of operations partners' equity and cash flows for
the year then ended. These financial statements are the responsibility of the
Partnership'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 and Government Auditing Standards issued by the Comptroller General
of 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Glenoaks Townhomes as of
December 31, 1996, and the results of its operations and its cash flows for the
year then ended in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards we have also issued reports
dated January 28, 1997 on our consideration of Glenoaks Townhomes' Internal
Control Structure and on its compliance with requirements applicable to U.S.
Department of Housing and Urban Development programs.
/s/ NANAS, STERN, BIERS, NEINSTEIN AND CO. LLP
January 28, 1997
<PAGE> 26
[LOGO]
[COOPERS & LYBRAND LETTERHEAD]
Report of Independent Accountants
To the Partners of
Lakeland Place Associates
Limited Dividend Housing Association
We have audited the accompanying balance sheets of Lakeland Place Associates
Limited Dividend Housing Association (A Michigan Limited Partnership, MSHDA
Development Number 513). as of December 31, 1996 and 1995, and the related
statements of operations, changes in partners' deficit, and cash flows for the
years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Lakeland Place Associates
Limited Dividend Housing Association, MSHDA No. 513, as of December 31, 1996
and 1995, and the results of its operations, and its cash flows for the years
then ended in conformity with generally accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The other financial information of
Lakeland Place Associates Limited Dividend Housing Association, MSHDA No. 513,
on pages 9 through 17 is presented for purposes of additional analysis and is
not a required part of the basic financial statements. This additional
information is the responsibility of the Partnership's management. Such
information has been subjected to the auditing procedures applied in the audit
of the basic financial statements and, in our opinion, is fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
In accordance with Government Auditing Standards, we have also issued a report
dated January 27, 1997 on our consideration of Lakeland Place Associates
Limited Dividend Housing Association's internal control structure and a report
dated January 27, 1997 on its compliance with laws and regulations.
/s/ COOPERS & LYBRAND LLP
Cleveland, Ohio
January 27, 1997
<PAGE> 27
[LOGO]
[ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
To the Partners of
Lauderhlll Apartment Investors Limited Partnership
We have audited the accompanying balance sheets of LAUDERHILL APARTMENT
INVESTORS LIMITED PARTNERSHIP as of December 31, 1996 and 1995, and the related
statements of income, changes in partners' deficiency and cash flows for the
years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits 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 audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Lauderhill Apartment Investors
Limited Partnership as of December 31, 1996 and 1995, and its results of
operations, changes in partners' deficiency, and cash flows for the years then
ended in conformity with generally accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the financial
statements taken as a whole. The additional 1996 financial data, listed in the
Table of Contents, are presented for purposes of additional analysis and are
not a required part of the financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the 1996 financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the financial statements taken as a whole.
/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
Los Angeles, California
February 17, 1997
<PAGE> 28
[LOGO]
[ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]
INDEPENDENT AUDITORS' REPORT ON
FINANCIAL STATEMENTS AND ADDITIONAL
FINANCIAL DATA REQUIRED BY THE CONNECTICUT
STATE DEPARTMENT OF ECONOMIC AND COMMUNITY DEVELOPMENT
To the Partners of
Better Housing Associates Limited Partnership
We have audited the balance sheets of BETTER HOUSING ASSOCIATES LIMITED
PARTNERSHIP, FHA Project Number 064-MRD-077, as of December 31, 1996 and 1995,
and the statements of operations, changes in partners' equity and cash flows
for the years then ended. These financial statements are the responsibility of
the Partnership's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audits 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 our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Better Housing Associates
Limited Partnership as of December 31, 1996 and 1995, and the results of its
operations and cash flows for the years then ended in conformity with generally
accepted accounting principles.
The financial statements have been prepared assuming the Partnership will
continue as a going concern. As discussed in Note 7 to the financial
statements, the Partnership has suffered recurring losses from operations and
is past due on several financial obligations. These matters raise substantial
doubt about the Partnership's ability to continue as a going concern.
Management's plans with regard to these matters are also described in Note 7.
The financial statements do not include any adjustments that might result from
the outcome of this uncertainty.
<PAGE> 29
In accordance with Government Auditing Standards, we have also issued a report
dated February 12, 1997, on our consideration of the Partnership's internal
control structure and a report dated February 12, 1997, on its compliance with
laws and regulations.
Our audits were performed for the purpose of forming an opinion on the
financial statements taken as a whole. The additional financial data on pages
14 through 19 are presented for purposes of additional analysis and are not a
required part of the financial statements. This information has been subjected
to the procedures applied in the audits of the financial statements and, in our
opinion, is stated fairly in all material respects in relation to the financial
statements taken as a whole.
/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
Chicago, Illinois
February 12, 1997
<PAGE> 30
[LOGO]
[STONE CARLIE & COMPANY, L.C. LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
The Partners
O'Fallon Associates
St. Louis, Missouri
We have audited the accompanying balance sheet of O'Fallon Associates, Project
No. 072-35070-PM, (a limited partnership) as of December 31, 1996, and the
related statements of profit and foes (on HUD Form No. 92410), partners'
capital deficiency and cash flows for the year then ended. These financial
statements are the responsibility of the Partnership'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
and Government Auditing Standards issued by the Comptroller General of 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of O'Fallon Associates as of
December 31, 1996, and the results of its operations and its cash flows for the
year then ended in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued a report
dated January 23, 1997 on our consideration of the partnership's internal
control structure and a report dated January 23, 1997 on its compliance with
laws and regulations.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental information included on
pages 14 through 20 is presented for purposes of additional analysis and is not
a required part of the basic financial statements. This information has been
subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/s/ Stone Carlie & Company, L.C.
January 23, 1997
<PAGE> 31
[LOGO]
[R. BEN YOUNG & ASSOCIATES LETTERHEAD]
Partners
Oak Ridge Park Apartments
Phase 1
Biloxi, Mississipi
INDEPENDENT AUDIT REPORT
I have audited the balance sheets of Oak Ridge Park Apartments, Ltd. (Phase I)
as of December 31, 1996 and 1995, and the related statements of income,
partner's equity, and cash flows for the years then ended. These financial
statements are the responsibility of the partnership's management. My
responsibility is to express an opinion on these financial statements based on
my audit.
I conducted my audit in accordance with generally accepted auditing standards
and generally accepted governmental auditing standards, as set forth in
Governmental Auditing Standards (1988 Revision) issued by the Comptroller
General of the United States. Those standards require that I 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. I believe that my audit provides a reasonable
basis for my opinion.
As described in NOTE A to the financial statements, the partnership's policy is
to prepare its financial statements on the basis of accounting used for income
tax purposes. Accordingly, the accompanying financial statements are not
intended to present financial position and results of operation in conformity
with generally accepted accounting principles.
In my opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Oak Ridge Park Apartments,
Ltd. (Phase I) as of December 31, 1996 and 1995, and the results of its
operations and its cash flows for the years then ended on the basis of
accounting described in NOTE A.
/s/ R. BEN YOUNG, CPA
February 26, 1997
<PAGE> 32
[LOGO]
[OTIS ATWELL & TIMBERLAKE]
The Partners
One Madison Avenue Associates
INDEPENDENT AUDITOR'S REPORT
We have audited the accompanying balance sheets of One Madison Avenue
Associates, a limited partnership, as of December 31,1996 and 1995, and the
related statements of income and partners' deficit, and cash flows for the
years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits 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 audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of One Madison Avenue Associates
as of December 31,1996 and 1995, and the results of its operations and its cash
flows for the years then ended, in conformity with generally accepted
accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
Schedules 1 through 5is presented for purposes of additional analysis and is
not a required part of the basic financial statements. Such information has
been subjected to the auditing procedures applied in the audits of the basic
financial statements and, in our opinion, is stated fairly in all material
respects in relation to the basic financial statements taken as a whole.
