FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1996
------------------
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 0-21718
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BOSTON CAPITAL TAX CREDIT FUND III L.P.
- -----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 52-1749505
- -------------------------------- -----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Boston Place, Suite 2100, Boston, Massachusetts 02108
- -----------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 624-8900
--------------
- -----------------------------------------------------------------
(Former name, former address and former fiscal year, if changed
since last report)
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
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<PAGE>
BOSTON CAPITAL TAX CREDIT FUND III L.P.
--------------------------------------------------
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED DECEMBER 31, 1996
-----------------------------------------------
TABLE OF CONTENTS
-----------------
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements..............................
Balance Sheets....................................
Statements of Operations..........................
Statement of Changes in Partners' Capital.........
Statements of Cash Flows..........................
Notes to Financial Statements.....................
Item 2. Management's Discussion and Analysis of
Financial Condition and Results
of Operations.....................................
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K..................
Signatures........................................
<PAGE>
Boston Capital Tax Credit Fund III L.P.
BALANCE SHEETS
December 31, March 31,
1996 1996
(Unaudited) (Audited)
ASSETS ------------ ------------
INVESTMENTS IN OPERATING
PARTNERSHIPS (Note D) $138,824,448 $147,259,013
OTHER ASSETS
Cash and cash equivalents 3,264,706 4,958,860
Investments 2,503,779 5,141,767
Notes receivable 2,081,333 4,962,160
Deferred acquisition costs,
net of accumulated amortization (Note B) 1,775,033 2,144,343
Organization costs, net of
accumulated amortization (Note B) 264,823 399,040
Other assets 2,018,517 2,420,327
----------- -----------
$150,732,639 $167,285,510
=========== ===========
LIABILITIES
Accounts payable & accrued
expenses (Note C) $ 4,682 $ 75,208
Accounts payable affiliates 6,387,444 4,454,405
Capital contributions payable (Note D) 3,782,043 9,539,884
----------- -----------
10,174,169 14,069,497
----------- -----------
PARTNERS' CAPITAL
Limited Partners
Units of limited partnership interest,
$10 stated value per BAC; 22,000,000
authorized BACs; 21,996,102 issued and
outstanding, as of December 31, 1996 141,032,530 153,561,702
General Partner (484,177) (357,619)
Unrealized gain (loss)
on securities available for sale, net 10,117 11,930
----------- -----------
140,558,470 153,216,013
----------- -----------
$150,732,639 $167,285,510
=========== ===========
The accompanying notes are an integral part of these statements.
1 <PAGE>
Boston Capital Tax Credit Fund III L.P.
BALANCE SHEETS
SERIES 15
----------------------------
December 31, March 31,
1996 1996
(Unaudited) (Audited)
ASSETS ----------- ---------
INVESTMENTS IN OPERATING
PARTNERSHIPS (Note D) $19,498,587 $21,718,070
OTHER ASSETS
Cash and cash equivalents 249,948 163,428
Investments - 151,943
Notes receivable 135,000 185,000
Deferred acquisition costs,
net of accumulated amortization (Note B) 270,675 281,199
Organization costs, net of
accumulated amortization (Note B) 6,558 26,232
Other assets 451,744 292,164
---------- ----------
$20,612,512 $22,818,036
========== ==========
LIABILITIES
Accounts payable and accrued
expenses (Note C) $ 1,144 $ 68,856
Accounts payable affiliates 1,675,674 1,264,641
Capital contributions payable (Note D) 189,312 202,750
---------- ----------
1,866,130 1,536,247
---------- ----------
PARTNERS' CAPITAL
Limited Partners
Units of limited partnership interest,
$10 stated value per BAC; 22,000,000
authorized BACs; 3,870,500 issued and
outstanding, as of December 31, 1996 18,891,590 21,401,297
General Partner (145,208) (119,857)
Unrealized gain (loss) on securities
available for sale, net - 349
---------- ----------
18,746,382 21,281,789
---------- ----------
$20,612,512 $22,818,036
========== ==========
The accompanying notes are an integral part of these statements.
2 <PAGE>
Boston Capital Tax Credit Fund III L.P.
BALANCE SHEETS
SERIES 16
----------------------------
December 31, March 31,
1996 1996
(Unaudited) (Audited)
ASSETS ----------- ---------
INVESTMENTS IN OPERATING
PARTNERSHIPS (Note D) $34,825,175 $37,074,575
OTHER ASSETS
Cash and cash equivalents 1,321,108 1,429,491
Investments 318,877 394,836
Notes receivable - 483,464
Deferred acquisition costs
net of accumulated amortization (Note B) 433,934 445,554
Organization costs, net of
accumulated amortization (Note B) 55,788 89,261
Other assets 9,529 38,197
---------- ----------
$36,964,411 $39,955,378
========== ==========
LIABILITIES
Accounts payable & accrued
expenses (Note C) $ - $ 100
Accounts payable affiliates 1,770,041 1,251,118
Capital contributions payable (Note D) 155,225 900,481
---------- ----------
1,925,266 2,151,699
---------- ----------
PARTNERS' CAPITAL
Limited Partners
Units of limited partnership interest,
$10 stated value per BAC; 22,000,000
authorized BACs; 5,429,402 issued and
outstanding, as of December 31, 1996 35,154,454 37,891,343
General Partner (116,226) (88,581)
Unrealized gain (loss) on securities
available for sale, net 917 917
---------- ----------
35,039,145 37,803,679
---------- ----------
$36,964,411 $39,955,378
========== ==========
The accompanying notes are an integral part of these statements.
3<PAGE>
Boston Capital Tax Credit Fund III L.P.
BALANCE SHEETS
SERIES 17
----------------------------
December 31, March 31,
1996 1996
(Unaudited) (Audited)
ASSETS ----------- ---------
INVESTMENTS IN OPERATING
PARTNERSHIPS (Note D) $31,290,112 $34,318,721
OTHER ASSETS
Cash and cash equivalents 540,652 285,417
Investments - 629,950
Notes receivable 1,409,982 1,658,475
Deferred acquisition costs
net of accumulated amortization (Note B) 400,410 415,482
Organization costs, net of
accumulated amortization (Note B) 60,465 90,262
Other assets 1,322,906 1,245,840
---------- ----------
$35,024,527 $38,644,147
========== ==========
LIABILITIES
Accounts payable & accrued
expenses (Note C) $ - $ -
Accounts payable affiliates 1,452,612 1,021,686
Capital contributions payable (Note D) 1,849,192 2,312,721
---------- ----------
3,301,804 3,334,407
---------- ----------
PARTNERS' CAPITAL
Limited Partners
Units of limited partnership interest,
$10 stated value per BAC; 22,000,000
authorized BACs; 5,000,000 issued and
outstanding, as of December 31, 1996 31,835,175 35,384,872
General Partner (112,452) ( 76,596)
Unrealized gain (loss) on securities
available for sale, net - 1,464
---------- ----------
31,722,723 35,309,740
---------- ----------
$35,024,527 $38,644,147
========== ==========
The accompanying notes are an integral part of these statements.
4 <PAGE>
Boston Capital Tax Credit Fund III L.P.
