UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES
EXCHANGE ACT OF 1934
For The Quarterly Period Ended September 30, 1996
Commission File Number 0-19022
Gateway Tax Credit Fund II Ltd.
(Exact name of Registrant as specified in its charter)
Florida 65-0142704
(State or other jurisdiction of ( I.R.S. Employer No.)
incorporation or organization)
880 Carillon Parkway, St. Petersburg, Florida 33716
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (813)573-3800
Indicate by check mark whether the Registrant: (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the Registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
YES X NO
Number of Units
Title of Each Class September 30, 1996
Beneficial Assignee Certificates:
$1,000 per certificate 37,228
DOCUMENTS INCORPORATED BY REFERENCE
Parts I and II, 1995 Form 10-K, filed with the
Securities and Exchange Commission on June 27, 1996
Parts III and IV - Form S-11 Registration Statement
and all amendments and supplements thereto
File No. 33-31821
<PAGE>
PART I - Financial Information
Item 1. Financial Statements
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SEPTEMBER 30, MARCH 31,
1996 1996
----------- -----------
SERIES 2 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 143,039 $ 135,519
Investments in Securities 44,210 43,655
----------- ----------
Total Current Assets 187,249 179,174
Investments in Securities 333,713 363,740
Investments in Project
Partnerships, Net 1,106,079 1,350,923
----------- ----------
Total Assets $1,627,041 $1,893,837
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 43,331 $ 44,607
Long-Term Liabilities:
Payable to General Partners 227,945 225,720
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 6,136
at September 30, 1996 and March 31, 1996
have been issued to the assignees
Assignees
Units of beneficial interest of
the limited partnership interest of
the assignor limited partner, $1,000
stated value per BAC, 6,136 at
September 30, 1996 and March 31, 1996,
issued and outstanding 1,396,007 1,661,075
General Partners (40,242) (37,565)
----------- ----------
Total Partners' Equity 1,355,765 1,623,510
----------- ----------
Total Liabilities and
Partners Equity $1,627,041 $1,893,837
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SEPTEMBER 30, MARCH 31,
1996 1996
----------- ----------
SERIES 3 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 107,298 $ 97,988
Investments in Securities 39,324 38,831
----------- ----------
Total Current Assets 146,622 136,819
Investments in Securities 296,830 323,539
Investments in Project
Partnerships, Net 686,967 901,663
----------- ----------
Total Assets $1,130,419 $1,362,021
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 47,498 $ 48,855
Long-Term Liabilities:
Payable to General Partners 182,353 189,722
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 5,456
at September 30, 1996 and March 31, 1996
have been issued to the assignees
Assignees
Units of beneficial interest of
the limited partnership interest of
the assignor limited partner, $1,000
stated value per BAC, 5,456 at
September 30, 1996 and March 31, 1996,
issued and outstanding 939,378 1,160,025
General Partners (38,810) (36,581)
---------- ----------
Total Partners' Equity 900,568 1,123,444
----------- ----------
Total Liabilities and
Partners Equity $1,130,419 $1,362,021
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SEPTEMBER 30, MARCH 31,
1996 1996
----------- ----------
SERIES 4 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 185,035 $ 178,506
Investments in Securities 49,819 49,195
----------- ----------
Total Current Assets 234,854 227,701
Investments in Securities 376,055 409,891
Investments in Project
Partnerships, Net 1,754,955 2,073,510
----------- ----------
Total Assets $2,365,864 $2,711,102
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 52,316 $ 53,905
Long-Term Liabilities:
Payable to General Partners 209,343 212,638
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 6,915
at September 30, 1996 and March 31, 1996
have been issued to the assignees
Assignees
Units of beneficial interest of
the limited partnership interest of
the assignor limited partner, $1,000
stated value per BAC, 6,915 at
September 30, 1996 and March 31, 1996,
issued and outstanding 2,143,817 2,480,767
General Partners (39,612) (36,208)
----------- ----------
Total Partners' Equity 2,104,205 2,444,559
----------- ----------
Total Liabilities and
Partners Equity $2,365,864 $2,711,102
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SEPTEMBER 30, MARCH 31,
1996 1996
----------- ----------
SERIES 5 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 253,333 $ 257,549
Investments in Securities 62,093 61,314
----------- ----------
Total Current Assets 315,426 318,863
Investments in Securities 468,703 510,876
Investments in Project
Partnerships, Net 2,789,102 3,211,868
----------- ----------
Total Assets $3,573,231 $4,041,607
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 70,251 $ 72,085
Long-Term Liabilities:
Payable to General Partners 191,267 201,848
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 8,616
at September 30, 1996 and March 31, 1996
have been issued to the assignees
Assignees
Units of beneficial interest of
the limited partnership interest of
the assignor limited partner, $1,000
stated value per BAC, 8,616 at
September 30, 1996 and March 31, 1996,
issued and outstanding 3,354,219 3,805,620
General Partners (42,506) (37,946)
----------- ----------
Total Partners' Equity 3,311,713 3,767,674
----------- ----------
Total Liabilities and
Partners Equity $3,573,231 $4,041,607
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SEPTEMBER 30, MARCH 31,
1996 1996
----------- ----------
SERIES 6 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 340,857 $ 388,991
Investments in Securities 44,245 43,120
----------- ----------
Total Current Assets 385,102 432,111
Investments in Securities 424,955 410,950
Investments in Project
Partnerships, Net 4,372,633 4,769,625
----------- ----------
Total Assets $5,182,730 $5,612,686
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 65,696 $ 67,831
Long-Term Liabilities:
Payable to General Partners 241,891 240,262
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 10,105
at September 30, 1996 and March 31, 1996
have been issued to the assignees
Assignees
Units of beneficial interest of
the limited partnership interest of
the assignor limited partner, $1,000
stated value per BAC, 10,105 at
September 30, 1996 and March 31, 1996,
issued and outstanding 4,915,119 5,340,274
General Partners (39,976) (35,681)
----------- ----------
Total Partners' Equity 4,875,143 5,304,593
----------- ----------
Total Liabilities and
Partners Equity $5,182,730 $5,612,686
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SEPTEMBER 30, MARCH 31,
1996 1996
----------- ----------
TOTAL SERIES 2 - 6 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $1,029,562 $1,058,553
Investments in Securities 239,691 236,115
----------- ----------
Total Current Assets 1,269,253 1,294,668
Investments in Securities 1,900,296 2,018,996
Investments in Project
Partnerships, Net 10,709,736 12,307,589
----------- ----------
Total Assets $13,879,285 $15,621,253
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 279,092 $ 287,283
Long-Term Liabilities:
Payable to General Partners 1,052,799 1,070,190
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 37,228
at September 30, 1996 and March 31, 1996
have been issued to the assignees
Assignees
Units of beneficial interest of
the limited partnership interest of
the assignor limited partner, $1,000
stated value per BAC, 37,228 at
September 30, 1996 and March 31, 1996,
issued and outstanding 12,748,540 14,447,761
General Partners (201,146) (183,981)
----------- -----------
Total Partners' Equity 12,547,394 14,263,780
----------- ----------
Total Liabilities and
Partners Equity $13,879,285 $15,621,253
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 2 ----------- ----------
Revenues:
Interest Income $ 9,144 $ 9,139
----------- ----------
Expenses:
Asset Management Fee-
General Partner 17,250 17,256
General and Administrative-
