FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1998
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ________ to ___________
Commission file number: 33-76970
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., Series 4
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
California 33-0601852
3158 Redhill Avenue, Suite 120
Costa Mesa, CA 92626
(714) 662-5565
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 ____ No X
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., Series 4
(A California Limited Partnership)
INDEX TO FORM 10-Q
FOR THE QUARTER ENDED JUNE 30, 1998
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets, June 30, 1998 and
December 31, 1997......................................................3
Statement of Operations
For the three months and six months ended June 30, 1998 and 1997.......4
Statement of Partners' Equity
For the six months ended June 30, 1998 and 1997........................5
Statement of Cash Flows
For the six months ended June 30, 1998 and 1997........................6
Notes to Financial Statements............................................8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations..............................14
Item 3. Quantitative and Qualitative Disclosures
Above Market Risks...............................................16
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K..................................17
Signatures ...............................................................18
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
BALANCE SHEETS
June 30, 1998 and December 31, 1997
1998 1997
---- ----
ASSETS
Cash and cash equivalents $ 1,013,286 $ 1,147,906
Receivable from affiliates 14,271 31,646
Investment in limited
partnerships - Note 2 7,192,082 7,622,211
Other assets - -
---------- ----------
$ 8,219,639 $ 8,801,763
========== ==========
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
Liabilities:
Payable to limited partnership
- Note 4 $ 222,119 $ 363,634
Accrued fees and expenses due to
general partner and affiliates
- Note 3 - 6,445
---------- ----------
Total liabilities 222,119 370,079
---------- ----------
Partners' equity (deficit):
General partner (21,198) (16,856)
Limited partners (25,000 units
authorized, 11,500 issued and
outstanding) 8,018,718 8,448,540
---------- ----------
Total partners' equity 7,997,520 8,431,684
---------- ----------
$ 8,219,639 $ 8,801,763
========== ==========
UNAUDITED
See Accompanying Notes to Financial Statements
3
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
STATEMENT OF OPERATIONS
For the Three and Six Months Ended June 30, 1998 and 1997
1998 1997
---- ----
Three Six Three Six
Months Months Months Months
Interest income $ 14,987 $ 25,883 $ 17,999 $ 41,899
-------- -------- -------- --------
Operating expenses:
Amortization 6,394 12,773 6,354 12,705
Asset management fees
(Note 4) 7,907 15,813 7,907 15,813
Legal and accounting 7,000 10,350 3,500 4,500
Other 3,997 4,711 4,789 5,355
-------- -------- -------- --------
Total operating expenses 25,298 43,647 22,550 38,373
-------- -------- -------- --------
Loss from operations (10,311) (17,764) (4,551) 3,526
Equity in loss from
limited partnerships (194,152) (416,400) (69,600) (234,600)
-------- -------- -------- --------
Net loss $ (204,463) $ (434,164) $ (74,151) $ (231,074)
======== ======== ======= ========
Net loss allocated to:
General partner $ (2,045) (4,342) (742) (2,311)
======== ======== ======= ========
Limited partners $ (202,418) (429,822) (73,409) (228,763)
======== ======== ======= ========
Net loss per limited
partner units (11,500
weighted units 1998 and
1997) $ (17.60) $ (37.38) $ (6.38) $ (20.00)
======== ======== ======= ========
UNAUDITED
See Accompanying Notes to Financial Statements
4
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
STATEMENT OF PARTNERS' EQUITY
For the Six Months Ended June 30, 1998 and 1997
For the Six Months Ended June 30, 1998
- --------------------------------------
General Limited
Partner Partner Total
------- ------- -----
Equity (deficit), December 31, 1997 $ (16,856) $ 8,448,540 $ 8,431,684
Net loss for the six months ended
June 30, 1998 (4,342) (429,822) (434,164)
------- --------- ---------
Equity (deficit), June 30, 1998 $ (21,198) $ 8,018,718 $ 7,997,520
======= ========= =========
For the Six Months Ended June 30, 1997
- --------------------------------------
General Limited
Partner Partner Total
------- ------- -----