BALANCE SHEETS
SERIES 18
----------------------------
December 31, March 31,
1996 1996
(Unaudited) (Audited)
ASSETS ------------ ----------
INVESTMENTS IN OPERATING
PARTNERSHIPS (Note D) $24,495,683 $26,102,954
OTHER ASSETS
Cash and cash equivalents 796,880 529,400
Investments 196,019 647,930
Notes receivable 536,351 536,351
Deferred acquisition costs,
new of accumulated amortization (Note B) 294,836 305,861
Organization costs, net of
accumulated amortization (Note B) 57,215 80,280
Other assets 3,475 8,052
---------- ----------
$26,380,459 $28,210,828
========== ==========
LIABILITIES
Accounts payable & accrued
expenses (Note C) $ 132 $ 1,751
Accounts payable affiliates 720,435 434,163
Capital contributions payable (Note D) 756,295 861,315
---------- ----------
1,476,862 1,297,229
---------- ----------
PARTNERS' CAPITAL
Limited Partners
Units of limited partnership interest,
$10 stated value per BAC; 22,000,000
authorized BACs; 3,616,200 issued and
outstanding, as of December 31, 1996 24,963,302 26,953,204
General Partner (61,206) (41,106)
Unrealized gain (loss) on securities
available for sale, net 1,501 1,501
---------- ----------
24,903,597 26,913,599
---------- ----------
$26,380,459 $28,210,828
========== ==========
The accompanying notes are an integral part of these statements.
5 <PAGE>
Boston Capital Tax Credit Fund III L.P.
BALANCE SHEETS
SERIES 19
----------------------------
December 31, March 31,
1996 1996
(Unaudited) (Audited)
ASSETS ------------ ----------
INVESTMENTS IN OPERATING
PARTNERSHIPS (Note D) $28,714,891 $28,044,693
OTHER ASSETS
Cash and cash equivalents 356,118 2,551,124
Investments 1,988,883 3,317,108
Notes receivables - 2,098,870
Deferred acquisition costs,
net of accumulated amortization (Note B) 375,178 696,247
Organization costs, net of
accumulated amortization (Note B) 84,797 113,005
Other assets 230,863 836,074
---------- ----------
$31,750,730 $37,657,121
========== ==========
LIABILITIES
Accounts payable & accrued
expenses (Note C) $ 3,406 $ 4,501
Accounts payable affiliates 768,682 482,797
Capital contributions payable (Note D) 832,019 5,262,617
---------- ----------
1,604,107 5,749,915
---------- ----------
PARTNERS' CAPITAL
Limited Partners
Units of limited partnership interest,
$10 stated value per BAC; 22,000,000
authorized BACs; 4,080,000 issued and
outstanding, as of December 31, 1996 30,188,009 31,930,986
General Partner (49,085) (31,479)
Unrealized gain (loss) on securities
available for sale, net 7,699 7,699
---------- ----------
30,146,623 31,907,206
---------- ----------
$31,750,730 $37,657,121
========== =========
The accompanying notes are an integral part of these statements.
6<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Three Months Ended December 31,
(Unaudited)
1996 1995
---- ----
Income
Interest income $ 117,138 $ 292,452
---------- ----------
Share of loss from Operating
Partnerships (Note D) (3,339,896) (2,324,418)
---------- ----------
Expenses
Professional fees 14,445 40,818
Fund management fee (Note C) 596,591 633,826
Amortization 61,573 61,650
General and administrative expenses 84,289 130,505
---------- ----------
756,898 866,799
---------- ----------
NET LOSS $(3,979,656) $(2,898,765)
========== ==========
Net loss allocated to limited
partners $(3,939,859) $(2,869,777)
========== ==========
Net loss allocated general
partner $ (39,797) $ (28,988)
========== ==========
Net loss per BAC $ (.88) $ ( .63)
========== ==========
The accompanying notes are an integral part of these statements.
7 <PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Three Months Ended December 31,
(Unaudited)
SERIES 15
-----------------------
1996 1995
---- ----
Income
Interest income $ 168,304 $ 171,208
-------- --------
Share of loss from Operating
Partnerships (711,062) (736,916)
-------- --------
Expenses
Professional fees 659 366
Fund management fee (Note C) 126,640 134,135
Amortization 9,186 9,211
General and administrative expenses 12,433 13,868
-------- --------
148,918 157,580
-------- --------
NET LOSS $(691,676) $(723,288)
======== ========
Net loss allocated to limited
partners $(684,759) $(716,055)
======== ========
Net loss allocated to general
partner $ (6,917) $ (7,233)
======== ========
Net loss per BAC $ (.18) $ (.19)
======== ========
The accompanying notes are an integral part of these statements.
8 <PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Three Months Ended December 31,
(Unaudited)
SERIES 16
------------------------
1996 1995
---- ----
Income
Interest income $ (8,822) $ 34,819
-------- --------
Share of loss from Operating
Partnerships (639,191) (596,311)
-------- --------
Expenses
Professional fees 1,754 4,417
Fund management fee (Note C) 162,767 164,995
Amortization 15,370 15,362
General and administrative expenses 18,412 37,922
-------- --------
198,303 222,696
-------- --------
NET LOSS $(846,316) $(784,188)
======== ========
Net loss allocated to limited
partners $(837,853) $(776,346)
======== ========
Net loss allocated to general
partner $ (8,463) $ (7,842)
======== ========
Net loss per BAC $ (.15) $ (.14)
======== ========
The accompanying notes are an integral part of these statements.
9<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Three Months Ended December 31,
(Unaudited)
SERIES 17
------------------------
1996 1995
---- ----
Income
Interest income $ (40,891) $ (25,418)
---------- --------
Share of loss from Operating
Partnerships (1,051,704) (545,098)
---------- --------
Expenses
Professional fees 4,412 22,866
Fund management fee (Note C) 127,702 132,847
Amortization 13,820 13,819
General and administrative expenses 20,486 26,777
---------- --------
166,420 196,309
---------- --------
NET LOSS $(1,259,015) $(766,825)
========== ========
Net loss allocated to limited
partners $(1,246,425) $(759,157)
========== ========
Net loss allocated to general
partner $ (12,590) $ (7,668)
========== ========
Net loss per BAC $ (.25) $ (.15)
========== ========
The accompanying notes are an integral part of these statements.
10<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Three Months Ended December 31,
(Unaudited)
SERIES 18
----------------------
1996 1995
---- ----
Income
Interest income $ (32,822) $ 592
-------- --------
Share of loss from Operating
Partnerships (372,618) (128,685)
-------- --------
Expenses
Professional fees 2,396 2,228
Fund management fee (Note C) 76,999 96,396
Amortization 10,542 10,576
General and administrative expenses 11,813 17,961
-------- --------
101,750 127,161
-------- --------
NET LOSS $(507,190) $(255,254)
======== ========
Net loss allocated to limited
partners $(502,118) $(252,701)
======== ========
Net loss allocated to general
partner $ (5,072) $ (2,553)
======== ========
Net loss per BAC $ (.14) $ (.07)
======== ========
The accompanying notes are an integral part of these statements.
11<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Three Months Ended December 31,
(Unaudited)
SERIES 19
----------------------
1996 1995
---- ----
Income
Interest income $ 31,369 $ 111,251
-------- --------
Share of loss from Operating
Partnerships (565,321) (317,408)
-------- --------
Expenses
Professional fees 5,224 10,941
Fund management fee (Note C) 102,483 105,453
Amortization 12,655 12,682
General and administrative expenses 21,145 33,977
-------- --------
141,507 163,053
-------- --------
NET LOSS $(675,459) $(369,210)
======== ========
Net loss allocated to limited
partners $(668,704) $(365,518)
======== ========
Net loss allocated to general
partner $ (6,755) $ (3,692)
======== ========
Net loss per BAC $ (.16) $ (.08)
======== ========
The accompanying notes are an integral part of these statements.