General Partner 1,676 984
General and Administrative-
Other 7,158 3,246
Amortization 1,203 1,321
----------- ----------
Total Expenses 27,287 22,807
Loss Before Equity in Losses of
Project Partnerships (18,143) (13,668)
Equity in Losses of Project
Partnerships (116,078) (145,518)
----------- ----------
Net Loss $ (134,221) $ (159,186)
=========== ==========
Allocation of Net Loss:
Assignees $ (132,879) $ (157,594)
General Partners (1,342) (1,592)
----------- ----------
$ (134,221) $ (159,186)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (21.66) $ (25.68)
Number of Beneficial Assignee
Certificates Outstanding 6,136 6,136
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 3 ----------- ----------
Revenues:
Interest Income $ 8,024 $ 7,752
----------- ----------
Expenses:
Asset Management Fee-
General Partner 15,982 16,010
General and Administrative-
General Partner 1,751 1,016
General and Administrative-
Other 10,281 3,158
Amortization 319 1,991
----------- ----------
Total Expenses 28,333 22,175
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (20,309) (14,423)
Equity in Losses of Project
Partnerships (120,574) (118,631)
----------- ----------
Net Loss $(140,883) $ (133,054)
=========== ==========
Allocation of Net Loss:
Assignees $(139,474) $ (131,723)
General Partners (1,409) (1,331)
----------- ----------
$(140,883) $ (133,054)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (25.56) $ (24.14)
Number of Beneficial Assignee
Certificates Outstanding 5,456 5,456
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 4 ----------- ----------
Revenues:
Interest Income $ 10,625 $ 10,483
----------- ----------
Expenses:
Asset Management Fee-
General Partner 19,596 19,642
General and Administrative-
General Partner 2,209 1,297
General and Administrative-
Other 7,384 3,676
Amortization 847 1,197
----------- ----------
Total Expenses 30,036 25,812
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (19,411) (15,329)
Equity in Losses of Project
Partnerships (155,597) (171,525)
----------- ----------
Net Loss $ (175,008) $ (186,854)
=========== ==========
Allocation of Net Loss:
Assignees $ (173,258) $ (184,985)
General Partners (1,750) (1,869)
----------- ----------
$ (175,008) $ (186,854)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (25.06) $ (26.75)
Number of Beneficial Assignee
Certificates Outstanding 6,915 6,915
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 5 ----------- ----------
Revenues:
Interest Income $ 13,576 $ 13,506
----------- ----------
Expenses:
Asset Management Fee-
General Partner 24,253 24,290
General and Administrative-
General Partner 2,742 1,609
General and Administrative-
Other 9,406 4,596
Amortization 3,116 3,082
----------- ----------
Total Expenses 39,517 33,577
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (25,941) (20,071)
Equity in Losses of Project
Partnerships (250,900) (205,049)
----------- ----------
Net Loss $ (276,841) $ (225,480)
=========== ==========
Allocation of Net Loss:
Assignees $ (274,073) $ (223,225)
General Partners (2,768) (2,255)
----------- ----------
$ (276,841) $ (225,480)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (31.81) $ (25.91)
Number of Beneficial Assignee
Certificates Outstanding 8,616 8,616
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 6 ----------- ----------
Revenues:
Interest Income $ 12,071 $ 12,348
----------- ----------
Expenses:
Asset Management Fee-
General Partner 26,916 26,977
General and Administrative-
General Partner 2,895 1,699
General and Administrative-
Other 6,909 5,253
Amortization 5,664 5,757
----------- ----------
Total Expenses 42,384 39,686
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (30,313) (27,338)
Equity in Losses of Project
Partnerships (174,399) (287,932)
----------- ----------
Net Loss $ (204,712) $ (315,270)
=========== ==========
Allocation of Net Loss:
Assignees $ (202,665) $ (312,117)
General Partners (2,047) (3,153)
----------- ----------
$ (204,712) $ (315,270)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (20.06) $ (30.89)
Number of Beneficial Assignee
Certificates Outstanding 10,105 10,105
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
TOTAL SERIES 2 - 6 ----------- ----------
Revenues:
Interest Income $ 53,440 $ 53,228
----------- ----------
Expenses:
Asset Management Fee-
General Partner 103,997 104,175
General and Administrative-
General Partner 11,273 6,605
General and Administrative-
Other 41,138 19,929
Amortization 11,149 13,348
----------- ----------
Total Expenses 167,557 144,057
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (114,117) (90,829)
Equity in Losses of Project
Partnerships (817,548) (929,015)
----------- ----------
Net Loss $ (931,665) $(1,019,844)
=========== ==========
Allocation of Net Loss:
Assignees $ (922,348) $(1,009,644)
General Partners (9,317) (10,200)
----------- ----------
$ (931,665) $(1,019,844)
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 2 ----------- ----------
Revenues:
Interest Income $ 18,436 $ 18,537
----------- ----------
Expenses:
Asset Management Fee-
General Partner 34,500 34,512
General and Administrative-
General Partner 3,340 3,226
General and Administrative-
Other 9,205 6,878
Amortization 2,406 2,642
----------- ----------
Total Expenses 49,451 47,258
Loss Before Equity in Losses of
Project Partnerships (31,015) (28,721)
Equity in Losses of Project
Partnerships (236,730) (307,609)
----------- ----------
Net Loss $ (267,745) $ (336,330)
=========== ==========
Allocation of Net Loss:
Assignees $ (265,068) $ (332,967)
General Partners (2,677) (3,363)
----------- ----------
$ (267,745) $ (336,330)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (43.20) $ (54.26)
Number of Beneficial Assignee
Certificates Outstanding 6,136 6,136
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 3 ----------- ----------
Revenues:
Interest Income $ 15,679 $ 15,724
----------- ----------
Expenses:
Asset Management Fee-
General Partner 31,964 32,020
General and Administrative-
General Partner 3,493 3,354
General and Administrative-
Other 12,158 7,418
Amortization 638 3,982
----------- ----------
Total Expenses 48,253 46,774
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (32,574) (31,050)
Equity in Losses of Project
Partnerships (190,302) (245,664)
----------- ----------
Net Loss $(222,876) $ (276,714)
=========== ==========
Allocation of Net Loss:
Assignees $(220,647) $ (273,947)
General Partners (2,229) (2,767)
----------- ----------
$(222,876) $ (276,714)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (40.44) $ (50.21)
Number of Beneficial Assignee
Certificates Outstanding 5,456 5,456
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 4 ----------- ----------
Revenues:
Interest Income $ 20,859 $ 21,377
----------- ----------
Expenses:
Asset Management Fee-
General Partner 39,192 39,284
General and Administrative-
General Partner 4,403 4,252
General and Administrative-
Other 9,963 8,122
Amortization 1,694 2,394
----------- ----------
Total Expenses 55,252 54,052
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (34,393) (32,675)
Equity in Losses of Project
Partnerships (305,961) (322,145)
----------- ----------
Net Loss $ (340,354) $ (354,820)
=========== ==========
Allocation of Net Loss:
Assignees $ (336,950) $ (351,272)
General Partners (3,404) (3,548)
----------- ----------
$ (340,354) $ (354,820)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (48.73) $ (50.80)
Number of Beneficial Assignee
Certificates Outstanding 6,915 6,915
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 5 ----------- ----------
Revenues:
Interest Income $ 26,713 $ 27,603
----------- ----------
Expenses:
Asset Management Fee-
General Partner 48,506 48,580
General and Administrative-
General Partner 5,466 5,278
General and Administrative-
Other 12,399 9,867
Amortization 6,232 6,164
----------- ----------
Total Expenses 72,603 69,889
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (45,890) (42,286)
Equity in Losses of Project
Partnerships (410,071) (347,407)
----------- ----------
Net Loss $ (455,961) $ (389,693)
=========== ==========
Allocation of Net Loss:
Assignees $ (451,401) $ (385,796)
General Partners (4,560) (3,897)
