UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
[X] Annual report pursuant toSection 13 or 15 (d) of the Securities
Exchange Act of 1934 (Fee Required) For the fiscal year ended
December 31, 1996
[ ] Transition report pursuant to Section 13 or 15 (d) of the Securities
Exchange act of 1934 (No Fee Required). For the transition from
_________to____________
---------------
COMMISSION FILE NO. 0-19916
TMP INLAND EMPIRE V, LTD.,
A CALIFORNIA LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
CALIFORNIA 33-0368324
(State or other jurisdiction of (I.R.S. Employer
Identification No.)
incorporation or organization)
801 N. PARKCENTER DRIVE, SUITE 235 92705
SANTA ANA, CALIFORNIA (Zip Code)
(Address of principal executive office)
(714) 836-5503
(Registrant's telephone number, including area code)
-------------
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
------------------- ------------------------------
N/A N/A
Securities to be registered pursuant to Section 12(g) of the Act:
UNITS OF LIMITED PARTNERSHIP INTEREST
-------------------------------------
(Title of Class)
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
<PAGE>
Table of Contents
Independent Auditor's Report.................................... 1
Balance Sheet................................................... 2
Statement of Income............................................. 3
Statement of Partners' Capital.................................. 4
Statement of Cash Flows......................................... 5
Notes to FinancialStatements.................................... 6-9
Supplementary Information....................................... 10-12
<PAGE>
Independent Auditor's Report
To the Partners
TMP Inland Empire V, Ltd.
(A California Limited Partnership)
We have audited the accompanying balance sheet of TMP Inland Empire V, Ltd. (A
California Limited Partnership) as of December 31, 1997 and the related
statements of income, partners' capital, and cash flows for the year then ended.
These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of TMP Inland Empire V, Ltd. (A
California Limited Partnership) as of December 31, 1997 and the results of its
operations and its cash flows for the year then ended, in conformity with
generally accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplementary information contained in Schedule
I is presented for purposes of additional analysis and is not a required part of
the basic financial statements. Such information has been subjected to the
auditing procedures applied in the audit of the basic financial statements and,
in our opinion, is stated fairly in all material respects in relation to the
basic financial statements taken as a whole.
Balser, Horowitz, Frank & Wakeling
BALSER, HOROWITZ, FRANK & WAKELING
An Accountancy Corporation
Santa Ana, California January 26, 1998 except for Note 6, as to which the date
is August 3, 1998
<PAGE>
<TABLE>
<CAPTION>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Balance Sheet
December 31, 1997
Assets
1997
<S> <C>
Cash $ 32,509
Notes receivable 92,010
Investment in unimproved land,
at lower of cost or fair value 4,675,102
-----------
Total assets $ 4,799,621
============
Liabilities and Partners' Capital
---------------------------------
Property taxes payable $ 180,150
Interest payable 1,563
Commissions payable 5,400
Due to affiliates 932
Franchise tax payable 800
Notes payable 125,000
------------
Total liabilities 313,845
============
Partners' capital (deficit)
General partners (44,323)
Limited partners; 10,000 equity
units authorized and outstanding 4,530,099
---------
Total partners' capital 4,485,776
---------
Total liabilities and partners' capital $4,799,621
==========
</TABLE>
See Accompanying Notes and Independent Auditor's Report
<PAGE>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Statement of Income
For the Year Ended December 31, 1997
1997
----
Income
- ------
Interest income $ 8,417
-------------
Total income 8,417
Expenses
- --------
Accounting 7,705
General partner fees 17,491
Expense reimbursements 16,341
------------
Total expenses 41,537
------------
Income or (loss) before income taxes (33,120)
State franchise tax 800
------------
Net income or (loss) $ (33,920)
=============
Allocation of net income or (loss):
General partners, in the aggregate $ (339)
=============
Limited partners, in the aggregate $ (33,581)
=============
Limited partners, per equity unit
$ (3.36)
==============
See Accompanying Notes and Independent Auditor's Report
<PAGE>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Statement of Partners' Capital
For the Year Ended December 31, 1997
<TABLE>
<CAPTION>
General Limited
Partners Partners Total
<S> <C> <C> <C>
Partners' capital (deficit),
December 31, 1996 (43,984) 4,563,680 4,519,696