12<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Nine Months Ended December 31,
(Unaudited)
1996 1995
---- ----
Income
Interest income $ 342,091 $ 765,837
---------- ----------
Share of loss from Operating
Partnerships (Note D) (10,607,400) (8,381,673)
---------- ----------
Expenses
Professional fees 275,382 248,045
Fund management fee (Note C) 1,702,502 1,862,539
Amortization 184,676 185,029
General and administrative expenses 227,861 294,899
---------- ----------
2,390,421 2,590,512
---------- ----------
NET LOSS $(12,655,730) $(10,206,348)
========== ==========
Net loss allocated to limited
partners $(12,529,172) $(10,104,283)
========== ==========
Net loss allocated general
partner $ (126,558) $ (102,065)
========== ==========
Net loss per BAC $ (2.84) $ (2.27)
========== ==========
The accompanying notes are an integral part of these statements.
13 <PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Nine Months Ended December 31,
(Unaudited)
SERIES 15
-----------------------
1996 1995
---- ----
Income
Interest income $ 172,187 $ 189,084
--------- ---------
Share of loss from Operating
Partnerships (2,219,355) $(2,231,498)
--------- ---------
Expenses
Professional fees 59,452 44,905
Fund management fee (Note c) 371,714 387,191
Amortization 27,557 27,632
General and administrative expenses 29,167 33,309
--------- ---------
487,890 493,037
--------- ---------
NET LOSS $(2,535,058) $(2,535,451)
========= =========
Net loss allocated to limited
partners $(2,509,707) $(2,510,096)
========= =========
Net loss allocated to general
partner $ (25,351) $ (25,355)
========= =========
Net loss per BAC $ (.65) $ (.65)
========= =========
The accompanying notes are an integral part of these statements.
14<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Nine Months Ended December 31,
(Unaudited)
SERIES 16
------------------------
1996 1995
---- ----
Income
Interest income $ 23,285 $ 80,342
---------- ----------
Share of loss from Operating
Partnerships (2,216,096) (2,170,632)
---------- ----------
Expenses
Professional fees 52,081 61,843
Fund management fee (Note C) 424,522 485,838
Amortization 46,068 46,170
General and administrative expenses 49,052 63,982
---------- ----------
571,723 657,833
---------- ----------
NET LOSS $(2,764,534) $(2,748,123)
========= ==========
Net loss allocated to limited
partners $(2,736,889) $(2,720,641)
========== ==========
Net loss allocated to general
partner $ (27,645) $ (27,482)
========== ==========
Net loss per BAC $ (.50) $ (.50)
========== ==========
The accompanying notes are an integral part of these statements.
15<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Nine Months Ended December 31,
(Unaudited)
SERIES 17
------------------------
1996 1995
---- ----
Income
Interest income $ (17,040) $ 75,176
---------- ---------
Share of loss from Operating
Partnerships (3,020,274) (1,945,522)
---------- ---------
Expenses
Professional fees 73,499 64,063
Fund management fee (Note C) 392,641 396,312
Amortization 41,459 41,458
General and administrative expenses 40,640 60,407
---------- ---------
548,239 562,240
---------- ---------
NET LOSS $(3,585,553) $(2,432,586)
========== =========
Net loss allocated to limited
partners $(3,549,697) $(2,408,260)
========== =========
Net loss allocated to general
partner $ (35,856) $ (24,326)
========== =========
Net loss per BAC $ (.71) $ (.49)
========== =========
The accompanying notes are an integral part of these statements.
16<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Nine Months Ended December 31,
(Unaudited)
SERIES 18
----------------------
1996 1995
---- ----
Income
Interest income $ (9,021) $ 126,517
---------- ---------
Share of loss from Operating
Partnerships (1,655,730) (907,253)
---------- ---------
Expenses
Professional fees 31,620 37,186
Fund management fee (Note C) 251,969 281,839
Amortization 31,626 31,724
General and administrative expenses 30,036 50,195
---------- ---------
345,251 400,944
---------- ---------
NET LOSS $(2,010,002) $(1,181,680)
========== =========
Net loss allocated to limited
partners $(1,989,902) $(1,169,863)
========== =========
Net loss allocated to general
partner $ (20,100) $ (11,817)
========== =========
Net loss per BAC $ (.55) $ (.32)
========== =========
The accompanying notes are an integral part of these statements.
17<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF OPERATIONS
Nine Months Ended December 31,
(Unaudited)
SERIES 19
----------------------
1996 1995
---- ----
Income
Interest income $ 172,680 $ 294,718
---------- ---------
Share of loss from Operating
Partnerships (1,495,945) (1,126,768)
---------- ---------
Expenses
Professional fees 58,730 40,048
Fund management fee (Note C) 261,656 311,359
Amortization 37,966 38,045
General and administrative expenses 78,966 87,006
---------- ---------
437,318 476,458
---------- ---------
NET LOSS $(1,760,583) $(1,308,508)
========== =========
Net loss allocated to limited
partners $(1,742,977) $(1,295,423)
========== =========
Net loss allocated to general
partner $ (17,606) $ (13,085)
========== =========
Net loss per BAC $ (.43) $ (.31)
========== =========
The accompanying notes are an integral part of these statements.
18<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
Nine Months Ended December 31, 1996
(Unaudited)
Unrealized
gain (loss) on
securities
available
General for
Assignees Partner sale, net Total
--------- ------- --------- -----
Partners' capital
(deficit)
April 1, 1996 $153,561,702 $(357,619) $ 11,930 $153,216,013
Net change in
unrealized gain
(loss) on secur-
ities available
for sale - - (1,813) (1,813)
Net income (loss) (12,529,172) (126,558) - (12,655,730)
----------- -------- --------- -----------
Partners' capital
(deficit),
December 31, 1996 $141,032,530 $(484,177) $ 10,117 $140,558,470
=========== ======== ========== ===========
The accompanying notes are an integral part of these statements.
19 <PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
Nine Months Ended December 31, 1996
(Unaudited)
Unrealized
gain (loss) on
securities
available
General for
Assignees Partner sale,net Total
--------- ------- -------- -----
Series 15
- ---------
Partners' capital
(deficit),
April 1, 1996 $21,401,297 $ (119,857) $ 349 $21,281,789
Net change in
unrealized gain
(loss) on secur-
ities available
for sale - - (349) (349)
Net income (loss) (2,509,707) (25,351) - (2,535,058)
---------- -------- ---------- ----------
Partners' capital
(deficit),
December 31, 1996 $18,891,590 $ (145,208) $ - $18,746,382
========== ======== ========== ==========
Series 16
- ---------
Partners' capital
(deficit),
April 1, 1996 $37,891,343 $ (88,581) $ 917 $37,803,679
Net change in
unrealized gain
(loss) on secur-
ities available
for sale - - - -
Net income (loss) (2,736,889) (27,645) - $(2,764,534)
---------- -------- --------- ----------
Partners' capital
(deficit),
December 31, 1996 $35,154,454 $(116,226) $ 917 $35,039,145
========== ======== ========= ==========
The accompanying notes are an integral part of these statements.
