-----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, PNfnkXy8Od8akaZsO1U395jPzoSwBYAXDTqYHu/AtwRgPoNfW57hkqH48QN749wM dRPWRqmeupKkZ6hdUHRpWg== 0000865549-06-000009.txt : 20061115 0000865549-06-000009.hdr.sgml : 20061115 20061115153450 ACCESSION NUMBER: 0000865549-06-000009 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20060930 FILED AS OF DATE: 20061115 DATE AS OF CHANGE: 20061115 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATLAS FUTURES FUND LIMITED PARTNERSHIP CENTRAL INDEX KEY: 0000865549 STANDARD INDUSTRIAL CLASSIFICATION: [6221] IRS NUMBER: 510380494 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 333-53111 FILM NUMBER: 061219798 BUSINESS ADDRESS: STREET 1: 5916 N 300 WEST CITY: FREMONT STATE: IN ZIP: 46737 BUSINESS PHONE: 2198331306 MAIL ADDRESS: STREET 1: 5916 N 300 WEST CITY: FREMONT STATE: IN ZIP: 46737 10-Q 1 a10q0906.txt 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 AND EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2006 OR [ ] 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 333-53111 Atlas Futures Fund, Limited Partnership (Exact name of registrant as specified in its charter) Delaware 51-0380494 (State or other jurisdiction of incorporation (I.R.S. Employer or organization) Identification No.) 505 Brookfield Drive, Dover, DE 19901 (Address of principal executive offices, including zip code) (800) 331-1532 (Registrant's telephone number, including area code) (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2) Yes No X Part 1 - FINANCIAL INFORMATION Item 1. Financial Statements. The reviewed financial statements for the Registrant for the nine months ended September 30, 2006 are attached hereto and made a part hereof. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. General Information During the past quarter and in the future, Registrant, did and will, pursuant to the terms of the Limited Partnership Agreement, engage in the business of speculative and high risk trading of commodity futures and options markets through the services of one or more commodity trading advisors it selects. Description of Fund Business The Fund grants the commodity trading advisors a power of attorney that is terminable at the will of either party to trade the equity assigned by the Fund. Currently, the Fund has granted powers to two commodity trading advisors, Clarke Capital Management, Inc. and NuWave Investment Corp. Clarke trades approximately 80% of the Fund's equity made available for trading and NuWave trades the other 20%. The commodity trading advisors have sole discretion to select the trades and do not disclose the methods they use to make those determinations in their disclosure documents or to the Fund or general partner. There is no promise or expectation of a fixed return to the partners. The partners must look solely to trading profits for a return their investment as the interest income is expected to be less than the fixed expenses to operate the Fund. Assets The Fund assets consist of cash used as margin to secure futures (formerly called commodity) trades entered on its behalf by the commodity trading advisors it selects. The Fund deposits its cash with one or more futures commission merchants (brokers) who hold and allocate the cash to use as margin to secure the trades made. The futures held in the Fund accounts are valued at the market price on the close of business each day by the Futures Commission Merchant or Merchants that hold the Fund equity made available for trading. The Capital accounts of the Partners are immediately responsible for all profit and losses incurred by trading and payment and accrual of the expenses of offering partnership interests for sale and the operation of the partnership. The fixed costs of operation of the Fund include continuing offering costs, a management fee to NuWave of 2% of equity assigned to it to trade, fixed brokerage commissions of 11%, and accounting and legal fees that must be paid before the limited partners may earn a profit on their investment. See Subsequent Events under this Item 2 for a change to the Fund fee structure. The Fund does not intend to borrow from third