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 December 31, 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 December 31, 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
DECEMBER 31, MARCH 31,
1996 1996
----------- -----------
SERIES 2 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 139,021 $ 135,519
Investments in Securities 44,989 43,655
----------- ----------
Total Current Assets 184,010 179,174
Investments in Securities 340,269 363,740
Investments in Project
Partnerships, Net 937,161 1,350,923
----------- ----------
Total Assets $1,461,440 $1,893,837
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 42,557 $ 44,607
Long-Term Liabilities:
Payable to General Partners 245,032 225,720
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 6,136
at December 31, 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
December 31, 1996 and March 31, 1996,
issued and outstanding 1,215,913 1,661,075
General Partners (42,062) (37,565)
----------- ----------
Total Partners' Equity 1,173,851 1,623,510
----------- ----------
Total Liabilities and
Partners Equity $1,461,440 $1,893,837
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
SERIES 3 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 106,537 $ 97,988
Investments in Securities 40,017 38,831
----------- ----------
Total Current Assets 146,554 136,819
Investments in Securities 302,661 323,539
Investments in Project
Partnerships, Net 651,973 901,663
----------- ----------
Total Assets $1,101,188 $1,362,021
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 46,686 $ 48,855
Long-Term Liabilities:
Payable to General Partners 198,165 189,722
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 5,456
at December 31, 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
December 31, 1996 and March 31, 1996,
issued and outstanding 895,589 1,160,025
General Partners (39,252) (36,581)
---------- ----------
Total Partners' Equity 856,337 1,123,444
----------- ----------
Total Liabilities and
Partners Equity $1,101,188 $1,362,021
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
SERIES 4 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 181,968 $ 178,506
Investments in Securities 50,697 49,195
----------- ----------
Total Current Assets 232,665 227,701
Investments in Securities 383,442 409,891
Investments in Project
Partnerships, Net 1,634,239 2,073,510
----------- ----------
Total Assets $2,250,346 $2,711,102
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 51,311 $ 53,905
Long-Term Liabilities:
Payable to General Partners 228,724 212,638
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 6,915
at December 31, 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
December 31, 1996 and March 31, 1996,
issued and outstanding 2,011,261 2,480,767
General Partners (40,950) (36,208)
----------- ----------
Total Partners' Equity 1,970,311 2,444,559
----------- ----------
Total Liabilities and
Partners Equity $2,250,346 $2,711,102
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
SERIES 5 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 251,299 $ 257,549
Investments in Securities 63,188 61,314
----------- ----------
Total Current Assets 314,487 318,863
Investments in Securities 477,909 510,876
Investments in Project
Partnerships, Net 2,612,878 3,211,868
----------- ----------
Total Assets $3,405,274 $4,041,607
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 69,024 $ 72,085
Long-Term Liabilities:
Payable to General Partners 215,253 201,848
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 8,616
at December 31, 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
December 31, 1996 and March 31, 1996,
issued and outstanding 3,165,410 3,805,620
General Partners (44,413) (37,946)
----------- ----------
Total Partners' Equity 3,120,997 3,767,674
----------- ----------
Total Liabilities and
Partners Equity $3,405,274 $4,041,607
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
SERIES 6 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 339,902 $ 388,991
Investments in Securities 44,822 43,120
----------- ----------
Total Current Assets 384,724 432,111
Investments in Securities 432,238 410,950
Investments in Project
Partnerships, Net 4,175,389 4,769,625
----------- ----------
Total Assets $4,992,351 $5,612,686
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 64,371 $ 67,831
Long-Term Liabilities:
Payable to General Partners 268,525 240,262
Partners' Equity:
Assignor Limited Partner
Units of limited Partnership
interest consisting of 40,000
authorized BAC's, of which 10,105
at December 31, 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
December 31, 1996 and March 31, 1996,
issued and outstanding 4,701,587 5,340,274
General Partners (42,132) (35,681)
----------- ----------
Total Partners' Equity 4,659,455 5,304,593
----------- ----------
Total Liabilities and
Partners Equity $4,992,351 $5,612,686
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
TOTAL SERIES 2 - 6 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 1,018,727 $ 1,058,553
Investments in Securities 243,713 236,115
----------- -----------
Total Current Assets 1,262,440 1,294,668
Investments in Securities 1,936,519 2,018,996
Investments in Project