20 <PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
Nine Months Ended December 31, 1996
(Unaudited)
Unrealized
gain (loss) on
securities
available
General for
Assignees Partner sale,net Total
--------- ------- -------- -----
Series 17
- ---------
Partners' capital
(deficit),
April 1, 1996 $35,384,872 $ (76,596) $ 1,464 $35,309,740
Net change in
unrealized gain
(loss) on secur-
ities available
for sale - - (1,464) (1,464)
Net income (loss) (3,549,697) (35,856) - (3,585,553)
---------- -------- --------- ----------
Partners' capital
(deficit),
December 31, 1996 $31,835,175 $(112,452) $ - $31,722,723
========== ======== ========= ==========
Series 18
- ---------
Partners' capital
(deficit),
April 1, 1996 $26,953,204 $ (41,106) $ 1,501 $26,913,599
Net change in
unrealized gain
(loss) on secur-
ities available
for sale - - - -
Net income (loss) (1,989,902) (20,100) - (2,010,002)
--------- ------- --------- ----------
Partners' capital
(deficit),
December 31, 1996 $24,963,302 $(61,206) $ 1,501 $24,903,597
========== ======= ========= ==========
The accompanying notes are an integral part of these statements.
21<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
Nine Months Ended December 31, 1996
(Unaudited)
Unrealized
gain (loss) on
securities
available
General for
Assignees Partner sale,net Total
--------- ------- -------- -----
Series 19
- ---------
Partners' capital
(deficit),
April 1, 1996 $31,930,986 $ (31,479) $ 7,699 $31,907,206
Net change in
unrealized gain
(loss) on secur-
ities available
for sale - - - -
Net income (loss) (1,742,977) (17,606) - (1,760,583)
---------- -------- ---------- ----------
Partners' capital
(deficit),
December 31, 1996 $30,188,009 $ (49,085) $ 7,699 $30,146,623
========== ======== ========== ==========
22 <PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
1996 1995
---- ----
Cash flows from operating activities:
Net loss $(12,655,730) $(10,206,348)
Adjustments
Distributions from Operating
Partnerships 9,322 10,487
Amortization 184,676 185,029
Share of loss from Operating
Partnerships 10,607,400 8,381,673
Changes in assets and liabilities
(Decrease) Increase in accounts
payable and accrued expenses (70,525) 55,524
Decrease (Increase) in accounts
receivable 357,937 2,585,887
Decrease (Increase) in accounts
payable affiliates 1,933,039 2,136,739
---------- ----------
Net cash (used in) provided by
operating activities 366,119 3,148,991
---------- ----------
Cash flows from investing activities:
Acquisition costs repaid (paid) for
Operating Partnerships acquired or
to acquire 14,930 (66,583)
Capital contributions paid to
Operating Partnerships (7,592,998) (18,410,229)
Advances to Operating Partnerships 2,880,827 334,485
Investments 2,636,175 10,428,343
---------- -----------
Net cash (used in) provided by
investing activities (2,061,066) (7,713,984)
---------- ----------
23<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
1996 1995
---- ----
Continued
- ---------
Cash flows from financing activity:
Credit adjusters received from
Operating Partnerships 793 1,547
---------- ----------
Net cash (used in) provided by
financing activity 793 1,547
---------- ----------
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (1,694,154) (4,563,446)
---------- ----------
Cash and cash equivalents, beginning 4,958,860 10,181,096
---------- ----------
Cash and cash equivalents, ending $ 3,264,706 $ 5,617,650
========== ==========
Supplemental schedule of noncash
investing and financing activates:
The fund has increased its investments
for unpaid capital contributions due to
the Operating Partnerships $ 429,000 $ 33,504
========== ==========
The accompanying notes are an integral part of these statements.
24<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 15
-------------------------
1996 1995
---- ----
Cash flows from operating activities:
Net loss $(2,535,058) $(2,535,451)
Adjustments
Distributions from Operating
Partnerships 1,396 6,328
Amortization 27,557 27,632
Share of loss from Operating
Partnerships 2,219,355 2,231,498
Changes in assets and liabilities
(Decrease) increase in accounts
payable and accrued expenses (67,712) -
Decrease (Increase) in accounts
receivable (159,580) 176,395
Decrease (Increase) in accounts
payable affiliates 411,033 411,012
-------- --------
Net cash (used in) provided by
operating activities (103,009) 317,414
-------- --------
Cash flows from investing activities:
Acquisition costs repaid (paid) for
Operating Partnerships acquired or
to acquire 2,640 92,539
Capital contributions paid to Operating
Partnerships (14,705) (1,200,904)
Advances to Operating Partnerships 50,000 67,500
Investments 151,594 185,161
-------- --------
Net cash (used in) provided by
investing activities 189,529 (855,704)
-------- --------
25<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 15
----------------------
1996 1995
---- ----
Continued
- ---------
Cash flows from financing activity:
Credit adjusters received from
Operating Partnerships - 804
-------- --------
Net cash (used in) provided by
financing activity - 804
-------- --------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 86,520 (537,486)
Cash and cash equivalents, beginning 163,428 976,876
-------- --------
Cash and cash equivalents, ending $ 249,948 $ 439,390
======== ========
Supplemental schedule of noncash investing
and financing activities
The Fund has increased its investments
for unpaid capital contributions due to
the Operating Partnerships $ - $ -
======== =========
The accompanying notes are an integral part of these statements.
26<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 16
-------------------------
1996 1995
---- ----
Cash flows from operating activities:
Net loss $(2,764,534) $(2,748,123)
Adjustments
Distributions from Operating
Partnerships 1,321 2,349
Amortization 46,068 46,170
Share of loss from Operating
Partnerships 2,216,096 2,170,632
Changes in assets and liabilities
(Decrease) increase in accounts
payable and accrued expenses (100) (833)
Decrease (Increase) in accounts
receivable 23,472 74,712
Decrease (Increase) in accounts
payable affiliates 518,923 518,760
---------- ----------
Net cash (used in) provided by
operating activities 41,246 63,667
---------- ----------
Cash flows from investing activities:
Acquisition costs repaid (paid) for
Operating Partnerships acquired or
to acquire 3,700 110,222
Capital contributions paid to Operating
Partnerships (712,752) (2,528,078)
Advances to Operating Partnerships 483,464 1,000
Investments 75,959 819,110
---------- ----------
Net cash (used in) provided by
investing activities (149,629) (1,597,746)
---------- ----------
27<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31
(Unaudited)
Series 16
-----------------------
1996 1995
---- -----
Continued
- ---------
Cash flows from financing activity:
Credit adjusters received from
Operating Partnerships - -
--------- ----------
Net cash (used in) provided by
financing activity - -
--------- ----------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (108,383) (1,534,079)
Cash and cash equivalents, beginning 1,429,491 2,757,494
---------- ----------
Cash and cash equivalents, ending $ 1,321,108 $ 1,223,415
========== ==========
Supplemental schedule of noncash investing
and financing activities:
The Fund has increased its investments
for unpaid capital contributions due to
the Operating Partnerships $ - $ 32,504
========== ==========
The accompanying notes are an integral part of these statements.
28<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 17
-------------------------
1996 1995
---- ----
Cash flows from operating activities:
Net loss $(3,585,553) $(2,432,586)
Adjustments
Distributions from Operating
Partnerships 1,824 (363)
Amortization 41,459 41,458
Share of loss from Operating
Partnerships 3,020,274 1,945,522
Changes in assets and liabilities
(Decrease) increase in accounts
payable and accrued expenses - 13,902
Decrease (Increase) in accounts
receivable (81,058) (287,089)
Decrease (Increase) in accounts
payable affiliates 430,926 604,338
---------- ----------
Net cash (used in) provided by
operating activities (172,128) (114,818)
---------- ----------
Cash flows from investing activities:
Acquisition costs repaid (paid) for
Operating Partnerships acquired or
to acquire 3,410 77,263
Capital contributions paid to Operating
Partnerships (453,026) (2,848,769)
Advances to Operating Partnerships 248,493 327,390
Investments 628,486 1,976,808
---------- ----------
Net cash (used in) provided by
investing activates 427,363 (467,308)
---------- ----------
29<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 17
------------------------
1996 1995
---- ----
Continued
- ---------
Cash flows from financing activity:
Credit adjusters received from
Operating Partnerships - 743
---------- ----------
Net cash (used in) provided by
financing activity - 743
---------- ----------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 255,235 (581,383)
Cash and cash equivalents, beginning 285,417 1,690,922
---------- ----------
Cash and cash equivalents, ending $ 540,652 $ 1,109,539
========== ==========
Supplemental schedule of noncash investing
and financing activities:
The Fund has increased its investments
for unpaid capital contributions due to
the Operating Partnerships $ - $ -
========== ==========
The accompanying notes are an integral part of these statements.