parties. Its trades are entered pursuant to a margin agreement with the futures commission merchant which obligates the fund to the actual loss, if any, without reference or limit by the amount of cash posted to secure the trade. The limited partners are not personally liable for the debts of the Fund, including any trading losses. The Registrant will continue to offer Units for sale to the public via its fully amended and restated prospectus dated November 13, 2006 until the balance, as of September 30, 2006, of $1,954,886 in face amount of Units are sold. As of September 30, 2006, of the $15,000,000 in Units registered, $13,045,114 has been sold and upon redemption by the holder, will not be resold. Absent the registration of additional Units, the Fund will be capitalized at $15,000,000 subject to redemption of Units by the holders as they request which are expected to be honored by the General Partner. An Investment in the Fund Depends upon Redemption of Fund Units The Fund Units are not traded and they have no market value. Liquidity of an investment in the Fund depends upon the credit worthiness of the exchanges, brokers, and third parties of off exchange traded futures that hold Fund equity or have a lien against Fund assets for payment of debts incurred. Those parties must honor their obligations to the Fund for the Fund to be able to obtain the return of its cash from the futures commission merchant that holds the Fund account. The commodity trading advisors select the markets and the off exchange instruments to be traded. The General Partner selects the futures commission merchants to hold the Fund assets. Both the commodity trading advisors and the general partner believe all parties who hold Fund assets or are otherwise obligated to pay value to the Fund are credit worthy. Margin is an amount to secure the entry of a trade and is not a limit of the profit or loss to be gained from the trade. The general partner intends to allocate approximately 97% of the Fund equity to be used as margin to enter trades. Although it is customary for the commodity trading advisors to use 40% or less of the equity available as margin, there is no limit imposed by the Fund upon the amount of equity the advisors may commit to margin. It is possible for the Fund to suffer losses in excess of the margin it posts to secure the trades made. To have the purchase price or appreciation, if any, of the Units paid to them, partners must use the redemption feature of the Partnership. Distributions, although possible in the sole discretion of the general partner, are not expected to be made. There is no current market for the Units sold, none is expected to develop and the limited partnership agreement limits the ability of a partner to transfer the Units. Results of Operations The Fund results after payment and accrual of expenses for the first nine months of 2006 was a profit of $177,189 and for the nine months of 2005 was a profit of $2,726,052. The profits were generated by the commodity trading advisors by methods that are proprietary to them. These results are not to be construed as an expectation of similar profits in the future. Subsequent Events Effective October 25, 2006, the auditor of the Fund was changed from Frank L. Sassetti & Co., 6611 W. North Avenue, Oak Park, Illinois 60302-1043, to the CPA firm of Jordan, Patke & Associates, Ltd., 300 Village Green Drive Ste 210, Lincolnshire, IL 60069 for normal business considerations without any disagreement between the former auditor and the Fund or its management. On October 27, 2006, the Fund filed post effective amendment no. 9, which became effective November 13, 2006. Effective December 1, 2006, the management fee to NuWave Investment Corp. will be increased from 2% annually on the first $2,000,000 of equity assigned and 1% annually on equity over $2,000,000 to a percentage based on the rate of trading assigned by NuWave and approved by the General Partner of up to 3% annually on the first $2,000,000 of equity and up to 2% annually on all equity over $2,000,000. The bookkeeping will be transferred from Michael Liccar & Co, certified public