Partnerships, Net 10,011,640 12,307,589
----------- -----------
Total Assets $13,210,599 $15,621,253
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 273,949 $ 287,283
Long-Term Liabilities:
Payable to General Partners 1,155,699 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 December 31, 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
December 31, 1996 and March 31, 1996,
issued and outstanding 11,989,760 14,447,761
General Partners (208,809) (183,981)
----------- -----------
Total Partners' Equity 11,780,951 14,263,780
----------- -----------
Total Liabilities and
Partners Equity $13,210,599 $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 DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 2 ----------- ----------
Revenues:
Interest Income $ 9,035 $ 9,039
----------- -----------
Expenses:
Asset Management Fee-
General Partner 17,250 17,256
General and Administrative-
General Partner 1,666 1,692
General and Administrative-
Other 1,582 947
Amortization 1,203 1,321
----------- -----------
Total Expenses 21,701 21,216
Loss Before Equity in Losses of
Project Partnerships (12,666) (12,177)
Equity in Losses of Project
Partnerships (169,248) (129,737)
----------- -----------
Net Loss $ (181,914) $ (141,914)
=========== ===========
Allocation of Net Loss:
Assignees $ (180,094) $ (140,495)
General Partners (1,820) (1,419)
----------- -----------
$ (181,914) $ (141,914)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (29.35) $ (22.90)
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 DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 3 ----------- ----------
Revenues:
Interest Income $ 7,823 $ 7,748
----------- ----------
Expenses:
Asset Management Fee-
General Partner 15,982 16,010
General and Administrative-
General Partner 1,742 1,770
General and Administrative-
Other 2,136 1,196
Amortization 319 1,991
----------- -----------
Total Expenses 20,179 20,967
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (12,356) (13,219)
Equity in Losses of Project
Partnerships (31,875) (138,204)
----------- -----------
Net Loss $ (44,231) $ (151,423)
=========== ===========
Allocation of Net Loss:
Assignees $ (43,789) $ (149,909)
General Partners (442) (1,514)
----------- -----------
$ (44,231) $ (151,423)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (8.03) $ (27.48)
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 DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 4 ----------- ----------
Revenues:
Interest Income $ 10,465 $ 10,490
----------- -----------
Expenses:
Asset Management Fee-
General Partner 19,596 19,642
General and Administrative-
General Partner 2,196 2,231
General and Administrative-
Other 1,851 1,275
Amortization 847 1,197
----------- -----------
Total Expenses 24,490 24,345
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (14,025) (13,855)
Equity in Losses of Project
Partnerships (119,869) (133,499)
----------- -----------
Net Loss $ (133,894) $ (147,354)
=========== ===========
Allocation of Net Loss:
Assignees $ (132,556) $ (145,880)
General Partners (1,338) (1,474)
----------- -----------
$ (133,894) $ (147,354)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (19.17) $ (21.10)
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 DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 5 ----------- ----------
Revenues:
Interest Income $ 13,331 $ 13,389
----------- -----------
Expenses:
Asset Management Fee-
General Partner 24,253 24,290
General and Administrative-
General Partner 2,726 2,770
General and Administrative-
Other 2,260 1,458
Amortization 3,116 3,082
----------- -----------
Total Expenses 32,355 31,600
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (19,024) (18,211)
Equity in Losses of Project
Partnerships (171,692) (177,128)
----------- -----------
Net Loss $ (190,716) $ (195,339)
=========== ===========
Allocation of Net Loss:
Assignees $ (188,809) $ (193,386)
General Partners (1,907) (1,953)
----------- -----------
$ (190,716) $ (195,339)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (21.91) $ (22.44)
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 DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 6 ----------- ----------
Revenues:
Interest Income $ 11,892 $ 11,953
----------- -----------
Expenses:
Asset Management Fee-
General Partner 26,916 26,977
General and Administrative-
General Partner 2,877 2,923
General and Administrative-
Other 2,119 1,527
Amortization 5,664 5,757
----------- -----------
Total Expenses 37,576 37,184
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (25,684) (25,231)
Equity in Losses of Project
Partnerships (190,004) (239,594)
----------- -----------
Net Loss $ (215,688) $ (264,825)
=========== ===========
Allocation of Net Loss:
Assignees $ (213,532) $ (262,117)
General Partners (2,156) (2,648)
----------- -----------
$ (215,688) $ (264,825)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (21.13) $ (25.95)
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 DECEMBER 31, 1996 AND 1995:
1996 1995
TOTAL SERIES 2 - 6 ----------- ----------
Revenues:
Interest Income $ 52,546 $ 52,619
----------- ------------
Expenses:
Asset Management Fee-
General Partner 103,997 104,175
General and Administrative-
