SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K/A
Amendment No. 1 to
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Original Report: August 28, 1997
CORNERSTONE REALTY INCOME TRUST, INC.
(Exact name of registrant as specified in its charter)
VIRGINIA 0-23954 54-1589139
(State of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
306 East Main Street
Richmond, Virginia 23219
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code: (804) 643-1761
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CORNERSTONE REALTY INCOME TRUST, INC.
FORM 8-K/A
Index
Item 7. Financial Statements and Exhibit
a. Independent Accountants' Report (Italian Village
and Villa Marina Apartments)
Historical Statement of Income and Direct Operating
Expenses (Unaudited)
(Italian Village and Villa Marina Apartments)
Notes to Historical Statement of Income and Direct
Operating Expenses
(Italian Village and Villa Marina Apartments)
d. Exhibits
23.1 Consent of Independent Accountants
The Company hereby amends Items 7.a., 7.b., 7.c. and 7.d. of its
Current Report on Form 8-K dated August 28, 1997 as follows:
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ITEMS 7.a., 7.b. and 7.c.
Following is a compiled (unaudited) statement of income and direct
operating expenses exclusive of items not comparable to the proposed future
operations of the property Italian Village Apartments (t/a Italian Village
Apartments and Villa Marina Apartments) for the twelve-month period ended July
31, 1997. The Company is unable to provide an audited statement relative to such
property. However, the Company's filing of a compiled, rather than an audited,
statement (in light of the significance of the acquisition to the Company in
terms of purchase price, the Company's assets, and the Company's providing of
audited financial statements with regard to other property acquisitions) is
consistent and in compliance with Securities and Exchange Commission staff
interpretations regarding the relevant financial statement filing requirements
of SEC Regulation S-X and Rule 3-14 thereunder.
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[letterhead]
L.P. Martin & Company
4132 Innslake Drive
Glen Allen, Virginia 23060
Phone: (804) 346-2626
Fax: (804) 346-9311
Independent Accountants' Report
The Board of Directors
Cornerstone Realty Income Trust, Inc.
Richmond, Virginia
We have complied the accompanying statement of income and direct
operating expenses exclusive of items not comparable to the proposed future
operations of the property Italian Village Apartments, t/a Italian Village
Apartments and Villa Marina Apartments, located in Charlotte, North Carolina for
the twelve month period ended July 31, 1997, in accordance with Statements on
Standards for Accounting and Review Services issued by the American Institute of
Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of management. We have not
audited or reviewed the accompanying financial statement and, accordingly, do
not express an opinion or any other form of assurance on it.
The accompanying statement was prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission (for inclusion in a filing by Cornerstone Realty Income Trust, Inc.)
and excludes material expenses, described in Note 2 to the statement, that would
not be comparable to those resulting from the proposed future operations of the
property.
/s/ L.P. Martin & Co., P.C.
November 7, 1997
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ITALIAN VILLAGE APARTMENTS
STATEMENT OF INCOME AND DIRECT OPERATING EXPENSES EXCLUSIVE OF
ITEMS NOT COMPARABLE TO THE PROPOSED FUTURE
OPERATIONS OF THE PROPERTY
TWELVE MONTH PERIOD ENDED JULY 31, 1997
INCOME
Rental and Other Income $1,298,014
DIRECT OPERATING EXPENSES
Administrative and Other 89,889
Insurance 29,606
Repairs and Maintenance 264,666
Taxes, Property 82,821
Utilities 104,806
-------
TOTAL DIRECT OPERATING EXPENSES 571,788
-------
Operating income exclusive of items not comparable
to the proposed future operations of the property $726,226
========
See accompanying notes to the financial statement.
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ITALIAN VILLAGE APARTMENTS
NOTE TO THE STATEMENT OF INCOME AND DIRECT OPERATING EXPENSES
EXCLUSIVE OF ITEMS NOT COMPARABLE TO THE PROPOSED
FUTURE OPERATIONS OF THE PROPERTY
TWELVE MONTH PERIOD ENDED JULY 31, 1997
NOTE 1 - ORGANIZATION
Italian Village Apartments consists of Italian Village Apartments, a 156 unit
garden and townhouse style apartment complex and Villa Marina Apartments, an
adjacent 44 unit garden & townhouse style apartment complex. The apartment
complexes are located on 22.43 acres in Charlotte, North Carolina. The assets
comprising the property were owned by Italian Investment Company, a partnership
unaffiliated with Cornerstone Realty Income Trust, Inc., during the financial
statement period. Cornerstone Realty Income Trust, Inc. subsequently purchased
the property.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. In
accordance with Rule 3-14 of Regulation S-X of the Securities and Exchange
Commission, the statement of income and direct operating expenses excludes
interest and non rent related income and expenses not considered comparable to
those resulting from the proposed future operations of the property. Excluded
expenses are mortgage interest, property depreciation, amortization and
management fees.
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 revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Advertising - Advertising costs are expensed in the period incurred.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Report on Form 8-K/A to be signed on its behalf
by the undersigned hereunto duly authorized.
Cornerstone Realty Income Trust, Inc.
Date: November 10, 1997 By: /s/ Stanley J. Olander, Jr.
---------------------------
Stanley J. Olander, Jr.
Chief Financial Officer of Cornerstone
Realty Income Trust, Inc.
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EXHIBIT INDEX
Cornerstone Realty Income Trust
Form 8-K/A to Form 8-K dated August 28, 1997
Exhibit Number Exhibit
23.1 Consent of Independent Accountants
Exhibit 23
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[letterhead]
L.P. Martin & Company
4132 Innslake Drive
Glen Allen, Virginia 23060
Phone: (804) 346-2626
Fax: (804) 346-9311
Consent of Independent Accountants'
The Board of Directors
Cornerstone Realty Income Trust, Inc.
Richmond, Virginia
We consent to the use of our report dated November 7, 1997 with
respect to the statement of income and direct operating expenses exclusive of
items not comparable to the proposed future operations of the property Italian
Village Apartments for the twelve month period ended July 31, 1997 for inclusion
in the Form 8K filing with the Securities and Exchange Commission by Cornerstone
Realty Income Trust, Inc.
/s/ L. P. Martin & Co., P.C.
Richmond, Virginia
November 7, 1997
