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 0-21762
Gateway Tax Credit Fund III Ltd.
(Exact name of Registrant as specified in its charter)
Florida 59-3090386
(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
Units of Limited Partnership
Interest: $1,000 per unit 33,799
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. 33-44238
<PAGE>
PART I - Financial Information
Item 1. Financial Statements
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- -----------
SERIES 7 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 221,213 $ 259,782
Investments in Securities 43,827 42,189
Receivable from Project Partnerships 0 0
----------- ----------
Total Current Assets 265,040 301,971
Investments in Securities 459,013 436,329
Investments in Project
Partnerships, Net 4,756,650 5,464,982
----------- ----------
Total Assets $5,480,703 $6,203,282
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 49,460 $ 53,005
Payable to Project Partnerships 0 0
---------- ----------
Total Current Liabilities 49,460 53,005
Long-Term Liabilities:
Payable to General Partners 162,238 139,289
Partners' Equity:
Limited Partners (10,395 units for
Series 7, 9,980 for Series 8,
6,254 for Series 9, 5,043 for
Series 10 and 5,127 for Series 11
at December 31, 1996 and
March 31, 1996) 5,307,593 6,042,156
General Partners (38,588) (31,168)
----------- ----------
Total Partners' Equity 5,269,005 6,010,988
----------- ----------
Total Liabilities and
Partners Equity $5,480,703 $6,203,282
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
SERIES 8 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 354,016 $ 295,021
Investments in Securities 38,839 37,407
Receivable from Project Partnerships 453 76,027
----------- ----------
Total Current Assets 393,308 408,455
Investments in Securities 434,024 413,585
Investments in Project
Partnerships, Net 4,834,391 5,658,160
----------- ----------
Total Assets $5,661,723 $6,480,200
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 39,844 $ 43,617
Payable to Project Partnerships 0 0
----------- ----------
Total Current Liabilities 39,844 43,617
Long-Term Liabilities:
Payable to General Partners 194,934 155,249
Partners' Equity:
Limited Partners (10,395 units for
Series 7, 9,980 for Series 8,
6,254 for Series 9, 5,043 for
Series 10 and 5,127 for Series 11
at December 31, 1996 and
March 31, 1996) 5,460,301 6,306,146
General Partners (33,356) (24,812)
---------- ----------
Total Partners' Equity 5,426,945 6,281,334
----------- ----------
Total Liabilities and
Partners Equity $5,661,723 $6,480,200
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
SERIES 9 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 127,295 $ 112,252
Investments in Securities 26,895 25,978
Receivable from Project Partnerships 0 8,545
----------- ----------
Total Current Assets 154,190 146,775
Investments in Securities 293,126 280,586
Investments in Project
Partnerships, Net 4,025,723 4,397,301
----------- ----------
Total Assets $4,473,039 $4,824,662
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 22,775 $ 25,016
Payable to Project Partnerships 0 0
----------- ----------
Total Current Liabilities 22,775 25,016
Long-Term Liabilities:
Payable to General Partners 106,546 78,117
Partners' Equity:
Limited Partners (10,395 units for
Series 7, 9,980 for Series 8,
6,254 for Series 9, 5,043 for
Series 10 and 5,127 for Series 11
at December 31, 1996 and
March 31, 1996) 4,355,118 4,729,151
General Partners (11,400) (7,622)
----------- ----------
Total Partners' Equity 4,343,718 4,721,529
----------- ----------
Total Liabilities and
Partners Equity $4,473,039 $4,824,662
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
SERIES 10 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 163,586 $ 162,576
Investments in Securities 19,913 19,125
Receivable from Project Partnerships 0 13,059
----------- ----------
Total Current Assets 183,499 194,760
Investments in Securities 231,774 220,599
Investments in Project
Partnerships, Net 3,632,462 3,788,041
----------- ----------
Total Assets $4,047,735 $4,203,400
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 26,878 $ 28,549
Payable to Project Partnerships 7,712 7,713
----------- ----------
Total Current Liabilities 34,590 36,262
Long-Term Liabilities:
Payable to General Partners 29,847 18,327
Partners' Equity:
Limited Partners (10,395 units for
Series 7, 9,980 for Series 8,
6,254 for Series 9, 5,043 for
Series 10 and 5,127 for Series 11
at December 31, 1996 and
March 31, 1996) 3,987,645 4,151,503
General Partners (4,347) (2,692)
----------- ----------
Total Partners' Equity 3,983,298 4,148,811
----------- ----------
Total Liabilities and
Partners Equity $4,047,735 $4,203,400
=========== ==========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
SERIES 11 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 130,013 $ 365,027
Investments in Securities 19,904 18,995
Receivable from Project Partnerships 0 8,250
----------- ----------
Total Current Assets 149,917 392,272
Investments in Securities 242,966 230,179
Investments in Project
Partnerships, Net 4,348,650 4,340,316
----------- ----------
Total Assets $4,741,533 $4,962,767
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 28,565 $ 32,148
Payable to Project Partnerships 0 279,887
----------- ----------
Total Current Liabilities 28,565 312,035
Long-Term Liabilities:
Payable to General Partners 0 3,707
Partners' Equity:
Limited Partners (10,395 units for
Series 7, 9,980 for Series 8,
6,254 for Series 9, 5,043 for
Series 10 and 5,127 for Series 11
at December 31, 1996 and
March 31, 1996) 4,711,830 4,646,546
General Partners 1,138 479
----------- ----------
Total Partners' Equity 4,712,968 4,647,025
----------- ---------
Total Liabilities and
Partners Equity $4,741,533 $4,962,767
=========== =========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
DECEMBER 31, MARCH 31,
1996 1996
----------- ----------
TOTAL SERIES 7 - 11 (Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 996,123 $ 1,194,658
Investments in Securities 149,378 143,694
Receivable from Project Partnerships 453 105,881
------------ -----------
Total Current Assets 1,145,954 1,444,233
Investments in Securities 1,660,903 1,581,278
Investments in Project
Partnerships, Net 21,597,876 23,648,800
------------ -----------
Total Assets $24,404,733 $26,674,311
============ ===========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 167,522 $ 182,335
Payable to Project Partnerships 7,712 287,600
------------ -----------
Total Current Liabilities 175,234 469,935
Long-Term Liabilities:
Payable to General Partners 493,565 394,689
Partners' Equity:
Limited Partners (10,395 units for
Series 7, 9,980 for Series 8,
6,254 for Series 9, 5,043 for
Series 10 and 5,127 for Series 11
at December 31, 1996 and
March 31, 1996) 23,822,487 25,875,502
General Partners (86,553) (65,815)
------------ -----------
Total Partners' Equity 23,735,934 25,809,687
------------ -----------
Total Liabilities and
Partners Equity $24,404,733 $26,674,311
============ ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 7 ----------- ----------
Revenues:
Interest Income $ 10,938 $ 10,880