General Partner 11,207 11,386
General and Administrative-
Other 9,948 6,403
Amortization 11,149 13,348
----------- ------------
Total Expenses 136,301 135,312
----------- ------------
Loss Before Equity in Losses of
Project Partnerships (83,755) (82,693)
Equity in Losses of Project
Partnerships (682,688) (818,162)
----------- ------------
Net Loss $ (766,443) $ (900,855)
=========== ============
Allocation of Net Loss:
Assignees $ (758,780) $ (891,847)
General Partners (7,663) (9,008)
----------- ------------
$ (766,443) $ (900,855)
=========== ============
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 2 ----------- -----------
Revenues:
Interest Income $ 27,471 $ 27,576
----------- -----------
Expenses:
Asset Management Fee-
General Partner 51,750 51,768
General and Administrative-
General Partner 5,006 4,918
General and Administrative-
Other 10,787 7,825
Amortization 3,609 3,963
----------- -----------
Total Expenses 71,152 68,474
Loss Before Equity in Losses of
Project Partnerships (43,681) (40,898)
Equity in Losses of Project
Partnerships (405,978) (437,346)
----------- -----------
Net Loss $ (449,659) $ (478,244)
=========== ===========
Allocation of Net Loss:
Assignees $ (445,162) $ (473,462)
General Partners (4,497) (4,782)
----------- -----------
$ (449,659) $ (478,244)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (72.55) $ (77.16)
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 NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 3 ----------- ----------
Revenues:
Interest Income $ 23,502 $ 23,472
----------- ----------
Expenses:
Asset Management Fee-
General Partner 47,946 48,030
General and Administrative-
General Partner 5,235 5,124
General and Administrative-
Other 14,294 8,614
Amortization 957 5,973
----------- -----------
Total Expenses 68,432 67,741
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (44,930) (44,269)
Equity in Losses of Project
Partnerships (222,177) (383,868)
----------- -----------
Net Loss $ (267,107) $ (428,137)
=========== ===========
Allocation of Net Loss:
Assignees $ (264,436) $ (423,856)
General Partners (2,671) (4,281)
----------- -----------
$ (267,107) $ (428,137)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (48.47) $ (77.69)
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 NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 4 ----------- ----------
Revenues:
Interest Income $ 31,324 $ 31,867
----------- -----------
Expenses:
Asset Management Fee-
General Partner 58,788 58,926
General and Administrative-
General Partner 6,599 6,483
General and Administrative-
Other 11,814 9,397
Amortization 2,541 3,591
----------- -----------
Total Expenses 79,742 78,397
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (48,418) (46,530)
Equity in Losses of Project
Partnerships (425,830) (455,644)
----------- -----------
Net Loss $ (474,248) $ (502,174)
=========== ===========
Allocation of Net Loss:
Assignees $ (469,506) $ (497,152)
General Partners (4,742) (5,022)
----------- -----------
$ (474,248) $ (502,174)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (67.90) $ (71.89)
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 NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 5 ----------- ----------
Revenues:
Interest Income $ 40,044 $ 40,992
----------- -----------
Expenses:
Asset Management Fee-
General Partner 72,759 72,870
General and Administrative-
General Partner 8,192 8,048
General and Administrative-
Other 14,659 11,325
Amortization 9,348 9,246
----------- -----------
Total Expenses 104,958 101,489
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (64,914) (60,497)
Equity in Losses of Project
Partnerships (581,763) (524,535)
----------- -----------
Net Loss $ (646,677) $ (585,032)
=========== ===========
Allocation of Net Loss:
Assignees $ (640,210) $ (579,182)
General Partners (6,467) (5,850)
----------- -----------
$ (646,677) $ (585,032)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (74.30) $ (67.22)
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 NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 6 ----------- ----------
Revenues:
Interest Income $ 35,879 $ 36,847
----------- -----------
Expenses:
Asset Management Fee-
General Partner 80,748 80,931
General and Administrative-
General Partner 8,647 8,495
General and Administrative-
Other 11,947 12,448
Amortization 16,992 17,271
----------- -----------
Total Expenses 118,334 119,145
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (82,455) (82,296)
Equity in Losses of Project
Partnerships (562,683) (688,274)
----------- -----------
Net Loss $ (645,138) $ (770,570)
=========== ===========
Allocation of Net Loss:
Assignees $ (638,687) $ (762,864)
General Partners (6,451) (7,706)
----------- -----------
$ (645,138) $ (770,570)
=========== ===========
Net Loss Per Beneficial
Assignee Certificate $ (63.21) $ (75.49)
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 NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
TOTAL SERIES 2 - 6 ----------- ----------
Revenues:
Interest Income $ 158,220 $ 160,756
------------ ------------
Expenses:
Asset Management Fee-
General Partner 311,991 312,525
General and Administrative-
General Partner 33,679 33,068
General and Administrative-