Net (loss) for 1997 (339) (33,581) (33,920)
----------- ---------- ----------
Partners' capital (deficit),
December 31, 1997 $(44,323) $4,530,099 $4,485,776
========= ========= =========
</TABLE>
See Accompanying Notes and Independent Auditor's Report
<PAGE>
<TABLE>
<CAPTION>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Statement of Cash Flows
For the Year Ended December 31, 1997
<S> <C>
1997
Cash flow from operating activities
Net income or (loss) $ (33,920)
Adjustments to reconcile net income or
(loss) to net cash used in operating activities:
Increase in carrying costs (75,102)
Increase in property taxes payable 45,812
Increase in interest payable (43,495)
Increase or (decrease) in property tax payable 1,563
Increase or (decrease) in due to affiliates 371
----------
Net cash (used in) operating activities (61,276)
-----------
Cash flows from investing activities
(Increase) or decrease in notes receivable 24,990
Proceeds from sale of property 0
--------
Net cash provided by investing activities (24,990)
--------
Cash flow from financing activities
Proceeds from notes payable 0
-------
Net cash provided by financing activities 0
-------
Net increase or (decrease) in cash (36,286)
Cash, beginning of year 68,795
-------
Cash, end of year $ 32,509
=======
Supplemental disclosures of cash flow information
Income taxes paid $ 800
========
Interest paid $ 18,750
========
</TABLE>
Other Disclosures
For the year ended December 31, 1997, the Partnership did not enter into any
non-cash investing or financing activities. The Partnership did not have any
short-term highly liquid investments for the year ended December 31, 1997.
See Accompanying Notes and Independent Auditor's Report
<PAGE>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1997
Note 1 - Summary of significant accounting policies
Accounting Method - The Partnership's policy is to prepare its
financial statements on the accrual basis of accounting.
Organization Costs - Organization costs include expenses incurred in
the formation of the Partnership. These costs were capitalized and
amortized over a period of 40 years prior to 1992 and were changed to
a 5-year amortization schedule in 1992. Organization costs were fully
amortized in 1996.
Investment in Unimproved Land - Investment in unimproved land is
stated at lower of cost or fair value. All costs associated with the
acquisition of a property are capitalized. Additionally, the
Partnership capitalizes direct carrying costs (such as interest
expense and property taxes). These costs are added to the cost of the
properties and are deducted from the sales prices to determine gains
when properties are sold.
Syndication Costs - Syndication costs (such as commissions, printing,
and legal fees) totaling $1,081,818 represent costs incurred to raise
capital and, accordingly, are recorded as a reduction in partners'
capital (see Note 3).
Income Taxes - The entity is treated as a partnership for income tax
purposes and any income or loss is passed through and taxable to the
individual partners. Accordingly, there is no provision for federal
income taxes in the accompanying financial statements. However, the
minimum California Franchise tax due by the Partnership at December
31, 1997 is $800.
Cash and Cash Equivalents - For purposes of the statements of cash
flows, the Partnership considers all highly liquid debt instruments
purchased with a maturity of three months or less to be cash
equivalents.
Estimates - In preparing financial statements in conformity with
generally accepted accounting principles, management is required to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and the disclosure of contingent assets and
liabilities at the date of the financial statements and revenues and
expenses during the reporting period. Actual results could differ
from these estimates.
Concentration - All unimproved land parcels held for investment are
located in the Inland Empire area of Southern California. The
eventual sales price of all parcels is highly dependent on the real
estate market condition. The Partnership attempts to mitigate any
potential risk by monitoring the market condition and holding the
land parcels until the real estate market recovers.
<PAGE>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1997
Note 2 - Organization of the Partnership
On November 16, 1989, the Partnership was formed with TMP Properties
(A California General Partnership) and TMP Investments, Inc. (A
California Corporation) as the general partners. The partners of TMP
Properties are William O. Passo, Anthony W. Thompson and Scott E.
McDaniel. William O. Passo and Anthony W. Thompson were the
shareholders of TMP Investments, Inc. until October 1, 1995, when
they sold their shares to TMP Group, Inc., and then became the
shareholders of TMP Group, Inc.