accountants, 200 West Adams Street, Suite 2211, Chicago, IL 60606-5208 to Shoup Accounting Services, certified public accountants, 306 S. West Street, Angola, IN 46703. Shoup is an accounting expert that will maintain a duplicate set of the Fund books and records and handle the Fund accounting. Item 3. Quantitative and Qualitative Disclosures about Market Risk The business of the Fund is speculative and involves a high degree of risk of loss. Item 4. Controls and Procedures The Registrant has adopted procedures in connection with the operation of its business including, but not limited to, the review of account statements sent to the general partner before the open of business each day that disclose the positions held overnight in the Fund accounts, the margin to hold those positions, and the amount of profit or loss on each position, and the net balance of equity available in each account. The Fund brokerage account statements and financial books and records accounts are prepared by an independent Certified Public Accounting Firm and then are reviewed each quarter and audited each year by a different independent CPA firm. As of the end of the period covered by this report, the general partner carried out an evaluation, under the supervision and with the participation of the general partner's management, including its principal executive officer and principal financial officer, of the effectiveness of the design and operation of the Fund's disclosure controls and procedures as contemplated by Rule 13a-15 of the Securities Exchange Act of 1934, as amended. Based on and as of the date of that evaluation, the general partner's principal executive officer and principal financial officer concluded that the Fund's disclosure controls and procedures are effective, in all material respects, in timely alerting them to material information relating to the Fund required to be included in the reports required to be filed or submitted by the Fund with the SEC under the Exchange Act. Internal Control over Financial Reporting Each month, the general partner reviews the profit and loss statements for the month and, once approved, each partner is sent a statement to disclose total Fund performance and the amount in the partner's capital account. Checks are paid for expenses only upon approval of invoices submitted to the general partner or pursuant to standing authorizations for periodic fixed expenses. Payment of a redemption is only upon receipt of a request form signed by the person with authority over the limited partner's account. The general partner balances the daily account information with the monthly compilation and financial statements prepared by the independent CPA. There was no change in the Fund's internal control over financial reporting in the quarter ended September 30, 2006 that has materially affected, or is reasonably likely to materially affect, the Fund's internal control over financial reporting. Part II - OTHER INFORMATION Item 1. Legal Proceedings None Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. None Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matters to a Vote of Security Holders None Item 5. Other Information (a) Report filed on 8-K subsequent to reporting period of this 10-Q The Fund filed a Form 8-K on October 26, 2006 and Form 8-K/A on November 2, 2006 to disclose the change of the Fund's auditor effective October 25, 2006 from Frank L. Sassetti & Co., 6611 W. North Avenue, Oak Park, Illinois 60302- 1043, to the CPA firm of Jordan, Patke & Associates, Ltd., 300 Village Green Drive Ste 210, Lincolnshire, IL 60069 for normal business considerations without any disagreement between the former auditor and the Fund or its management. (b) None Item 6. Exhibits 31.1 Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 32.