----------- ----------
$ (455,961) $ (389,693)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (52.39) $ (44.78)
Number of Beneficial Assignee
Certificates Outstanding 8,616 8,616
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 6 ----------- ----------
Revenues:
Interest Income $ 23,987 $ 24,896
----------- ----------
Expenses:
Asset Management Fee-
General Partner 53,832 53,954
General and Administrative-
General Partner 5,770 5,572
General and Administrative-
Other 9,828 10,921
Amortization 11,328 11,514
----------- ----------
Total Expenses 80,758 81,961
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (56,771) (57,065)
Equity in Losses of Project
Partnerships (372,679) (448,680)
----------- ----------
Net Loss $ (429,450) $ (505,745)
=========== ==========
Allocation of Net Loss:
Assignees $ (425,155) $ (500,688)
General Partners (4,295) (5,057)
----------- ----------
$ (429,450) $ (505,745)
=========== ==========
Net Loss Per Beneficial
Assignee Certificate $ (42.07) $ (49.55)
Number of Beneficial Assignee
Certificates Outstanding 10,105 10,105
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
TOTAL SERIES 2 - 6 ----------- ----------
Revenues:
Interest Income $ 105,674 $ 108,137
----------- ----------
Expenses:
Asset Management Fee-
General Partner 207,994 208,350
General and Administrative-
General Partner 22,472 21,682
General and Administrative-
Other 53,553 43,206
Amortization 22,298 26,696
----------- ----------
Total Expenses 306,317 299,934
----------- ----------
Loss Before Equity in Losses of
Project Partnerships (200,643) (191,797)
Equity in Losses of Project
Partnerships (1,515,743) (1,671,505)
----------- ----------
Net Loss $(1,716,386) $(1,863,302)
=========== ==========
Allocation of Net Loss:
Assignees $(1,699,221) $(1,844,670)
General Partners (17,165) (18,632)
----------- ----------
$(1,716,386) $(1,863,302)
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
General
Assignees Partners Total
SERIES 2 ----------- ----------- -----------
Balance at
March 31, 1995 $ 2,246,516 $ (31,651) $ 2,214,865
Net Loss (332,967) (3,363) (336,330)
----------- ---------- -----------
Balance at
September 30, 1995 $ 1,913,549 $ (35,014) $ 1,878,535
=========== ========== ===========
Balance at
March 31, 1996 $ 1,661,075 $ (37,565) $ 1,623,510
Net Loss (265,068) (2,677) (267,745)
----------- ---------- -----------
Balance at
September 30, 1996 $ 1,396,007 $ (40,242) $ 1,355,765
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
General
Assignees Partners Total
SERIES 3 ----------- ---------- -----------
Balance at
March 31, 1995 $ 1,626,196 $ (31,872) $ 1,594,324
Net Loss (273,947) (2,767) (276,714)
----------- ---------- -----------
Balance at
September 30, 1995 $ 1,352,249 $ (34,639) $ 1,317,610
=========== ========== ===========
Balance at
March 31, 1996 $ 1,160,025 $ (36,581) $ 1,123,444
Net Loss (220,647) (2,229) (222,876)
----------- ---------- -----------
Balance at
September 30, 1996 $ 939,378 $ (38,810) $ 900,568
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
General
Assignees Partners Total
SERIES 4 ----------- ---------- -----------
Balance at
March 31, 1995 $ 3,179,350 $ (29,152) $ 3,150,198
Net Loss (351,272) (3,548) (354,820)
----------- ---------- -----------
Balance at
September 30, 1995 $ 2,828,078 $ (32,700) $ 2,795,378
=========== ========== ===========
Balance at
March 31, 1996 $ 2,480,767 $ (36,208) $ 2,444,559
Net Loss (336,950) (3,404) (340,354)
----------- ---------- -----------
Balance at
September 30, 1996 $ 2,143,817 $ (39,612) $ 2,104,205
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
General
Assignees Partners Total
SERIES 5 ----------- ---------- -----------
Balance at
March 31, 1995 $ 4,579,242 $ (30,132) $ 4,549,110
Net Loss (385,796) (3,897) (389,693)
----------- ---------- -----------
Balance at
September 30, 1995 $ 4,193,446 $ (34,029) $ 4,159,417
=========== ========== ===========
Balance at
March 31, 1996 $ 3,805,620 $ (37,946) $ 3,767,674
Net Loss (451,401) (4,560) (455,961)
----------- ---------- -----------
Balance at
September 30, 1996 $ 3,354,219 $ (42,506) $ 3,311,713
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
General
Assignees Partners Total
SERIES 6 ----------- ---------- -----------
Balance at
March 31, 1995 $ 6,153,088 $ (27,471) $ 6,125,617
Net Loss (500,688) (5,057) (505,745)
----------- ---------- -----------
Balance at
September 30, 1995 $ 5,652,400 $ (32,528) $ 5,619,872
=========== ========== ===========
Balance at
March 31, 1996 $ 5,340,274 $ (35,681) $ 5,304,593
Net Loss (425,155) (4,295) (429,450)
----------- ---------- -----------
Balance at
September 30, 1996 $ 4,915,119 $ (39,976) $ 4,875,143
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
General
Assignees Partners Total
TOTAL SERIES 2 - 6 ----------- ---------- -----------
Balance at
March 31, 1995 $17,784,392 $ (150,278) $17,634,114
Net Loss (1,844,670) (18,632) (1,863,302)
----------- ---------- -----------
Balance at
September 30, 1995 $15,939,722 $ (168,910) $15,770,812
=========== ========== ===========
Balance at
March 31, 1996 $14,447,761 $ (183,981) $14,263,780
Net Loss (1,699,221) (17,165) (1,716,386)
----------- ---------- -----------
Balance at
September 30, 1996 $12,748,540 $ (201,146) $12,547,394
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 2 ----------- ---------
Cash Flows from Operating Activities:
Net Loss $ (267,745) $ (336,330)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 2,406 2,642
Accreted Interest Income
on Investments in Securities (14,183) (14,307)
Equity in Losses of
Project Partnerships 236,730 307,609
Interest Income from
Redemption of Securities 10,359 7,238
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners 950 (152)
----------- ---------
Net Cash Provided by (Used in)
Operating Activities (31,483) (33,300)
---------- ---------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 5,709 4,593
Redemption of Investment
in Securities 33,294 34,609
----------- ---------
Net Cash Provided by
Investing Activities 39,003 39,202
----------- ---------
Increase (Decrease) in Cash and
Cash Equivalents 7,520 5,902
Cash and Cash Equivalents at
Beginning of Year 135,519 127,890
----------- ---------
Cash and Cash Equivalents at
End of Year $ 143,039 $ 133,792
=========== =========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 3 ----------- ---------
Cash Flows from Operating Activities:
Net Loss $(222,876) $ (276,714)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 638 3,982
Accreted Interest Income
on Investments in Securities (12,617) (12,726)
Equity in Losses of
Project Partnerships 190,302 245,664
Interest Income from
Redemption of Securities 9,214 6,437
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (8,725) (5,823)
---------- ---------
Net Cash Provided by (Used in)
Operating Activities (44,064) (39,180)
---------- ---------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 23,757 20,900
Redemption of Investment
in Securities 29,617 30,785
---------- ---------
Net Cash Provided by
Investing Activities 53,374 51,685
---------- ---------
Increase (Decrease) in Cash and
Cash Equivalents 9,310 12,505
Cash and Cash Equivalents at
Beginning of Year 97,988 83,648
---------- ---------
Cash and Cash Equivalents at
End of Year $ 107,298 $ 96,153
========== =========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 4 ---------- ---------
Cash Flows from Operating Activities:
Net Loss $ (340,354) $ (354,820)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 1,694 2,394
Accreted Interest Income
on Investments in Securities (15,983) (16,123)
Equity in Losses of
Project Partnerships 305,961 322,145
Interest Income from
Redemption of Securities 11,674 8,156
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (4,885) (3,489)
---------- ---------
Net Cash Provided by (Used in)
Operating Activities (41,893) (41,737)
---------- ---------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 10,900 9,580
Redemption of Investment
in Securities 37,522 39,001
---------- ---------
Net Cash Provided by
Investing Activities 48,422 48,581
---------- ---------
Increase (Decrease) in Cash and