/s/ OTIS, ATWELL & TIMBERLAKE
Certified Public Accountants
January 29,1997
Portland, Maine
<PAGE> 33
[LOGO]
[LANDSMAN, FRANK AND BLOCH]
Independent Auditors' Report
To the Partners
Pacific Coast Villa
(A California Limited Partnership)
We have audited the accompanying balance sheets of Pacific Coast Villa (A
California Limited Partnership), FHA Project Number 12235413-PM-L8, as of
December 31, 1996 and 1995, and the related statements of operations, changes
in partners' deficiency and cash flows for the years then ended. These
financial statements are the responsibility of the Partnership's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards and Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Pacific Coast Villa (A
California Limited Partnership) as of December 31, 1996 and 1995, and the
results of its operations and its cash flows for the years then ended in
conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued a report
dated February 5, 1997 on our consideration of the Partnership's internal
control structure and reports dated February 5,1997, on its compliance with
specific requirements applicable to major HUD programs and affirmative fair
housing.
<PAGE> 34
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplementary
information (shown on pages 13 through 22) is presented for purposes of
additional analysis and is not a required part of the basic financial
statements. Such information has been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our opinion, is
fairly stated in all material respects in relation to the financial statements
taken as a whole.
/s/ Landsman, Frank and Bloch
Beverly Hills, California
February 5, 1997
Employer Identification
Number 95-2783759
Audit Principal
Alan H. Salz, C.P.A
<PAGE> 35
LOGO]
[J. RICHARD NORRIS, JR. LETTERHEAD]
INDEPENDENT ACCOUNTANT'S REPORT
To the Partners
Queensbury Heights Apartments
Middlesboro, Kentucky
I have audited We accompanying balance sheets of Queensbury Heights Apart (A
Limited Partnership] as of December 31, 1996 and 1995 and the related
statements of income and partners' deficit and cash flows for the years then
ended. These financial statements are the responsibility of the partnership's
management, My responsibility is to express an opinion on these financial
statements based on my audit.
I conducted the audit in accordance generally accepted auditing standards and
Government Auditing Standards, issued by the Comptroller General of the United
States. Those standards require that I 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. I believe that the audit provides a reasonable basis
for my opinion.
In my opinion the financial statements referred to above present fairly, in all
material respects, the financial position of Queensbury Heights Apartments (A
Limited Partnership) as of December 31, 1996 and 1995, and the results d its
operations and its cash flows for the years then ended in conformity with
generally accepted accounting principles.
My audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The additional information on page 11 is presented
for the purposes of additional analysis and is not a required part of the basic
financial statements, Such information has been subjected to the auditing
procedures applied in the audited the basic financial statements and, in my
opinion, is fairly stated in all material respect in relation to the basic
financial statements taken as a whole.
/s/ J. Richard Norris, Jr.
February 1, 1997
<PAGE> 36
[LOGO]
[ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]
INDEPENDENT ACCOUNTANT'S REPORT
To the Partners of
Camarillo-Rosewood Associates
We have audited the accompanying balance sheets of CAMARILLO-ROSEWOOD
ASSOCIATES (a limited partnership) as of December 31, 1996 and 1995, and the
related statements of income, changes in partners' deficiency and cash flows
for the years then ended. These financial statements are the responsibility of
the Partnership's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits 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 audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Camarillo-Rosewood Associates
at December 31, 1996 and 1995, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted accounting
principles.
/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
Los Angeles, California
January 29, 1997
<PAGE> 37
[LOGO]
[ROCKOFF, HARLAN, RASOF, LTD. LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
To the Partners
Sandwich Apartments Associates II
We have audited the accompanying balance sheet of SANDWICH APARTMENTS
ASSOCIATES II Project No. IL-06-0038-004 (the Partnership) as of June 30, 1996,
and the related statements of profit and loss, changes in partners' capital
(deficit) and cash flows for the year then ended. These financial statements
are the responsibility of the Partnership'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, Government Auditing Standards issued by the Comptroller General of
the United States, and the Consolidated Audit Guide for Audits of HUD Programs
IG 2000.4 Rev-l (the "Guide") issued by the U.S. Department of Housing and
Urban Development, Office of the Inspector General in July 1993. Those
standards and the Guide 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 financial position of the Partnership as of June 30,
1996, and the results of its operations and its cash flows for the year then
ended in conformity with generally accepted accounting principles.
/s/ ROCKOFF, HARLAN, RASOF, LTD.
August 23, 1996
<PAGE> 38
[LOGO]
[PAUL DAMIANO LETTERHEAD]
The Partners
Scituate Vista Associates
(A limited Partnership)
Cranston, RI
We have audited the accompanying balance sheet of RIHMFC Project No.
RI-43-H023-115 of Scituate Vista Associates (a limited partnership) as of
February 29, 1996, and the related statements of income and changes in
partners' equity and cash flows for the year then ended. These financial
statements are the responsibility of the project'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 and Government Auditing Standards, issued by the Comptroller General
of 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly
in all material respects, the financial position of RIHMFC Project No.
RI-43-H023-115 as of February 29, 1996 and the results of its operations and
the changes in partners' equity and cash flows for the year then ended in
conformity with generally accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supporting information included in
the report shown on pages 12-18 are presented for the purposes of additional
analysis and are not a required part of the basic financial statements of
RIHMFC Project No. RI-43-H023-115. Such information has been subjected to the
auditing procedures applied in the audit of the basic financial statements and,
in our opinion, is fairly stated in all material respects in relation to the
financial statements taken as a whole.
In accordance with Government Auditing Standards, we have also issued a
report dated May 14, 1996 on our consideration of the Scituate Vista
Associates' internal control structure and a report dated May 14, 1996 on its
compliance with specific requirements applicable to RIHMFC programs.
/s/ Paul Damiano, P.C.
May 14, 1996
<PAGE> 39
[LOGO]
[COOPERS & LYBRAND LLP LETTERHEAD]
Report of Independent Accountants
To the Partners of
Sterling Village
We have audited the accompanying balance sheets of Sterling Village (A
California Limited Partnership, CHFA Number 79-120-S) as of December 31, 1996
and 1995, and the related statements of operations, changes in partners'
deficit, and cash flows for the years then ended. These financial statements
are the responsibility of the Partnership's management. Our responsibility is
to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards
and Government Auditing Standards, issued by the Comptroller General of the
United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Sterling Village as of
December 31, 1996 and 1995, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted accounting
principles.
In accordance with Government Auditing Standards, we have also issued a report
dated February 6, 1997 on our consideration of the Partnership's internal
control structure and a report dated February 6, 1997 on its compliance with
laws and regulations.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The other financial information on pages
10 through 15 is presented for purposes of additional analysis and is not a
required part of the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, is fairly stated, in all material
respects, in relation to the basic financial statements taken as a whole.
/s/ COOPERS & LYBRAND LLP
Cleveland, Ohio
February 6, 1997
<PAGE> 40
[LOGO]
[ALTSCHULER, MELVOIN AND GLASSER LLP LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
To the Partners of
Villa Del Sol Associates
We have audited the accompanying balance sheets of VILLA DEL SOL ASSOCIATES (a
limited partnership) as of December 31, 1996 and 1995, and the related
statements of operations, changes in partners' deficiency and cash flows for
the years then ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits 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 audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Villa Del Sol Associates at
December 31, 1996 and 1995, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted accounting
principles.