Equity (deficit), December 31, 1996 $ (8,737) $ 9,252,302 $ 9,243,565
Offering expense (3) (347) (350)
Net loss for the six months ended
June 30, 1997 (2,311) (228,763) (231,074)
------- --------- ---------
Equity (deficit), June 30, 1997 $ (11,051) $ 9,023,192 $ 9,012,141
========= ============ ============
UNAUDITED
See Accompanying Notes to Financial Statements
5
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
STATEMENT OF CASH FLOWS
For the Six Months Ended June 30, 1998 and 1997
1998 1997
---- ----
Cash flows provided by operating activities:
Net loss $ (434,164) $ (231,074)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Equity in loss of limited partnerships 416,400 234,600
Amortization 12,773 12,705
Asset management fee - 15,813
Decrease in receivables 17,375 8,077
Increase (decrease) in accrued fees and expense
due to general partner and affiliates (6,445) 23,988
---------- ----------
Net cash provided by operating activities 5,939 64,109
---------- ----------
Cash flows used by investing activities:
Investments in limited partnerships (141,513) (971,862)
Distribution from limited partnerships 2,539 -
Acquisition costs and fees (1,585) (300)
---------- ----------
Net cash used by investing activities (140,559) (972,162)
---------- ----------
Net decrease in cash and cash equivalents (134,620) (908,053)
Cash and cash equivalents, beginning of period 1,147,906 2,614,756
---------- ----------
Cash and cash equivalent, end of period $ 1,013,286 $ 1,706,703
========== ==========
UNAUDITED
See Accompanying Notes to Financial Statements
6
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
STATEMENT OF CASH FLOWS - CONTINUED
For the Six months ended June 30, 1998 and 1997
Supplemental disclosure of noncash financing and investing activity:
- --------------------------------------------------------------------
For the Six months ended June 30,
---------------------------------
1998 1997
---- ----
During the six months ended June 30, 1998
and 1997 the Partnership's payables to limited
partnerships; (in connection with its
investments in limited partnerships) (see
Note 2) had decreases due to various price
adjuster provisions in the respective
limited partnership agreements $ (2) $ (10,721)
==== ========
UNAUDITED
See Accompanying Notes to Financial Statements
7
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ---------------------------------------------------
Organization
- ------------
WNC CALIFORNIA TAX CREDITS IV, L.P., Series 4 (the "Partnership") was formed
under the California Revised Limited Partnership Act on February 16, 1995, and
commenced operations on July 26, 1995. The Partnership was formed to invest
primarily in other limited partnerships which will own and operate multi-family
housing complexes that will qualify for low income housing credits.
The general partner of the Partnership is WNC California Tax Credit Partners IV,
L.P. (the "General Partner"), a California limited partnership. WNC &
Associates, Inc. is the general partner of the General Partner. Wilfred N.
Cooper, Sr., through the Cooper Revocable Trust, owns 70% of the outstanding
stock of WNC & Associates, Inc. John B. Lester, Jr. is the original limited
partner of the Partnership and owns, through the Lester Family Trust, 30% of the
outstanding stock of WNC & Associates, Inc.
General
- -------
The information contained in the following notes to the financial statements is
condensed from that which would appear in the annual financial statements;
accordingly, the financial statements included herein should be reviewed in
conjunction with the audited financial statements and related notes thereto
contained in the Partnership's financial statements for the period ended
December 31, 1997 (audited).
In the opinion of the General Partner, the accompanying unaudited financial
statements contain all adjustments (consisting of only normal recurring
accruals) necessary to present fairly the financial position as of June 30, 1998
and the results of operations and changes in cash flows for the six months ended
June 30, 1998 and 1997.
Allocations Under the Terms of the Partnership Agreement
- --------------------------------------------------------
The General Partner has a 1% interest in operating profits and losses, taxable
income and loss and in cash available for distribution from the Partnership. The
limited partners will be allocated the remaining 99% of these items in
proportion to their respective investments.