Other 63,501 49,609
Amortization 33,447 40,044
------------ ------------
Total Expenses 442,618 435,246
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (284,398) (274,490)
Equity in Losses of Project
Partnerships (2,198,431) (2,489,667)
------------ ------------
Net Loss $(2,482,829) $(2,764,157)
============ ============
Allocation of Net Loss:
Assignees $(2,458,001) $(2,736,516)
General Partners (24,828) (27,641)
------------ ------------
$(2,482,829) $(2,764,157)
============ ============
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Assignees Partners Total
SERIES 2 ----------- ----------- -----------
Balance at
March 31, 1995 $ 2,246,516 $ (31,651) $ 2,214,865
Net Loss (473,462) (4,782) (478,244)
----------- ---------- -----------
Balance at
December 31, 1995 $ 1,773,054 $ (36,433) $ 1,736,621
=========== ========== ===========
Balance at
March 31, 1996 $ 1,661,075 $ (37,565) $ 1,623,510
Net Loss (445,162) (4,497) (449,659)
----------- ---------- -----------
Balance at
December 31, 1996 $ 1,215,913 $ (42,062) $ 1,173,851
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Assignees Partners Total
SERIES 3 ----------- ---------- -----------
Balance at
March 31, 1995 $ 1,626,196 $ (31,872) $ 1,594,324
Net Loss (423,856) (4,281) (428,137)
----------- ---------- -----------
Balance at
December 31, 1995 $ 1,202,340 $ (36,153) $ 1,166,187
=========== ========== ===========
Balance at
March 31, 1996 $ 1,160,025 $ (36,581) $ 1,123,444
Net Loss (264,436) (2,671) (267,107)
----------- ---------- -----------
Balance at
December 31, 1996 $ 895,589 $ (39,252) $ 856,337
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Assignees Partners Total
SERIES 4 ----------- ---------- -----------
Balance at
March 31, 1995 $ 3,179,350 $ (29,152) $ 3,150,198
Net Loss (497,152) (5,022) (502,174)
----------- ---------- -----------
Balance at
December 31, 1995 $ 2,682,198 $ (34,174) $ 2,648,024
=========== ========== ===========
Balance at
March 31, 1996 $ 2,480,767 $ (36,208) $ 2,444,559
Net Loss (469,506) (4,742) (474,248)
----------- ---------- -----------
Balance at
December 31, 1996 $ 2,011,261 $ (40,950) $ 1,970,311
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Assignees Partners Total
SERIES 5 ----------- ---------- -----------
Balance at
March 31, 1995 $ 4,579,242 $ (30,132) $ 4,549,110
Net Loss (579,182) (5,850) (585,032)
----------- ---------- -----------
Balance at
December 31, 1995 $ 4,000,060 $ (35,982) $ 3,964,078
=========== ========== ===========
Balance at
March 31, 1996 $ 3,805,620 $ (37,946) $ 3,767,674
Net Loss (640,210) (6,467) (646,677)
----------- ---------- -----------
Balance at
December 31, 1996 $ 3,165,410 $ (44,413) $ 3,120,997
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Assignees Partners Total
SERIES 6 ----------- ---------- -----------
Balance at
March 31, 1995 $ 6,153,088 $ (27,471) $ 6,125,617
Net Loss (762,864) (7,706) (770,570)
----------- ---------- -----------
Balance at
December 31, 1995 $ 5,390,224 $ (35,177) $ 5,355,047
=========== ========== ===========
Balance at
March 31, 1996 $ 5,340,274 $ (35,681) $ 5,304,593
Net Loss (638,687) (6,451) (645,138)
----------- ---------- -----------
Balance at
December 31, 1996 $ 4,701,587 $ (42,132) $ 4,659,455
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 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 (2,736,516) (27,641) (2,764,157)
----------- ---------- -----------
Balance at
December 31, 1995 $15,047,876 $ (177,919) $14,869,957
=========== ========== ===========
Balance at
March 31, 1996 $14,447,761 $ (183,981) $14,263,780
Net Loss (2,458,001) (24,828) (2,482,829)
----------- ---------- -----------
Balance at
December 31, 1996 $11,989,760 $ (208,809) $11,780,951
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 2 ----------- -----------
Cash Flows from Operating Activities:
Net Loss $ (449,659) $ (478,244)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 3,609 3,963
Accreted Interest Income
on Investments in Securities (21,518) (21,688)
Equity in Losses of
Project Partnerships 405,978 437,346
Interest Income from
Redemption of Securities 10,359 7,238
Payment of Asset Management Fee 32,438 32,540
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (15,175) (15,404)
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (33,968) (34,249)
----------- -----------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 4,176 4,593
Redemption of Investment
in Securities 33,294 34,609
----------- -----------
Net Cash Provided by
Investing Activities 37,470 39,202
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 3,502 4,593
Cash and Cash Equivalents at
Beginning of Year 135,519 127,890
----------- -----------
Cash and Cash Equivalents at
End of Year $ 139,021 $ 132,843
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 3 ----------- ---------
Cash Flows from Operating Activities:
Net Loss $ (267,107) $ (428,137)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 957 5,973
Accreted Interest Income
on Investments in Securities (19,141) (19,291)
Equity in Losses of
Project Partnerships 222,177 383,868
Interest Income from
Redemption of Securities 9,214 6,437
Payment of Asset Management Fee 39,504 35,611