/s/ ALTSCHULER, MELVOIN AND GLASSER LLP
Los Angeles, California
January 29, 1997
<PAGE> 41
[LOGO]
[NANAS, STERN, BIERS, NEINSTEIN AND CO. LLP LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
The Partners
Vista Park Chino
Culver City, California
We have audited the accompanying balance sheet of Vista Park Chino (a
California partnership)! Project No.143-35076-PM-L8, as of December 31, 1996
and the related statements of operations partners! equity and cash flows for
the year then ended. These financial statements are the responsibility of the
Partnership'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 and Government Auditing Standards issued by the Comptroller General
of 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly in
all material respects, the financial position of Vista Park Chino as of
December 31, 1996, and the results of its operations and its cash flows for the
year then ended in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards we have also issued reports
dated January 31, 1997 on our consideration of Vista Park Chino's Internal
Control Structure and on its compliance with requirements applicable to U.S.
Department of Housing and Urban Development financial assistance programs.
/s/ NANAS, STERN, BIERS, NEINSTEIN AND CO. LLP
January 31, 1997
<PAGE> 42
[LOGO]
[NANAS, STERN, BIERS, NEINSTEIN AND CO. LLP]
INDEPENDENT AUDITORS: REPORT
The Partners
Wasco Arms Apartments
Culver City, California
We have audited the accompanying balance sheet of Wasco Arms Apartments (a
California partnership) Project No. 122-35521-PM-L8, as of December 31, 1996
and the related statements of operational partners equity and cash flows for
the year then ended. These financial statements are the responsibility of the
Partnership'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 and Government Auditing Standards issued by the Comptroller General
of 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Wasco Arms Apartments as of
December 31, 1996, and the results of its operations and its cash flows for the
year then ended in conformity with generally accepted accounting principles.
In accordance with Government Auditing Standards we have also issued reports
dated February 4, 1997 on our consideration of Wasco Arms Apartments' Internal
Control Structure and on its compliance with requirements applicable to U.S.
Department of Housing and Urban Development financial assistance programs.
/s/ NANAS, STERN, BIERS, NEINSTEIN AND CO. LLP
February 4, 1997
<PAGE> 43
REAL ESTATE ASSOCIATES LIMITED IV
(A CALIFORNIA LIMITED PARTNERSHIP)
BALANCE SHEETS
DECEMBER 31, 1996 AND 1995
ASSETS
<TABLE>
<CAPTION>
1996 1995
---------- ----------
<S> <C> <C>
INVESTMENTS IN LIMITED PARTNERSHIPS (Note 2) $3,098,674 $3,221,339
CASH AND CASH EQUIVALENTS (Note 1) 6,603,047 5,561,045
SHORT TERM INVESTMENTS (Note 1) - 125,000
OTHER ASSETS 72,829 90,000
---------- ----------
TOTAL ASSETS $9,774,550 $8,997,384
========== ==========
LIABILITIES AND PARTNERS' EQUITY (DEFICIENCY)
LIABILITIES:
Notes payable (Notes 3 and 7) $1,230,743 $1,230,743
Interest payable (Notes 3 and 7) 244,760 407,511
Accounts payable 14,701 29,327
---------- ----------
1,490,204 1,667,581
---------- ----------
COMMITMENTS AND CONTINGENCIES (Notes 4 and 5)
PARTNERS' EQUITY (DEFICIENCY):
General partners (189,186) (198,732)
Limited partners 8,473,532 7,528,535
---------- ----------
8,284,346 7,329,803
---------- ----------
TOTAL LIABILITIES AND PARTNERS'
EQUITY $9,774,550 $8,997,384
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 44
REAL ESTATE ASSOCIATES LIMITED IV
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
1996 1995 1994
---------- ---------- ----------
<S> <C> <C> <C>
INTEREST INCOME $ 173,145 $ 152,450 $ 105,982
---------- ---------- ----------
OPERATING EXPENSES:
Legal and accounting 101,255 89,895 83,322
Management fees - general partner (Note 4) 505,392 505,392 505,392
Interest (Note 2) 123,000 123,000 123,000
Administrative (Note 4) 79,999 88,629 74,530
---------- ---------- ----------
TOTAL OPERATING EXPENSES 809,646 806,916 786,244
---------- ---------- ----------
LOSS FROM OPERATIONS (636,501) (654,466) (680,262)
DISTRIBUTIONS FROM LIMITED
PARTNERSHIPS RECOGNIZED AS
INCOME (Note 2) 1,107,630 1,222,286 1,053,488
EQUITY IN INCOME OF LIMITED
PARTNERSHIPS AND AMORTIZATION
OF ACQUISITION COSTS 483,414 487,116 314,015
---------- ---------- ----------
NET INCOME $ 954,543 $1,054,936 $ 687,241
========== ========== ==========
NET INCOME PER LIMITED PARTNERSHIP
INTEREST (Note 1) $ 72 $ 80 $ 52
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 45
REAL ESTATE ASSOCIATES LIMITED IV
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF PARTNERS' EQUITY (DEFICIENCY)
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
General Limited
Partners Partners Total
--------- ---------- ----------
<S> <C> <C> <C>
EQUITY (DEFICIENCY),
January 1, 1994 $(216,153) 5,803,779 5,587,626
Net income for 1994 6,872 680,369 687,241
--------- ---------- ----------
EQUITY (DEFICIENCY),
December 31, 1994 (209,281) 6,484,148 6,274,867
Net income for 1995 10,549 1,044,387 1,054,936
--------- ---------- ----------
EQUITY (DEFICIENCY),
December 31, 1995 (198,732) 7,528,535 7,329,803
Net income for 1996 9,545 944,998 954,543
--------- ---------- ----------
EQUITY (DEFICIENCY),
December 31, 1996 $(189,186) $8,473,532 $8,284,346
========= ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 46
REAL ESTATE ASSOCIATES LIMITED IV
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
1996 1995 1994
----------- ---------- -----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 954,543 $1,054,936 $ 687,241
Adjustments to reconcile net income to net cash
used in operating activities:
Equity in income of limited partnerships and amorti-
zation of additional basis and acquisition costs (483,414) (487,116) (314,015)
Decrease (increase) in other assets 17,171 (90,000) -
Decrease (increase) in accounts payable and
interest payable (177,377) (11,610) 39,933
----------- ---------- -----------
Net cash provided by operating activities 310,923 466,210 413,159
----------- ---------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital contributions to limited partnerships - - (200,000)
Decrease (increase) in short term investments 125,000 - (125,000)
Distributions from limited partnerships
recognized as return of capital 606,079 500,661 568,484
----------- ---------- -----------
Net cash provided by investing activities 731,079 500,661 243,484
----------- ---------- -----------
NET INCREASE IN CASH AND
CASH EQUIVALENTS 1,042,002 966,871 656,643
CASH AND CASH EQUIVALENTS,
beginning of year 5,561,045 4,594,174 3,937,531
----------- ---------- -----------
CASH AND CASH EQUIVALENTS,
end of year $ 6,603,047 $5,561,045 $ 4,594,174
=========== ========== ===========
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION:
Cash paid during the year for interest $ 285,751 $ 147,896 $ 96,283
=========== ========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 47
REAL ESTATE ASSOCIATES LIMITED IV
(a California limited partnership)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
Real Estate Associates Limited IV (the Partnership) was formed under the
California Limited Partnership Act on August 24, 1981. The Partnership
was formed to invest either directly or indirectly in other limited
partnerships which own and operate primarily federal, state and local
government-assisted housing projects. The general partners are National
Partnership Investments Corp. (NAPICO), the corporate general partner,
and Coast Housing Investments Associates (CHIA), a limited partnership.