8
<PAGE>
WNC CALIFORNIA TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
- --------------------------------------------------------------
After the limited partners have received sale or refinancing proceeds equal to
their capital contributions and their return on investment (as defined in the
Partnership's Agreement of Limited Partnership) and the General Partner has
received a subordinated disposition fee (as described in Note 3 below), any
additional sale or refinancing proceeds will be distributed 90% to the limited
partners (in proportion to their respective investments) and 10% to the General
Partner.
Method of Accounting For Investment in Limited Partnerships
- -----------------------------------------------------------
The investment in limited partnerships is accounted for on the equity method of
accounting whereby the Partnership adjusts its investment balance for its share
of each limited partnership's results of operations and for any distributions
received. Costs incurred by the Partnership in acquiring the investments in
limited partnerships are capitalized as part of the investment account.
Losses from the limited partnerships will not be recognized to the extent that
the individual investment balance would be adjusted below zero.
Offering Expenses
- -----------------
Offering expenses consist of underwriting commissions, legal fees, printing,
filing and recordation fees, and other costs incurred with selling limited
partnership interests in the Partnership. The General Partner is obligated to
pay all offering and organization costs in excess of 15% (including sales
commissions) of the total offering proceeds. Offering expenses are reflected as
a reduction of partners' capital.
Organization Costs
- ------------------
Organization costs are being amortized on the straight-line method over 60
months.
Cash and Cash Equivalents
- -------------------------
The Partnership considers investments with an original maturity of three months
or less as cash equivalents.
9
<PAGE>
WNC CALIFORNIA TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2 - INVESTMENT IN LIMITED PARTNERSHIPS
- -------------------------------------------
As of June 30, 1998 the Partnership had acquired limited partnership interests
in nine limited partnerships each of which owns one Apartment Complex. As of
June 30, 1998, construction or rehabilitation of eight of the Apartment
Complexes had been completed and one was undergoing construction or
rehabilitation.
As of June 30, 1997 the Partnership had acquired limited partnership interests
in eight limited partnerships each of which owns one Apartment Complex. As of
June 30, 1997, construction or rehabilitation of six of the Apartment Complexes
had been completed and two were undergoing construction or rehabilitation.
The Partnership, as a limited partner, is entitled to 99%, as specified in the
partnership agreements, of the operating profits and losses of the limited
partnerships upon the acquisition of its limited partnership interest. Following
is a summary of the components of investment in limited partnerships as of June
30, 1998 and December 31, 1997:
1998 1997
---- ----
Investment beginning of period $ 7,622,211 $ 8,467,424
Total capital contributions made and
accrued with respect to limited
partnerships (2) (10,722)
Increase in capitalized acquisition fees
and costs 1,585 3,567
Distributions from limited partnerships (2,539) (6,000)
Amortization of acquisition fees and costs (12,773) (25,419)
Equity in loss of limited partnerships (416,400) (806,639)
--------- ---------
Investment, end of period $ 7,192,082 $ 7,622,211
========= =========
10
<PAGE>
WNC CALIFORNIA TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2 - INVESTMENT IN LIMITED PARTNERSHIPS (CONTINUED)
- -------------------------------------------------------
Selected financial information from the financial statements of the limited
partnerships with operations for the six months ended June 30, 1998 and 1997 is
as follows:
Six months ended
June 30, 1998 June 30, 1997
Total revenue $ 525,000 $ 483,000
-------- --------
Expenses:
Operating expenses - exclusive of
depreciation and interest 339,000 273,000
Interest expense 282,000 161,000
Depreciation 325,000 286,000
-------- --------
Total expenses 946,000 720,000
-------- --------
Net loss $ (421,000) $ (237,000)
======== ========
Net loss allocable to Partnership $ (416,400) $ (234,600)
======== ========
NOTE 3 - RELATED PARTY TRANSACTIONS
- -----------------------------------
As of June 30, 1998 and December 31, 1997, receivable from affiliates consist of
amounts due from an affiliate related to certain costs paid by the Partnership
on behalf of such affiliate.