Cash Equivalents 6,529 6,844
Cash and Cash Equivalents at
Beginning of Year 178,506 168,651
---------- ---------
Cash and Cash Equivalents at
End of Year $ 185,035 $ 175,495
========== =========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 5 ---------- ---------
Cash Flows from Operating Activities:
Net Loss $ (455,961) $ (389,693)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 6,232 6,164
Accreted Interest Income
on Investments in Securities (19,921) (20,095)
Equity in Losses of
Project Partnerships 410,071 347,407
Interest Income from
Redemption of Securities 14,550 10,166
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (12,416) (17,263)
---------- ---------
Net Cash Provided by (Used in)
Operating Activities (57,445) (63,314)
========== =========
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 6,462 9,517
Redemption of Investment
in Securities 46,767 48,609
---------- ---------
Net Cash Provided by
Investing Activities 53,229 58,126
---------- ---------
Increase (Decrease) in Cash and
Cash Equivalents (4,216) (5,188)
Cash and Cash Equivalents at
Beginning of Year 257,549 249,065
---------- ---------
Cash and Cash Equivalents at
End of Year $ 253,333 $ 243,877
---------- ---------
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
SERIES 6 ---------- ---------
Cash Flows from Operating Activities:
Net Loss $ (429,450) $ (505,745)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 11,328 11,514
Accreted Interest Income
on Investments in Securities (15,170) (15,133)
Equity in Losses of
Project Partnerships 372,679 448,680
Interest Income from
Redemption of Securities 0 0
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (505) 2,669
---------- ---------
Net Cash Provided by (Used in)
Operating Activities (61,118) (50,015)
---------- ---------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 12,984 7,858
Redemption of Investment
in Securities 0 0
---------- ---------
Net Cash Provided by
Investing Activities 12,984 7,858
---------- ---------
Increase (Decrease) in Cash and
Cash Equivalents (48,134) (50,157)
Cash and Cash Equivalents at
Beginning of Year 388,991 384,578
---------- ---------
Cash and Cash Equivalents at
End of Year $ 340,857 $ 334,421
========== =========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996 AND 1995:
1996 1995
TOTAL SERIES 2 - 6 ---------- ---------
Cash Flows from Operating Activities:
Net Loss $(1,716,386) $(1,863,302)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 22,298 26,696
Accreted Interest Income
on Investments in Securities (77,874) (78,384)
Equity in Losses of
Project Partnerships 1,515,743 1,671,505
Interest Income from
Redemption of Securities 45,797 31,997
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (25,581) (24,058)
---------- ---------
Net Cash Provided by (Used in)
Operating Activities (236,003) (235,546)
---------- ---------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 59,812 52,448
Redemption of Investment
in Securities 147,200 153,004
---------- ---------
Net Cash Provided by
Investing Activities 207,012 205,452
---------- ---------
Increase (Decrease) in Cash and
Cash Equivalents (28,991) (30,094)
Cash and Cash Equivalents at
Beginning of Year 1,058,553 1,013,832
---------- ---------
Cash and Cash Equivalents at
End of Year $ 1,029,562 $ 983,738
========== =========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
September 30, 1996
NOTE 1 - ORGANIZATION:
Gateway Tax Credit Fund II Ltd. ("Gateway"), a Florida Limited
Partnership, was formed September 12, 1989, under the laws of
Florida. Operations commenced on September 14, 1990 for Series 2,
September 28, 1990 for Series 3, February 1, 1991 for Series 4,
July 1, 1991 for Series 5 and January 1, 1992 for Series 6.
Gateway has invested, as a limited partner, in other limited
partnerships ("Project Partnerships") each of which owns and
operates one or more apartment complexes expected to qualify for
Low-Income Housing Tax Credits. Gateway will terminate on December
31, 2040, or sooner, in accordance with the terms of the Limited
Partnership Agreement. As of September 30, 1996, Gateway had
received capital contributions of $1,000 from the General Partners
and $37,228,000 from Beneficial Assignee Certificate investors (the
"Assignees"). The fiscal year of Gateway for reporting purposes
ends on March 31.
Pursuant to the Securities Act of 1933, Gateway filed a Form S-11
Registration Statement with the Securities and Exchange Commission,
effective September 12, 1989, which covered the offering (the
"Public Offering") of Gateway's Beneficial Assignee Certificates
("BACs") representing assignments of units for the beneficial
interest of the limited partnership interest of the Assignor
Limited Partner. The Assignor Limited Partner was formed for the
purpose of serving in that capacity for the Fund and will not
engage in any other business.
Raymond James Partners, Inc. and RJ Credit Partners, Inc.,
wholly-owned subsidiaries of Raymond James Financial, Inc., are the
General Partner and the Managing General Partner, respectively.
The Managing General Partner manages and controls the business of
Gateway.
Gateway offered BACs in five series. BACs in the amounts of
$6,136,000, $5,456,000, $6,915,000, $8,616,000 and $10,105,000 for
Series 2, 3, 4, 5 and 6, respectively had been issued as of
September 30, 1996. Each Series is treated as a separate
partnership, investing in a separate and distinct pool of Project
Partnerships. Net proceeds from each Series are used to acquire
Project Partnerships which are specifically allocated to such
Series. Income or loss and all tax items from the Project
Partnerships acquired by each Series are specifically allocated
among the Assignees of such Series.
Operating profits and losses, cash distributions from operations
and tax credits are allocated 99% to the Assignees and 1% to the
General Partners. Profit or loss and cash distributions from sales
of properties will be allocated as formulated in the Limited
Partnership Agreement.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting
Gateway utilizes the accrual basis of accounting whereby revenues
are recognized when earned and expenses are recognized when
obligations are incurred.
Gateway accounts for its investments as the sole limited partner
in Project Partnerships ("Investments in Project Partnerships")
using the equity method of accounting and reports the equity in
losses of the Project Partnerships on a 3-month lag in the
Statements of Operations. Under the equity method, the Investments
in Project Partnerships initially include:
1) Gateway's capital contribution,
2) Acquisition fees paid to the General Partner for services
rendered in selecting properties for acquisition, and
3) Acquisition expenses including legal fees, travel and other
miscellaneous costs relating to acquiring properties.
Quarterly the Investments in Project Partnerships are increased or
decreased as follows:
1) Increased for equity in income or decreased for equity in
losses of the Project Partnerships,
2) Decreased for cash distributions received from the Project
Partnerships,
3) Decreased for the amortization of the acquisition fees and
expenses,
4) In certain Project Partnerships, where Gateway's investment
was greater than Gateway's pro-rata share of the book value of
the underlying assets, decreased for the amortization of the
difference; and
5) In certain Project Partnerships, where Gateway's investment
was less than Gateway's pro-rata share of the book value of the
underlying assets, increased for the accretion of the difference.
Amortization and accretion are calculated on a straight-line
basis over 35 years, as this is the average estimated useful life
of the underlying assets. The net amortization and accretion are
shown as amortization expense on the Statements of Operations.
Pursuant to the limited partnership agreements for the Project
Partnerships, cash losses generated by the Project Partnerships are
allocated to the general partners of those partnerships. In
subsequent years, cash profits, if any, are first allocated to the
general partners to the extent of the allocation of prior years'
cash losses.