30<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 18
-------------------------
1996 1995
---- ----
Cash flows from operating activities:
Net loss $(2,010,002) $(1,181,680)
Adjustments
Distributions from Operating
Partnerships 2,468 2,173
Amortization 31,626 31,724
Share of loss from Operating
Partnerships 1,655,730 907,253
Changes in assets and liabilities
(Decrease) increase in accounts
payable and accrued expenses (1,619) 180
Decrease (Increase) in accounts
receivable 4,577 1,489,870
Decrease (Increase) in accounts
payable affiliates 286,272 286,272
---------- ----------
Net cash (used in) provided by
operating activities (30,948) 1,535,792
---------- ----------
Cash flows from investing activities:
Acquisition costs repaid (paid) for
Operating Partnerships acquired or
to acquire 2,465 (60,639)
Capital contributions paid to Operating
Partnerships (155,948) (6,306,738)
Advances to Operating Partnerships - 78,595
Investments 451,911 4,266,323
---------- ----------
Net cash (used in) provided by
investing activities 298,428 (2,022,459)
---------- ----------
31<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 18
-----------------------
1996 1995
---- ----
Continued
- ---------
Cash flows from financing activity:
Credit adjusters received from
Operating Partnerships - -
--------- ----------
Net cash (used in) provided by
financing activity - -
--------- ----------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 267,480 (486,667)
Cash and cash equivalents, beginning 529,400 1,813,653
--------- ----------
Cash and cash equivalents, ending $ 796,880 $ 1,326,986
========= ==========
Supplemental schedule of noncash investing
and financing activities:
The Fund has increased its investments
for unpaid capital contributions due to
the Operating Partnerships $ - $ -
========= =========
The accompanying notes are an integral part of these statements.
32<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 19
-------------------------
1996 1995
---- ----
Cash flows from operating activities:
Net loss $(1,760,583) $(1,308,508)
Adjustments
Distributions from Operating
Partnerships 2,313 -
Amortization 37,966 38,045
Share of loss from Operating
Partnerships 1,495,945 1,126,768
Changes in assets and liabilities
(Decrease) increase in accounts
payable and accrued expenses (1,094) 42,275
Decrease (Increase) in accounts
receivable 570,526 1,131,999
Decrease (Increase) in accounts
payable affiliates 285,885 316,357
---------- ----------
Net cash (used in) provided by
operating activities 630,958 1,346,936
---------- ----------
Cash flows from investing activities:
Acquisition costs repaid (paid) for
Operating Partnerships acquired or
to acquire 2,715 (285,968)
Capital contributions paid to Operating
Partnerships (6,256,567) (5,525,740)
Advances to Operating Partnerships 2,098,870 (140,000)
Investments 1,328,225 4,331,397
---------- ----------
Net cash (used in) provided by
investing activities (2,826,757) (1,620,311)
---------- ---------
33<PAGE>
Boston Capital Tax Credit Fund III L.P.
STATEMENTS OF CASH FLOWS
Nine Months Ended December 31,
(Unaudited)
Series 19
------------------------
1996 1995
---- ----
Continued
- ---------
Cash flows from financing activity:
Credit adjusters received from
Operating Partnerships 793 -
---------- ----------
Net cash (used in) provided by
financing activity 793 -
---------- ----------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (2,195,006) (273,375)
Cash and cash equivalents, beginning 2,551,124 2,942,151
---------- ----------
Cash and cash equivalents, ending $ 356,118 $ 2,668,776
========== ==========
Supplemental schedule of noncash investing
and financing activities:
The Fund has increased its investments
for unpaid capital contributions due to
the Operating Partnerships $ 429,000 $ -
========== ==========
The accompanying notes are an integral part of these statements.
34<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS
December 31, 1996
(Unaudited)
NOTE A - ORGANIZATION
Boston Capital Tax Credit Fund III L.P. (the "Fund") was formed under the laws
of the State of Delaware as of September 19, 1991 for the purpose of
acquiring, holding, and disposing of limited partnership interests in
Operating Partnerships which will acquire, develop, rehabilitate, operate and
own newly constructed, existing or rehabilitated low-income apartment
complexes ("Operating Partnerships"). The general partner of the Fund is
Boston Capital Associates III L.P., a Delaware limited partnership. Boston
Capital Associates, a Massachusetts general partnership, whose only two
partners are Herbert F. Collins and John P. Manning, the principals of Boston
Capital Partners, Inc., is the sole general partner of the general partner.
The limited partner of the general partner is Capital Investment Holdings, a
general partnership whose partners are certain officers and employees of
Boston Capital Partners, Inc., and its affiliates. The Assignor Limited
Partner is BCTC III Assignor Corp., a Delaware corporation which is
wholly-owned by Herbert F. Collins and John P. Manning.
Pursuant to the Securities Act of 1933, the Fund filed a Form S-11
Registration Statement with the Securities and Exchange Commission, effective
January 24, 1992 which covered the offering (the "Public Offering") of the
Fund's beneficial assignee certificates ("BACs") representing assignments of
units of the beneficial interest of the limited partnership interest of the
Assignor Limited Partner. The Fund registered 20,000,000 BACs at $10 per BAC
for sale to the public in one or more series. On September 4, 1993 the Fund
filed an amendment to Form S-11 with the Securities and Exchange Commission
which registered an additional 2,000,000 BACs at $10 per BAC for sale to the
public in one or more series. The registration for the additional BACs became
effective on October 6, 1993. Offers and sales of BACs in Series 15 through
19 of the Fund were completed and the last of the BACs in Series 15, 16, 17,
18 and 19 were issued by the Fund on June 26, 1992, December 28, 1992, June
17, 1993, September 22, 1993, and December 17, 1993, respectively. The Fund
sold 3,870,500 of Series 15 BACs, for a total of $38,705,000; 5,429,402 of
Series 16 BACs, for a total of $54,293,000; 5,000,000 of Series 17 BACs, for a
total of $50,000,000; 3,616,200 of Series 18 BACs, for a total of $36,162,000;
and 4,080,000 of Series 19 BACs, for a total of $40,800,000. The Fund issued
the last BACs in Series 19 on December 17, 1993. This concluded the Public
Offering of the Fund.
35<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE B - ACCOUNTING AND FINANCIAL REPORTING POLICIES
The condensed financial statements included herein as of December 31, 1996
and for the three and nine months then ended have been prepared by the Fund,
without audit. The Fund accounts for its investments in Operating
Partnerships using the equity method, whereby the Fund adjusts its investment
cost for its share of each Operating Partnership's results of operations and
for any distributions received or accrued. Costs incurred by the Fund in
acquiring the investments in the Operating Partnerships are capitalized to
the investment account. The Fund's accounting and financial reporting
policies are in conformity with generally accepted accounting principles and
include adjustments in interim periods considered necessary for a fair
presentation of the results of operations. Such adjustments are of a normal
recurring nature.