Casden Investment Corp. owns 100 percent of NAPICO's stock. The limited
partner of CHIA is an officer of NAPICO.
These financial statements include the accounts of the Partnership and
Real Estate Associates II (REA II), a California general partnership in
which the Partnership holds a 99.9 percent general partner interest.
Losses in excess of the minority interest in equity that would otherwise
be attributed to the minority interest, are being allocated to the
Partnership.
The Partnership issued 13,200 limited partner interests through a public
offering. The general partners have a 1 percent interest in operating
profits and losses of the Partnership. The limited partners have the
remaining 99 percent interest in proportion to their respective
investments.
The Partnership shall be dissolved only upon the expiration of 52
complete calendar years (December 31, 2033) from the date of formation
of the Partnership or the occurrence of various other events as
specified in the terms of the Partnership Agreement.
Upon total or partial liquidation of the Partnership or the disposition
or partial disposition of a project or project interest and distribution
of the proceeds, the general partners will be entitled to a liquidation
fee as stipulated in the Partnership Agreement. The limited partners
will have a priority item equal to their invested capital attributable
to the project(s) or project interest(s) sold and shall receive from the
sale of the project(s) or project interest(s) sold an amount sufficient
to pay state and federal income taxes, if any, calculated at the maximum
rate then in effect. The general partners' liquidation fee may accrue
but shall not be paid until the limited partners have received
distributions equal to 100 percent of their capital contributions.
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 reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
5
<PAGE> 48
REAL ESTATE ASSOCIATES LIMITED IV
(a California limited partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1996
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Method of Accounting for Investments in Limited Partnerships
The investments in limited partnerships are accounted for on the equity
method. Acquisition, selection and other costs related to the
acquisition of the projects have been capitalized as part of the
investment account and are being amortized on a straight line basis over
the estimated lives of the underlying assets, which is generally 30
years.
Net Income Per Limited Partnership Interest
Net income per limited partnership interest was computed by dividing the
limited partners' share of net income by the number of limited
partnership interests outstanding during the year. The number of
limited partnership interests was 13,202 for all years presented.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash and bank certificates of
deposit with an original maturity date of three months or less. The
Partnership has its cash and cash equivalents on deposit primarily with
one high credit quality financial institution. Such cash and cash
equivalents are in excess of the FDIC insurance limit.
Short Term Investments
Short term investments consist of bank certificates of deposit with
original maturities ranging from more than three months to twelve
months. The fair value of these securities, which have been classified
as held for sale, approximates their carrying value.
Impairment of Long-Lived Assets
The Partnership reviews long-lived assets to determine if there has been
any permanent impairment whenever events or changes in circumstances
indicate that the carrying amount of the asset may not be recoverable.
If the sum of the expected future cash flows is less than the carrying
amount of the assets, the Partnership recognizes an impairment loss.
2. INVESTMENTS IN LIMITED PARTNERSHIPS
The Partnership holds limited partnership interests in twenty-two
limited partnerships. In addition, the Partnership holds a general
partner interest in REA II. NAPICO is also a general partner in REA II.
REA II, in turn, holds limited partner interests in seven additional
limited partnerships. In total, therefore, the Partnership holds
interests, either directly or indirectly through REA II, in twenty-nine
partnerships which own residential low income rental projects consisting
of 2,783 apartment units. The mortgage loans of these projects are
payable to or insured by various governmental agencies.
6
<PAGE> 49
REAL ESTATE ASSOCIATES LIMITED IV
(a California limited partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1996
2. INVESTMENTS IN LIMITED PARTNERSHIPS
The Partnership, as a limited partner, is entitled to between 80 percent
and 99 percent of the profits and losses of the limited partnerships it
has invested in directly. The Partnership is also entitled to 99.9
percent of the profits and losses of REA II. REA II is entitled to a 99
percent interest in each of the limited partnerships in which it has
invested.
Equity in loss of the limited partnerships is recognized until the
investment balance is reduced to zero. Losses incurred after the
limited partnership investment account is reduced to zero are not
recognized. The cumulative amount of the unrecognized equity in losses
of certain limited partnerships was approximately $11,201,000 and
$9,713,000 as of December 31, 1996 and 1995, respectively.
Distributions from the limited partnerships are accounted for as a
return of capital until the investment balance is reduced to zero or to
a negative amount equal to further capital contributions required.
Subsequent distributions received are recognized as income.
The following is a summary of the investments in limited partnerships
and reconciliation to the limited partnership accounts:
<TABLE>
<CAPTION>
1996 1995
---------- ----------
<S> <C> <C>
Investment balance, beginning of year $3,221,339 $3,234,884
Equity in income of limited partnerships 662,251 665,948
Amortization of capitalized additional basis
and acquisition costs and fees (178,837) (178,832)
Distributions recognized as return of capital (606,079) (500,661)
---------- -----------
Investment balance, end of year $3,098,674 $3,221,339
========== ==========
</TABLE>
The difference between the investment per the accompanying balance
sheets at December 31, 1996 and 1995, and the deficiency per the limited
partnerships' combined financial statements is due primarily to
cumulative unrecognized equity in losses of certain limited
partnerships, additional basis and costs capitalized to the investment
account and cumulative distributions recognized as income.
Selected financial information from the combined financial statements at
December 31, 1996 and 1995 and for each of the three years in the period
ended December 31, 1996, of the limited partnerships in which the
Partnership has invested directly or indirectly, is as follows:
7
<PAGE> 50
REAL ESTATE ASSOCIATES LIMITED IV
(a California limited partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1996
2. INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)
Balance Sheets
<TABLE>
<CAPTION>
1996 1995
-------- --------
(in thousands)
<S> <C> <C>
Land and buildings, net $ 61,270 $ 65,753
======== ========
Total assets $ 77,145 $ 81,698
======== ========
Mortgages payable $ 91,965 $ 93,181
======== ========
Total liabilities $ 96,702 $ 98,494
======== ========
Deficiency of Real Estate
Associates Limited IV $(18,647) $(15,945)
======== ========
Deficiency of other partners $ (910) $ (851)
======== ========
</TABLE>
Statements of Operations
<TABLE>
<CAPTION>
1996 1995 1994
-------- -------- --------
(in thousands)
<S> <C> <C> <C>
Total revenue $23,947 $23,498 $23,484
======= ======= =======
Interest expense $ 8,173 $ 8,088 $ 8,309
======= ======= =======
Depreciation $3,690 $ 3,764 $ 3,679
======= ======= =======
Total expenses $25,017 $23,559 $23,416
======= ======= =======
Net (loss) income $(1,070) $ (61) $ 68
======= ======= =======
Net (loss) income allocable
to the Partnership $(1,123) $ 269 $ 318
======= ======= =======
</TABLE>
Land and buildings above have been adjusted for the amount by which the
investments in the limited partnerships exceed the Partnership's share
of the net book value of the underlying net assets of the investee which
are recorded at historical costs. Depreciation on the adjustment is
provided for over the estimated remaining useful lives of the
properties.