----------- -----------
Expenses:
Asset Management Fee-
General Partner 19,500 19,500
General and Administrative-
General Partner 2,954 3,000
General and Administrative-
Other 2,160 1,545
Amortization 5,486 5,392
----------- -----------
Total Expenses 30,100 29,437
Loss Before Equity in Losses of
Project Partnerships (19,162) (18,557)
Equity in Income (Losses) of Project
Partnerships (248,641) (181,622)
----------- -----------
Net Loss $ (267,803) $ (200,179)
=========== ===========
Allocation of Net Loss:
Limited Partners $ (265,125) $ (198,177)
General Partners (2,678) (2,002)
----------- -----------
$ (267,803) $ (200,179)
=========== ===========
Net Loss Per Limited
Partnership Unit $ (25.51) $ (19.06)
Number of Limited
Partnership Units Outstanding 10,395 10,395
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 8 ----------- ----------
Revenues:
Interest Income $ 11,669 $ 10,401
----------- ----------
Expenses:
Asset Management Fee-
General Partner 21,500 21,500
General and Administrative-
General Partner 3,257 3,208
General and Administrative-
Other 2,246 1,943
Amortization 3,745 3,911
----------- -----------
Total Expenses 30,748 30,562
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (19,079) (20,161)
Equity in Income (Losses) of Project
Partnerships (372,161) (238,153)
----------- -----------
Net Loss $ (391,240) $ (258,314)
=========== ===========
Allocation of Net Loss:
Limited Partners $ (387,327) $ (255,731)
General Partners (3,913) (2,583)
----------- -----------
$ (391,240) $ (258,314)
=========== ===========
Net Loss Per Limited
Partnership Unit $ (38.81) $ (25.62)
Number of Limited
Partnership Units Outstanding 9,980 9,980
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 9 ----------- ----------
Revenues:
Interest Income $ 8,436 $ 6,095
----------- -----------
Expenses:
Asset Management Fee-
General Partner 12,000 12,000
General and Administrative-
General Partner 1,818 1,847
General and Administrative-
Other 1,373 1,078
Amortization 1,779 1,762
----------- -----------
Total Expenses 16,970 16,687
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (8,534) (10,592)
Equity in Income (Losses) of Project
Partnerships (116,661) 4,026
----------- -----------
Net Loss $ (125,195) $ (6,566)
=========== ===========
Allocation of Net Loss:
Limited Partners $ (123,943) $ (6,500)
General Partners (1,252) (66)
----------- -----------
$ (125,195) $ (6,566)
=========== ===========
Net Loss Per Limited
Partnership Unit $ (19.82) $ (1.04)
Number of Limited
Partnership Units Outstanding 6,254 6,254
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 10 ----------- ----------
Revenues:
Interest Income $ 6,032 $ 6,633
----------- -----------
Expenses:
Asset Management Fee-
General Partner 7,500 7,500
General and Administrative-
General Partner 1,136 1,154
General and Administrative-
Other 1,101 992
Amortization 1,476 1,454
----------- -----------
Total Expenses 11,213 11,100
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (5,181) (4,467)
Equity in Income (Losses) of Project
Partnerships (43,529) 35,237
----------- -----------
Net Income (Loss) $ (48,710) $ 30,770
=========== ===========
Allocation of Net Income (Loss):
Limited Partners $ (48,223) $ 30,462
General Partners (487) 308
----------- -----------
$ (48,710) $ 30,770
=========== ===========
Net Income (Loss) Per Limited
Partnership Unit $ (9.56) $ 6.04
Number of Limited
Partnership Units Outstanding 5,043 5,043
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 11 ----------- ----------
Revenues:
Interest Income $ 7,451 $ 14,265
----------- -----------
Expenses:
Asset Management Fee-
General Partner 6,000 5,233
General and Administrative-
General Partner 908 923
General and Administrative-
Other 1,081 795
Amortization 1,663 1,585
----------- -----------
Total Expenses 9,652 8,536
----------- -----------
Income (Loss) Before Equity in Income
(Losses) of Project Partnerships (2,201) 5,729
Equity in Income (Losses) of Project
Partnerships 30,198 99,594
----------- -----------
Net Income (Loss) $ 27,997 $ 105,323
=========== ===========
Allocation of Net Income (Loss):
Limited Partners $ 27,717 $104,270
General Partners 280 1,053
----------- -----------
$ 27,997 $ 105,323
=========== ===========
Net Income (Loss) Per Limited
Partnership Unit $ 5.41 $ 20.34
Number of Limited
Partnership Units Outstanding 5,127 5,127
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
TOTAL SERIES 7 - 11 ----------- ----------
Revenues:
Interest Income $ 44,526 $ 48,274
----------- -----------
Expenses:
Asset Management Fee-
General Partner 66,500 65,733
General and Administrative-
General Partner 10,073 10,132
General and Administrative-
Other 7,961 6,353
Amortization 14,149 14,104
----------- -----------
Total Expenses 98,683 96,322
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (54,157) (48,048)
Equity in Income (Losses) of Project
Partnerships (750,794) (280,918)
----------- -----------
Net Loss $ (804,951) $ (328,966)
=========== ===========
Allocation of Net Loss:
Limited Partners $ (796,901) $ (325,675)
General Partners (8,050) (3,290)
----------- -----------
$ (804,951) $ (328,965)
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 7 ----------- ----------
Revenues:
Interest Income $ 32,878 $ 43,767
----------- -----------
Expenses:
Asset Management Fee-
General Partner 58,500 58,000
General and Administrative-
General Partner 8,874 8,650
General and Administrative-
Other 14,476 14,980
Amortization 16,432 16,418
----------- -----------
Total Expenses 98,282 97,958
Loss Before Equity in Losses of
Project Partnerships (65,404) (54,191)
Equity in Income (Losses) of Project
Partnerships (676,579) (697,657)
----------- -----------
Net Loss $ (741,983) $ (751,848)
=========== ===========
Allocation of Net Loss:
Limited Partners $ (734,563) $ (744,330)
General Partners (7,420) (7,518)
----------- -----------
$ (741,983) $ (751,848)
=========== ===========
Net Loss Per Limited
Partnership Unit $ (70.67) $ (71.60)
Number of Limited
Partnership Units Outstanding 10,395 10,395
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 8 ----------- ----------
Revenues:
Interest Income $ 37,445 $ 35,743
----------- ----------
Expenses:
Asset Management Fee-
General Partner 64,500 64,500
General and Administrative-
General Partner 9,785 9,513
General and Administrative-
Other 15,637 16,288
Amortization 9,805 10,248
----------- -----------
Total Expenses 99,727 100,549
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (62,282) (64,806)
Equity in Income (Losses) of Project
Partnerships (792,107) (651,504)
----------- -----------
Net Loss $ (854,389) $ (716,310)
=========== ===========
Allocation of Net Loss:
Limited Partners $ (845,845) $ (709,147)
General Partners (8,544) (7,163)
----------- -----------
$ (854,389) $ (716,310)
=========== ===========
Net Loss Per Limited
Partnership Unit $ (84.75) $ (71.06)
Number of Limited
Partnership Units Outstanding 9,980 9,980
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 9 ----------- -----------
Revenues:
Interest Income $ 19,885 $ 23,570
----------- -----------
Expenses:
Asset Management Fee-