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 SIGNATURES Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Form 10-Q for the period ended September 30, 2006, to be signed on its behalf by the undersigned, thereunto duly authorized. Registrant: Atlas Futures Fund, Limited Partnership By Ashley Capital Management, Incorporated Its General Partner By: /s/ Michael Pacult Mr. Michael Pacult Sole Director, Sole Shareholder, President, and Treasurer of the General Partner Date: November 15, 2006 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) INDEX TO FINANCIAL STATEMENTS Page Accountants' Review Report F-2 Financial Statements Balance Sheets as of September 30, 2006 and December 31, 2005 F-3 Schedules of Investments as of September 30, 2006 and December 31, 2005 F-4 - F-9 Statements of Operations for the Three and Nine Months Ended September 30, 2006 and 2005 F-10 Statements of Partners' Equity for the Nine Months Ended September 30, 2006 and 2005 F-11 Statements of Cash Flows for the Nine Months Ended September 30, 2006 and 2005 F-12 Notes to Financial Statements F-13 - F-20 F-1 Jordan, Patke & Associates, Ltd. Certified Public Accountants To The Partners Atlas Futures Fund, Limited Partnership Dover, Kent County, Delaware We have reviewed the balance sheet, including the schedule of investments, of ATLAS FUTURES FUND, LIMITED PARTNERSHIP as of September 30, 2006 and December 31, 2005 and the related statements of operations for the three and nine months ended September 30, 2006 and 2005, and the statements of partners' equity and cash flows for the nine months ended September 30, 2006 and 2005. These financial statements are the responsibility of the Partnership's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review we are not aware of any material modifications that should be made to the financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States. Frank L. Sassetti & Co. have previously audited, in accordance with auditing standards generally accepted in the United States, the balance sheet, including the schedule of investments, of ATLAS FUTURES FUND, LIMITED PARTNERSHIP as of December 31, 2005 and the related statements of operations, partner's equity and cash flows for the year then ended (not presented herein); and in their report dated February 24, 2006, they expressed an unqualified opinion on these financial statements. In our opinion, the information set forth in the accompanying balance sheet as of December 31, 2005 is fairly stated, in all material respects, in relation to the balance sheet from which it has been derived. /s/ Jordan, Patke & Associates November 15, 2006 Lincolnshire, Illinois F-2 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) BALANCE SHEETS SEPTEMBER 30, 2006 AND DECEMBER 31, 2005 ASSETS September 30, 2006 December 31, (A Review) 2005 Investments Equity in Commodity Futures Trading Accounts - Cash and cash equivalents $16,992,456 $16,822,678 Net unrealized gain on open commodity futures contracts 164,788 250,902 17,157,244 17,073,580 Cash 40,033 88,004 Accrued interest receivable 51,787 34,073 $17,249,064 $17,195,657 LIABILITIES AND PARTNERS' EQUITY LIABILITIES Partner redemptions payable $ 60,144 $ 117,164 Accrued trading commissions payable 31,076 15,555 Accrued management fees payable 12,594 13,110 Incentive fees payable 257,223 170,919 Other accrued liabilities 28,620 37,128 Total Liabilities 389,657 353,876 PARTNERS' EQUITY Limited partners - (4,955.64 and 5,016.79 units) 16,859,407 16,841,781 General partner - (0 units) - - Total Partners' Equity 16,859,407 16,841,781 $17,249,064 $17,195,657 The accompanying notes are an integral part of the financial statements. F-3 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) SCHEDULE OF INVESTMENTS SEPTEMBER 30, 2006 (A Review) Contracts Value Percent United States Commodity Futures Positions, Held Long: 9 Dec '06 CBOT Wheat $21,938 0.13% 12 Dec '06 CBT 10 Y Note 15,953 0.09 6 Dec '06 CME Cattle (5,340) (0.03) 3 Mar '07 CSC Sugar 2,587 0.02 2 Nov '06 RBOB Gas 1,982 0.01 2 Dec '06 IMM GBP 638 0.00 5 Dec '06 IMM CAD 700 0.00 1 Oct '06 LME Copper 10,288 0.06 70 Jun '07 IMM Euro $ 13,663 0.08 11 Dec '06 E-Mini 20,900 0.12 1 Dec '06 LME Alum US 3,810 0.02 Total United States Commodity Futures Positions 87,118 0.51 Japanese Commodity Futures Positions, Held Long: 4 Dec '06 SGX MINI JGB (3,471) (0.02) Total Japanese Commodity Futures Positions (3,471) (0.02) European Commodity Futures Positions, Held Long: 7 Dec '06 Eurx E-Bund 