An affiliate of NAPICO is the general partner in two of the limited
partnerships included above, and another affiliate receives property
management fees of 5 percent of their revenue. The affiliate received
property management fees of $120,956, $120,060 and $119,980 in 1996,
1995 and 1994, respectively. The following sets forth the significant
data for these partnerships, reflected in the accompanying financial
statements using the equity method of accounting:
8
<PAGE> 51
REAL ESTATE ASSOCIATES LIMITED IV
(a California limited partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1996
2. INVESTMENTS IN LIMITED PARTNERSHIPS
<TABLE>
<CAPTION>
1996 1995 1994
-------- -------- --------
(in thousands)
<S> <C> <C> <C>
Total assets $ 5,343 $ 5,896
======= =======
Total liabilities $ 8,689 $ 8,894
======= =======
Deficiency of Real Estate Associates Limited IV $(3,316) $(2,968)
======= =======
Deficiency of other partners $ (31) $ (30)
======= =======
Total revenue $ 2,879 $ 2,831 $ 2,775
======= ======= =======
Net income $ 33 $ 220 $ 181
======= ======= =======
</TABLE>
Authorization was granted to Lakeland Place limited partnership to
proceed with the request for a $3,200,000 loan from the partnership's
excess reserves. If approval is granted, the loan is expected to close
by June 1997 and the proceeds used to retire existing debt.
3. NOTES PAYABLE
Certain of the Partnership's investments involved purchases of
partnership interests from partners who subsequently withdrew from the
operating partnership. The Partnership is obligated on non-recourse
notes payable of $1,230,743 bearing interest at 10 percent, to the
sellers of the partnership interests. The notes and the related
interest are payable by the Partnership through REA II, and have
principal maturity dates ranging from 2015 to 2022 or upon sale or
refinancing of the underlying partnership properties. The notes are
collateralized by REA II's investment in the respective limited
partnerships and are payable only out of cash distributions from the
investee partnerships as defined in the notes. Unpaid interest is due
at maturity of the notes.
Maturity dates on the notes payable are as follows:
<TABLE>
<CAPTION>
Years Ending December 31
------------------------
<S> <C>
1997 $ -
1998 -
1999 -
2000 -
2001 -
Thereafter 1,230,743
----------
$1,230,743
==========
</TABLE>
9
<PAGE> 52
REAL ESTATE ASSOCIATES LIMITED IV
(a California limited partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1996
4. FEES AND EXPENSES DUE GENERAL PARTNER
Under the terms of the Restated Certificate and Agreement of Limited
Partners, the Partnership is obligated to NAPICO for an annual
management fee equal to .4 percent of the original invested assets of
the limited partnerships. Invested assets is defined as the costs of
acquiring project interests, including the proportionate amount of the
mortgage loans related to the Partnerships interest in the capital
accounts of the respective partnerships.
The Partnership reimburses NAPICO for certain expenses. The
reimbursement to NAPICO was $34,565, $32,004 and $30,841 in 1996, 1995
and 1994, respectively, and is included in operating expenses.
5. CONTINGENCIES
The corporate general partner of the Partnership is a plaintiff in
various lawsuits and has also been named a defendant in other lawsuits
arising from transactions in the ordinary course of business. In the
opinion of management and the corporate general partner, the claims will
not result in any material liability to the Partnership.
6. INCOME TAXES
No provision has been made for income taxes in the accompanying
financial statements since such taxes, if any, are the liability of the
individual partners.
The major differences in tax and financial reporting result from the use
of different bases and depreciation methods for the properties held by
the limited partnerships. Differences in tax and financial reporting
also arise as losses are not recognized for financial reporting purposes
when the investment balance has been reduced to zero.
7. FAIR VALUE OF FINANCIAL INSTRUMENTS
Statement of Financial Accounting Standards No. 107, "Disclosure about
Fair Value of Financial Instruments," requires disclosure of fair value
information about financial instruments, when it is practicable to
estimate that value. The notes payable are collateralized by the
Partnership's investments in the investee limited partnerships and are
payable only out of cash distributions from the investee partnerships.
The operations generated by the investee limited partnerships are
subject to various government rules, regulations and restrictions which
make it impracticable to estimate the fair value of the notes payable
and related accrued interest. The carrying amount of other assets and
liabilities reported on the balance sheets that require such disclosure
approximates fair value due to their short-term maturity.
10
<PAGE> 53
REAL ESTATE ASSOCIATES LIMITED IV
(a California limited partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1996
8. FOURTH-QUARTER ADJUSTMENT
The Partnership's policy is to record its equity in the income (loss) of
limited partnerships on a quarterly basis, using estimated financial
information furnished by the various local operating general partners.
The equity in income (loss) of limited partnerships reflected in the
accompanying financial statements is based primarily upon audited
financial statements of the investee limited partnerships. The
increase, approximately $123,000, between the estimated nine-month
equity in income and the actual 1995 income has been recorded in the
fourth quarter.
11
<PAGE> 54
SCHEDULE
REAL ESTATE ASSOCIATES LIMITED IV
INVESTMENTS IN LIMITED PARTNERSHIPS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
Year Ended December 31, 1996
-----------------------------------------------------------------
Cash
Balance Capital Distri- Equity Balance
January 1, Contri- butions in December 31,
Limited Partnerships 1996 butions Received Income (Loss) 1996
- --------------------- ---------- --------- ---------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Alliance Towers $ - $ $ (42,868) $ 42,868 $ -
Antelope Village Apts. - (109,976) 109,976 -
Armitage Commons
Barnesboro Family Project 296,837 (27,661) (5,266) 263,910
Baughman Towers
Beacon Hill/Hillsdale Place
Branford Elderly II 188,495 (22,828) 49,415 215,082
Buckingham Apts.
Coatesville Towers - (47,274) 47,274 -
Daniel Scott Commons
Ethel Arnold Bradley 280,238 (10,578) 5,558 275,218
Glen Oaks Townhomes
Lakeland Place 140,541 (37,632) 50,683 153,592
Loch Haven Apts. 790,250 (307,262) (45,137) 437,851
Ninety-Five Vine St.
Oakridge Park Apts.
O'Fallon Apts.
One Madison
Pacific Coast Villa
Queensbury Heights
Rosewood Apts.
Sandwich Apts.
Scituate Vista 1,524,978 228,043 1,753,021
Sterling Village
Villa del Sol
Village of Albany/Brodhead
Vista Chino Park
Wasco Arms Apts.
Wright Park Phase II
---------- -------- --------- --------- ----------
$3,221,339 $ - $(606,079) $ 483,414 $3,098,674
========== ======== ========= ========= ==========
</TABLE>
<PAGE> 55
SCHEDULE
(CONTINUED)
REAL ESTATE ASSOCIATES LIMITED IV
INVESTMENT IN LIMITED PARTNERSHIPS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
Year Ended December 31, 1996
-----------------------------------------------------------------
Cash
Balance Capital Distri- Equity Balance
January 1, Contri- butions in December 31,
Limited Partnerships 1996 butions Received Income (Loss) 1996
- --------------------- ---------- --------- ---------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Alliance Towers $ $ $ (57,930) $ 57,930 $ -
Antelope Village Apts. (57,433) 57,433 -
Armitage Commons
Barnesboro Family Project 482,115 (139,741) (45,537) 296,837
Baughman Towers
Beacon Hill/Hillsdale Place
Branford Elderly II 157,786 (14,900) 45,609 188,495
Buckingham Apts.
Coatesville Towers - (85,185) 85,185 -
Daniel Scott Commons 7,262 (7,262) -
Ethel Arnold Bradley 324,129 (10,578) (33,313) 280,238
Glen Oaks Townhomes
Lakeland Place 110,512 (37,632) 67,661 140,541
Loch Haven Apts. 834,403 (90,000) 45,847 790,250
Ninety-Five Vine St.