General Partner 36,000 36,000
General and Administrative-
General Partner 5,462 5,366
General and Administrative-
Other 8,892 9,306
Amortization 5,337 4,835
----------- -----------
Total Expenses 55,691 55,507
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (35,806) (31,937)
Equity in Income (Losses) of Project
Partnerships (342,005) (51,915)
----------- -----------
Net Loss $ (377,811) $ (83,852)
=========== ===========
Allocation of Net Loss:
Limited Partners $ (374,033) $ (83,013)
General Partners (3,778) (839)
----------- -----------
$ (377,811) $ (83,852)
=========== ===========
Net Loss Per Limited
Partnership Unit $ (59.81) $ (13.27)
Number of Limited
Partnership Units Outstanding 6,254 6,254
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 10 ----------- -----------
Revenues:
Interest Income $ 19,065 $ 21,050
----------- -----------
Expenses:
Asset Management Fee-
General Partner 22,500 22,500
General and Administrative-
General Partner 3,412 3,352
General and Administrative-
Other 6,158 5,602
Amortization 4,412 4,302
----------- -----------
Total Expenses 36,482 35,756
----------- -----------
Loss Before Equity in Losses of
Project Partnerships (17,417) (14,706)
Equity in Income (Losses) of Project
Partnerships (148,096) 9,468
----------- -----------
Net Loss $ (165,513) $ (5,238)
=========== ===========
Allocation of Net Loss:
Limited Partners $ (163,858) $ (5,186)
General Partners (1,655) (52)
----------- -----------
$ (165,513) $ (5,238)
=========== ===========
Net Loss Per Limited
Partnership Unit $ (32.49) $ (1.03)
Number of Limited
Partnership Units Outstanding 5,043 5,043
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 11 ----------- -----------
Revenues:
Interest Income $ 23,447 $ 59,354
----------- -----------
Expenses:
Asset Management Fee-
General Partner 18,000 14,888
General and Administrative-
General Partner 2,728 2,622
General and Administrative-
Other 5,357 5,337
Amortization 5,188 3,437
----------- -----------
Total Expenses 31,273 26,284
----------- -----------
Income (Loss) Before Equity in Income
(Losses) of Project Partnerships (7,826) 33,070
Equity in Income (Losses) of Project
Partnerships 73,769 70,106
----------- -----------
Net Income (Loss) $ 65,943 $ 103,176
=========== ===========
Allocation of Net Income (Loss):
Limited Partners $ 65,284 $ 102,144
General Partners 659 1,032
----------- -----------
$ 65,943 $ 103,176
=========== ===========
Net Income (Loss) Per Limited
Partnership Unit $ 12.73 $ 19.92
Number of Limited
Partnership Units Outstanding 5,127 5,127
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
TOTAL SERIES 7 - 11 ----------- ------------
Revenues:
Interest Income $ 132,720 $ 183,484
------------ ------------
Expenses:
Asset Management Fee-
General Partner 199,500 195,888
General and Administrative-
General Partner 30,261 29,413
General and Administrative-
Other 50,520 51,513
Amortization 41,174 39,240
------------ ------------
Total Expenses 321,455 316,054
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (188,735) (132,570)
Equity in Income (Losses) of Project
Partnerships (1,885,018) (1,321,502)
------------ ------------
Net Loss $(2,073,753) $(1,454,072)
============ ============
Allocation of Net Loss:
Limited Partners $(2,053,015) $(1,439,532)
General Partners (20,738) (14,540)
------------ ------------
$(2,073,753) $(1,454,072)
============ ============
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Limited Partners' Total
Partners' Equity Partners'
Equity (Deficit) Equity
SERIES 7 ----------- ----------- -----------
Balance at
March 31, 1995 $ 7,046,659 $ (21,021) $ 7,025,638
Distributions 0 0 0
Net Loss (744,330) (7,518) (751,848)
----------- ---------- -----------
Balance at
December 31, 1995 $ 6,302,329 $ (28,539) $ 6,273,790
=========== ========== ===========
Balance at
March 31, 1996 $ 6,042,156 $ (31,168) $ 6,010,988
Net Loss (734,563) (7,420) (741,983)
----------- ---------- -----------
Balance at
December 31, 1996 $ 5,307,593 $ (38,588) $ 5,269,005
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Limited Partners' Total
Partners' Equity Partners'
Equity (Deficit) Equity
SERIES 8 ----------- ----------- -----------
Balance at
March 31, 1995 $ 7,495,677 $ (12,797) $ 7,482,880
Distributions 0 0 0
Net Loss (709,147) (7,163) (716,310)
----------- ---------- -----------
Balance at
December 31, 1995 $ 6,786,530 $ (19,960) $ 6,766,570
=========== ========== ===========
Balance at
March 31, 1996 $ 6,306,146 $ (24,812) $ 6,281,334
Net Loss (845,845) (8,544) (854,389)
----------- ---------- -----------
Balance at
December 31, 1996 $ 5,460,301 $ (33,356) $ 5,426,945
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Limited Partners' Total
Partners' Equity Partners'
Equity (Deficit) Equity
SERIES 9 ----------- ----------- -----------
Balance at
March 31, 1995 $ 5,228,817 $ (2,575) $ 5,226,242
Distributions 0 0 0
Net Loss (83,013) (839) (83,852)
----------- ---------- -----------
Balance at
December 31, 1995 $ 5,145,804 $ (3,414) $ 5,142,390
=========== ========== ===========
Balance at
March 31, 1996 $ 4,729,151 $ (7,622) $ 4,721,529
Net Loss (374,033) (3,778) (377,811)
----------- ---------- -----------
Balance at
December 31, 1996 $ 4,355,118 $(11,400) $ 4,343,718
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Limited Partners' Total
Partners' Equity Partners'
Equity (Deficit) Equity
SERIES 10 ----------- ----------- -----------
Balance at
March 31, 1995 $ 4,338,647 $ (802) $ 4,337,845
Distributions 0 0 0
Net Loss (5,186) (52) (5,238)
----------- ---------- -----------
Balance at
December 31, 1995 $ 4,333,461 $ (854) $ 4,332,607
=========== ========== ===========
Balance at
March 31, 1996 $ 4,151,503 $ (2,692) $ 4,148,811
Net Loss (163,858) (1,655) (165,513)
----------- ---------- -----------
Balance at
December 31, 1996 $ 3,987,645 $ (4,347) $ 3,983,298
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Limited Partners' Total
Partners' Equity Partners'
Equity (Deficit) Equity
SERIES 11 ----------- ----------- -----------
Balance at
March 31, 1995 $ 4,800,616 $ 1,564 $ 4,802,180
Distributions (46,690) 0 (46,690)
Net Income (Loss) 102,144 1,032 103,176
----------- ---------- -----------
Balance at
December 31, 1995 $ 4,856,070 $ 2,596 $ 4,858,666
=========== ========== ===========
Balance at
March 31, 1996 $ 4,646,546 $ 479 $ 4,647,025
Net Income (Loss) 65,284 659 65,943
----------- ---------- -----------
Balance at
December 31, 1996 $ 4,711,830 $ 1,138 $ 4,712,968
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
General
Limited Partners' Total
Partners' Equity Partners'
Equity (Deficit) Equity
TOTAL SERIES 7-11 ----------- ----------- -----------
Balance at
March 31, 1995 $28,910,416 $ (35,631) $28,874,785
Distributions (46,690) 0 (46,690)
Net Loss (1,439,532) (14,540) (1,454,072)
----------- ---------- -----------
Balance at
December 31, 1995 $27,424,194 $ (50,171) $27,374,023
=========== ========== ===========
Balance at
March 31, 1996 $25,875,502 $ (65,815) $25,809,687
Net Loss (2,053,015) (20,738) (2,073,753)
----------- ---------- -----------
Balance at
December 31, 1996 $23,822,487 $ (86,553) $23,735,934