Investment Securities
- ---------------------
The Fund has determined that all of it's investment securities are to be
categorized as securities available for sale. Securities classified as
available for sale are those debt securities that the Fund purchased that may
be liquidated prior to the maturity date should the need arise. These
securities are carried at approximate fair market value. All of the
investments held by the Fund are tax-exempt municipal bonds.
The amortized cost of securities available for sale as of December 31, 1996
by contractual maturity are as follows:
Amortized
Cost
-----------
Due in one year or less $2,493,662
Due after one year -
---------
Total $2,493,662
=========
The fair market value of the securities is $2,503,779. The difference being
an unrealized gain on securities available for sale of $10,117, as of
December 31, 1996.
36<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE - B ACCOUNTING AND FINANCIAL REPORTING POLICIES - CONTINUED
Amortized cost is the face value of the securities and any unamortized premium
or discount. The balance sheet reflects the fair market value under
investments.
Amortization
- ------------
The Fund amortizes organizational costs over 60 months. As of December 31,
1996 and 1995 the Fund has accumulated organization amortization totalling
$669,605 and $490,648 respectively. The breakdown of accumulated organization
amortization within the Fund as of December 31, 1996 and 1995 is as follows:
1996 1995
---- ----
Series 15 $160,519 $134,287
Series 16 172,121 127,491
Series 17 145,422 105,693
Series 18 93,081 62,327
Series 19 98,462 60,850
------- -------
$669,605 $490,648
======= =======
On July 1, 1995, the Fund began amortizing unallocated acquisition costs over
330 months from April 1, 1995. As of December 31, 1996 the Fund has
accumulated unallocated acquisition amortization totalling $118,306. The
breakdown of accumulated unallocated acquisition amortization within the fund
as of December 31, 1996 for Series 15, Series 16, Series 17, Series 18, and
Series 19 is $18,495, $29,495, $27,341, $20,104 and $22,871, respectively.
NOTE C - RELATED PARTY TRANSACTIONS
The Fund has entered into several transactions with various affiliates of the
general partner, including Boston Capital Partners, Inc., and Boston Capital
Asset Management Limited Partnership (formerly Boston Capital Communications
Limited Partnership) as follows:
Boston Capital Partners, Inc. is entitled to asset acquisition fees for
selecting, evaluating, structuring, negotiating, and closing the Fund's
acquisition of interests in the Operating Partnerships. Prior to the quarter
ended December 31, 1996 all series had completed payment of all acquisition
fees due to Boston Capital Partners, Inc.
37<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE C - RELATED PARTY TRANSACTIONS - CONTINUED
An annual fund management fee based on .5 percent of the aggregate cost of all
apartment complexes owned by the Operating Partnerships, has been accrued to
Boston Capital Asset Management Limited Partnership (formerly Boston Capital
Communications Limited Partnership). The fund management fees accrued for the
quarter ended December 31, 1996 and 1995 are as follows:
1996 1995
---- ----
Series 15 $137,013 $134,135
Series 16 172,968 164,995
Series 17 141,348 132,847
Series 18 95,424 96,396
Series 19 97,050 105,453
------- -------
$643,803 $633,826
======= =======
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS
At December 31, 1996 and 1995, the Fund had limited partnership interests in
241 Operating Partnerships which own or are constructing apartment complexes.
The breakdown of Operating Partnerships within the Fund at December 31, 1996
and 1995 is as follows:
1996 1995
---- ----
Series 15 68 68
Series 16 64 65
Series 17 49 48
Series 18 34 34
Series 19 26 26
--- ---
241 241
=== ===
38<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS - CONTINUED
Under the terms of the Fund's investment in each Operating Partnership, the
Fund is required to make capital contributions to the Operating Partnerships.
These contributions are payable in installments over several years upon each
Operating Partnership achieving specified levels of construction and/or
operations. The contributions payable at December 31, 1996 and 1995 are as
follows:
1996 1995
---- ----
Series 15 $ 189,312 $ 276,715
Series 16 155,225 1,182,714
Series 17 1,849,192 1,874,202
Series 18 756,295 1,081,078
Series 19 832,019 8,161,217
--------- ----------
$3,782,043 $12,575,926
========= ==========
The Fund's fiscal year ends March 31st of each year, while all the Operating
Partnerships' fiscal years are the calendar year. Pursuant to the provisions
of each Operating Partnership Agreement, financial results for each of the
Operating Partnerships are provided to the Fund within 45 days after the close
of each Operating Partnership's quarterly period. Accordingly, the current
financial results available for the Operating Partnerships are for the nine
months ended September 30, 1996.
39<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Nine months ended Septemer 30,
(Unaudited)
Series 15
---------------------------
1996 1995
---- ----
Revenues
Rental $ 6,849,761 $ 6,451,631
Interest and other 381,604 288,820
--------- ---------
7,231,365 6,740,451
--------- ---------
Expenses
Interest 2,382,528 2,310,898
Depreciation and amortization 2,991,845 2,859,272
Operating expenses 4,141,526 3,824,320
--------- ---------
$ 9,515,899 8,994,490
--------- ---------
NET LOSS $(2,284,534) $(2,254,039)
========= =========
Net loss allocated to Boston
Capital Tax Credit Fund
III L.P. $(2,219,355) $(2,231,498)
========= =========
Net loss allocated to other
partners $ (22,845) $ (22,541)
========= =========
Net loss suspended $ (42,334) $ -
========= =========
The Fund accounts for its investments using the equity method of accounting.
Under the equity method of accounting, the partnership adjusts its investment
cost for its share of each Operating Partnership's results of operations and
for any distributions received or accrued. However, the Partnership
recognizes individual operating losses only to the extent of capital
contributions. Excess losses are suspended for use in future years to offset
excess income.
40<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Nine months ended September 30,
(Unaudited)
Series 16
--------------------------
1996 1995
---- ----
Revenues
Rental $ 8,906,847 $ 8,517,500
Interest and other 673,696 601,047
---------- ----------
9,580,543 9,118,547
---------- ----------
Expenses
Interest 2,980,379 2,922,950
Depreciation and amortization 3,645,623 3,528,528
Operating expenses 5,193,791 4,859,626
---------- ----------
11,819,793 11,311,104
---------- ----------
NET LOSS $(2,239,250) $(2,192,557)
========== ==========
Net loss allocated to Boston
Capital Tax Credit Fund
III L.P. $(2,216,857) $(2,170,632)
========== ==========
Net loss allocated to other
partners $ (22,393) $ (21,925)
========== ==========
41<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Nine Months ended September 30,
(Unaudited)
Series 17
--------------------------
1996 1995
Revenues ---- ----
Rental $ 8,154,824 $ 7,174,788
Interest and other 306,634 649,076
---------- ---------
8,461,458 7,823,864
---------- ---------
Expenses
Interest 3,436,522 3,109,032
Depreciation and amortization 2,848,043 2,406,584
Operating expenses 5,227,674 4,273,420
---------- ---------
11,512,239 9,789,036
---------- ---------
NET LOSS $(3,050,781) $(1,965,172)
========== =========
Net loss allocated to Boston
Capital Tax Credit Fund
III L.P. $(3,020,274) $(1,945,522)
========== =========
Net loss allocated to other
partners $ (30,507) $ (19,650)
========== =========
42<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Nine months ended September 30,
(Unaudited)
Series 18
----------------------------
1996 1995
Revenues ---- ----
Rental $ 4,433,556 $3,952,988
Interest and other 219,751 219,534
--------- ---------
4,653,307 4,172,522
--------- ---------
Expenses
Interest 1,541,187 1,095,984
Depreciation and amortization 2,086,747 1,815,428
Operating expenses 2,697,827 2,177,527
--------- ---------
6,325,761 5,088,939
--------- ---------
NET LOSS $(1,672,454) $ (916,417)
========= =========
Net loss allocated to Boston
Capital Tax Credit Fund
III L.P. $(1,655,730) $ (907,253)
========= =========
Net loss allocated to other
partners $ (16,724) $ (9,164)
========= =========
43<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Nine months ended September 30,
(Unaudited)
Series 19
--------------------------
1996 1995
Revenues ---- ----
Rental $ 6,166,967 $ 2,747,473
Interest and other 204,419 100,231
--------- ---------
6,371,386 2,847,704
--------- ---------
Expenses
Interest 2,365,788 1,356,372
Depreciation and amortization 1,755,100 900,653
Operating expenses 3,761,554 1,728,828
--------- ---------
7,882,442 3,985,853
--------- ---------
NET LOSS $(1,511,056) $(1,138,149)
========= =========
Net loss allocated to Boston
Capital Tax Credit Fund
III L.P. $(1,144,815) $(1,126,768)
========= =========
Net loss allocated to other
partners $ (366,241) $ (11,381)
========= =========
44<PAGE>
Boston Capital Tax Credit Fund III L.P.