Under the terms of its Agreement of Limited Partnership, the Partnership is
obligated to the General Partner or its affiliates for the following items:
Acquisition fees of up to 7% of the gross proceeds from the sale of
Partnership units. No acquisition fees were incurred for the six months
ended June 30, 1998 and 1997.
11
<PAGE>
WNC CALIFORNIA TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 3 - RELATED PARTY TRANSACTIONS (CONTINUED)
- -----------------------------------------------
An annual asset management fee equal to the greater amount of (i) $2,000
for each Apartment Complex, or (ii) 0.275% of Gross Proceeds. In either
case, the fee will be decreased or increased annually based on changes to
the Consumer Price Index. However, in no event will the maximum amount
exceed 0.2 % of the invested assets (defined as the Partnership's capital
contributions to the limited partnerships plus its allocable percentage of
the permanent financing) of the limited partnerships which are subsidized
under one or more Federal, state or local government programs. The
Partnership has incurred fees of $15,813 for each six month period ended
June 30, 1998 and 1997.
Reimbursement for organizational, offering and selling expenses advanced by
an affiliate of the General Partner on behalf of the Partnership. These
reimbursements plus all other organizational and offering expenses
inclusive of sales commissions will not exceed 15% of the gross proceeds.
During the six months ended June 30, 1997 the Partnership incurred
organizational, offering and selling expenses of $-0-, $7,009 and $-0-,
respectively. No organizational, offering or selling expenses were incurred
in 1998.
A subordinated disposition fee in an amount equal to 1% of the sales price
of real estate sold. Payment of this fee is subordinated to the limited
partners receiving a return on investment (as defined in the Agreement of
Limited Partnership) and is payable only if services are rendered in the
sales effort.
Accrued fees and advances due to affiliates of the General Partner included in
the accompanying balance sheet consists of the following at June 30, 1998 and
December 31, 1997:
1998 1997
---- ----
Advances made for acquisition costs,
organizational, offering and selling
expenses $ - $ 1,055
Asset management fees accrued - 5,390
------ -----
$ - $ 6,445
====== =====
12
<PAGE>
WNC CALIFORNIA TAX CREDITS IV, L.P., SERIES 4
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 4 - PAYABLE TO LIMITED PARTNERSHIPS
- ----------------------------------------
Payable to limited partnerships represent amounts which are due at various times
based on conditions specified in the respective limited partnership agreements.
These contributions are payable in installments, are generally due upon the
limited partnerships achieving certain operating benchmarks and are generally
expected to be paid within two years of the Partnership's initial investment.
NOTE 5 - INCOME TAXES
- ---------------------
The Partnership will not make a provision for income taxes since all items of
taxable income and loss will be allocated to the partners for inclusion in their
respective income tax returns.
13
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operation
WNC California Housing Tax Credits IV, L.P., Series 4 is a California Limited
Partnerships formed under the laws of the State of California on May 4, 1993 to
acquire limited partnership interests in limited partnerships ("Limited
Partnerships") which own multifamily apartment complexes that are eligible for
low-income housing federal income tax credits (the "Housing Tax Credit"). WNC
California Housing Tax Credits IV, L.P., Series 4 ("the Partnership")
As of June 30, 1998, the Partnership has received subscriptions for 11,500 Units
at $1,000 per Unit consisting of cash of $11,099,050 and discounts $400,950. The
offering terminated in August, 1995 at which time the subscriptions for 11,500
units were accepted.
The Partnership raised funds from investors through its public offering of units
of limited partnership interest ("Units") and intends to apply such funds,
including the installment payments of the limited partners' promissory notes as
received, to the acquisition of investments in Limited Partnerships, acquisition
fees, the establishment of reserves, the payment of operating expenses and the
payment of expenses of this offering.
Liquidity and Capital Resources
- -------------------------------
Overall, as reflected in its Statement of Cash Flows, the Partnership had a net
decrease in cash and cash equivalents of approximately $134,600 for the six
months ended June 30, 1998. Cash of approximately $5,900 was provided by
operating activities during the six months ended June 30, 1998. Cash of
approximately $141,000 used by investing activities and consisted primarily of
capital contributions to limited partnerships. Cash provided by operating
activities consisted primarily of interest received on cash deposits, and cash
used consisted primarily of payments operating fees and expenses. The major
components of all these activities are discussed in greater detail below.