8,609 0.05 7 Dec '06 CAC 40 11,006 0.06 1 Dec '06 DTB Dax Index 3,328 0.02 Total European Commodity Futures Positions 22,943 0.13 The accompanying notes are an integral part of the financial statements. F-4 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) SCHEDULE OF INVESTMENTS SEPTEMBER 30, 2006 (A Review) Contracts/ Amount Value Percent Great British Commodity Futures Positions, Held Long: 5 Dec '06 FTSE 100 8,231 0.05 8 Dec '06 LIFFE Long Gilt 3,423 0.02 Total British Commodity Futures Positions 11,654 0.07 Hong Kong Commodity Futures Positions, Held Long: 1 Oct '06 Hong Kong Hang Seng (674) (0.00) Total HK Commodity Futures Positions (674) (0.00) Total Commodity Futures Positions 126,816 0.74 Australian Commodity Futures Positions, Held Long: 1 Dec '06 SFE SPI 200 2,350 0.01 4 Dec '06 SFE 10 Y T-Note 3,003 0.02 Total Australian Commodity Futures Positions 5,352 0.03 Total Commodity Futures Positions 122,922 0.72 United States Commodity Futures Positions, Sold Short: 55 Dec '06 IMM Aust Dollar $20,350 0.12% 1 Dec '06 CMX Silver 6,185 0.04 5 Nov '06 CBOT Soybeans 17,525 0.10 0 Nov '06 NY Heating Oil 84 0.00 1 Dec '06 CSC Coffee 1,350 0.01 1 Dec '06 LME Copper 3,555 0.02 Total United States Commodity Futures Positions 49,049 1.13 The accompanying notes are an integral part of the financial statements. F-5 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) SCHEDULE OF INVESTMENTS SEPTEMBER 30, 2006 (A Review) European Commodity Futures Positions, Held Short: 10 Jun '07 LIF 3M Euribor (2,694) (0.02) British Commodity Futures Positions, Sold Short: 12 Jun '07 Lif 3M Sterling (4,490) (0.03) Total Commodity Futures Positions, Sold Short 41,865 0.24 Net Commodity Futures Positions 164,788 0.96 Cash and Cash Equivalents in Trading Accounts: Dec '06 United States Treasury Bill ($10,500,000 Face Value) 10,374,575 60.47 Nov '06 United States Treasury Bill ($1,800,000 Face Value) 1,777,205 10.36 Dec '06 United States Treasury Bill ($1,000,000 Face Value) 988,018 5.76 Nov '06 United States Treasury Bill ($1,00,000 Face Value) 987,675 5.76 Oct '06 United States Treasury Bill ($800,000 Face Value) 790,060 4.60 United States Markets 2,090,654 12.19 Euro Markets 377,106 2.20 British Pound Markets (369,305) (2.15) Australian Dollar Markets (85,187) (0.50) Hong Kong Dollar Markets 9,145 0.05 Japanese Yen Markets 52,510 0.31 Total Cash and Cash Equivalents in Trading Accounts 16,992,455 99.04 Total Investments $17,157,244 100.00% The accompanying notes are an integral part of the financial statements. F-6 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) SCHEDULE OF INVESTMENTS DECEMBER 31, 2005 Contracts Value Percent United States Commodity Futures Positions, Held Long: 68 Mar '06 CBOT Soybeans $(32,162) (0.19)% 62 Mar '06 CBT Bean Meal (29,140) (0.17) 62 Mar '06 CBT T-Bonds (9,688) (0.06) 76 Feb '06 CME Cattle 18,540 0.11 62 Mar '06 CMX HG Copper 19,200 0.11 8 Jan '06 LME Alum US 51,081 0.30 2 Mar '06 LME Alum US 1,087 0.01 1 Jan '06 LME Copper 13,022 0.08 58 Mar '06 CSC Sugar II 187,656 1.10 62 Mar '06 KC Wheat 4,288 0.03 62 Mar '06 IMM Mex Peso 11,963 0.07 2 Mar '06 IMM B-Pounds (6,400) (0.04) 5 Mar '06 IMM Canadian $ (2,200) (0.01) 19 Mar '06 CBOT Corn 8,800 0.05 2 Mar '06 CBOT Wheat 238 0.00 1 Feb '06 CMX Gold 2,260 0.01 1 Mar '06 CMX Silver 200 0.00 8 Mar '06 Emini S&P 500 (4,000) (0.02) 4 Feb '06 NY LT Crude 1,810 0.01 1 Feb '06 NY Heating Oil 3,352 0.02 1 Feb '06 NY Unlead Gas 7,178 0.04 1 Feb '06 NY Natural Gas (1,050) (0.01) Total United States Commodity Futures Positions 246,035 1.44 Japanese Commodity Futures Positions, Held Long: 5 Mar '06 SGX MINI JGB 2,117 0.01 4 Mar '06 SMX Nikkei 8,298 0.05 Total Japanese Commodity Futures Positions 10,415 0.06 European Commodity Futures Positions, Held Long: 3 Mar '06 DAB Dax Index 9,488 0.06 1 Mar '06 Eurex E-Bund 71 0.00 Total European Commodity Futures Positions 9,559 0.06 The accompanying notes are an integral part of the financial statements. F-7 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) SCHEDULE OF INVESTMENTS December 31, 2005 Contracts Value Percent British Commodity Futures Positions, Held Long: 5 Mar '06 NEW