Oakridge Park Apts.
O'Fallon Apts.
One Madison
Pacific Coast Villa
Queensbury Heights
Rosewood Apts.
Sandwich Apts
Scituate Vista 1,318,677 206,301 1,524,978
Sterling Village
Villa del Sol
Village of Albany/Brodhead
Vista Chino Park
Wasco Arms Apts.
Wright Park Phase II
---------- ------- --------- --------- ----------
TOTAL $3,234,884 $ - $(500,661) $ 487,116 $3,221,339
========== ======= ========= ========= ==========
</TABLE>
<PAGE> 56
SCHEDULE
(CONTINUED)
REAL ESTATE ASSOCIATES LIMITED IV
INVESTMENT IN LIMITED PARTNERSHIPS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
Year Ended December 31, 1996
-----------------------------------------------------------------
Cash
Balance Capital Distri- Equity Balance
January 1, Contri- butions in December 31,
Limited Partnerships 1996 butions Received Income (Loss) 1996
- --------------------- ---------- --------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Alliance Towers $ 117,965 $ $(194,505) $ 76,540 $
Antelope Village Apts.
Armitage Commons
Barnesboro Family Project 96,560 200,000 185,555 482,115
Baughman Towers
Beacon Hill/Hillsdale Place
Branford Elderly II 149,216 (13,903) 22,473 157,786
Buckingham Apts.
Coatesville Towers 33,676 (94,064) 60,388 -
Daniel Scott Commons 56,191 (85,000) 36,071 7,262
Ethel Arnold Bradley 335,120 (10,579) (412) 324,129
Glen Oaks Townhomes
Lakeland Place 86,633 (37,632) 61,511 110,512
Loch Haven Apts. 820,365 (15,778) 29,816 834,403
Ninty-Five Vine St. 213,316 (213,316)
Oakridge Park Apts.
O'Fallon Apts.
One Madison
Pacific Coast Villa
Queensbury Heights
Rosewood Apts.
Sandwich Apts
Scituate Vista 1,380,311 (117,023) 55,389 1,318,677
Sterling Village
Villa del Sol
Village of Albany/Brodhead
Vista Chino Park
Wasco Arms Apts.
Wright Park Phase II
---------- -------- --------- --------- ----------
TOTAL $3,289,353 $200,000 $(568,484) $ 314,015 $3,234,884
========== ======== ========= ========= ==========
</TABLE>
<PAGE> 57
SCHEDULE
(Continued)
REAL ESTATE ASSOCIATES LIMITED IV
INVESTMENT IN LIMITED PARTNERSHIPS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
NOTES: 1. Equity in income (losses) of the limited partnerships
represents the Partnership's allocable share of the
net income (loss) from the limited partnerships for
the year. Equity in income (losses) of the limited
partnerships will be recognized until the investment
balance is reduced to zero, or below zero to an
amount equal to future capital contributions to be
made by the Partnership.
2. Cash distributions from the limited partnerships will
be treated as a return on the investment and will
reduce the investment balance until such time as the
investment is reduced to an amount equal to
additional contributions. Distributions subsequently
received will be recognized as income.
<PAGE> 58
SCHEDULE III
REAL ESTATE ASSOCIATES LIMITED IV
REAL ESTATE AND ACCUMULATED DEPRECIATION
OF PROPERTY HELD BY LOCAL LIMITED PARTNERSHIPS
IN WHICH REAL IV HAS INVESTMENTS
DECEMBER 31, 1996
<TABLE>
<CAPTION>
Number Outstanding
of Mortgage Buildings, Furnishing Accumulated Construction
Partnership/Location Units Loan Land & Equipment Total Depreciation Period
- --------------------- ----- ----------- ----------- ------------ ------------ ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Alliance Towers 101 $2,427,729 $306,054 $3,210,423 $3,516,477 $2,128,627 (A)
Alliance, OH
Antelope Valley Apartments 121 5,352,170 377,311 6,827,086 7,204,397 3,362,654 1982-1983
Lancaster, CA
Armitage Commons 104 4,850,597 234,000 4,816,326 5,050,326 2,478,432 1982-1983
Chicago, IL
Barnesboro Family Project 62 1,880,675 55,247 2,766,171 2,821,418 1,294,521 1982-1983
Barnesboro, PA
Baughman Towers 104 3,613,033 285,159 4,054,854 4,340,013 2,735,848 (A)
Phillippi, WV
Beacon Hill/ 199 6,787,064 1,209,738 8,149,129 9,358,867 5,638,071 (A)
Hillsdale Place
Hillsdale, MI
Branford Elderly II 44 1,468,552 306,089 1,639,110 1,945,199 564,825 1982-1983
Branford, CT
Buckingham Apartments 83 3,562,341 608,527 4,069,558 4,678,085 1,962,751 1982-1983
Los Angeles, CA
Coatesville Towers 90 2,522,064 429,145 2,960,687 3,389,832 2,050,396 (A)
Coatesville, PA
Daniel Scott Commons 72 3,193,916 91,864 3,818,166 3,910,030 1,346,021 1982-1983
Chester, PA
Ethel Arnold 81 4,069,438 1,020,762 3,984,425 5,005,187 1,388,341 1982-1983
Los Angeles, CA
Glenoaks Townhouses 48 2,652,789 716,570 2,575,016 3,291,586 1,251,759 1982-1983
Los Angeles, CA
Lakeland Place 200 4,844,832 663,771 5,354,032 6,017,803 3,939,886 (A)
Waterford, MI
Loch Haven Apartments 208 2,940,293 402,000 4,385,299 4,787,299 3,230,781 (A)
Lauderhill, FL
Oakridge Park Apts. 40 959,596 40,000 1,152,116 1,192,116 1,031,059 1982-1983
North Biloxi, MS
One Madison Avenue 27 942,634 83,750 1,076,522 1,160,272 553,619 1982-1983
Madison, ME
O'Fallon Apartments 132 4,425,039 149,211 4,773,995 4,923,206 2,283,309 1981-1982
O'Fallon, IL
Pacific Coast Villa 50 1,206,899 100,000 1,607,587 1,707,587 865,146 (A)
Long Beach, CA
Queensbury Heights 64 1,883,487 50,000 2,568,504 2,618,504 1,102,378 1982-1983
Middlesboro, KY
Rosewood Apartments 150 5,483,977 541,000 5,799,175 6,340,175 3,304,472 (A)
Camarillo, CA
Sandwich Apartments 90 2,410,000 60,000 3,594,942 3,654,942 2,515,743 (A)
Sandwich, IL
Scituate Vista 232 7,068,742 414,914 10,160,666 10,575,580 4,366,028 1981-1983
Cranston, RI
Sterling Village 80 2,821,261 280,000 3,569,380 3,849,380 2,173,382 1982-1983
San Bernardino, CA
Villa del Sol 121 3,587,290 345,959 4,038,693 4,384,652 2,660,609 (A)
Norwalk, CA
Village of Albany/ 32 1,051,862 59,850 1,152,688 1,212,538 526,193 1982-1983
Village of Brodhead
Albany & Brodhead, WI
95 Vine Street 31 1,271,497 280,000 1,742,796 2,022,796 624,490 1982-1983
Hartford, CT
Vista Park Chino 40 1,951,661 261,548 2,350,219 2,611,767 1,170,252 1982-1983
Chino, CA
Wasco Arms Apartments 78 3,258,446 160,991 4,264,387 4,425,378 2,152,495 1982-1983
Wasco, CA
Wright Park Phase II 99 3,477,233 - - - - (A)
Rome, NY
Additional carrying value 941,860 9,200,516 10,142,376 6,075,809
of real estate on investee
limited partnerships not
recorded on said limited
partnerships
----- ----------- ----------- ------------ ------------ -----------
TOTAL 2,783 $91,965,117 $10,475,320 $115,662,488 $126,137,788 $64,867,897
===== =========== =========== ============ ============ ===========
</TABLE>
<PAGE> 59
SCHEDULE III
(Continued)
REAL ESTATE ASSOCIATES LIMITED IV
REAL ESTATE AND ACCUMULATED DEPRECIATION OF PROPERTY
HELD BY LOCAL LIMITED PARTNERSHIPS
IN WHICH REAL IV HAS INVESTMENTS
DECEMBER 31, 1996
NOTES: 1. Each local limited partnership has developed, owns and
operates the housing project. Substantially all project
costs, including construction period interest expense, are
being capitalized by the limited partnerships.
