-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VHMwypiq0WZavEkzxOdgfK3h0Jq2Kmbuj00gCKJw1Ava6/7YScZ9kXcvFgDvXnj9 5AYjo89gGZTZ5KeKY2xz9g== 0000950148-97-002166.txt : 19970820 0000950148-97-002166.hdr.sgml : 19970820 ACCESSION NUMBER: 0000950148-97-002166 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970819 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: REAL ESTATE ASSOCIATES LTD V CENTRAL INDEX KEY: 0000702644 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 953768810 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-12438 FILM NUMBER: 97666055 BUSINESS ADDRESS: STREET 1: 9090 WILSHIRE BLVD STREET 2: STE 201 CITY: BEVERLY HILLS STATE: CA ZIP: 90211 BUSINESS PHONE: 3102782191 MAIL ADDRESS: STREET 1: 9090 WILSHIRE BLVD STREET 2: STE 201 CITY: BEVERLY HILLS STATE: CA ZIP: 90211 10-Q 1 FORM 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Ended JUNE 30, 1997 Commission File Number 2-77645 REAL ESTATE ASSOCIATES LIMITED V (A California Limited Partnership) I.R.S. Employer Identification No. 95-3768810 9090 WILSHIRE BLVD., SUITE 201 BEVERLY HILLS, CALIF. 90211 Registrant's Telephone Number, Including Area Code (310) 278-2191 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 twelve 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 [ ] 2 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) INDEX TO FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1997 PART I. FINANCIAL INFORMATION Item 1. Financial Statements Balance Sheets, June 30, 1997 and December 31, 1996 ....................... 1 Statements of Operations, Six and Three Months Ended June 30, 1997 and 1996 .................... 2 Statement of Partners' Equity (Deficiency), Six Months Ended June 30, 1997 ....................................... 3 Statements of Cash Flows, Six Months Ended June 30, 1997 and 1996 .............................. 4 Notes to Financial Statements ............................................. 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations................................... 9 PART II. OTHER INFORMATION Item 1. Legal Proceedings ......................................................... 10 Item 6. Exhibits and Reports on Form 8-K .......................................... 10 Signatures.......................................................................... 11
3 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) BALANCE SHEETS JUNE 30, 1997 AND DECEMBER 31, 1996 ASSETS
1997 1996 (Unaudited) (Audited) ----------- ----------- INVESTMENTS IN LIMITED PARTNERSHIPS (Note 2) $ 1,374,060 $ 1,305,672 CASH AND CASH EQUIVALENTS (Note 1) 2,016,814 1,953,506 ----------- ----------- TOTAL ASSETS $ 3,390,874 $ 3,259,178 =========== =========== LIABILITIES AND PARTNERS' EQUITY (DEFICIENCY) LIABILITIES: Accounts payable $ 3,147 $ 9,978 ----------- ----------- COMMITMENTS AND CONTINGENCIES (Notes 3 and 4) PARTNERS' EQUITY (DEFICIENCY): General partners (123,469) (124,854) Limited partners 3,511,196 3,374,054 ----------- ----------- 3,387,727 3,249,200 ----------- ----------- TOTAL LIABILITIES AND PARTNERS' EQUITY (DEFICIENCY) $ 3,390,874 $ 3,259,178 =========== ===========
The accompanying notes are an integral part of these financial statements. 1 4 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) STATEMENTS OF OPERATIONS SIX AND THREE MONTHS ENDED JUNE 30, 1997 AND 1996 (Unaudited)
Six months Three months Six months Three months ended ended ended ended June 30, 1997 June 30, 1997 June 30, 1996 June 30, 1996 ------------- ------------- ------------- ------------- INTEREST INCOME $ 44,802 $ 23,224 $ 32,400 $ 16,203 --------- --------- --------- --------- OPERATING EXPENSES: Legal and accounting 39,252 19,364 39,657 13,521 Management fees - general partner (Note 3) 127,224 63,612 127,224 63,612 Administrative (Note 3) 29,031 17,176 22,042 12,588 --------- --------- --------- --------- Total operating expenses 195,507 100,152 188,923 89,721 --------- --------- --------- --------- LOSS FROM OPERATIONS (150,705) (76,928) (156,523) (73,518) DISTRIBUTIONS FROM LIMITED PARTNERSHIPS RECOGNIZED AS INCOME (Note 2) 95,232 30,518 119,913 71,341 EQUITY IN INCOME OF LIMITED PARTNERSHIP AND AMORTI- ZATION OF ACQUISITION COSTS (Note 2) 194,000 97,000 250,000 125,000 --------- --------- --------- --------- NET INCOME $ 138,527 $ 129,701 $ 213,390 $ 122,823 ========= ========= ========= ========= NET INCOME PER LIMITED PARTNERSHIP INTEREST (Note 1) $ 18 $ 17 $ 27 $ 16 ========= ========= ========= =========