The Partnership originally acquired thirteen separate parcels of
unimproved real property in Riverside and San Bernardino Counties,
California. The properties were to be held for investment,
appreciation, and ultimate sale and/or improvement of all or a
portion thereof, either alone or in conjunction with a joint venture
partner. A portion of one parcel was sold in 1992 and the proceeds
were retained for working capital. During 1993, the Partnership
foreclosed on property underlying a note receivable and subsequently
sold the property. During 1995, the Partnership sold a portion of one
parcel.
The partnership agreement provides for two types of investments:
Individual Retirement Accounts (IRA) and others. The IRA minimum
purchase requirement was $2,000 and all others were a minimum
purchase requirement of $5,000. The maximum liability of the limited
partners is the amount of their capital contribution.
Note 3 -Partners' contributions
The Partnership offered for sale 10,000 units at $1,000 each to
qualified investors. By December 31, 1990, all 10,000 units had been
sold for total limited partner contributions of $10,000,000. There
have been no contributions made by the general partners. As described
in Note 1, syndication costs have been recorded as a reduction in
partners' capital.
Note 4 - Allocation of profits, losses and cash distributions
Profits, losses and cash distributions are allocated 99% to the
limited partners and 1% to the general partners until the limited
partners have received an amount equal to their capital contributions
plus a cumulative, non-compounded return of 6% per annum on their
adjusted capital contributions. At that point, the limited partners
are allocated 83.5% and the general partners 16.5% of profits, losses
and cash distributions. There were no distributions in 1997.
<PAGE>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1997
Note 5 - Related party transactions
Syndication costs (see Note 1) netted against partners' capital
contributions include $1,000,000 in selling commissions paid in prior
years to TMP Capital Corp. for the sale of partnership units of which
a portion was then paid to unrelated registered representatives.
William O. Passo and Anthony W. Thompson were the shareholders of TMP
Capital Corp. until October 1, 1995, when they sold their shares to
TMP Group, Inc.
Investment in unimproved land includes acquisition fees of
approximately $617,562 paid in prior years to TMP Properties and TMP
Investments, Inc., the general partners, for services rendered in
connection with the acquisition of the properties.
The Partnership paid $17,491 in partnership management fees to the
general partners for the year ended December 31, 1997. Sales comm-
issions payable to Regal Realty, which is wholly owned by Scott E.
McDaniel, total $5,400 at December 31, 1997. Mr. McDaniel is a
partner of TMP Properties and he was a shareholder of TMP Investments
, Inc. until September 1993 when he sold his shares to Mr. Passo and
Mr. Thompson.
The Partnership was also charged $9,505 during the year ended December
31, 1997 by the general partner and an affiliated company of the
general partner for office, secretarial and advertising expenses. At
December 31, 1997 the Partnership had a payable of $932 to the
general partner and the affiliated company.
Note 6 - Re-statement and re-issuance of 1997 financial statements
In compliance with Statement of Financial Accounting Standards No. 121
Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of (SFAS 121), the 1996 financial statements
reported an expense for the decline in fair value of unimproved land of
$3,922,730. The 1997 financial statements originally issued with the
auditor's report dated January 28, 1998 reported $1,782,361of income
due to appreciation in fair value of land. Current clarification
reveals that SFAS 121 does not provide for recording appreciation in
fair value of an asset even in view of previously recording a decline
in value. Therefore, these financial statements have been re-stated to
remove the appreciation in fair value of land.
In addition, certain carrying costs of land that were previously
capitalized have been re-stated as current expenses in the amount of
$41,537.
<PAGE>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1997
Note 7 - Notes receivable
The Partnership sold a parcel of land and as a part of the sale
proceeds received a note for $141,000. The note is secured by a deed
of trust and is due on September 1, 2002. Interest accrues at 7% per
annum, and the borrower is to make monthly payments of $3,000
starting August 6, 1996, however, interest begins accruing December
29, 1996. As of December 31, 1997, $7,280 of interest has been
received.
Note 8 - Notes payable
The Partnership borrowed $125,000 from a private mortgage company. The
note is secured by a deed of trust on a parcel of land owned by the
Partnership in Victorville, California. The note is due on August 1,
1998. Interest accrues at 15% per annum payable in monthly
installments of $1,562.50 starting September 1, 1996. As of December
31, 1997, $27,344 of interest has been paid and is capitalized to land
carrying cost.