Since Gateway invests as a limited partner, and therefore is not
obligated to fund losses or make additional capital contributions,
it does not recognize losses from individual Project Partnerships
to the extent that these losses would reduce the investment in
those Project Partnerships below zero. The suspended losses will
be used to offset future income from the individual Project
Partnerships.
Cash and Cash Equivalents
It is Gateway's policy to include short-term investments with an
original maturity of three months or less in Cash and Cash
Equivalents. Short-term investments are comprised of money market
mutual funds.
Concentration of Credit Risk
Financial instruments which potentially subject Gateway to
concentrations of credit risk consist of cash investments in a
money market mutual fund that is a wholly-owned subsidiary of
Raymond James Financial, Inc.
Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with
generally accepted accounting principles requires the use of
estimates that affect certain reported amounts and disclosures.
These estimates are based on management's knowledge and experience.
Accordingly, actual results could differ from these estimates.
Investment in Securities
Effective April 1, 1994, Gateway adopted Statement of Financial
Accounting Standards No. 115, Accounting for Certain Investments in
Debt and Equity Securities ("FAS 115"). Under FAS 115, Gateway is
required to categorize its debt securities as held-to-maturity,
available-for-sale or trading securities, dependent upon Gateway's
intent in holding the securities. Gateway's intent is to hold all
of its debt securities (U. S. Government Security Strips) until
maturity and to use these reserves to fund Gateway's ongoing
operations. Interest income is recognized ratably on the U. S.
Government Strips using the effective yield to maturity.
Offering and Commission Costs
Offering and commission costs were charged against Assignees'
Equity upon the admission of Limited Partners.
Income Taxes
No provision for income taxes has been made in these financial
statements, as income taxes are a liability of the partners rather
than of Gateway.
Reclassifications
For comparability, the 1995 figures have been reclassified, where
appropriate, to conform with the financial statement presentation
used in 1996.
Fair Value of Financial Instruments
The fair value of investment securities is discussed in Note 3.
The fair value of current assets and current liabilities is assumed
to be equal to their reported carrying amounts due to their short
term nature. It is not practicable to estimate the fair value of
the long term payable to the general partner because it is
attributable to a related party transaction for which there would
be no fair market equivalent.
Basis of Preparation
The unaudited financial statements presented herein have been
prepared in accordance with the instructions to Form 10-Q and do
not include all of the information and note disclosures required by
generally accepted accounting principles. These statements should
be read in conjunction with the financial statements and notes
thereto included with the Partnership's Form 10-K for the year
ended March 31, 1996. In the opinion of management these financial
statements include adjustments, consisting only of normal recurring
adjustments, necessary to fairly summarize the Partnership's
financial position and results of operations. The results of
operations for the periods may not be indicative of the results to
be expected for the year.
NOTE 3 - INVESTMENT IN SECURITIES:
The September 30, 1996 Balance Sheet includes Investment in
Securities consisting of U.S. Government Security Strips which
represents their cost, plus accreted interest income of $112,259
for Series 2, $99,852 for Series 3, $126,502 for Series 4, $157,669
for Series 5 and $108,151 for Series 6. For convenience, the
Investment in Securities are commonly held in a brokerage account
with Raymond James and Associates, Inc. A separate accounting is
maintained for each series' share of the investments.
<PAGE>
Estimated Cost Plus Gross Unrealized
Market Accreted Gains and
Value Interest (Losses)
--------- --------- ---------
Series 2 $ 395,794 $377,923 $ 17,871
Series 3 351,935 336,154 15,781
Series 4 446,042 425,873 20,169
Series 5 555,762 530,796 24,966
Series 6 477,348 469,241 8,107
As of September 30, 1996, the cost and accreted interest of debt
securities by contractual maturities is as follows:
Series 2 Series 3 Series 4
--------- --------- ---------
Due within 1 year $ 44,210 $ 39,324 $ 49,819
After 1 year
through 5 years 162,671 144,691 183,307
After 5 years
through 10 years 171,042 152,139 192,747
After 10 years 0 0 0
--------- --------- ---------
Total Amount Carried on
Balance Sheet $ 377,923 $ 336,154 $ 425,873
========= ========= =========
Series 5 Series 6 Total
--------- --------- ---------
Due within 1 year $ 62,093 $ 44,245 $ 239,691
After 1 year
through 5 years 228,471 177,623 896,763
After 5 years
through 10 years 240,232 208,859 965,019
After 10 years 0 38,514 38,514
--------- --------- ---------
Total Amount Carried on
Balance Sheet $ 530,796 $ 469,241 $2,139,987
========= ========= =========
NOTE 4 - RELATED PARTY TRANSACTIONS:
The Payable to General Partners primarily represents the asset
management fees owed to the General Partners at the end of the
period. It is unsecured, due on demand and, in accordance with the
limited partnership agreement, non-interest bearing. Within the
next twelve months, the Managing General Partner does not intend to
demand payment on the portion of Asset Management fees payable
classified as long-term on the balance sheet.
For the six months ended September 30, 1996 and 1995 the General
Partners and affiliates are entitled to compensation and
reimbursement for costs and expenses incurred by Gateway as
follows:
Asset Management Fee - The Managing General Partner is entitled
to be paid an annual asset management fee equal to 0.25% of the
aggregate cost of Gateway's interest in the projects owned by the
Project Partnerships. The asset management fee will be paid only
after all other expenses of Gateway have been paid. These fees are
included in the Statements of Operations.
1996 1995
--------- ---------
Series 2 $ 34,500 $ 34,512
Series 3 31,964 32,020
Series 4 39,192 39,284
Series 5 48,506 48,580
Series 6 53,832 53,954
--------- ---------
Total $207,994 $ 208,350
========= =========
General and Administrative Expenses - The Managing General
Partner is reimbursed for general and administrative expenses of
Gateway on an accountable basis. This expense is included in the
Statements of Operations.
1996 1995
--------- ---------
Series 2 $ 3,340 $ 3,226
Series 3 3,493 3,354
Series 4 4,403 4,252
Series 5 5,466 5,278
Series 6 5,770 5,572
--------- ---------
Total $ 22,472 $ 21,682
========= =========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS:
As of September 30, 1996, the Partnership had acquired an
interest in 22 Project Partnerships for the Series which own and
operate government assisted multi-family housing complexes. The
Partnership, as the Investor Limited Partner pursuant to the
Project Partnership Agreements has generally acquired an ownership
interest of 99% in these Project Partnerships.
The following is a summary of Investments in Project Partnerships
as of:
SEPTEMBER 30, MARCH 31,
1996 1996
SERIES 2 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 4,524,678 $ 4,524,678
Accumulated accretion/(amortization) of
the difference in the book value of
underlying assets of the Project
Partnerships over/under purchase
price (1) 36,775 33,815
Cumulative equity in losses of
Project Partnerships (2) (3,731,926) (3,495,196)
Cumulative distributions received
from Project Partnerships (50,833) (45,124)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 390,838 390,838
Accumulated amortization of
acquisition fees and expenses (63,453) (58,088)
---------- ----------
Investments in
Project Partnerships $1,106,079 $1,350,923
========== ==========
(1) Includes amounts representing accumulated accretion or
(amortization) of the difference between the book value of the
underlying assets of the Project Partnerships over or under the
purchase price. At September 30, 1996 and March 31, 1996 these
excess costs were $205,718.
(2) In accordance with the Partnership's accounting policy to not
carry Investments in Project Partnerships below zero, cumulative
suspended losses of $47,771 for the period ended September 30, 1996
and cumulative suspended losses of $25,114 for the year ended March
31, 1996 are not included.