2. Depreciation is, or will be, provided for by various methods
over the estimated useful lives of the projects. The
estimated composite useful lives of the buildings are
generally from 25 to 40 years.
3. Investments in property and equipment:
<TABLE>
<CAPTION>
Buildings,
Furnishings,
And
Land Equipment Total
---------- ------------ ------------
<S> <C> <C> <C>
Balance, January 1, 1994 $10,262,475 $117,239,717 $127,502,192
Net additions during 1994 44,528 1,149,116 1,193,644
----------- ------------ ------------
Balance, December 31, 1994 10,307,003 118,388,833 128,695,836
Net additions during 1995 177,017 84,592 261,609
----------- ------------ ------------
Balance, December 31, 1995 10,484,020 118,473,425 128,957,445
Net deletions during 1996 (8,700) (2,810,957) (2,819,657)
----------- ------------ ------------
Balance, December 31, 1996 $10,475,320 $115,662,468 $126,137,788
=========== ============ ============
</TABLE>
<PAGE> 60
SCHEDULE III
(Continued)
REAL ESTATE ASSOCIATES LIMITED IV
REAL ESTATE AND ACCUMULATED DEPRECIATION OF PROPERTY
HELD BY LOCAL LIMITED PARTNERSHIPS
IN WHICH REAL IV HAS INVESTMENTS
DECEMBER 31, 1996
<TABLE>
<CAPTION>
Buildings
Furnishings
and Equipment
-------------
ACCUMULATED DEPRECIATION:
- ------------------------
<S> <C>
Balance, January 1, 1994 $57,691,734
Net additions during 1994 1,856,956
-----------
Balance, December 31, 1994 59,548,690
Net additions during 1995 3,655,616
-----------
Balance, December 31, 1995 63,204,306
Net additions during 1996 1,663,591
-----------
Balance, December 31, 1996 $64,867,897
===========
</TABLE>
<PAGE> 61
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT:
REAL ESTATE ASSOCIATES LIMITED IV (the "Partnership") has no directors or
executive officers of its own.
National Partnership Investment Corp. ("NAPICO" or "the Managing General
Partner") is a wholly-owned subsidiary of Casden Investment Corporation, an
affiliate of The Casden Company. The following biographical information is
presented for the directors and executive officers of NAPICO with principal
responsibility for the Partnership's affairs.
CHARLES H. BOXENBAUM, 67, Chairman of the Board of Directors and Chief
Executive Officer of NAPICO.
Mr. Boxenbaum has been associated with NAPICO since its inception. He has been
active in the real estate industry since 1960, and prior to joining NAPICO was
a real estate broker with the Beverly Hills firm of Carl Rhodes Company.
Mr. Boxenbaum has been a guest lecturer at national and state realty
conventions, certified properties exchanger's seminars, Los Angeles Town Hall,
National Association of Home Builders, International Council of Shopping
Centers, Society of Conventional Appraisers, California Real Estate
Association, National Institute of Real Estate Brokers, Appraisal Institute,
various mortgage banking seminars, and the North American Property Forum held
in London, England. In 1963, he was the winner of the Snyder Award, the
highest annual award offered by the National Association of Real Estate Boards
for Best Exchange. He is one of the founders and a past director of the First
Los Angeles Bank, organized in November 1974. Mr. Boxenbaum was a member of
the Board of Directors of the National Housing Council. Mr. Boxenbaum received
his Bachelor of Arts degree from the University of Chicago.
BRUCE E. NELSON, 45, President and a director of NAPICO.
Mr. Nelson joined NAPICO in 1980 and became President in February 1989. He is
responsible for the operations of all NAPICO sponsored limited partnerships.
Prior to that he was primarily responsible for the securities aspects of the
publicly offered real estate investment programs. Mr. Nelson is also involved
in the identification, analysis, and negotiation of real estate investments.
From February 1979 to October 1980, Mr. Nelson held the position of Associate
General Counsel at Western Consulting Group, Inc., private residential and
commercial real estate syndicators. Prior to that time, Mr. Nelson was engaged
in the private practice of law in Los Angeles. Mr. Nelson received his
Bachelor of Arts degree from the University of Wisconsin and is a graduate of
the University of Colorado School of Law. He is a member of the State Bar of
California and is a licensed real estate broker in California and Texas.
ALAN I. CASDEN, 51, Chairman of The Casden Company, an affiliate of Casden
Properties (formerly CoastFed Properties), a director and member of the audit
committee of NAPICO, and chairman of the Executive Committee of NAPICO.
Mr. Casden is Chairman of the Board, Chief Executive Officer and sole
shareholder of The Casden Company and Casden Investment Company. Prior to
that, he was the president and chairman of Mayer Group, Inc., which he joined
in 1975. He is also chairman of Mayer Management, Inc., a real estate
management firm. Mr. Casden has been involved in approximately $3 billion of
real estate financings and sales and has been responsible for the development
and construction of more than 12,000 apartment units and 5,000 single-family
homes and condominiums.
<PAGE> 62
Mr. Casden is a member of the American Institute of Certified Public
Accountants and of the California Society of Certified Public Accountants. Mr.
Casden is a member of the advisory board of the National Multi-Family Housing
Conference, the Multi-Family Housing Council, and the President's Council of
the California Building Industry Association. He also serves on the advisory
board to the School of Accounting of the University of Southern California. He
holds a Bachelor of Science degree and a Masters in Business Administration
degree from the University of Southern California.
HENRY C. CASDEN, 53, President, Chief Operating Officer and Secretary of The
Casden Company and a director and secretary of NAPICO.
Mr. Casden has been President and Chief Operating Officer of The Casden
Company, as well as a director of NAPICO since February 1988. He became
secretary of both companies in late 1994. From 1982 to 1988, Mr. Casden was of
counsel and a partner in the Los Angeles law firm of Troy, Casden & Gould.
From 1978 to 1981, he was of counsel and a partner in the Los Angeles law firm
of Loeb & Loeb. From 1972 to 1978, Mr. Casden was a member of the Beverly
Hills law firm of Fink & Casden, Professional Corporation.
Mr. Casden received his Bachelor of Arts degree from the University of
California at Los Angeles, and is a graduate of the University of San Diego Law
School. Mr. Casden is a member of the State Bar of California and has numerous
professional affiliations.
BRIAN D. GOLDBERG, 33, Chief Financial Officer of The Casden Company and a
director of NAPICO.
Mr. Goldberg joined The Casden Company in 1990 as Vice President of Finance and
became Chief Financial Officer in March 1991. Prior to joining The Casden
Company, Mr. Goldberg was with Arthur Andersen & Co., an international public
accounting firm, from August 1985 until July 1990 in their Los Angeles office.