The accompanying notes are an integral part of these financial statements. 2 5 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) STATEMENT OF PARTNERS' EQUITY (DEFICIENCY) SIX MONTHS ENDED JUNE 30, 1997 (Unaudited)
General Limited Partners Partners Total ----------- ---------- ---------- PARTNERSHIP INTERESTS, June 30, 1997 7,808 ========== EQUITY (DEFICIENCY), January 1, 1997 $ (124,854) $3,374,054 $3,249,200 Net income for the six months ended June 30, 1997 1,385 137,142 138,527 ---------- ---------- ---------- EQUITY (DEFICIENCY), June 30, 1997 $ (123,469) $3,511,196 $3,387,727 ========== ========== ==========
The accompanying notes are an integral part of these financial statements. 3 6 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) STATEMENTS OF CASH FLOWS SIX MONTHS ENDED JUNE 30, 1997 AND 1996 (Unaudited)
1997 1996 ----------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 138,527 $ 213,390 Adjustments to reconcile net income to net cash used in operating activities: Equity in income of limited partnerships and amortization of acquisition costs (194,000) (250,000) Increase in other assets - (600) Decrease in accounts payable (6,831) (28,919) ----------- ----------- Net cash used in operating activities (62,304) (66,129) ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES: Distributions from limited partnerships recognized as a return of capital 125,612 139,633 ----------- ----------- NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS 63,308 73,504 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 1,953,506 1,876,153 ----------- ----------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 2,016,814 $ 1,949,657 =========== ===========
The accompanying notes are an integral part of these financial statements. 4 7 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) NOTES TO FINANCIAL STATEMENTS JUNE 30, 1997 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES GENERAL The information contained in the following notes to the financial statements is condensed from that which would appear in the annual audited financial statements; accordingly, the financial statements included herein should be reviewed in conjunction with the financial statements and related notes thereto contained in the annual report for the year ended December 31, 1996 prepared by Real Estate Associates Limited V (the "Partnership"). Accounting measurements at interim dates inherently involve greater reliance on estimates than at year end. The results of operations for the interim period presented are not necessarily indicative of the results for the entire year. In the opinion of the Partnership, the accompanying unaudited financial statements contain all adjustments (consisting primarily of normal recurring accruals) necessary to present fairly the financial position as of June 30, 1997, and the results of operations for the six and three months then ended and changes in cash flows for the six months then ended. The general partners have a 1 percent interest in profits and losses of the Partnership. The limited partners have the remaining 99 percent interest which is allocated in proportion to their respective individual investments. National Partnership Investments Corp. (NAPICO) is the corporate general partner of the Partnership. USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. METHOD OF ACCOUNTING FOR INVESTMENT IN LIMITED PARTNERSHIPS The investment in limited partnerships is accounted for on the equity method. Acquisition, selection and other costs related to the acquisition of the projects are capitalized as part of the investment balance and are being amortized on a straight line basis over the estimated lives of the underlying assets, which is generally 30 years. NET INCOME PER LIMITED PARTNERSHIP INTEREST Net income per limited partnership interest was computed by dividing the limited partners' share of net income by the number of limited partnership interests outstanding during the year. The number of limited partnership interests was 7,808 for the periods presented. 