NOTES TO FINANCIAL STATEMENTS - CONTINUED
December 31, 1996
(Unaudited)
NOTE D - INVESTMENT IN OPERATING PARTNERSHIPS-CONTINUED
In the prior year an Operating Partnership was admitted to Series 16 without
an initial outlay of capital. This short form admission was an agreement
between the Operating Partnership's General Partner and the General Partner,
that upon further due diligence, the Fund had the option to purchase the
Operating Partnership if it was in the best interest of the Fund. Subsequent
studies indicated that the Operating Partnership would not generate the
originally anticipated amount of credits, and the General Partner elected to
have the Fund's interest repurchased. As a result the number of Operating
Partnerships has decreased by one for Series 16 from the quarter ended
December 31, 1995.
When comparing the results of operations from the operating partnerships for
the nine months ended September 30, 1996 and September 30, 1995 numerous
variances, some material in nature, exist. The variances are the result of a
number of factors including an increase in the number of Operating
Partnerships owned, an increase in the number which have completed
construction, and an increase in the number which have completed the lease-up
phase. Smaller variances are anticipated in future years since the Fund has
finished acquiring Operating Partnerships, construction is complete on all of
the Operating Partnerships and most have completed the lease-up phase.
NOTE E - TAXABLE LOSS
The Fund's taxable loss for the fiscal year ended March 31, 1997 is expected
to differ from its loss for financial reporting purposes primarily due to
accounting differences in depreciation incurred by the Operating Partnerships.
No provision or benefit for income taxes has been included in these financial
statements since taxable income or loss passes through to, and is reportable
by, the partners and assignees individually.
45 <PAGE>
Item 2. Management's Discussions and Analysis of Financial Condition and
Results of Operations
Liquidity
- ---------
The Fund's primary source of funds is the proceeds of its Public Offering.
Other sources of liquidity will include (i) interest earned on capital
contributions held pending investment and on Working Capital Reserves and (ii)
cash distributions from operations of the operating Partnerships in which the
Fund has and will invest. Interest income is expected to decrease over the
life of the Fund as capital contributions are paid to the Operating
Partnerships and Working Capital Reserves are expended. The Fund does not
anticipate significant cash distributions from operations of the Operating
Partnerships.
The Fund is currently accruing the fund management fee. Pursuant to the
Partnership Agreement, such liabilities will be deferred until the Fund
receives sales of refinancing proceeds from Operating Partnerships which will
be used to satisfy such liabilities. The Fund's working capital and sources
of liquidity coupled with affiliated party liability accruals allow sufficient
levels of liquidity to meet the third party obligations of the Fund. The
Fund is currently unaware of any trends which would create insufficient
liquidity to meet future third party obligations.
Capital Resources
- -----------------
The Fund offered BACs in a Public Offering declared effective by the
Securities and Exchange Commission on January 24, 1992. The Fund received
$38,705,000, $54,293,000, $50,000,000, $36,162,000 and $40,800,000
representing 3,870,500, 5,429,402, 5,000,000, 3,616,200 and 4,080,000 BACs
from investors admitted as BAC Holders in Series 15, Series 16, Series 17,
Series 18, and Series 19, respectively. The Public Offering was completed on
December 17, 1993.
(Series 15) The Fund commenced offering BACs in Series 15 on January 24,
1992. Offers and sales of BACs in Series 15 were completed on June 26, 1992.
The Fund has committed proceeds to pay initial and additional installments of
capital contributions to 68 Operating Partnerships in the amount of
$28,257,701.
During the quarter ended December 31, 1996, none of Series 15 net offering
proceeds had been used to pay capital contributions. Series 15 net offering
proceeds in the amount of $189,312 remain to be used by the Fund to pay
remaining capital contributions to the Operating Partnerships that Series 15
has invested in as of December 31, 1996.
(Series 16) The Fund commenced offering BACs in Series 16 on July 13, 1992.
Offers and sales of BACs in Series 16 were completed on December 28, 1992.
The Fund has committed proceeds to pay initial and additional installments of
capital contributions to 64 Operating Partnerships in the amount of
$39,579,774.
46 <PAGE>
During the quarter ended December 31, 1996, none of Series 16 net
offering proceeds had been used to pay capital contributions. Series 16 net
offering proceeds in the amount of $155,225 remain to be used by the Fund to
pay remaining capital contributions to the Operating Partnerships that Series
16 has invested in as of December 31, 1996.
(Series 17) The Fund commenced offering BACs in Series 17 on January 24,
1993. Offers and sales of BACs in Series 17 were completed on June 17, 1993.
The Fund has committed proceeds to pay initial and additional installments of
capital contributions to 49 Operating Partnerships in the amount of
$36,538,204.
During the quarter ended December 31, 1996, $235,849 of Series 17 net
offering proceeds had been used to pay capital contributions. Series 17 net
offering proceeds in the amount of $540,652 remain to be used by the Fund to
pay remaining capital contributions to the Operating Partnerships that Series
17 has invested in as of December 31, 1996.
(Series 18) The Fund commenced offering BACs in Series 18 on June 17, 1993.
Offers and sales of BACs in Series 18 were completed on September 22, 1993.
The Fund has committed proceeds to pay initial and additional installments of
capital contributions to 34 operating Partnerships in the amount of
$26,442,202.
During the quarter ended December 31, 1996 none of Series 18 net offering
proceeds had been used to pay capital contributions. Series 18 net offering
proceeds in the amount of $756,295 remain to be used by the Fund to pay
remaining capital contributions to the Operating Partnerships that Series 18
has invested in as of December 31, 1996.
(Series 19). The Fund commenced offering BACs in Series 19 on October 8,
1993. Offers and sales of BACs in Series 19 were completed on December 17,
1993. The Fund has committed proceeds to pay initial and additional
installments of capital contributions to 26 Operating Partnerships in the
amount of $29,614,506.