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
As of September 30, 1996, the Partnership had acquired an
interest in 23 Project Partnerships for the Series which own and
operate government assisted multi-family housing complexes. The
Partnership, as the Investor Limited Partner pursuant to the
Project Partnership Agreements has generally acquired an ownership
interest of 99% in these Project Partnerships.
The following is a summary of Investments in Project Partnerships
as of:
SEPTEMBER 30, MARCH 31,
1996 1996
SERIES 3 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 3,888,713 $ 3,888,713
Accumulated accretion/(amortization) of
the difference in the book value of
underlying assets of the Project
Partnerships over/under purchase
price (1) 37,659 33,947
Cumulative equity in losses of
Project Partnerships (2) (3,528,062) (3,337,760)
Cumulative distributions received
from Project Partnerships (134,497) (110,740)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 491,746 491,746
Accumulated amortization of
acquisition fees and expenses (68,592) (64,243)
---------- ----------
Investments in
Project Partnerships $ 686,967 $ 901,663
========== ==========
(1) Includes amounts representing accumulated accretion or
(amortization) of the difference between the book value of the
underlying assets of the Project Partnerships over or under the
purchase price. At September 30, 1996 and March 31, 1996 these
excess costs were $213,147.
(2) In accordance with the Partnership's accounting policy to not
carry Investments in Project Partnerships below zero, cumulative
suspended losses of $315,177 for the period ended September 30,
1996 and cumulative suspended losses of $226,112 for the year ended
March 31, 1996 are not included.
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
As of September 30, 1996, the Partnership had acquired an
interest in 29 Project Partnerships for the Series which own and
operate government assisted multi-family housing complexes. The
Partnership, as the Investor Limited Partner pursuant to the
Project Partnership Agreements has generally acquired an ownership
interest of 99% in these Project Partnerships.
The following is a summary of Investments in Project Partnerships
as of:
SEPTEMBER 30, MARCH 31,
1996 1996
SERIES 4 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 4,952,519 $ 4,952,519
Accumulated accretion/(amortization) of
the difference in the book value of
underlying assets of the Project
Partnerships over/under purchase
price (1) 66,592 60,437
Cumulative equity in losses of
Project Partnerships (2) (3,674,164) (3,368,203)
Cumulative distributions received
from Project Partnerships (70,183) (59,283)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 562,967 562,967
Accumulated amortization of
acquisition fees and expenses (82,776) (74,927)
---------- ----------
Investments in
Project Partnerships $1,754,955 $2,073,510
========== ==========
(1) Includes amounts representing accumulated accretion or
(amortization) of the difference between the book value of the
underlying assets of the Project Partnerships over or under the
purchase price. At September 30, 1996 and March 31, 1996 these
excess costs were $430,637.
(2) In accordance with the Partnership's accounting policy to not
carry Investments in Project Partnerships below zero, cumulative
suspended losses of $25,570 for the period ended September 30, 1996
and cumulative suspended losses of $11,440 for the year ended March
31, 1996 are not included.
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
As of September 30, 1996, the Partnership had acquired an
interest in 36 Project Partnerships for the Series which own and
operate government assisted multi-family housing complexes. The
Partnership, as the Investor Limited Partner pursuant to the
Project Partnership Agreements has generally acquired an ownership
interest of 99% in these Project Partnerships.
The following is a summary of Investments in Project Partnerships
as of:
SEPTEMBER 30, MARCH 31,
1996 1996
SERIES 5 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 6,164,472 $ 6,164,472
Accumulated accretion/(amortization) of
the difference in the book value of
underlying assets of the Project
Partnerships over/under purchase
price (1) 30,084 27,015
Cumulative equity in losses of
Project Partnerships (2) (3,876,734) (3,466,663)
Cumulative distributions received
from Project Partnerships (91,333) (84,871)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 650,837 650,837
Accumulated amortization of
acquisition fees and expenses (88,224) (78,922)
---------- ----------
Investments in
Project Partnerships $2,789,102 $3,211,868
========== ==========
(1) Includes amounts representing accumulated accretion or
(amortization) of the difference between the book value of the
underlying assets of the Project Partnerships over or under the
purchase price. At September 30, 1996 and March 31, 1996 these
excess costs were $214,636.
(2) In accordance with the Partnership's accounting policy to not
carry Investments in Project Partnerships below zero, cumulative
suspended losses of $0 for the period ended September 30, 1996 and
cumulative suspended losses of $0 for the year ended March 31, 1996
are not included.
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
As of September 30, 1996, the Partnership had acquired an
interest in 38 Project Partnerships for the Series which own and
operate government assisted multi-family housing complexes. The
Partnership, as the Investor Limited Partner pursuant to the
Project Partnership Agreements has generally acquired an ownership
interest of 99% in these Project Partnerships.
The following is a summary of Investments in Project Partnerships
as of:
SEPTEMBER 30, MARCH 31,
1996 1996
SERIES 6 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 7,462,215 $ 7,462,215
Accumulated accretion/(amortization) of
the difference in the book value of
underlying assets of the Project
Partnerships over/under purchase
price (1) (2,551) (2,253)
Cumulative equity in losses of
Project Partnerships (2) (3,700,265) (3,327,586)
Cumulative distributions received
from Project Partnerships (76,416) (63,432)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 785,179 785,179
Accumulated amortization of
acquisition fees and expenses (95,529) (84,498)
---------- ----------
Investments in
Project Partnerships $4,372,633 $4,769,625
========== ==========
(1) Includes amounts representing accumulated accretion or
(amortization) of the difference between the book value of the
underlying assets of the Project Partnerships over or under the
purchase price. At September 30, 1996 and March 31, 1996 these
excess costs were ($20,841).
(2) In accordance with the Partnership's accounting policy to not
carry Investments in Project Partnerships below zero, cumulative
suspended losses of $27,340 for the period ended September 30, 1996
and cumulative suspended losses of $11,517 for the year ended March
31, 1996 are not included.