=========== ========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 7 ----------- ---------
Cash Flows from Operating Activities:
Net Income (Loss) $ (741,983) $ (751,848)
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided by (Used in)
Operating Activities:
Amortization 16,432 16,418
Accreted Interest Income
on Investments in Securities (24,321) (24,116)
Equity in (Income)/Losses of
Project Partnerships 676,579 697,657
Payment of Asset Management Fee 35,551 27,680
Changes in Operating Assets and Liabilities:
Increase in Payable to
General Partners (16,147) (823)
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (53,889) (35,032)
----------- -----------
Cash Flows from Investing Activities:
Investments in Project Partnerships (3,333) (421,182)
Increase in Accounts Receivable 0 0
(Increase) Decrease in Receivable
from Project Partnerships 0 0
Acquisition Fees and Expenses (272) (2,142)
Distributions Received from
Project Partnerships 18,925 18,941
Increase (Decrease) in Payable -
General Partners - Acquisition Fees 0 0
Project Partnerships 0 0
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 15,320 (404,383)
----------- -----------
Cash Flows from Financing Activities:
Distributions 0 0
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 0 0
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents (38,569) (439,415)
Cash and Cash Equivalents at
Beginning of Year 259,782 656,686
----------- -----------
Cash and Cash Equivalents at
End of Year $ 221,213 $ 217,271
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 8 ----------- ---------
Cash Flows from Operating Activities:
Net Income (Loss) $ (854,389) $ (716,310)
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided by (Used in)
Operating Activities:
Amortization 9,805 10,248
Accreted Interest Income
on Investments in Securities (21,871) (21,737)
Equity in (Income)/Losses of
Project Partnerships 792,107 651,504
Payment of Asset Management Fee 24,813 16,236
Changes in Operating Assets and Liabilities:
Increase in Payable to
General Partners 11,100 27,325
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (38,435) (32,734)
----------- -----------
Cash Flows from Investing Activities:
Investments in Project Partnerships 453 28,554
Increase in Accounts Receivable 0 0
(Increase) Decrease in Receivable
from Project Partnerships 75,574 133,482
Acquisition Fees and Expenses 0 0
Distributions Received from
Project Partnerships 21,403 11,337
Increase (Decrease) in Payable -
General Partners - Acquisition Fees 0 0
Project Partnerships 0 (241,400)
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 97,430 (68,027)
----------- -----------
Cash Flows from Financing Activities:
Distributions 0 0
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 0 0
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 58,995 (100,761)
Cash and Cash Equivalents at
Beginning of Year 295,021 343,908
----------- -----------
Cash and Cash Equivalents at
End of Year $ 354,016 $ 243,147
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 9 ----------- -----------
Cash Flows from Operating Activities:
Net Income (Loss) $ (377,811) $ (83,852)
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided by (Used in)
Operating Activities:
Amortization 5,337 4,835
Accreted Interest Income
on Investments in Securities (13,457) (13,481)
Equity in (Income)/Losses of
Project Partnerships 342,005 51,915
Payment of Asset Management Fee 7,570 0
Changes in Operating Assets and Liabilities:
Increase in Payable to
General Partners 18,618 26,976
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (17,738) (13,607)
----------- -----------
Cash Flows from Investing Activities:
Investments in Project Partnerships 18,076 21,192
Increase in Accounts Receivable 0 0
(Increase) Decrease in Receivable
from Project Partnerships 8,545 14,382
Acquisition Fees and Expenses 0 (5,124)
Distributions Received from
Project Partnerships 6,160 6,034
Increase (Decrease) in Payable -
General Partners - Acquisition Fees 0 5,124
Project Partnerships 0 (333,006)
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 32,781 (291,398)
----------- -----------
Cash Flows from Financing Activities:
Distributions 0 0
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 0 0
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 15,043 (305,005)
Cash and Cash Equivalents at
Beginning of Year 112,252 386,116
----------- -----------
Cash and Cash Equivalents at
End of Year $ 127,295 $ 81,111
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 10 ----------- ---------
Cash Flows from Operating Activities:
Net Income (Loss) $ (165,513) $ (5,238)
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided by (Used in)
Operating Activities:
Amortization 4,412 4,302
Accreted Interest Income
on Investments in Securities (11,963) (11,859)
Equity in (Income)/Losses of
Project Partnerships 148,096 (9.468)
Payment of Asset Management Fee 10,981 17,050
Changes in Operating Assets and Liabilities:
Increase in Payable to
General Partners (1,132) (14,791)
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (15,119) (20,004)
----------- -----------
Cash Flows from Investing Activities:
Investments in Project Partnerships 0 (13,737)
Increase in Accounts Receivable 0 0
(Increase) Decrease in Receivable
from Project Partnerships 13,059 (13,059)
Acquisition Fees and Expenses 0 (96)
Distributions Received from
Project Partnerships 3,070 1,823
Increase (Decrease) in Payable -
General Partners - Acquisition Fees 0 0
Project Partnerships 0 (61,812)
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 16,129 (86,881)
----------- -----------
Cash Flows from Financing Activities:
Distributions 0 0
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 0 0
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 1,010 (106,885)
Cash and Cash Equivalents at
Beginning of Year 162,576 318,131
----------- -----------
Cash and Cash Equivalents at
End of Year $ 163,586 $ 211,246
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
SERIES 11 ----------- ---------
Cash Flows from Operating Activities:
Net Income (Loss) $ 65,943 $ 103,176
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided by (Used in)
Operating Activities:
Amortization 5,188 3,437
Accreted Interest Income
on Investments in Securities (13,697) (13,512)
Equity in (Income)/Losses of
Project Partnerships (73,769) (70,106)
Payment of Asset Management Fee 19,785 0
Changes in Operating Assets and Liabilities:
Increase in Payable to
General Partners (27,074) (44,969)
----------- -----------
Net Cash Provided by (Used in)
Operating Activities (23,624) (21,974)
----------- -----------
Cash Flows from Investing Activities:
Investments in Project Partnerships 58,925 (617,714)
Increase in Accounts Receivable 0 (2,395)
(Increase) Decrease in Receivable
from Project Partnerships 8,250 0
Acquisition Fees and Expenses (178) (105,176)
Distributions Received from
Project Partnerships 1,500 0
Increase (Decrease) in Payable -
General Partners - Acquisition Fees 0 0
Project Partnerships (279,887) (67,522)
----------- -----------
Net Cash Provided by (Used in)
Investing Activities (211,390) (792,807)