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (33,229) (25,395)
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (47,625) (40,934)
----------- -----------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 26,557 20,900
Redemption of Investment
in Securities 29,617 30,785
----------- -----------
Net Cash Provided by
Investing Activities 56,174 51,685
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 8,549 10,751
Cash and Cash Equivalents at
Beginning of Year 97,988 83,648
----------- -----------
Cash and Cash Equivalents at
End of Year $ 106,537 $ 94,399
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 4 ---------- ---------
Cash Flows from Operating Activities:
Net Loss $ (474,248) $ (502,174)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 2,541 3,591
Accreted Interest Income
on Investments in Securities (24,248) (24,440)
Equity in Losses of
Project Partnerships 425,830 455,644
Interest Income from
Redemption of Securities 11,674 8,156
Payment of Asset Management Fee 42,702 40,031
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (29,211) (23,812)
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (44,960) (43,004)
----------- -----------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 10,900 11,776
Redemption of Investment
in Securities 37,522 39,001
----------- -----------
Net Cash Provided by
Investing Activities 48,422 50,777
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 3,462 7,773
Cash and Cash Equivalents at
Beginning of Year 178,506 168,651
----------- -----------
Cash and Cash Equivalents at
End of Year $ 181,968 $ 176,424
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 5 ---------- ---------
Cash Flows from Operating Activities:
Net Loss $ (646,677) $ (585,032)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 9,348 9,246
Accreted Interest Income
on Investments in Securities (30,222) (30,461)
Equity in Losses of
Project Partnerships 581,763 524,535
Interest Income from
Redemption of Securities 14,550 10,166
Payment of Asset Management Fee 59,353 62,521
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (49,010) (55,377)
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (60,895) (64,402)
=========== ===========
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 7,878 13,906
Redemption of Investment
in Securities 46,767 48,609
----------- -----------
Net Cash Provided by
Investing Activities 54,645 62,515
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents (6,250) (1,887)
Cash and Cash Equivalents at
Beginning of Year 257,549 249,065
----------- -----------
Cash and Cash Equivalents at
End of Year $ 251,299 $ 247,178
----------- -----------
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 6 ---------- ---------
Cash Flows from Operating Activities:
Net Loss $ (645,138) $ (770,570)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 16,992 17,271
Accreted Interest Income
on Investments in Securities (22,990) (22,930)
Equity in Losses of
Project Partnerships 562,683 688,274
Interest Income from
Redemption of Securities 0 0
Payment of Asset Management Fee 52,484 47,661
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (27,680) (17,940)
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (63,649) (58,234)
----------- ----------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 14,560 10,281
Redemption of Investment
in Securities 0 0
----------- -----------
Net Cash Provided by
Investing Activities 14,560 10 281
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents (49,089) (47,953)
Cash and Cash Equivalents at
Beginning of Year 388,991 384,578
----------- -----------
Cash and Cash Equivalents at
End of Year $ 339,902 $ 336,625
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
TOTAL SERIES 2 - 6 ---------- ---------
Cash Flows from Operating Activities:
Net Loss $(2,482,829) $(2,764,157)
Adjustments to Reconcile Net Loss to
Net Cash Provided by (Used in)
Operating Activities:
Amortization 33,447 40,044
Accreted Interest Income
on Investments in Securities (118,119) (118,810)
Equity in Losses of
Project Partnerships 2,198,431 2,489,667
Interest Income from
Redemption of Securities 45,797 31,997
Payment of Asset Management Fee 226,481 218,364
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners (154,305) (137,928)
------------ ------------
Net Cash Provided by (Used in)
Operating Activities (251,097) (240,823)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from
Project Partnerships 64,071 61,456
Redemption of Investment
in Securities 147,200 153,004
------------ ------------
Net Cash Provided by
Investing Activities 211,271 214,460
------------ ------------
Increase (Decrease) in Cash and
Cash Equivalents (39,826) (26,363)
Cash and Cash Equivalents at
Beginning of Year 1,058,553 1,013,832
------------ ------------
Cash and Cash Equivalents at
End of Year $ 1,018,727 $ 987,469
============ ============
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
December 31, 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 December 31, 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 Raymond James Tax Credit Funds,
Inc., f/k/a 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
December 31, 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.