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
The following is a summary of Investments in Project
Partnerships:
SEPTEMBER 30, MARCH 31,
1996 1996
TOTAL SERIES 2 - 6 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 26,992,597 $ 26,992,597
Accumulated accretion/(amortization) of
the difference in the book value of
underlying assets of the Project
Partnerships over/under purchase
price (1) 168,559 152,961
Cumulative equity in losses of
Project Partnerships (18,511,151) (16,995,408)
Cumulative distributions received
from Project Partnerships (423,262) (363,450)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 2,881,567 2,881,567
Accumulated amortization of
acquisition fees and expenses (398,574) (360,678)
---------- ----------
Investments in
Project Partnerships $10,709,736 $12,307,589
========== ==========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
In accordance with the Partnership's policy of presenting the
financial information of the Project Partnerships on a three month
lag, below is the summarized financial information for the Series'
Project Partnerships as of June 30 of each year:
1996 1995
SERIES 2 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 1,583,447 $ 1,358,204
Investment properties, net 22,950,706 23,882,128
Other assets 2,377 4,100
----------- ----------
Total assets $ 24,536,530 $ 25,244,432
=========== ==========
Liabilities and Partners' Equity
Current liabilities $ 423,058 $ 528,099
Long-term debt 23,290,759 23,311,584
----------- ----------
Total liabilities 23,713,817 23,839,683
Partners' Equity
Limited Partner 733,799 1,217,840
General Partners 88,914 186,909
----------- ----------
822,713 1,404,749
Total liabilities and
partners' equity $ 24,536,530 $ 25,244,432
=========== ==========
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,287,603 $ 1,306,214
Expenses:
Operating expenses 656,094 606,872
Interest expense 414,340 523,895
Depreciation and amortization 479,176 486,163
----------- ----------
Total expenses 1,549,610 1,616,930
Net loss $ (262,007) $ (310,716)
=========== ==========
Other partners' share
of net loss $ (2,620) $ (3,107)
Partnership's share of net loss $ (259,387) $ (307,609)
Suspended loss 22,657 0
----------- ----------
Equity in Loss of
Project Partnerships $ (236,730) $ (307,609)
=========== ==========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
In accordance with the Partnership's policy of presenting the
financial information of the Project Partnerships on a three month
lag, below is the summarized financial information for the Series'
Project Partnerships as of June 30 of each year:
1996 1995
SERIES 3 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 1,966,829 $ 1,823,987
Investment properties, net 20,223,468 21,110,327
Other assets 233,517 240,719
----------- ----------
Total assets $ 22,423,814 $ 23,175,033
=========== ==========
Liabilities and Partners' Equity
Current liabilities $ 492,234 $ 539,321
Long-term debt 21,871,583 21,930,524
----------- ----------
Total liabilities 22,363,817 22,469,845
Partners' Equity
Limited Partner (304,933) 355,958
General Partners 364,930 349,230
----------- ----------
59,997 705,188
Total liabilities and
partners' equity $ 22,423,814 $ 23,175,033
=========== ==========
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,217,433 $ 1,428,864
Expenses:
Operating expenses 744,049 689,478
Interest expense 292,418 549,651
Depreciation and amortization 463,155 460,495
----------- ----------
Total expenses 1,499,622 1 699,624
Net loss $ (282,189) $ (270,760)
=========== ==========
Other partners' share
of net loss $ (2,822) $ (2,708)
Partnership's share of net loss $ (279,367) $ (268,052)
Suspended loss 89,065 22,388
----------- ----------
Equity in Loss of
Project Partnerships $ (190,302) $ (245,664)
=========== ==========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
In accordance with the Partnership's policy of presenting the
financial information of the Project Partnerships on a three month
lag, below is the summarized financial information for the Series'
Project Partnerships as of June 30 of each year:
1996 1995
SERIES 4 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 1,936,500 $ 1,850,292
Investment properties, net 26,784,353 27,767,973
Other assets 22,385 12,101
----------- ----------
Total assets $ 28,743,238 $ 29,630,366
=========== ==========
Liabilities and Partners' Equity
Current liabilities $ 589,582 $ 676,123
Long-term debt 26,641,940 26,695,204
----------- ----------
Total liabilities 27,231,522 27,371,327
Partners' Equity
Limited Partner 1,227,606 1,901,921
General Partners 284,110 357,118
----------- ----------
1,511,716 2,259,039
Total liabilities and
partners' equity $ 28,743,238 $ 29,630,366
=========== ==========
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,568,591 $ 1,658,707
Expenses:
Operating expenses 903,525 829,997
Interest expense 459,990 617,874
Depreciation and amortization 528,400 536,235
----------- ----------
Total expenses 1,891,915 1,984,106
Net loss $ (323,324) $ (325,399)
=========== ==========
Other partners' share
of net loss $ (3,233) $ (3,254)
Partnership's share of net loss $ (320,091) $ (322,145)
Suspended loss 14,130 0
----------- ----------
Equity in Loss of
Project Partnerships $ (305,961) $ (322,145)
=========== ==========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
In accordance with the Partnership's policy of presenting the
financial information of the Project Partnerships on a three month
lag, below is the summarized financial information for the Series'
Project Partnerships as of June 30 of each year:
1996 1995
SERIES 5 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,463,229 $ 2,201,359
Investment properties, net 33,612,772 34,811,384
Other assets 2,123 14,927
------------ ----------
Total assets $ 36,078,124 $ 37,027,670
=========== ==========
Liabilities and Partners' Equity
Current liabilities $ 807,295 $ 903,208
Long-term debt 32,945,488 33,030,447
----------- ----------
Total liabilities 33,752,783 33,933,655
Partners' Equity
Limited Partner 2,321,219 3,060,860
General Partners 4,122 33,155
----------- ----------
2,325,341 3,094,015
Total liabilities and
partners' equity $ 36,078,124 $ 37,027,670
=========== ==========
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,761,025 $ 1,799,716
Expenses:
Operating expenses 1,074,848 921,271
Interest expense 403,404 533,087
Depreciation and amortization 696,986 696,274
----------- ----------
Total expenses 2,175,238 2,150,632
Net loss $ (414,213) $ (350,916)
=========== ==========
Other partners' share
of net loss $ (4,142) $ (3,509)
Partnership's share of net loss $ (410,071) $ (347,407)
Suspended loss 0 0
----------- -----------
Equity in Loss of
Project Partnerships $ (410,071) $ (347,407)
=========== ==========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
In accordance with the Partnership's policy of presenting the
financial information of the Project Partnerships on a three month
lag, below is the summarized financial information for the Series'
Project Partnerships as of June 30 of each year:
1996 1995
SERIES 6 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,611,371 $ 2,300,313
Investment properties, net 37,716,660 39,110,793
Other assets 23,382 38,804
----------- ----------
Total assets $ 40,351,413 $ 41,449,910
=========== ==========
Liabilities and Partners' Equity
Current liabilities $ 928,080 $ 1,065,016
Long-term debt 35,827,365 36,047,889
----------- ----------
Total liabilities 36,755,445 37,112,915
Partners' Equity
Limited Partner 3,708,349 4,395,528
General Partners (112,381) (58,533)
----------- ----------
3,595,968 4,336,995
Total liabilities and
partners' equity $ 40,351,413 $ 41,449,910
=========== ==========
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,973,212 $ 2,023,802
Expenses:
Operating expenses 1,093,105 982,071
Interest expense 499,641 707,735
Depreciation and amortization 772,892 787,208
----------- ----------
Total expenses 2,365,638 2,477,014
Net loss $ (392,426) $ (453,212)
=========== ==========
Other partners' share
of net loss $ (3,924) $ (4,532)
Partnership's share of net loss $ (388,502) $ (448,680)
Suspended loss 15,823 0
----------- ----------
Equity in Loss of
Project Partnerships $ (372,679) $ (448,680)
=========== ==========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
In accordance with the Partnership's policy of presenting the
financial information of the Project Partnerships on a three month
lag, below is the summarized financial information for the Project
Partnerships as of June 30 of each year:
1996 1995
TOTAL SERIES 2 - 6 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 10,561,376 $ 9,534,155
Investment properties, net 141,287,959 146,682,605
Other assets 283,784 310,651
----------- ----------
Total assets $ 152,133,119 $156,527,411
=========== ==========
Liabilities and Partners' Equity
Current liabilities $ 3,240,249 $ 3,711,767
Long-term debt 140,577,135 141,015,658
----------- ----------
Total liabilities 143,817,384 144,727,425
Partners' Equity
Limited Partner 7,686,040 10,932,107
General Partners 629,695 867,879
----------- -----------
8,315,735 11,799,986
Total liabilities and
partners' equity $ 152,133,119 $156,527,411
=========== ==========
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 7,807,864 $ 8,217,303
Expenses:
Operating expenses 4,471,621 4,029,689
Interest expense 2,069,793 2,932,242
Depreciation and amortization 2,940,609 2,966,375
----------- ----------
Total expenses 9,482,023 9,928,306
Net loss $ (1,674,159) $ (1,711,003)
=========== ==========
Other partners' share
of net loss $ (16,741) $ (17,110)
Partnership's share of net loss $ (1,657,418) $ (1,693,893)
Suspended loss 141,675 22,388
----------- ----------
Equity in Loss of
Project Partnerships $ (1,515,743) $ (1,671,505)
=========== ==========
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
September 30, 1996
Results of Operations, Liquidity and Capital Resources
Operations commenced on September 14, 1990, with the first
admission of Assignees in Series 2. The proceeds from Assignees'
capital contributions available for investment were used to acquire
interests in Project Partnerships.