Overall, as reflected in its Statement of Cash Flows, the Partnership had a net
decrease in cash and cash equivalents of approximately $908,000 for the six
months ended June 30, 1997. Cash of approximately $64,000 was provided by
operating activities and cash of approximately $972,000 was used by investing
activities, during six months ended June 30, 1997. Cash used by investing
activities consisted of capital contributions to limited partnerships. Cash
provided by operating activities consisted primarily of interest received on
cash deposits and investors notes receivable, and cash used consisted primarily
of payments operating fees and expenses. The major components of all these
activities are discussed in greater detail below.
As of June 30, 1998 and December 31, 1997, receivables from affiliates of
approximately $14,300 consist of amounts due from an affiliate related to
certain costs paid by the Partnership on behalf of such affiliate.
14
<PAGE>
As of June 30, 1998 and December 31, 1997, the Partnership has received and
accepted subscriptions funds in the amount of $11,099,000. As of June 30, 1998
and December 31, 1997, the Partnership had made capital contributions to Local
Limited Partnerships in the amount of approximately $8,140,000, and 7,998,000,
respectively, and had commitments for additional capital contributions of
approximately $222,000 and $364,000, respectively.
It is not expected that any of the local limited partnerships in which the
Partnership will invest will generate cash from operations sufficient to provide
distributions to the limited partners in any significant amount. Such cash from
operations, if any, would first be used to meet operating expenses of the
Partnership, including the payment of the asset management fee to the General
Partner.
The Partnership's investments will not be readily marketable and may be affected
by adverse general economic conditions which, in turn, could substantially
increase the risk of operating losses for the apartment complexes, the local
limited partnerships and the Partnership. These problems may result from a
number of factors, many of which cannot be controlled by the General Partner.
Nevertheless, the General Partner anticipates that capital raised from the sale
of the Units will be sufficient to fund the Partnership's future investment
commitments and proposed operations.
The Partnerships will establish working capital reserves of at least 3% of
capital contributions, an amount which is anticipated to be sufficient to
satisfy general working capital and administrative expense requirements of the
Partnerships excluding payment of the asset management fee as well as expenses
attendant to the preparation of tax returns and reports to the Limited Partners
and other investor servicing obligations of the Partnerships. Liquidity would,
however, be adversely affected by unanticipated or greater than anticipated
operating costs. The Partnerships' liquidity could also be affected by defaults
or delays in payment of the Limited Partners' promissory notes, from which a
portion of the working capital reserves is expected to be funded. To the extent
that working capital reserves are insufficient to satisfy the cash requirements
of the Partnerships, it is anticipated that additional funds would be sought
through bank loans or other institutional financing. The General Partner may
also apply any cash distributions received from the Local Partnerships for such
purposes or to replenish or increase working capital reserves.
Under its partnership agreement the Partnership does not have the ability to
assess its partners for additional capital contributions to provide capital if
needed by the Partnership or local limited partnerships. Accordingly, if
circumstances arise that cause the local limited partnerships to require capital
in addition to that contributed by the Partnership and any equity of the local
general partners, the only sources from which such capital needs will be able to
be satisfied (other than the limited reserves available at the Partnership
level) will be (i) third-party debt financing (which may not be available, if,
as expected, the apartment complexes owned by the local limited partnerships are
already substantially leveraged), (ii) additional equity contributions or
advances of the local general partners, (iii) other equity sources (which could
adversely affect the Partnership's interest in tax credits, cash flow and/or
proceeds of sale or refinancing of the apartment complexes and result in adverse
tax consequences to the limited partners), or (iv) the sale or disposition of
the apartment complexes (which could have the same adverse effects as discussed
in (iii) above).
15
<PAGE>
The Partnerships' capital needs and resources are expected to undergo major
changes during their first several years of operations as a result of the
completion of their offerings of Units and their acquisition of investments.