Note 9 - Property taxes payable
<TABLE>
<CAPTION>
Property taxes payable at December 31, 1997 are as follows:
<S> <C> <C>
1994 $ 48,201
1995 56,269
1996 29,868
1997 45,812
-----------
$ 180,150
</TABLE>
If the property taxes remain delinquent for five years, then the
County can foreclose on the property. Management plans to take
necessary actions to prevent foreclosures.
<PAGE>
<TABLE>
SUPPLEMENTARY INFORMATION
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Schedule I - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
For the Year Ended December 31, 1997
<CAPTION>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Schedule I - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
For the Year Ended December 31, 1997
COSTS CAPITALIZED Gross
SUBSEQUENT amount
TO ACQUISITION at which Estimated
----------------------
Initial Carrying Carried at Accumulated Date of Date Depreciable
escription of Assets Encumbrances Costs Improvements Costs Year-End Depreciation Construction Acquired Life
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unimproved land -
Perris, CA -0- $ 95,786 -0- $ 10,189 $ 105,975 -0- n/a 10/3/89 n/a
Unimproved land -
Perris, CA -0- 93,088 -0- 10,687 103,775 -0- n/a 10/3/89 n/a
Unimproved land -
Rialto, CA -0- 490,180 -0- 65,496 555,676 -0- n/a 6/8/90 n/a
Unimproved land -
Adelanto, CA -0- 287,351 -0- 30,518 317,869 -0- n/a 5/25/90 n/a
Unimproved land -
Adelanto, CA -0- 490,593 -0- 61,195 551,788 -0- n/a 3/8/90 n/a
Unimproved land -
Mojave, CA -0- 591,209 -0- 80,348 671,557 -0- n/a 7/10/90 n/a
Unimproved land -
Mojave, CA -0- 1,090,017 -0- 117,142 1,207,159 -0- n/a 3/12/90 n/a
Unimproved land -
Victorville, CA -0- 272,140 -0- 28,205 300,345 -0- n/a 1/12/90 n/a
Unimproved land -
Victorville, CA -0- 1,204,302 -0- 157,331 1,361,633 -0- n/a 2/20/90 n/a
Unimproved land -
Victorville, CA -0- 859,635 722 97,313 956,948 -0- n/a 4/23/90 n/a
Unimproved land -
Victorville, CA -0- 1,107,264 -0- 124,765 1,232,029 -0- n/a 4/16/90 n/a
Unimproved land -
Victorville, CA -0- 958,623 -0- 106,345 1,064,968 -0- n/a 4/10/90 n/a
Unimproved land -
Victorville, CA -0- 138,751 -0- 29,359 168,110 -0- n/a 11/26/91 n/a
--- --------- --- ------- --------- ---
-0- $7,678,939 722 $918,893 $8,597,832 -0-
=== ========== === ======== ========== ===
Reconciliation of carrying amount
Beginning balance $8,522,730
Additions
Improvements $ -0-
Carrying costs 75,102
Total additions 75,102
------
8,597,832
Allowance for decline in fair
value of unimproved land (3,922,730)
----------
Ending balance $4,675,102
==========
See Accompanying Notes and Independent Auditor's Report
</TABLE>
<PAGE>
<TABLE>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Schedule I - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
For the Year Ended December 31, 1995
<CAPTION>
COSTS CAPITALIZED Gross
SUBSEQUENT amount
TO ACQUISITION at which Estimated
------------------------
Initial Carrying Carried a Accumulated Date of Date Depreciable
Description of Assets Encumbrances Costs Improvements Costs Year-End Depreciation Construction Acquired Life
- --------------------- ------------ ------- ------------ ----- -------- ------------ ------------ -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unimproved land -
Perris, CA -0- $ 95,786 -0- $ 8,140 $ 103,926 -0- n/a 10/3/89 n/a
Unimproved land -
Perris, CA -0- 93,088 -0- 8,479 101,567 -0- n/a 10/3/89 n/a
Unimproved land -
Rialto, CA -0- 490,180 -0- 46,997 537,177 -0- n/a 6/8/90 n/a
Unimproved land -