<PAGE>
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 December 31, 1996 Balance Sheet includes Investment in
Securities consisting of U.S. Government Security Strips which
represents their cost, plus accreted interest income of $119,594
for Series 2, $106,376 for Series 3, $134,769 for Series 4,
$167,970 for Series 5 and $115,970 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 $ 408,012 $ 385,258 $ 22,754
Series 3 362,799 342,678 20,121
Series 4 459,812 434,139 25,673
Series 5 572,917 541,097 31,820
Series 6 492,799 477,060 15,739
As of December 31, 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 $ 44,989 $ 40,017 $ 50,697
After 1 year
through 5 years 165,763 147,441 186,790
After 5 years
through 10 years 174,506 155,220 196,652
After 10 years 0 0 0
--------- --------- ---------
Total Amount Carried on
Balance Sheet $ 385,258 $ 342,678 $ 434,139
========= ========= =========
Series 5 Series 6 Total
--------- --------- ---------
Due within 1 year $ 63,188 $ 44,822 $ 243,713
After 1 year
through 5 years 232,814 180,359 913,167
After 5 years
through 10 years 245,095 212,628 984,101
After 10 years 0 39,251 39,251
--------- --------- ---------
Total Amount Carried on
Balance Sheet $ 541,097 $ 477,060 $2,180,232
========= ========= =========
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 nine months ended December 31, 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 $ 51,750 $ 51,768
Series 3 47,946 48,030
Series 4 58,788 58,926
Series 5 72,759 72,870
Series 6 80,748 80,931
--------- ---------
Total $ 311,991 $ 312,525
========= =========
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 $ 5,006 $ 4,918
Series 3 5,235 5,124
Series 4 6,599 6,483
Series 5 8,192 8,048
Series 6 8,647 8,495
--------- ---------
Total $ 33,679 $ 33,068
========= =========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS:
As of December 31, 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:
DECEMBER 31, 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) 38,254 33,815
Cumulative equity in losses of
Project Partnerships (2) (3,901,174) (3,495,196)
Cumulative distributions received
from Project Partnerships (49,300) (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 (66,135) (58,088)
------------ ------------
Investments in
Project Partnerships $ 937,161 $ 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 December 31, 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 $57,490 for the period ended December 31, 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 December 31, 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:
DECEMBER 31, 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) 39,514 33,947
Cumulative equity in losses of
Project Partnerships (2) (3,559,937) (3,337,760)
Cumulative distributions received
from Project Partnerships (137,297) (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 (70,766) (64,243)
------------ ------------
Investments in
Project Partnerships $ 651,973 $ 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 December 31, 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 $404,008 for the period ended December 31, 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 December 31, 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:
DECEMBER 31, 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) 69,669 60,437
Cumulative equity in losses of
Project Partnerships (2) (3,794,033) (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 (86,700) (74,927)
------------ ------------
Investments in
Project Partnerships $ 1,634,239 $ 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 December 31, 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 $36,498 for the period ended December 31, 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 December 31, 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:
DECEMBER 31, 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) 31,618 27,015
Cumulative equity in losses of
Project Partnerships (2) (4,048,426) (3,466,663)
Cumulative distributions received
from Project Partnerships (92,749) (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 (92,874) (78,922)
------------ ------------
Investments in
Project Partnerships $ 2,612,878 $ 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 December 31, 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 December 31, 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 December 31, 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:
DECEMBER 31, 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) (2,700) (2,253)
Cumulative equity in losses of
Project Partnerships (2) (3,890,269) (3,327,586)
Cumulative distributions received
from Project Partnerships (77,992) (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 (101,044) (84,498)
------------ ------------
Investments in
Project Partnerships $ 4,175,389 $ 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 December 31, 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 $37,229 for the period ended December 31, 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:
DECEMBER 31, 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) 176,355 152,961
Cumulative equity in losses of
Project Partnerships (19,193,839) (16,995,408)
Cumulative distributions received
from Project Partnerships (427,521) (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 (417,519) (360,678)
------------- -------------
Investments in
Project Partnerships $ 10,011,640 $ 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 September 30 of each year:
1996 1995
SERIES 2 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 1,660,264 $ 1,444,741
Investment properties, net 22,743,234 23,656,926
Other assets 1,693 3,419
------------- -------------
Total assets $ 24,405,191 $ 25,105,086
============= =============
Liabilities and Partners' Equity
Current liabilities $ 470,102 $ 524,716
Long-term debt 23,298,841 23,306,669
------------- -------------
Total liabilities 23,768,943 23,831,385
Partners' Equity
Limited Partner 554,832 1,088,103
General Partners 81,416 185,598
------------- -------------
636,248 1,273,701
Total liabilities and
partners' equity $ 24,405,191 $ 25,105,086