As disclosed on the statement of operations for each Series,
interest income and total expenses are comparable for the six and
three months ended September 30, 1996 and 1995. There were no
unusual variations in the operating results between these two
periods.
The capital resources of each Series are used to pay General and
Administrative operating costs including personnel, supplies, data
processing, travel and legal and accounting associated with the
administration and monitoring of Gateway and the Project
Partnerships. The capital resources are also used to pay the Asset
Management Fee due the Managing General Partner, but only to the
extent that Gateway's remaining resources are sufficient to fund
Gateway's ongoing needs.
The sources of funds to pay the operating costs of each Series
are short term investments and interest earned thereon, the
maturity of U.S. Treasury Security Strips ("Zero Coupon
Treasuries") which were purchased with funds set aside for this
purpose, and cash distributed to the Series from the operations of
the Project Partnerships.
From inception, no Series has paid distributions and management
does not anticipate distributions in the future.
Series 2 - Gateway closed this series on September 14, 1990 after
receiving $6,136,000 from 375 Assignees. Equity in Losses of
Project Partnerships decreased from $307,609 for the six months
ended September 30, 1995 to $236,730 for the six months ended
September 30, 1996. This decrease was partially caused by $22,657
of losses that were suspended to prevent reducing the investment in
certain Project Partnerships below zero, in accordance with the
equity method of accounting. In general, it is common in the real
estate industry to experience losses for financial and tax
reporting purposes because of the non-cash expenses of depreciation
and amortization. As a result, management expects that this
Series, as well as those described below, will report its equity in
Project Partnerships as a loss for tax and financial reporting
purposes. Overall, management believes the Project Partnerships
are operating as expected and are generating tax credits which meet
projections.
At September 30, 1996, the Series had $143,039 of short-term
investments (Cash and Cash Equivalents). It also had $377,923 in
Zero Coupon Treasuries. Management believes the sources of funds
are sufficient to meet current and ongoing operating costs for the
foreseeable future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had a net
loss of $267,745 for the six months ended September 30, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $236,730 and the changes in operating assets and
liabilities, net cash used in operating activities was $31,483.
Cash provided by investing activities totaled $39,003, consisting
of $33,294 from matured Zero Coupon Treasuries and $5,709 in cash
distributions received from the Project Partnerships. There were
no unusual events or trends to describe.
Series 3 - Gateway closed this series on December 13, 1990 after
receiving $5,456,000 from 398 Assignees. Equity in Losses of
Project Partnerships decreased from $245,664 for the six months
ended September 30, 1995 to $190,302 for the six months ended
September 30, 1996. This decrease was partially caused by $89,065
of losses that were suspended to prevent reducing the investment in
certain Project Partnerships below zero, in accordance with the
equity method of accounting in comparison to $22,388 for the period
ended September 30, 1995. Overall, management believes these
Project Partnerships are operating as expected and are generating
tax credits which meet projections.
At September 30, 1996, the Series had $107,298 of short-term
investments (Cash and Cash Equivalents). It also had $336,154 in
Zero Coupon Treasuries. Management believes these sources of funds
are sufficient to meet the Series' current and ongoing operating
costs for the foreseeable future, and to pay part of the Asset
Management Fee.
As disclosed on the statement of cash flows, the Series had a net
loss of $222,876 for the six months ended September 30, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $190,302 and the changes in operating assets and
liabilities net cash used in operating activities was $44,064.
Cash provided by investing activities totaled $53,374, consisting
of $23,757 in cash distributions received from the Project
Partnerships and $29,617 from matured Zero Coupon Treasuries.
There were no unusual events or trends to describe.
Series 4 - Gateway closed this series on May 31, 1991 after
receiving $6,915,000 from 465 Assignees. Equity in Losses of
Project Partnerships were comparable for the six months ended
September 30, 1995 and September 30, 1996. Overall, management
believes these Project Partnerships are operating as expected and
are generating tax credits which meet projections.
At September 30, 1996, the Series had $185,035 of short-term
investments (Cash and Cash Equivalents). It also had $425,873 in
Zero Coupon Treasuries. Management believes these sources of funds
are sufficient to meet the Series' current and ongoing operating
costs for the foreseeable future, and to pay part of the Asset
Management Fee.
As disclosed on the statement of cash flows, the Series had a net
loss of $340,354 for the six months ended September 30, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $305,961 and the changes in operating assets and
liabilities net cash used in operating activities was $41,893.
Cash provided by investing activities totaled $48,422 consisting of
$37,522 from matured Zero Coupon Treasuries and $10,900 in cash
distributions received from the Project Partnerships. There were
no unusual events or trends to describe.
Series 5 - Gateway closed this series on October 11, 1991 after
receiving $8,616,000 from 535 Assignees. Equity in Losses of
Project Partnerships increased from $347,407 for the six months
ended September 30, 1995 to $410,071 for the six months ended
September 30, 1996. Overall, management believes these Project
Partnerships are operating as expected and are generating tax
credits which meet projections.
At September 30, 1996, the Series had $253,333 of short-term
investments (Cash and Cash Equivalents). It also had $530,796 in
Zero Coupon Treasuries. Management believes these sources of funds
are sufficient to meet the Series' current and ongoing operating
costs for the foreseeable future, and to pay part of the Asset
Management Fee.
As disclosed on the statement of cash flows, the Series had a net
loss of $455,961 for the six months ended September 30, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $410,071 and the changes in operating assets and
liabilities net cash used in operating activities was $57,445.
Cash provided by investing activities totaled $53,229 consisting of
$46,767 from matured Zero Coupon Treasuries and $6,462 in cash
distributions received from the Project Partnerships. There were
no unusual events or trends to describe.
Series 6 - Gateway closed this series on March 11, 1992 after
receiving $10,105,000 from 625 Assignees. Equity in Losses of
Project Partnerships decreased from $448,680 for the six months
ended September 30, 1995 to $372,679 for the six months ended
September 30, 1996. Overall, management believes these Project
Partnerships are operating as expected and are generating tax
credits which meet projections.
At September 30, 1996, the Series had $340,857 of short-term
investments (Cash and Cash Equivalents). It also had $469,241 in
Zero Coupon Treasuries. Management believes these sources of funds
are sufficient to meet the Series' current and ongoing operating
costs for the foreseeable future, and to pay part of the Asset
Management Fee.
As disclosed on the statement of cash flows, the Series had a net
loss of $429,450 for the six months ended September 30, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $372,679 and the changes in operating assets and
liabilities net cash used in operating activities was $61,118.
Cash provided by investing activities totaled $12,984 consisting of
cash distributions received from the Project Partnerships. There
were no unusual events or trends to describe.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits - NONE
b. Reports on Form 8-K - NONE
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed by the following persons on
behalf of the Registrant and in the capacities and on the dates
indicated.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
By: RJ Credit Partners, Inc.
Managing General Partner
Date: November 13, 1996 By:/s/ Ronald M. Diner
Ronald M. Diner
President
Date: November 13, 1996 By:/s/ Sandra L. Furey
Sandra L. Furey
Secretary and Treasurer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> SEP-30-1996
<CASH> 1,029,562
<SECURITIES> 2,139,987
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,269,253
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 13,879,285
<CURRENT-LIABILITIES> 279,092
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 12,547,394
<TOTAL-LIABILITY-AND-EQUITY> 13,879,285
<SALES> 0
<TOTAL-REVENUES> 105,674
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 306,317
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,716,386)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,716,386)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,716,386)
<EPS-PRIMARY> (45.64)<F1>
<EPS-DILUTED> (45.64)<F1>
<FN>
<F1>EPS IS NET INCOME (LOSS) PER $1,000 LIMITED PARTNERSHIP UNIT.
</FN>
</TABLE>