Adelanto, CA -0- 287,351 -0- 22,990 310,341 -0- n/a 5/25/90 n/a
Unimproved land -
Adelanto, CA -0- 490,593 -0- 49,034 539,627 -0- n/a 3/8/90 n/a
Unimproved land -
Mojave, CA -0- 591,209 -0- 69,479 660,688 -0- n/a 7/10/90 n/a
Unimproved land -
Mojave, CA -0- 1,090,017 -0- 87,767 1,177,784 -0- n/a 3/12/90 n/a
Unimproved land -
Victorville, CA -0- 272,140 -0- 23,848 295,988 -0- n/a 1/12/90 n/a
Unimproved land -
Victorville, CA -0- 1,204,302 -0- 124,168 1,328,470 -0- n/a 2/20/90 n/a
Unimproved land -
Victorville, CA -0- 859,635 722 72,100 932,457 -0- n/a 4/23/90 n/a
Unimproved land -
Victorville, CA -0- 1,107,264 -0- 93,005 ,200,269 -0- n/a 4/16/90 n/a
Unimproved land -
Victorville, CA -0- 958,623 -0- 81,120 1,039,743 -0- n/a 4/10/90 n/a
Unimproved land -
Victorville, CA -0- 138,751 -0- 26,178 164,929 -0- n/a 11/26/91 n/a
--- --------- --- ------- --------- ---
-0- $7,678,939 $722 $713,305 $8,392,966 -0-
=== ========== === ======== ========== ===
Reconciliation of carrying amount
Beginning balance $9,062,972
Additions
Improvements $ 722
Carrying costs 132,113
-------
Total additions 132,835
Reductions
Initial costs (717,461)
Carrying costs (85,380)
-------
Total reductions (802,841)
--------
Ending balance $8,392,966
==========
See Accompanying Notes and Independent Auditor's Report
</TABLE>
<PAGE>
<TABLE>
TMP INLAND EMPIRE V, LTD.
(A California Limited Partnership)
Schedule I - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
For the Year Ended December 31, 1996
<CAPTION>
COSTS CAPITALIZED Gross
SUBSEQUENT amount
TO ACQUISITION at which Estimated
---------------------
Initial Carrying Carried at Accumulated Date of Date Depreciable
Description of Assets Encumbrances Costs Improvements Costs Year-End Depreciation Construction Acquired Life
- --------------------- ------------- ------- ------------ -------- -------- ------------ ------------ -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unimproved land -
Perris, CA -0- $ 95,786 -0- $ 9,316 $ 105,102 -0- n/a 10/3/89 n/a
Unimproved land -
Perris, CA -0- 93,088 -0- 9,666 102,754 -0- n/a 10/3/89 n/a
Unimproved land -
Rialto, CA -0- 490,180 -0- 59,288 549,468 -0- n/a 6/8/90 n/a
Unimproved land -
Adelanto, CA -0- 287,351 -0- 28,138 315,489 -0- n/a 5/25/90 n/a
Unimproved land -
Adelanto, CA -0- 490,593 -0- 57,152 547,745 -0- n/a 3/8/90 n/a
Unimproved land -
Mojave, CA -0- 591,209 -0- 77,015 668,224 -0- n/a 7/10/90 n/a
Unimproved land -
Mojave, CA -0- 1,090,017 -0- 106,106 1,196,123 -0- n/a 3/12/90 n/a
Unimproved land -
Victorville, CA -0- 272,140 -0- 27,432 299,572 -0- n/a 1/12/90 n/a
Unimproved land -
Victorville, CA -0- 1,204,302 -0- 143,563 1,347,865 -0- n/a 2/20/90 n/a
Unimproved land -
Victorville, CA -0- 859,635 722 87,890 948,247 -0- n/a 4/23/90 n/a
Unimproved land -
Victorville, CA -0- 1,107,264 -0- 112,792 1,220,056 -0- n/a 4/16/90 n/a
Unimproved land -
Victorville, CA -0- 958,623 -0- 96,208 1,054,831 -0- n/a 4/10/90 n/a
Unimproved land -
Victorville, CA -0- 138,751 -0- 28,503 167,254 -0- n/a 11/26/91 n/a
--- --------- --- ------- --------- ---
-0- $7,678,939 $722 $843,069 $8,522,730 -0-
=== ========== === ======== ========== ===
Reconciliation of carrying amount
Beginning balance $8,392,966
Additions
Improvements $ 0
Carrying costs 129,764
-------
Total additions 129,764
-------
8,522,730
Allowance for decline in fair
value of unimproved land (3,922,730)
----------
Ending balance $4,600,000
==========
See Accompanying Notes and Independent Auditor's Report
</TABLE>
