UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A
(Mark one)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 0-14435
CONSOLIDATED RESOURCES HEALTH CARE FUND IV
(Exact name of registrant as specified in its charter)
Georgia 58-1582370
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) (identification No.)
7000 Central Parkway, Suite 970, Atlanta, Georgia 30328
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 404-698-9040
Indicate by check mark whether the registrant, (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months, and (2) has been
subject to such filing requirements for the past 90 days.
Yes x No
THERE ARE NO EXHIBITS.
PAGE ONE OF 10 PAGES.
PART I. - FINANCIAL INFORMATION
CONSOLIDATED RESOURCES HEALTH CARE FUND IV
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
1995 1994
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 635,849 $ 820,321
Accounts receivable, net of allowance
for doubtful accounts of $72,978 416,847 367,145
Prepaid expenses 37,952 37,952
Property held for sale 3,221,293 3,268,042
Total current assets 4,311,941 4,493,460
Restricted escrows and other deposits 364,852 329,589
Note receivable 250,000 250,000
Deferred loan costs, net of accumulated
amortization of $90,049 and $78,480 117,807 120,699
Total other assets 732,659 700,288
$ 5,044,600 $ 5,193,748
LIABILITIES AND PARTNERS' DEFICIT
Current liabilities:
Current maturities of long-term obligations
including debt in default $ 4,660,201 $ 4,683,405
Trade accounts payable 123,141 112,059
Accrued compensation 137,305 144,832
Insurance payable 39,256 38,129
Accrued interest 470,962 397,326
Accrued real estate taxes 29,550 18,833
Total current liabilities 5,460,414 5,394,584
Advances from former affiliates (Note 6) - 1,941,359
Total liabilities 5,460,414 7,335,943
Partners' deficit:
Limited partners 253,842 (1,403,484)
General partners (669,656) (738,711)
Total partners' deficit (415,814) (2,142,195)
$ 5,044,600 $ 5,193,748
See accompanying notes to consolidated financial statements 2
CONSOLIDATED RESOURCES HEALTH CARE FUND IV
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended March 31,
1995 1994
Revenues:
Operating revenue $1,346,491 $1,243,465
Interest income 11,633 15,338
Total revenues 1,358,124 1,258,803
Expenses:
Operating expenses 1,350,963 1,252,075
Interest 118,526 111,973
Depreciation and amortization 83,729 90,297
Partnership administration costs 19,883 56,275
Total expenses 1,573,101 1,510,620
Operating loss (214,977) (251,817)
Litigation settlement
income (Note 6) - 76,345
Gain on sale of property (Note 5) - 607,169
Income(loss) before
extraordinary gain (214,977) 431,697
Extraordinary gain on settlement
of advances (Note 6) 1,941,358 -
Net Income $1,726,381 $ 431,697
Net income(loss) per L.P. unit
Income (loss) before
extraordinary gain $ (7.85) $ 16.46
Extraordinary gain on settlement
of advances 70.91 -
Net income per L.P. unit $ 63.06 $ 16.46
L.P. units outstanding 26,283 26,283
See accompanying notes to consolidated financial statements 3
CONSOLIDATED RESOURCES HEALTH CARE FUND IV
CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
(Unaudited)
Total
Partners'
General Limited Deficit
Balance, at December 31, 1993 $ (712,690) $ (383,426) $ (1,096,116)
Net income(loss) (851) 432,548 431,697
Balance, at March 31, 1994 $ (713,541) $ 49,122 $ (664,419)
Balance, at December 31,1994 $ (738,711) $ (1,403,484) $ (2,142,195)
Net income 69,055 1,657,326 1,726,381
Balance, at March 31, 1995 $ (669,656) $ 253,842 $ (415,814)
See accompanying notes to consolidated financial statements. 4
CONSOLIDATED RESOURCES HEALTH CARE FUND IV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended March 31,
1995 1994
Operating Activities:
Cash received from residents and
government agencies $ 1,296,789 $ 1,283,620
Cash paid to suppliers and employees (1,355,447) (1,180,942)
Cash paid into restricted escrows (35,263) (57,328)
Interest received 11,633 15,338
Interest paid (44,890) (27,878)
Property taxes paid - (24,281)
Cash provided by (used in) operating activities (127,178) 8,529
Investing Activities:
Addition to property and equipment
held for sale (34,090) (33,373)
Net proceeds from sale of property (Note 5) - 1,410,283
Cash provided by (used in) investing activites (34,090) 1,376,910
Financing Activities:
Principal payments on long-term obligations (23,204) (14,143)
Cash used in financing activities (23,204) (14,143)
Net increase (decrease) in cash
and cash equivalents (184,472) 1,371,296
Cash and cash equivalents, beginning of period 820,321 917,478
Cash and cash equivalents, end of period $ 635,849 $ 2,288,774
See accompanying notes to consolidated financial statements. 5
CONSOLIDATED RESOURCES HEALTH CARE FUND IV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended March 31,
1995 1994
Reconciliation of Net Income to Cash Provided
by (Used in) Operating Activities:
Net income $ 1,726,381 $ 431,697
Adjustments to reconcile net income to
cash provided by (used in) operating activities:
Depreciation and amortization 83,729 90,297
Gain on settlement of advances (1,941,358)
Gain on sale of property - (607,169)
Changes in assets and liabilities:
Accounts receivable (49,702) (36,190)
Other assets - 25,931
Trade accounts payable and 89,034 161,291
accrued liabilities
Restricted Escrow and other deposits (35,263) (57,328)
Cash provided by (used in) operating activities$ (127,178) $ 8,529
See accompanying notes to consolidated financial statements. 6
CONSOLIDATED RESOURCES HEALTH CARE FUND IV
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995
NOTE 1.