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,968,616 $ 2,012,031
Expenses:
Operating expenses 1,031,540 927,306
Interest expense 661,270 797,245
Depreciation and amortization 718,588 729,244
------------- -------------
Total expenses 2,411,398 2,453,795
Net loss $ (442,782) $ (441,764)
============= =============
Other partners' share
of net loss $ (4,428) $ (4,418)
Partnership's share of net loss $ (438,354) $ (437,346)
Suspended loss 32,376 0
------------- -------------
Equity in Loss of
Project Partnerships $ (405,978) $ (437,346)
============= =============
<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 September 30 of each year:
1996 1995
SERIES 3 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,049,208 $ 1,891,425
Investment properties, net 20,004,029 20,905,778
Other assets 233,196 241,231
------------- -------------
Total assets $ 22,286,433 $ 23,038,434
============= =============
Liabilities and Partners' Equity
Current liabilities $ 523,579 $ 569,000
Long-term debt 21,840,016 21,920,084
------------- -------------
Total liabilities 22,363,595 22,489,084
Partners' Equity
Limited Partner (425,639) 201,678
General Partners 348,477 347,672
------------- -------------
(77,162) 549,350
Total liabilities and
partners' equity $ 22,286,433 $ 23,038,434
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,871,589 $ 2,139,667
Expenses:
Operating expenses 1,145,127 1,061,810
Interest expense 446,640 824,786
Depreciation and amortization 683,936 679,669
------------- -------------
Total expenses 2,275,703 2,566,265
Net loss $ (404,114) $ (426,598)
============= =============
Other partners' share
of net loss $ (4,041) $ (4,266)
Partnership's share of net loss $ (400,073) $ (422,332)
Suspended loss 177,896 38,464
------------- -------------
Equity in Loss of
Project Partnerships $ (222,177) $ (383,868)
============= =============
<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 September 30 of each year:
1996 1995
SERIES 4 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,010,040 $ 1,989,218
Investment properties, net 26,528,213 27,508,612
Other assets 21,726 11,750
------------- -------------
Total assets $ 28,559,979 $ 29,509,580
============= =============
Liabilities and Partners' Equity
Current liabilities $ 575,577 $ 697,870
Long-term debt 26,618,948 26,690,914
------------- -------------
Total liabilities 27,194,525 27,388,784
Partners' Equity
Limited Partner 1,095,809 1,766,724
General Partners 269,645 354,072
------------- ------------
1,365,454 2,120,796
Total liabilities and
partners' equity $ 28,559,979 $ 29,509,580
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 2,372,440 $ 2,481,875
Expenses:
Operating expenses 1,341,690 1,210,200
Interest expense 693,611 926,095
Depreciation and amortization 792,581 805,826
------------- -------------
Total expenses 2,827,882 2,942,121
Net loss $ (455,442) $ (460,246)
============= =============
Other partners' share
of net loss $ (4,554) $ (4,602)
Partnership's share of net loss $ (450,888) $ (455,644)
Suspended loss 25,058 0
------------- -------------
Equity in Loss of
Project Partnerships $ (425,830) $ (455,644)
============= =============
<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 September 30 of each year:
1996 1995
SERIES 5 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,595,853 $ 2,327,453
Investment properties, net 33,271,847 34,487,069
Other assets 1,148 14,927
------------- -------------
Total assets $ 35,868,848 $ 36,829,449
============= =============
Liabilities and Partners' Equity
Current liabilities $ 799,455 $ 891,291
Long-term debt 32,935,732 33,023,060
------------- -------------
Total liabilities 33,735,187 33,914,351
Partners' Equity
Limited Partner 2,149,527 2,883,732
General Partners (15,866) 31,366
------------- -------------
2,133,661 2,915,098
Total liabilities and
partners' equity $ 35,868,848 $ 36,829,449
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 2,648,282 $ 2,734,788
Expenses:
Operating expenses 1,534,029 1,394,120
Interest expense 663,006 846,894
Depreciation and amortization 1,038,886 1,023,607
------------- -------------
Total expenses 3,235,921 3,264,621
Net loss $ (587,639) $ (529,833)
============= =============
Other partners' share
of net loss $ (5,876) $ (5,298)
Partnership's share of net loss $ (581,763) $ (524,535)
Suspended loss 0 0
------------- -------------
Equity in Loss of
Project Partnerships $ (581,763) $ (524,535)
============= =============
<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 September 30 of each year:
1996 1995
SERIES 6 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,777,491 $ 2,487,192
Investment properties, net 37,340,541 38,746,300
Other assets 21,153 38,635
------------- -------------
Total assets $ 40,139,185 $ 41,272,127
============= =============
Liabilities and Partners' Equity
Current liabilities $ 912,481 $ 1,139,260
Long-term debt 35,835,035 36,041,320
------------- -------------
Total liabilities 36,747,516 37,180,580
Partners' Equity
Limited Partner 3,508,456 4,154,097
General Partners (116,787) (62,550)
------------- -------------
3,391,669 4,091,547
Total liabilities and
partners' equity $ 40,139,185 $ 41,272,127
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 3,087,264 $ 2,994,268
Expenses:
Operating expenses 1,619,403 1,469,490
Interest expense 907,245 1,067,132
Depreciation and amortization 1,154,954 1,152,872
------------- -------------
Total expenses 3,681,602 3,689,494
Net loss $ (594,338) $ (695,226)
============= =============
Other partners' share
of net loss $ (5,943) $ (6,952)
Partnership's share of net loss $ (588,395) $ (688,274)
Suspended loss 25,712 0
------------- -------------
Equity in Loss of
Project Partnerships $ (562,683) $ (668,274)
============= =============
<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 September 30 of each year:
1996 1995
TOTAL SERIES 2 - 6 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 11,092,856 $ 10,140,029
Investment properties, net 139,887,864 145,304,685
Other assets 278,916 309,962
------------- -------------
Total assets $151,259,636 $155,754,676
============= =============