He received his bachelor of science degree in Accounting from the University of
Denver. Mr. Goldberg is a member of the American Institute of Certified Public
Accountants and the California Society of Certified Public Accountants.
SHAWN HORWITZ, 37, Executive Vice President and Chief Financial Officer.
Mr. Horwitz joined NAPICO in 1990 and is responsible for the financial affairs
of NAPICO and the limited partnerships sponsored by NAPICO. Prior to joining
NAPICO, Mr. Horwitz was President for approximately one year of Star Sub Shops,
Inc., a corporation engaged in the business of selling fast food franchises,
was an audit manager in the real estate industry group for Altschuler, Melvin &
Glasser for six years, and was an auditor with Arthur Young & Co. for 3 years.
Mr. Horwitz received his Bachelor of Commerce degree in accounting from Rhodes
University in South Africa and is a member of the Illinois Society of Certified
Public Accountants, the American Institute of Certified Public Accountants and
the South African Institute of Chartered Accountants.
BOB SCHAFER, 55, Senior Vice President and Corporate Controller.
Mr. Schafer joined NAPICO in 1984 and is the Corporate Controller responsible
for the financial reporting function of the Company. Prior to this, he was a
Group and Division Controller at Bergen Brunswig for over eight years,
Controller at a Flintkote subsidiary for over four years, and Assistant
Controller at an electronics subsidiary of General Electric for two years. Mr.
Schafer is a member of the California Society of Certified Public Accountants.
He holds a Bachelor of Science degree in accounting from Woodbury University,
Los Angeles.
<PAGE> 63
PATRICIA W. TOY, 67, Senior Vice President - Communications and Assistant
Secretary.
Mrs. Toy joined NAPICO in 1977, following her receipt of an MBA from the
Graduate School of Management, UCLA. From 1952 to 1956, Mrs. Toy served as a
U.S. Naval Officer in communications and personnel assignments. She holds a
Bachelor of Arts Degree from the University of Nebraska.
MARK L. WALTHER, 36, Executive Vice President, General Counsel and Assistant
Secretary.
Mr. Walther joined NAPICO in 1987 and is responsible for the legal affairs of
the NAPICO sponsored limited partnerships. Prior to joining NAPICO, Mr.
Walther worked in the San Francisco law firm of Browne and Kahn which
specialized in construction litigation. Mr. Walther received his Bachelor of
Arts Degree in Political Science from the University of California, Santa
Barbara and is a graduate of the University of California, Davis, School of
Law. He is a member of the State Bar of Hawaii.
<PAGE> 64
ITEM 11. MANAGEMENT RENUMERATION AND TRANSACTIONS:
Real Estate Associates Limited IV has no officers, employees or directors.
However, under the terms of the Restated Certificate and Agreement of Limited
Partnership, the Partnership is obligated to pay the Corporate General Partner
an annual management fee. The annual management fee is approximately equal to
.4% of the invested assets, including the Partnership's allocable share of the
mortgages related to real estate properties held by local limited partnerships.
The fee is earned beginning in the month the Partnership makes its initial
contribution to the limited partnership. In addition, the Partnership
reimburses the Corporate General Partner for certain expenses.
An affiliate of the General Partner is responsible for the on-site property
management for certain properties owned by the limited partnerships in which
the Partnership has invested.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT:
(a) Security Ownership of Certain Beneficial Owners
The general partners own all of the outstanding general partnership
interests of REAL IV; no person is known to own beneficially in excess
of 5% of the outstanding limited partnership interests.
(b) At December 31, 1996, security ownership of management is as listed:
<TABLE>
<CAPTION>
Percentage of
Outstanding
Amount and Limited
Name of Nature of Partnership
Title of Class Owner Beneficial Owner Interests
- -------------- ------- ---------------- -----------
<S> <C> <C> <C>
Limited Charles H. Boxenbaum
Partnership 780 Latimer Road
Interest Santa Monica, CA 90402 $ 7,500 *
</TABLE>
* Cumulative limited partnership interests owned by corporate officers or
the General Partner is less than 1% interest of total outstanding
Limited Partnership interests.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS:
The Partnership has no officers, directors or employees of it's own. All of
its affairs are managed by the Corporate General Partner, National Partnership
Investments Corp. The transactions with the Corporate General Partner are
primarily in the form of fees paid by the Partnership to the general partner
for services rendered to the Partnership, as discussed in Item 11 and in the
notes to the accompanying financial statements.
<PAGE> 65
ITEM 14. FINANCIAL STATEMENTS, SCHEDULES, EXHIBITS AND REPORT ON FORM 8-K:
FINANCIAL STATEMENTS
Report of Independent Public Accountants.
Balance Sheets as of December 31, 1996 and December 31, 1995.
Statements of Operations for the years ended December 31, 1996, 1995 and 1994.
Statements of Partners' Equity (Deficiency) for the years ended December 31,
1996, 1995 and 1994.
Statements of Cash Flows for the years ended December 31, 1996, 1995 and 1994.
Notes to Financial Statements December 31, 1996.
FINANCIAL STATEMENT SCHEDULES
APPLICABLE TO REAL ESTATE ASSOCIATES LIMITED IV, REAL ESTATE ASSOCIATES II AND
TO THE LIMITED PARTNERSHIPS IN WHICH REAL ESTATE ASSOCIATES IV AND REAL ESTATE
ASSOCIATES II HAVE INVESTMENTS:
Schedule - Investment in Limited Partnerships, December 31, 1996, 1995 and
1994.
Schedule III - Real Estate and Accumulated Depreciation, December 31, 1996.
The remaining schedules are omitted because any required information is
included in the financial statements and notes thereto.
EXHIBITS
(3) Articles of incorporation and bylaws: The registrant is not
incorporated. The Partnership Agreement was filed with Form S-11,
File #274063 which is hereby incorporated by reference.
(10) Material contracts: The registrant is not party to any material
contracts, other than the Restated Certificate and Agreement of
Limited Partnership dated August 24, 1981, and the twenty-nine
contracts representing the Partnership investment directly or
indirectly in local limited partnerships as previously filed at the
Securities Exchange Commission, File #274063 which is hereby
incorporated by reference.
(13) Annual report to security holders: Pages ____ to ____.
REPORTS ON FORM 8-K
A report on Form 8-K dated November 6, 1996, was filed with the Securities and
Exchange Commission. This Form 8-K disclosed that the registrant became aware
of an entity conducting a tender offer for units in the registrant. The
general partners on behalf of the registrant, by letter, dated November 6,
1996, advised the limited partners that the general partners expressed no
opinion regarding this offer, but urged the limited partners to consult with
their tax advisors about the tax consequences that could result from a sale of
their units.
<PAGE> 66
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Los
Angeles, State of California.
REAL ESTATE ASSOCIATES LIMITED IV
By: NATIONAL PARTNERSHIP INVESTMENTS CORP.
The General Partner
________________________________________________________
Charles H. Boxenbaum
Chairman of the Board of Directors
and Chief Executive Officer
_______________________________________________________
Bruce E. Nelson
Director and President
_______________________________________________________
Alan I. Casden
Director
_______________________________________________________
Henry C. Casden
Director
________________________________________________________
Brian D. Goldberg
Director
_______________________________________________________
Shawn D. Horwitz
Executive Vice President and
Chief Financial Officer
______________________________________________________
Bob E. Schafer
Senior Vice President and Corporate Controller
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 6,603,047
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 6,603,047
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0
0
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</TABLE>