----------- -----------
Cash Flows from Financing Activities:
Distributions 0 (46,690)
----------- -----------
Net Cash Provided by (Used in)
Investing Activities 0 (46,690)
----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents (235,014) (861,471)
Cash and Cash Equivalents at
Beginning of Year 365,027 1,598,884
----------- -----------
Cash and Cash Equivalents at
End of Year $ 130,013 $ 737,413
=========== ===========
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED DECEMBER 31, 1996 AND 1995:
1996 1995
TOTAL SERIES 7 - 11 ----------- ---------
Cash Flows from Operating Activities:
Net Income (Loss) $(2,073,753) $(1,454,072)
Adjustments to Reconcile Net Income
(Loss) to Net Cash Provided by (Used in)
Operating Activities:
Amortization 41,174 39,240
Accreted Interest Income
on Investments in Securities (85,309) (84,705)
Equity in (Income)/Losses of
Project Partnerships 1,885,018 1,321,502
Payment of Asset Management Fee 98,700 60,966
Changes in Operating Assets and Liabilities:
Increase in Payable to
General Partners (14,635) (6,282)
------------ ------------
Net Cash Provided by (Used in)
Operating Activities (148,805) (123,351)
------------ ------------
Cash Flows from Investing Activities:
Investments in Project Partnerships 74,122 (1,002,887)
Increase in Accounts Receivable 0 (2,395)
(Increase) Decrease in Receivable
from Project Partnerships 105,428 134,805
Acquisition Fees and Expenses (450) (112,538)
Distributions Received from
Project Partnerships 51,058 38,135
Increase (Decrease) in Payable -
General Partners - Acquisition Fees 0 5,124
Project Partnerships (279,888) (703,740)
------------ ------------
Net Cash Provided by (Used in)
Investing Activities (49,730) (1,643,496)
------------ ------------
Cash Flows from Financing Activities:
Distributions 0 (46,690)
------------ ------------
Net Cash Provided by (Used in)
Investing Activities 0 (46,690)
------------ ------------
Increase (Decrease) in Cash and
Cash Equivalents (198,535) (1,813,537)
Cash and Cash Equivalents at
Beginning of Year 1,194,658 3,303,725
------------ ------------
Cash and Cash Equivalents at
End of Year $ 996,123 $ 1,490,188
============ ============
See accompanying notes to financial statements.
<PAGE>
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
December 31, 1996
NOTE 1 - ORGANIZATION:
Gateway Tax Credit Fund III Ltd. ("Gateway"), a Florida Limited
Partnership, was formed October 17, 1991 under the laws of Florida.
Gateway offered its limited partnership interests in Series. The
first Series for Gateway is Series 7. Operations commenced on July
16, 1992 for Series 7, January 4, 1993 for Series 8, December 31,
1993 for Series 9, January 21, 1994 for Series 10 and April 29,
1994 for Series 11. Each Series invests, as a limited partner, in
other limited partnerships ("Project Partnerships"), each of which
owns and operates apartment complexes eligible for Low-Income
Housing Tax Credits ("Tax Credits"), provided for in Section 42 of
the Internal Revenue Code of 1986. Gateway will terminate on
December 31, 2040 or sooner, in accordance with the terms of the
Limited Partnership Agreement. Gateway received capital
contributions of $1,000 from the General Partners and $36,799,000
from the investor Limited Partners.
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 Managing
General Partner, respectively. The Managing General Partner
manages and controls the business of Gateway.
Gateway received capital contributions of $10,395,000,
$9,980,000, $6,254,000, $5,043,000 and $5,127,000 from the investor
Limited Partners in Series 7, 8, 9, 10 and 11, respectively. Each
Series is treated as though it were a separate partnership,
investing in a separate and distinct pool of Project Partnerships.
Income or loss and all tax items from the Project Partnerships
acquired by each Series are specifically allocated among the
limited partners of such Series.
Operating profits and losses, cash distributions from operations
and Tax Credits from each Series are allocated 99% to the Limited
Partners in that Series and 1% to the General Partners. Profit or
loss and cash distributions from sales of property by each Series
are allocated as formulated in the Limited Partnership Agreement.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting
Gateway utilizes an accrual basis of accounting whereby revenues
are recognized as earned and expenses are recognized as obligations
are incurred.
Gateway accounts for its investments as the 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 Statement 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 is 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 is 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.
<PAGE>
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.
Concentrations 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. Treasury Security Strips) until
maturity and to use these reserves to fund Gateway's ongoing
operations. Interest income is recognized ratably on the U.S.
Treasury Strips using the effective yield to maturity.
Receivable from Project Partnerships
Receivable from Project Partnerships represents amounts due from
the Project Partnerships due to a change in the amount Gateway
agreed to pay the Project Partnerships and is secured with cash in
restricted escrow accounts.
Offering and Commission Costs
Offering and commission costs are charged against Limited
Partners' Equity upon admission of Limited Partners.
Income Taxes
No provision for income taxes has been made in these financial
statements, as income taxes are a liability of the partners rather
than of Gateway.
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. Treasury Security Strips which
represents their cost, plus accreted interest income of $122,623
for Series 7, $99,797 for Series 8, $51,596 for Series 9, $41,803
for Series 10 and $44,149 for Series 11.
Estimated Cost Plus Gross Unrealized
Market Accreted Gains and
Value Accreted Interest (Losses)
----------- ----------------- ---------------
Series 7 $ 521,129 $502,840 $ 18,289
Series 8 480,508 472,863 7,645
Series 9 313,294 320,021 (6,727)
Series 10 257,214 251,687 5,527
Series 11 278,423 262,870 15,553
<PAGE>
As of December 31, 1996 the cost and accreted interest of debt
securities by contractual maturities is as follows:
Series 7 Series 8 Series 9
---------- ---------- ----------
Due within 1 year $ 43,827 $ 38,839 $ 26,895
After 1 year
through 5 years 176,364 161,816 104,475
After 5 years
through 10 years 206,546 196,630 121,692
After 10 years 76,103 75,578 66,959
---------- ---------- ----------
Total Amount Carried on
Balance Sheet $ 502,840 $ 472,863 $ 320,021
========== ========== ==========
Series 10 Series 11 Total
---------- ---------- ----------
Due within 1 year $ 19,913 $ 19,904 $ 149,378
After 1 year
through 5 years 81,196 78,816 602,667
After 5 years
through 10 years 87,827 95,622 708,317
After 10 years 62,751 68,528 349,919
---------- ---------- ----------
Total Amount Carried on
Balance Sheet $ 251,687 $ 262,870 $1,810,281
========== ========== ==========
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.