Thereafter, the Partnerships' capital needs and resources are expected to be
relatively stable over the holding periods of the investments except to the
extent of proceeds received in payment of Promissory Notes and disbursed to fund
the deferred obligations of the Partnerships.
Results of Operations
- ---------------------
As of June 30, 1998, the Partnership had acquired nine Local Limited
Partnerships Each has received government assistance and each of them has
received a reservation for Housing Tax Credits. As of June 30, 1998 and 1997,
nine and eight, respectively, of the Apartment Complexes in the Partnership had
commenced operations. Accordingly, the "Equity in losses from limited
partnerships" for the period ended June 30, 1998 and 1997 reflected in the
Statement of Operations of the Partnership is not indicative of the amounts to
be reported in future years.
As reflected on its Statements of Operations, The Partnership had a loss of
approximately $434,000 and $231,000 for the six months ended June 30, 1998 and
1997 respectively. The component items of revenue and expense are discussed
below.
Revenue. The Partnership's revenues consisted entirely of interest earned on
Promissory Notes and cash deposits held in financial institutions (i) as
Reserves, or (ii) pending investment in Local Partnerships. Interest revenue in
future years will be a function of prevailing interest rates and the amount of
cash balances. It is anticipated that The Partnership will maintain cash
Reserves in an amount not materially in excess of the minimum amount required by
its Partnership Agreement, which is 3% of Capital Contributions.
Expenses. The most significant component of operating expenses is and is
expected to be the Asset Management Fee. The Asset Management Fees is equal to
the greater of (i) $2,000 for each Apartment Complex or (ii) 0.275% of gross
proceeds, and will be decreased or increased annually based on changes to the
Consumer Price Index. Asset management fee of approximately $15,800 was accrued
for each of the six month periods ended June 30, 1998 and 1997.
Amortization expense consist of the amortization over a period of 30 years for
the Acquisition Fee and other expenses attributable to the acquisition of Local
Limited Partnership Interests. Office expense consist of the Partnership's
administrative expenses, such as legal fees, bank charges and investor reporting
expenses.
Office expenses and legal and accounting consists of the Partnership's
administrative expenses, such as accounting and legal fees, bank charges and
investor reporting expenses.
The Partnership's equity in losses from limited partnerships is equal to 99% of
the aggregate net loss of the limited partnerships. After rent-up, the limited
partnerships are expected to generate losses during each year of operations;
this is so because, although rental income is expected to exceed cash operating
expenses, depreciation and amortization deductions claimed by the limited
partnerships are expected to exceed net rental income.
Item 3. Quantitative and Qualitative Disclosures Above Market Risks
NONE.
16
<PAGE>
Part II. Other Information
Item 1. Legal Proceedings
NONE.
Item 6. Exhibits and Reports on Form 8-K
1. NONE.
No reports on Form 8-K were filed during the quarter ended June 30,
1998.
17
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
WNC CALIFORNIA HOUSING TAX CREDITS IV, L.P., Series 4
By: WNC & ASSOCIATES, INC General Partner
By: /s/ John B. Lester, Jr.
- -----------------------------------------------------
John B. Lester, Jr. President
Date: August 4, 1998
By: /s/ Theodore M. Paul
- -----------------------------------------------------
Theodore M. Paul Vice President - Finance
Date: August 4, 1998
18
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000921052
<NAME> WNC CALIFORNIA HOUSING TAX CREDITS IV LP SERIES 4
<MULTIPLIER> 1
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-30-1998
<EXCHANGE-RATE> 1
<CASH> 1,013,286
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,013,286
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 8,219,639
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 7,997,520
<TOTAL-LIABILITY-AND-EQUITY> 8,219,639
<SALES> 0
<TOTAL-REVENUES> 25,883
<CGS> 0
<TOTAL-COSTS> 43,647
<OTHER-EXPENSES> 416,400
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (434,164)
<INCOME-TAX> 0
<INCOME-CONTINUING> (434,164)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (434,164)
<EPS-PRIMARY> (37)
<EPS-DILUTED> 0
</TABLE>