The consolidated financial statements are unaudited and reflect
all adjustments (consisting only of normal recurring adjustments)
which are, in the opinion of management necessary for a fair
presentation of the financial position and operating results for
the interim periods. The results of operations for the three
months ended March 31, 1995, are not necessarily indicative of
the results to be expected for the year ending December 31, 1995.
NOTE 2.
The consolidated financial statements should be read in
conjunction with the consolidated financial statements and the
notes thereto contained in the Partnership's Annual Report on
Form 10-K for the year ended December 31, 1994, as filed with the
Securities and Exchange Commission, a copy of which is available
upon request by writing to WelCare Service Corporation-IV (the
"Managing General Partner"), at 7000 Central Parkway, Suite 970,
Atlanta, Georgia, 30328.
NOTE 3.
A summary of compensation paid to or accrued for the benefit of
the Partnership's general partners and their affiliates and
amounts reimbursed for costs incurred by these parties on the
behalf of the Partnership are as follows:
Three Months Ended
March 31,
1995 1994
Charged to costs and expenses:
Property management and oversight
management fees . . . . . . . . . . $80,417 $75,542
Financial accounting, data processing,
tax reporting, legal and compliance,
investor relations and supervision
of outside services. . . . . . . . $19,883 $15,835
NOTE 4.
The Partnership's consolidated financial statements have been
presented on the basis that it is a going concern, which
contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. At March 31, 1995,
the Partnership has experienced working capital deficiencies, had
7
defaulted on certain debt obligations and had no assurance of any
financial support from the General Partners.
The Partnership's continued existence is dependent upon its
ability to generate sufficient cash flow to meet its obligations
on a timely basis, to comply with the terms of its financing
agreements, and to obtain additional financing as may be
required.
NOTE 5:
On January 31, 1994, Rainbow Springs ("Rainbow") was auctioned
for sale by the Bankruptcy Court presiding over the bankruptcy
proceedings of the joint owner of the Rainbow property. On
February 1, 1994, the Bankruptcy Court approved the auction sale
of Rainbow to a third-party purchaser for $4,200,000 in cash. On
March 21, 1994, after payment of closing expenses and outstanding
property taxes of $1,213,408, the Partnership received 62%, or
$1,410,283 of the net proceeds from the sale, resulting in a gain
to the Partnership of $607,169. In the Consolidated Statement of
Cash Flows, proceeds from the sale are shown net of the payment
of property taxes and other closing costs. Accordingly, the
payment of these property taxes is not shown within Operating
Activities in the statement.
NOTE 6:
In November 1990, the Parnership filed claims against Southmark
Corporation ("Southmark"), in the Bankruptcy Court. In response
to the partnership's filing, Southmark filed suit against the
Parnership in August of 1991. The Parntership and Southmark
reached a settlement of this litigation and the partnership
received a nonappealable court order approving the settlement in
April 1994. Under this settlement, Southmark paid the
Partnership $76,345, which was included in litigation settlement
income in the accompanying statements of operations.
During the first quarter of 1995, the Partnership recognized a
gain on the settlement of advances as all litigation issues have
been resolved with Southmark. Prior to the settlement,
Southmark and the Corporate General Partner of the Partnership
each asserted their position with respect to operating
advances made to the Partnership prior to 1990.
NOTE 7:
The Partnership was in technical default on its long-term debt
obligations secured by Heritage Manor of Hoisington
("Hoisington") and Heritage Manor of Emporia ("Emporia") as of
March 31, 1995, and December 31, 1994, due to inadequate reserve
requirements. Accordingly, these obligations were included in
Current maturities of long-term obligations in the accompanying
balance sheets.
8
During February 1995, the partnership ceased fundings of a bond
sinking fund used to service debt secured by The Oaks of Mountain
Grove. Currently, the Partnership is in negotiations with the
lender and is seeking a buyer for the facility to purchase the
property and assume the debt balance on the facility.
Accordingly, the facility's debt was included in Current
maturities of long-term obligations in the accompanying balance
sheets.
9
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
CONSOLIDATED RESOURCES HEALTH CARE FUND IV
By: WELCARE CONSOLIDATED RESOURCES
CORPORATION OF AMERICA
Corporate General Partner
Date: June 22, 1995 By: /s/ J. Stephen Eaton
J. Stephen Eaton,
Sole Director and
Principal Executive Officer of
the
Corporate General Partner
Date: June 22, 1995 By: /s/ Alan C. Dahl
Alan C. Dahl,
Principal Financial Officer of the
Corporate General Partner
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