The Payable to Project Partnerships represents unpaid capital
contributions to the Project Partnerships and will be paid after
certain performance criteria are met. Such contributions are in
turn payable to the general partners of the Project Partnerships.
For the periods 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:
Acquisition Fees - Acquisition fees are paid for services
rendered by the Managing General Partner in selecting properties
for acquisition and providing other services in connection with the
acquisition of interests in Project Partnerships. The acquisition
fees paid or payable to the General Partners will not exceed the
amount that is equal to 8% of the gross proceeds. For Series 11
the fees will not exceed an amount that is equal to 5% of the gross
proceeds. The fees paid are included in Investments in Project
Partnerships on the Balance Sheet.
December 31, December 31,
1996 1995
----------- -----------
Series 7 $ 0 $ 0
Series 8 0 0
Series 9 0 5,124
Series 10 0 1,496
Series 11 0 86,984
---------- ----------
Total $ 0 $ 93,604
========== ==========
Acquisition Expenses - Affiliates of the General Partners are
reimbursed for acquisition expenses incurred on behalf of Gateway.
These expenses are included in Investments in Project Partnerships
on the Balance Sheet.
December 31, December 31,
1996 1995
---------- ----------
Series 7 $ 272 $ 2,142
Series 8 0 0
Series 9 0 0
Series 10 0 (1,400)
Series 11 178 18,192
---------- ---------
Total $ 450 $ 18,934
========== ==========
Asset Management Fee - The Managing General Partner is entitled
to receive an annual asset management fee equal to the greater of
(i) $2,000 for each limited partnership in which Gateway invests,
or (ii) 0.275% of Gateway's gross proceeds from the sale of limited
partnership interests. In either event (i) or (ii), the maximum
amount may not exceed 0.2% of the aggregate cost (Gateway's capital
contribution plus Gateway's share of the Properties' mortgage) of
Gateway's interest in properties 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
Statement of Operations.
<PAGE>
December 31, December 31,
1996 1995
---------- ----------
Series 7 $ 58,500 $ 58,000
Series 8 64,500 64,500
Series 9 36,000 36,000
Series 10 22,500 22,500
Series 11 18,000 14,888
---------- ----------
Total $ 199,500 $ 195,888
========== ==========
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
Statement of Operations.
December 31, December 31,
1996 1995
---------- ----------
Series 7 $ 8,874 $ 8,560
Series 8 9,785 9,513
Series 9 5,462 5,366
Series 10 3,412 3,352
Series 11 2,728 2,622
---------- ----------
Total $ 30,261 $ 29,413
========== ==========
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS:
As of December 31, 1996, the Partnership had acquired an interest
in 39 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 7 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 7,732,089 $ 7,728,757
Accumulated amortization of excess
of purchase price of Project
Partnerships over book value
of underlying assets (1) 1,208 644
Cumulative equity in losses of
Project Partnerships (3,613,330) (2,936,751)
Cumulative distributions received
from Project Partnerships (58,951) (40,026)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 793,335 793,063
Accumulated amortization of
acquisition fees and expenses (97,701) (80,705)
------------ ------------
Investments in
Project Partnerships $ 4,756,650 $ 5,464,982
============ ============
(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 these excess costs were
$21,129 and March 31, 1996 these excess costs were $28,498.
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
As of December 31, 1996, the Partnership had acquired an interest
in 43 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 8 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 7,586,105 $ 7,586,558
Accumulated amortization of excess
of purchase price of Project
Partnerships over book value
of underlying assets (1) 2,146 1,607
Cumulative equity in losses of
Project Partnerships (3,200,908) (2,408,801)
Cumulative distributions received
from Project Partnerships (49,339) (27,936)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 549,773 549,773
Accumulated amortization of
acquisition fees and expenses (53,386) (43,041)
------------ ------------
Investments in
Project Partnerships $ 4,834,391 $ 5,658,160
============ ============
(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 these excess costs were
$12,416 and March 31, 1996 these excess costs were $24,830.
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
As of December 31, 1996, the Partnership had acquired an interest
in 24 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 9 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 4,914,116 $ 4,932,192
Accumulated amortization of excess
of purchase price of Project
Partnerships over book value
of underlying assets (1) 763 871
Cumulative equity in losses of
Project Partnerships (1,087,428) (745,423)
Cumulative distributions received
from Project Partnerships (24,569) (18,409)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 244,087 244,087
Accumulated amortization of
acquisition fees and expenses (21,246) (16,017)
------------ ------------
Investments in
Project Partnerships $ 4,025,723 $ 4,397,301
============ ============
(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 these excess costs were
($9,618) and March 31, 1996 these excess costs were ($5,076).
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
As of December 31, 1996, the Partnership had acquired an interest
in 15 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 10 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 3,914,672 $ 3,914,673
Accumulated amortization of excess
of purchase price of Project
Partnerships over book value
of underlying assets (1) (476) (282)
Cumulative equity in losses of
Project Partnerships (438,024) (289,928)
Cumulative distributions received
from Project Partnerships (24,082) (21,012)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 196,738 196,738
Accumulated amortization of
acquisition fees and expenses (16,366) (12,148)
------------ ------------
Investments in
Project Partnerships $ 3,632,462 $ 3,788,041
============ ============
(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 these excess costs were
($14,400) and March 31, 1996 these excess costs were ($9,822).
<PAGE>
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
As of December 31, 1996, the Partnership had acquired an interest
in 12 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 11 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 4,144,542 $ 4,203,467
Accumulated amortization of excess
of purchase price of Project
Partnerships over book value
of underlying assets (1) 1,790 758
Cumulative equity in losses of
Project Partnerships (70,425) (144,194)
Cumulative distributions received
from Project Partnerships (1,500) 0
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 290,335 290,157
Accumulated amortization of
acquisition fees and expenses (16,092) (9,872)
------------ ------------
Investments in
Project Partnerships $ 4,348,650 $ 4,340,316
============ ============
(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 these excess costs were
$2656167,589 and March 31, 1996 these excess costs were $29,433.