During the quarter ended December 31, 1996 $1,745,348 of Series 19 net
offering proceeds had been used to pay capital contributions. Series 19 net
offering proceeds in the amount of $832,019 remain to be used by the Fund to
pay remaining capital contributions to the Operating Partnerships that Series
19 has invested in as of December 31, 1996.
Results of Operations
- ---------------------
As of December 31, 1996 and 1995 the Fund held limited partnership interests
in 241 Operating Partnerships. In each instance the Apartment Complex
owned by the applicable Operating Partnership is eligible for the Federal
Housing Tax Credit. Occupancy of a unit in each Apartment Complex which
initially complied with the Minimum Set-Aside Test (i.e., occupancy by tenants
47<PAGE>
with incomes equal to no more than a certain percentage of area median income)
and the Rent Restriction Test (i.e., gross rent charged tenants does not
exceed 30% of the applicable income standards) is referred to hereinafter as
"Qualified Occupancy." Each of the Operating Partnerships and each of the
respective Apartment Complexes are described more fully in the Prospectus or
applicable report on Form 8-K. The General Partner believes that there is
adequate casualty insurance on the properties.
The results of operations for future periods are likely to vary from those
for the period ended December 31, 1996. The losses from Operating
Partnerships reported for this interim period are not necessarily indicative
of the results anticipated for future periods as some of these Operating
Partnerships are in the lease-up phase.
The General Partner determined that in prior fiscal years interest income was
not allocated accurately across all series in the Fund. As of December 31,
1996 a reallocation has been done to more accurately reflect interest earned
in relation to each series sources and uses of funds. Since the reallocation
is occurring in a new fiscal year, some series will reflect a negative
interest amount for the current fiscal year.
The Fund incurred a fund management fee to Boston Capital Asset Management
Limited Partnerships (formerly Boston Capital Communications Limited
Partnership) in an amount equal to .5 percent of the aggregate cost of
the apartment complexes owned by the Operating Partnerships, less the amount
of certain asset management and reporting fees paid by the Operating
Partnerships. The fund management fees incurred for the quarter ended
December 31, 1996 for Series 15, Series 16, Series 17, Series 18 and Series
19 were $126,640, $162,767, $127,702, $76,999, and $102,483, respectively.
The Fund's investment objectives do not include receipt of significant cash
distributions from the Operating Partnerships in which it has invested or
intends to invest. The Fund's investments in Operating Partnerships have been
and will be made principally with a view towards realization of Federal
Housing Tax Credits for allocation to its partners and BAC holders.
(Series 15) As of December 31, 1996 and 1995, the average qualified
occupancy for the series was 100% and 99.3%, respectively. The series had a
total of 68 properties at December 31, 1996 all of which were at 100%
qualified occupancy.
For the nine months being reported Series 15 reflects a net loss from
Operating Partnerships of $2,284,534. When adjusted for depreciation,
which is a non-cash item, the Operating Partnerships reflect positive
operations of $707,311. This is an interim period estimate; it is not
necessarily indicative of the final year end results.
48
California Investors VII Limited Partnership was operating at a deficit due
to higher than projected operating expenses. Operating shortfalls caused
the accrual of accounts payable. The Operating Partnership closed on a debt
refinancing in the fourth quarter of 1996. The favorable interest rate
enabled the Operating Partnership to payoff the accrued accounts payable
and reduced the monthly debt payment. The refinancing should also create
increased operating stability for the Operating Partnership.
The General Partner is continuing to monitor the operations of Hidden Cove
Associates. The Operating General hired a new management company which has
completed a capital improvement program. As a result the tenant base has
improved significantly and occupancy is 92% as of December 31, 1996.
The Operating General Partner of School Street Limited Partnership I pledged
his general partnership interest to an unaffiliated lending institution in
violation of the partnership agreement. The management agent, an affiliate of
the Operating General Partner, has been replaced. Legal research is being
conducted in order to determine the best course of action regarding the
General Partner interests.
(Series 16) As of December 31, 1996 and 1995, the average qualified
occupancy for the series was 100% and 99.9%, respectively. The series had a
total of 64 properties at December 31, 1996 all of which were at 100%
qualified occupancy.
For the nine months being reported Series 16 reflects a net loss from
Operating Partnerships of $2,239,250. When adjusted for depreciation, which
is a non-cash item, the Operating Partnerships reflect positive operations of
$1,406,373. This is an interim period estimate; it is not necessarily
indicative of the final year end results.
The Operating General Partner of Mariner's Pointe Limited Partnership I and
Mariner's Pointe Limited Partnership II pledged his general partnership
interest to an unaffiliated lending institution in violation of the
partnership agreement. The management agent, an affiliate of the Operating
General Partner, has been replaced. Legal research is being conducted in
order to determine the best course of action regarding the General Partner
interests.
(Series 17) As of December 31, 1996 and 1995, the average qualified
occupancy for the series was 99.6% and 98.0%, respectively. The series had a
total of 49 properties at December 31, 1996. Out of the total 47 had 100%
qualified occupancy.
For the nine months being reported Series 17 reflects a net loss from
Operating Partnerships of $3,050,781. When adjusted for depreciation, which
is a non-cash item, the Operating Partnerships reflect a net loss of $202,738.
This is an interim period estimate; it is not necessarily indicative of the
final year end results.
49
Annadale Housing Partners has reported net losses due to operational issues
associated with the property. The Operating Partnership has stabilized
since the completion of rehabilitation and occupancy has shown steady
improvement. Occupancy is at 88% as of December 31, 1996.
California Investors VII Limited Partnership was operating at a deficit due
to higher than projected operating expenses. Operating shortfalls caused
the accrual of accounts payable. The Operating Partnership closed on a debt
refinancing in the fourth quarter of 1996. The favorable interest rate
enabled the Operating Partnership to payoff the accrued accounts payable
and reduced the monthly debt payment. The refinancing should also create
increased operating stability for the Operating Partnership.
(Series 18) As of December 31, 1996 and 1995 the average qualified occupancy
for the series was 100% and 97.0% respectively. The series had a total of 34
properties at December 31, 1996 all of which were at 100% qualified
occupancy.
For the nine months being reported Series 18 reflects a net loss from
Operating Partnerships of $1,672,454. When adjusted for depreciation, which
is a non-cash item, the Operating Partnerships reflect positive operations of
$414,293. This is an interim period estimate; it is not necessarily
indicative of the final year end results.
In August 1996 the General Partner was notified that Virginia Avenue Housing
Limited Partnership was named as defendant in a land encroachment complaint.
The Operating General Partner and its council are confident that the Operating
Partnership owns a clean title to all property in question, however, research
is being conducted into the title and title insurance.
(Series 19) As of December 31, 1996 and 1995 the average qualified occupancy
for the series was 99.9% and 98.3% respectively. The series had a total of 26
properties at December 31, 1996. Out of the total 25 had 100% qualified
occupancy.
For the nine months being reported Series 19 reflects a net loss from
Operating Partnerships of $1,511,056. When adjusted for depreciation, which
is a non-cash item, the Operating Partnerships reflect positive operations of
$244,044. This is an interim period estimate; it is not necessarily indicative
of the final year end results.
50<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
None
51<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BOSTON CAPITAL TAX CREDIT
FUND III L.P.
By: Boston Capital Associates III L.P.
By: C&M Associates d/b/a
Boston Capital Associates
Date: November 24, 1997 By: /s/ John P. Manning
-------------------
John P. Manning,
Partner & Principal Financial
Officer
52
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<NAME> BOSTON CAPITAL TAX CREDIT FUND III L.P.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-START> APR-01-1996
<PERIOD-END> MAR-31-1997
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