5 8 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) CASH AND CASH EQUIVALENTS Cash and cash equivalents consist of cash and bank certificates of deposit with an original maturity of three months or less. The Partnership has its cash and cash equivalents on deposit primarily with one high credit quality financial institution. Such cash and cash equivalents are in excess of the FDIC insurance limit. INCOME TAXES No provision has been made for income taxes in the accompanying financial statements since such taxes, if any, are the liability of the individual partners. IMPAIRMENT OF LONG-LIVED ASSETS The Partnership adopted Statement of Financial Accounting Standards No. 121, Account for the Improvement of Long-Lived Assets and for Long-Lived Assets To Be Disposed Of as of January 1, 1996 without a significant effect on its financial statements. The Partnership reviews long-lived assets to determine if there has been any permanent impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If the sum of the expected future cash flows is less than the carrying amount of the assets, the Partnership recognizes an impairment loss. NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS The Partnership holds limited partnership interests in 19 limited partnerships at June 30, 1997. The partnerships own residential rental projects consisting of 1,319 apartment units. The mortgage loans of these projects are insured by various governmental agencies. The Partnership, as a limited partner, is entitled to 75 percent to 99 percent of the profits and losses in these limited partnerships. Equity in losses of limited partnerships is recognized in the financial statements until the limited partnership investment account is reduced to a zero balance. Losses incurred after the limited partnership investment account is reduced to zero are not recognized. Distributions from the limited partnerships are accounted for as a return of capital until the investment balance is reduced to zero or to a negative amount equal to further capital contributions required. Subsequent distributions received are recognized as income. 6 9 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 1997 NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED) The following is a summary of the investment in limited partnerships for the six months ended June 30, 1997: Balance, beginning of period $1,305,672 Cash distributions recognized as a return of capital (125,612) Amortization of acquisition costs (4,000) Equity in income of limited partnerships 198,000 ---------- Balance, end of period $1,374,060 ==========
The following are unaudited combined estimated statements of operations for the six months ended June 30, 1997 and 1996 for the limited partnerships in which the Partnership has investments:
Six months Three months Six months Three months ended ended ended ended June 30, 1997 June 30, 1997 June 30, 1996 June 30, 1996 ------------- ------------- ------------- ------------- REVENUES Rental income $ 6,322,000 $ 3,161,000 $ 6,308,000 $ 3,154,000 ----------- ----------- ----------- ----------- EXPENSES Depreciation 952,000 476,000 942,000 471,000 Interest 2,680,000 1,340,000 2,758,000 1,379,000 Operating 2,720,000 1,360,000 2,650,000 1,325,000 ----------- ----------- ----------- ----------- 6,352,000 3,176,000 6,350,000 3,175,000 ----------- ----------- ----------- ----------- Net loss $ (30,000) $ (15,000) $ (42,000) $ (21,000) =========== =========== =========== ===========
NAPICO, or one of its affiliates, is the general partner and property management agent for certain of the limited partnerships included above. The Partnership is undergoing an extensive review of disposition, refinancing or re-engineering alternatives for the properties in its Portfolio that are subject to governmental mortgage and rental subsidy programs. The Partnership has begun to incur expenses in connection with this review by various third party professionals. Amounts incurred to date are not material to the operating results of the Partnership. NOTE 3 - MANAGEMENT FEES AND EXPENSES DUE TO GENERAL PARTNER Under the terms of the Restated Certificate and Agreement of Limited Partners, the Partnership is obligated to NAPICO for an annual management fee equal to 0.4 percent of the invested assets of the limited partnerships. Invested assets are defined as the costs of acquiring project interests, including the proportionate amount of the mortgage loans related to the Partnership's interests in the capital accounts of the respective partnerships. The fee was approximately $127,000 for the six months ended June 30, 1997 and 1996. 