<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 7 - 11 ---------- ----------
Capital Contributions to Project
Partnerships (purchase price paid
for limited partner interests in
Project Partnerships) $ 28,291,524 $ 28,365,647
Accumulated amortization of excess
of purchase price of Project
Partnerships over book value
of underlying assets 5,431 3,598
Cumulative equity in losses of
Project Partnerships (8,410,115) (6,525,097)
Cumulative distributions received
from Project Partnerships (158,441) (107,383)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 2,074,268 2,073,818
Accumulated amortization of
acquisition fees and expenses (204,791) (161,783)
------------- -------------
Investments in
Project Partnerships $ 21,597,876 $ 23,648,800
============= =============
<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 7 ---------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,525,608 $ 2,146,286
Investment properties, net 39,752,979 41,260,573
Other assets 110,200 107,952
------------- -------------
Total assets $ 42,388,787 $ 43,514,811
============= =============
Liabilities and Partners' Equity
Current liabilities $ 1,131,625 $ 1,441,361
Long-term debt 37,169,871 37,093,205
------------- -------------
Total liabilities 38,301,496 38,534,566
Partners' Equity
Limited Partner 4,036,157 5,003,988
General Partners 51,134 (23,743)
------------- -------------
4,087,291 4,980,245
Total liabilities and
partners' equity $ 42,388,787 $ 43,514,811
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 3,186,339 $ 3,128,703
Expenses:
Operating expenses 1,693,521 1,568,583
Interest expense 972,680 1,039,712
Depreciation and amortization 1,203,551 1,225,112
------------- -------------
Total expenses 3,869,752 3,833,407
Net loss $ (683,413) $ (704,704)
============= =============
Other partners' share
of net loss $ (6,834) $ (7,047)
Partnership's share of net loss $ (676,579) $ (697,657)
------------- -------------
Equity in Loss of
Project Partnerships $ (683,413) $ (704,704)
============= =============
<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 8 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,013,830 $ 2,262,104
Investment properties, net 42,827,854 41,930,288
Other assets 121,676 75,722
------------- -------------
Total assets $ 44,963,360 $ 44,268,114
============= =============
Liabilities and Partners' Equity
Current liabilities $ 1,507,955 $ 1,722,923
Long-term debt 39,134,012 36,772,507
------------- -------------
Total liabilities 40,641,967 38,495,430
Partners' Equity
Limited Partner 4,361,451 5,727,913
General Partners (40,058) 44,771
------------- -------------
4,321,393 5,772,684
Total liabilities and
partners' equity $ 44,963,360 $ 44,268,114
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 2,995,784 $ 2,843,444
Expenses:
Operating expenses 1,777,253 1,524,065
Interest expense 854,717 1,015,837
Depreciation and amortization 1,163,922 961,627
------------- -------------
Total expenses 3,795,892 3,501,529
Net loss $ (800,108) $ (658,085)
============= =============
Other partners' share
of net loss $ (8,001) $ (6,581)
Partnership's share of net loss $ (792,107) $ (651,504)
------------- -------------
Equity in Loss of
Project Partnerships $ (800,108) $ (658,085)
============= =============
<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 9 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 1,424,022 $ 2,054,515
Investment properties, net 23,745,7979 24,013,184
Other assets 10,982 39,568
------------- -------------
Total assets $ 25,180,801 $ 26,107,267
============= =============
Liabilities and Partners' Equity
Current liabilities $ 673,224 $ 1,281,797
Long-term debt 20,706,474 20,198,118
------------- -------------
Total liabilities 21,379,474 21,479,915
Partners' Equity
Limited Partner 3,792,392 4,580,129
General Partners 8,711 47,223
------------- ------------
3,801,103 4,627,352
Total liabilities and
partners' equity $ 25,180,801 $ 26,107,267
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,658,806 $ 1,497,672
Expenses:
Operating expenses 855,326 712,206
Interest expense 488,828 498,295
Depreciation and amortization 660,112 339,610
------------- -------------
Total expenses 2,004,266 1,550,111
Net loss $ (345,460) $ (52,439)
============= =============
Other partners' share
of net loss $ (3,455) $ (524)
Partnership's share of net loss $ (342,005) $ (51,915)
------------- -------------
Equity in Loss of
Project Partnerships $ (345,460) $ (52,439)
============= =============
<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 10 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 1,105,234 $ 1,411,828
Investment properties, net 16,325,794 16,644,033
Other assets 14,927 19,356
------------- -------------
Total assets $ 17,445,955 $ 18,075,217
============= =============
Liabilities and Partners' Equity
Current liabilities $ 345,100 $ 778,560
Long-term debt 13,606,421 13,442,031
------------- -------------
Total liabilities 13,951,521 14,220,591
Partners' Equity
Limited Partner 3,455,342 3,798,021
General Partners 39,092 56,605
------------- -------------
3,494,434 3,854,626
Total liabilities and
partners' equity $ 17,445,955 $ 18,075,217
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,043,912 $ 968,611
Expenses:
Operating expenses 590,576 510,232
Interest expense 224,633 230,432
Depreciation and amortization 378,295 218,383
------------- -------------
Total expenses 1,193,504 959,047
Net income (loss) $ (149,592) $ 9,564
============= =============
Other partners' share
of net income (loss) $ (1,496) $ 96
Partnership's share of
net income (loss) $ (148,096) $ 9,468
------------- -------------
Equity in Income (Losses) of
Project Partnerships $ (149,592) $ 9,564
============= =============
<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 11 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 1,644,880 $ 3,421,354
Investment properties, net 14,591,975 12,087,187
Other assets 131,613 7,830
------------- -------------
Total assets $ 16,368,468 $ 15,516,371
============= =============
Liabilities and Partners' Equity
Current liabilities $ 1,125,960 $ 2,353,588
Long-term debt 11,011,134 8,724,936
------------- -------------
Total liabilities 12,137,094 11,078, 524
Partners' Equity
Limited Partner 4,061,928 4,219,772
General Partners 169,446 218,075
------------- -------------
4,231,374 4,437,847
Total liabilities and
partners' equity $ 16,368,468 $ 15,516,371
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 1,063,736 $ 385,369
Expenses:
Operating expenses 528,581 202,379
Interest expense 299,725 87,000
Depreciation and amortization 160,916 25,176
------------- -------------
Total expenses 989,222 314,555
Net income (loss) $ 74,514 $ 70,814
============= =============
Other partners' share
of net income (loss) $ 745 $ 708
Partnership's share of
net income (loss) $ 73,769 $ 70,106
------------- -------------
Equity in Income (Losses) of
Project Partnerships $ 74,514 $ 70,814
============= =============
<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 7 - 11 ----------- ----------
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 8,713,574 $ 11,296,087
Investment properties, net 137,244,399 135,935,265
Other assets 389,398 250,428
------------- -------------
Total assets $146,347,371 $147,481,780
============= =============
Liabilities and Partners' Equity
Current liabilities $ 4,783,864 $ 7,578,229
Long-term debt 121,627,912 116,230,797
------------- -------------
Total liabilities 126,411,776 123,809,026
Partners' Equity
Limited Partner 19,707,270 23,329,823
General Partners 228,325 342,931
------------- -------------
19,935,595 23,672,754
Total liabilities and
partners' equity $146,347,371 $147,481,780
============= =============
SUMMARIZED STATEMENTS OF OPERATIONS:
Rental and other income $ 9,948,577 $ 8,823,799
Expenses:
Operating expenses 5,445,257 4,517,465
Interest expense 2,840,583 2,871,276
Depreciation and amortization 3,566,796 2,769,908
------------- -------------
Total expenses 11,852,636 10,158,649
Net loss $ (1,904,059) $ (1,334,850)
============= =============
Other partners' share
of net loss $ (19,041) $ (13,348)
Partnership's share of net loss $ (1,885,018) $ (1,321,502)
------------- ------------
Equity in Loss of
Project Partnerships $ (1,904,059) $ (1,334,850)
============= =============
<PAGE>
GATEWAY TAX CREDIT FUND III 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
The proceeds from Limited Partner investors' capital contributions
available for investment are used to acquire interests in Project
Partnerships. Project Partnership acquisitions and the status of
project operations are shown on the following table:
As of December 31, 1995
Under Recently Fully
Construction Completed Operating Totals
Series 7 1 - 38 39
Series 8 4 1 38 43
Series 9 2 1 21 24
Series 10 1 3 11 15
Series 11 9 1 2 12
As of December 31, 1996
Under Recently Fully
Construction Completed Operating Totals
Series 7 - - 39 39
Series 8 - - 43 43
Series 9 - - 24 24
Series 10 - - 15 15
Series 11 - - 12 12
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.