Liabilities and Partners' Equity
Current liabilities $ 3,281,194 $ 3,822,137
Long-term debt 140,528,572 140,982,047
------------- -------------
Total liabilities 143,809,766 144,804,184
Partners' Equity
Limited Partner 6,882,985 10,094,334
General Partners 566,885 856,158
------------- -------------
7,449,870 10,950,492
Total liabilities and
partners' equity $151,259,636 $155,754,676
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 11,948,191 $ 12,362,629
Expenses:
Operating expenses 6,671,789 6,062,926
Interest expense 3,371,772 4,462,152
Depreciation and amortization 4,388,945 4,391,218
------------- -------------
Total expenses 14,432,506 14,916,296
Net loss $ (2,484,315) $ (2,553,667)
============= =============
Other partners' share
of net loss $ (24,842) $ (25,536)
Partnership's share of net loss $ (2,459,473) $ (2,528,131)
Suspended loss 261,042 38,464
------------- ------------
Equity in Loss of
Project Partnerships $ (2,198,431) $ (2,489,667)
============= =============
<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
December 31, 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 nine and
three months ended December 31, 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 $437,346 for the nine months
ended December 31, 1995 to $405,978 for the nine months ended
December 31, 1996. This decrease was partially caused by $32,376
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 December 31, 1996, the Series had $139,021 of short-term
investments (Cash and Cash Equivalents). It also had $385,258 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 $449,659 for the nine months ended December 31, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $405,978 and the changes in operating assets and
liabilities, net cash used in operating activities was $33,968.
Cash provided by investing activities totaled $37,470, consisting
of $33,294 from matured Zero Coupon Treasuries and $4,176 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 $383,868 for the nine months
ended December 31, 1995 to $222,177 for the nine months ended
December 31, 1996. This decrease was caused by $177,896 of losses
that were suspended to prevent reducing the investment in certain
Project Partnerships below zero, in accordance with the equity
method of accounting. Overall, management believes these Project
Partnerships are operating as expected and are generating tax
credits which meet projections.
At December 31, 1996, the Series had $106,537 of short-term
investments (Cash and Cash Equivalents). It also had $342,678 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 $267,107 for the nine months ended December 31, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $222,177 and the changes in operating assets and
liabilities net cash used in operating activities was $47,625.
Cash provided by investing activities totaled $56,174, consisting
of $26,557 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 nine months ended
December 31, 1995 and December 31, 1996. Overall, management
believes these Project Partnerships are operating as expected and
are generating tax credits which meet projections.
At December 31, 1996, the Series had $181,968 of short-term
investments (Cash and Cash Equivalents). It also had $434,139 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 $474,248 for the nine months ended December 31, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $425,830 and the changes in operating assets and
liabilities net cash used in operating activities was $44,960.
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 $524,535 for the nine months
ended December 31, 1995 to $581,763 for the nine months ended
December 31, 1996. Overall, management believes these Project
Partnerships are operating as expected and are generating tax
credits which meet projections.
At December 31, 1996, the Series had $251,299 of short-term
investments (Cash and Cash Equivalents). It also had $541,097 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 $646,677 for the nine months ended December 31, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $581,763 and the changes in operating assets and
liabilities net cash used in operating activities was $60,895.
Cash provided by investing activities totaled $54,645 consisting of
$46,767 from matured Zero Coupon Treasuries and $7,878 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 $688,274 for the nine months
ended December 31, 1995 to $562,683 for the nine months ended
December 31, 1996. Overall, management believes these Project
Partnerships are operating as expected and are generating tax
credits which meet projections.
At December 31, 1996, the Series had $339,902 of short-term
investments (Cash and Cash Equivalents). It also had $477,060 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 $645,138 for the nine months ended December 31, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $562,683 and the changes in operating assets and
liabilities net cash used in operating activities was $63,649.
Cash provided by investing activities totaled $14,560 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: Raymond James Tax Credit
Funds,Inc. f/k/a/
RJ Credit Partners, Inc.
Managing General Partner
Date: February 11, 1997 By:/s/ Ronald M. Diner
Ronald M. Diner
President
Date: February 11, 1997 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 DECEMBER 31, 1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> DEC-31-1996
<CASH> 1,018,727
<SECURITIES> 2,180,232
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,262,440
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 13,210,599
<CURRENT-LIABILITIES> 273,949
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 11,780,981
<TOTAL-LIABILITY-AND-EQUITY> 13,210,599
<SALES> 0
<TOTAL-REVENUES> 158,220
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 442,618
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (2,482,829)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,482,829)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,482,829)
<EPS-PRIMARY> (66.69)<F1>
<EPS-DILUTED> (66.69)<F1>
<FN>
<F1>EPS IS NET INCOME (LOSS) PER $1,000 LIMITED PARTNERSHIP UNIT.
</FN>
</TABLE>