7 10 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 1997 NOTE 3 - MANAGEMENT FEES AND EXPENSES DUE TO GENERAL PARTNER (CONTINUED) The Partnership reimburses NAPICO for certain expenses. The reimbursement paid to NAPICO was $9,790 and $8,970 for the six months ended June 30, 1997 and 1996, respectively, and is included in administrative expenses. NOTE 4 - CONTINGENCIES The corporate general partner of the Partnership is involved in various lawsuits arising from transactions in the ordinary course of business. In the opinion of management and the corporate general partner, the claims will not result in any material liability to the Partnership. NOTE 5 - FAIR VALUE OF FINANCIAL INSTRUMENTS Statement of Financial Accounting Standards No. 107, "Disclosure about Fair Value of Financial Instruments," requires disclosure of fair value information about financial instruments. The carrying amount of assets and liabilities reported on the balance sheets that require such disclosure approximates fair value due to their short-term maturity. 8 11 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) JUNE 30, 1997 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS LIQUIDITY AND CAPITAL RESOURCES The Partnership's primary sources of funds include interest income earned from investing available cash and distributions from limited partnerships in which the Partnership has invested. RESULTS OF OPERATIONS Partnership revenues consist primarily of interest income earned on certificates of deposit and other temporary investment of funds not required for investment in local partnerships. Operating expenses consist primarily of recurring general and administrative expenses and professional fees for services rendered to the Partnership. In addition, an annual Partnership management fee in an amount equal to .4 percent of invested assets is payable to the corporate general partner. Operating expenses are consistent with the prior year. The Partnership is undergoing an extensive review of disposition, refinancing or re-engineering alternatives for the properties in its Portfolio that are subject to governmental mortgage and rental subsidy programs. The Partnership has begun to incur expenses in connection with this review by various third party professionals. Amounts incurred to date are not material to the operating results of the Partnership. The Partnership accounts for its investments in the local limited partnerships on the equity method, thereby adjusting its investment balance by its proportionate share of the income or loss of the local limited partnerships. Losses incurred after the limited partnership investment account is reduced to zero are not recognized in accordance with the equity accounting method. Distributions received from limited partnerships are recognized as return of capital until the investment balance has been reduced to zero or to a negative amount equal to future capital contributions required. Subsequent distributions received are recognized as income. Except for certificates of deposit and money market funds, the Partnership's investments are entirely interests in other limited partnerships primarily owning government assisted projects. Available cash is invested in these funds earning interest income as reflected in the statement of operations. These funds can be converted to cash to meet obligations as they arise. The Partnership intends to continue investing available funds in this manner. 9 12 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) JUNE 30, 1997 PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS The corporate general partner is involved in various lawsuits. None of these are related to REAL V. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) No exhibits are required per the provision of Item 7 of regulation S-K. 10 13 REAL ESTATE ASSOCIATES LIMITED V (A CALIFORNIA LIMITED PARTNERSHIP) JUNE 30, 1997 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. REAL ESTATE ASSOCIATES LIMITED V (a California limited partnership) By: National Partnership Investments Corp. General Partner Date: ----------------------------------------- By: ------------------------------------------- Bruce Nelson President Date: ----------------------------------------- By: ------------------------------------------ Charles H. Boxenbaum Chief Executive Officer Date: ----------------------------------------- 11 EX-27 2 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE PARTNERSHIP'S STATEMENTS OF EARNINGS AND BALANCE SHEETS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 6-MOS DEC-31-1997 JAN-01-1997 JUN-30-1997 2,016,814 0 0 0 0 2,016,814 0 0 3,390,874 3,147 0 0 0 0 3,387,727 3,390,874 0 334,034 0 0 195,507 0 0 138,527 0 138,527 0 0 0 138,527 0 0
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