Series 7 - Gateway closed this series on October 16, 1992 after
receiving $10,395,000 from 635 Limited Partner investors. Equity
in losses of Project Partnerships were comparable for the nine
months ended December 31,1996 to the nine months ended December 31,
1995. 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 the Series
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 $221,213 of short-term
investments (Cash and Cash Equivalents). It also had $502,840 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 $741,983 for the nine months ending December 31, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $676,579 and the changes in operating assets and
liabilities, net cash used in operating activities was $53,889.
Cash provided by investing activities totaled $15,320 primarily
consisting of cash distributions from the Project Partnerships of
$18,925. There were no unusual events or trends to describe.
Expenses for the three and nine months ended December 31, 1996
were comparable to the three and nine months ended December 31,
1995. Interest income decreased for the three and nine months
ended December 31, 1996 as compared to December 31, 1995 due to
lower interest rates and a decrease in the average balance of cash
available for investment. There were no unusual variations in the
operating results between these two periods.
Series 8 - Gateway closed this Series on June 28, 1993 after
receiving $9,980,000 from 664 Limited Partner investors. Equity in
losses of Project Partnerships were comparable for the three and
nine months ended December 31, 1996 to the three and nine months
ended December 31, 1995.
At December 31, 1996, the Series had $354,016 of short-term
investments (Cash and Cash Equivalents). It also had $472,863 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 $854,389 for the nine months ended December 31, 1996.
However, after adjusting for Equity in Losses of Project
Partnerships of $792,107 and the changes in operating assets and
liabilities, net cash used in operating activities was $38,435.
Cash provided by investing activities totaled $97,430 and was
primarily due to the reduction of a receivable from the Project
Partnerships and cash distributions from the Project Partnerships
of $21,403.
Income and expenses for the three and nine months ended December
31, 1996 were comparable to the three and nine months ended
December 31, 1995. There were no unusual variations in the
operating results between these two periods.
Series 9 - Gateway closed this Series on December 31, 1993 after
receiving $6,254,000 from 406 Limited Partner investors. Equity in
losses of Project Partnerships increased from $51,915 for the nine
ended December 31, 1995 to $342,005 for the nine months ended
December 31, 1996. This increase was due to 3 properties moving
from the construction and rent-up phases to fully operating in
1996.
At December 31, 1996, the Series had $127,295 of short-term
investments (Cash and Cash Equivalents). It also had $320,021 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 $377,811 for the nine months ended December 31, 1996.
After adjusting for Equity in Losses of Project Partnerships of
$342,005 and the changes in operating assets and liabilities, net
cash used in operating activities was $17,738. Cash provided by
investing activities totaled $32,781 and was primarily due to the
reduction of a receivable from the Project Partnerships and cash
distributions from the Project Partnerships of $6,160. There were
no unusual events or trends to describe.
Interest income and expenses for the three and nine months ended
December 31, 1996 were comparable to the three and nine months
ended December 31, 1995. There were no unusual variations in the
operating results between these two periods.
Series 10 - Gateway closed this Series on January 21, 1994 after
receiving $5,043,000 from 325 Limited Partner investors. Equity in
Losses of Project Partnerships decreased from income of $9,468 for
the nine months ended December 31, 1995 to losses of $148,096 for
the nine months ended December 31, 1996 as 4 properties moved from
the construction and rent-up phases to fully operating in 1996.
At December 31, 1996, the Series had $163,586 of short-term
investments (Cash and Cash Equivalents). It also had $251,687 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 $165,513 for the nine months ending December 31, 1996.
After adjusting for Equity in Losses of Project Partnerships of
$148,096 and the changes in operating assets and liabilities, net
cash used in operating activities was $15,119. Cash provided by
investing activities totaled $16,129 and was due to a reduction of
receivables from Project Partnerships of $13,059 and cash
distributions from Project Partnerships of $3,070. There were no
unusual events or trends to describe.
Interest income and expenses for the three and nine months ended
December 31, 1996 were comparable to the three and nine months
ended December 31, 1995. There were no unusual variations in the
operating results between these two periods.
Series 11 - Gateway closed this Series on April 29, 1994 after
receiving $5,127,000 from 330 Limited investors. Equity in Income
of Project Partnerships were comparable for the nine months ended
December 31, 1996 to nine months ended December 31, 1995.
At December 31, 1996, the Series had $130,013 of short-term
investments (Cash and Cash Equivalents). It also had $262,870 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 net
income of $65,943 for the nine months ending December 31, 1996.
After adjusting for Equity in Income of Project Partnerships of
$73,769 and the changes in operating assets and liabilities, net
cash used in operating activities was $23,624. Cash used in
investing activities totaled $211,390 and was used for the purchase
of Investments in Project Partnerships. There were no unusual
events or trends to describe.
Expenses for the three months and nine months ended December 31,
1996 were comparable to the three and nine months ended December
31, 1995. Interest income decreased for the three and nine months
ended December 31, 1996 as compared to December 31, 1995 due to a
decrease in the average balance of cash available for investment.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6 - EXHIBIT AND REPORTS ON FORM 8-K
a. Exhibits - NONE
b. Reports filed 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 III 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 PURSUSANT 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> 996,123
<SECURITIES> 1,810,281
<RECEIVABLES> 453
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,145,954
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 24,404,733
<CURRENT-LIABILITIES> 175,234
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 23,735,934
<TOTAL-LIABILITY-AND-EQUITY> 24,404,733
<SALES> 0
<TOTAL-REVENUES> 132,720
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 321,455
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (2,073,753)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,073,753)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,073,753)
<EPS-PRIMARY> (56.35)<F1>
<EPS-DILUTED> (56.35)<F1>
<FN>
<F1>EPS IS NET INCOME (LOSS) PER $1,000 LIMITED PARTNERSHIP UNIT.
</FN>
</TABLE>