FTSE 100 $ 7,646 0.04 % 5 Mar '06 LIF Long Gilt 6,100 0.04 9 Sep '06 CAP 3M STG 21 0.00 Total British Commodity Futures Positions 13,767 0.08 Hong Kong Commodity Futures Positions, Held Long: 5 Jan '06 HG (9,511) (0.05) Total Hong Kong Commodity Futures Positions (9,511) (0.05) Australian Commodity Futures Positions, Held Long: 1 Mar '06 SFE SPI 200 2,459 0.02 6 Mar '06 SFE 10Y T-Bond 9,224 0.05 62 Mar '06 SFE 3Y T-Bond 7,581 0.04 Total Australian Commodity Futures Positions 19,264 0.11 Total Commodity Futures Positions 289,529 1.70 United States Commodity Futures Positions, Sold Short: 58 Mar '06 CBT T-Note 2Y (12,813) (0.08) 65 Mar '06 IMM Euro FX (28,656) (0.17) 65 Mar '06 IMM Euro DLR 23,825 0.14 3 Mar '06 CSC Coffee C (7,819) (0.05) 5 Mar '06 IMM J YEN (10,406) (0.06) Total United States Commodity Futures Positions (35,869) (0.22) The accompanying notes are an integral part of the financial statements. F-8 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) SCHEDULE OF INVESTMENTS December 31, 2005 Contracts Value Percent European Commodity Futures Positions, Held Short: 9 Sep '06 LIF 3M Euribar $ 399 0.00 % 2 Jan '06 3M Monep CAC40 EU (1,088) (0.01) 62 Mar '06 Euro E-Schatz (2,069) (0.01) Total Euro Commodity Futures Positions (2,758) (0.02) Total Commodity Futures Positions, Sold Short (38,627) (0.24) Net Commodity Futures Positions 250,902 1.46 Cash and Cash Equivalents in Trading Accounts: Mar '06 United States Treasury Bill ($10,900,000 Face Value) 10,795,349 63.24 Mar '06 United States Treasury Bill ($1,800,000 Face Value) 1,782,533 10.44 Feb '06 United States Treasury Bill ($1,100,000 Face Value) 1,089,456 6.38 Feb '06 United States Treasury Bill ($600,000 Face Value) 594,226 3.48 Jan '06 United States Treasury Bill ($580,000 Face Value) 574,508 3.36 United States Markets 1,516,844 8.88 Euro Markets 592,040 3.47 British Pound Markets (91,011) (0.53) Australian Dollar Markets (85,440) (0.50) Hong Kong Dollar Markets 1,724 0.01 Japanese Yen Markets 52,449 0.31 Total Cash and Cash Equivalents in Trading Accounts 16,822,678 98.54 Total Investments $17,073,580 100.00 % The accompanying notes are an integral part of the financial statements. F-9 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005 (A Review) Three months ended Nine months ended Sep 30, Sep 30, 2006 2005 2006 2005 INVESTMENT AND OTHER INCOME Interest income $185,790 $116,851 $511,365 $257,242 Redemption penalty Total Income 185,790 116,851 511,365 257,242 EXPENSES Commissions 324,841 433,036 1,248,492 1,166,995 Management fees 12,603 13,044 37,676 29,032 Continuing service fee - - - - Incentive fees 257,223 387,101 324,275 1,157,218 Professional accounting and legal fees 24,500 32,000 89,000 102,796 Other operating and administrative expenses 188 1,727 909 10,406 Total Expenses 619,355 866,908 1,700,352 2,466,447 Net Investment Loss (433,565) (750,057)(1,188,987)(2,209,205) REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS Realized gain (loss) from trading in futures 779,658 1,057,546 1,420,441 4,111,002 Realized gain (loss) on exchange rate fluctuation (1,700) (6,269) 31,847 (24,167) Changes in unrealized gains (losses) on open commodity open futures contracts 206,882 653,159 (86,112) 848,932 Total Realized and Unrealized Gain (Loss) on Investments 984,840 1,704,436 1,366,176 4,935,767 NET INCOME (LOSS) $551,275 $954,379 $177,189 $2,726,562 NET INCOME (LOSS) - Limited partnership unit $111.40 $191.63 $44.98 $583.46 General partnership unit $ $ $ $ The accompanying notes are an integral part of the financial statements. F-10 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) STATEMENTS OF PARTNERS' EQUITY FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005 (A Review) 2006 2005 Amount Units Amount Units Beginning balance- January 1, $16,841,781 5,016.79 $11,790,949 4,316.80 Partner additions 758,150 228.37 2,590,950 870.95 Syndication redistribution costs 11,310 47,651 Partner withdrawals (929,023) (289.53) (387,318) (137.35) Net Income 177,189 2,726,562 Balance at September 30, $16,859,407 4,955.63 $16,768,794 5,050.40 2006 2005 Value per unit $3,402.07 $3,320.29 Total partnership units 4,955.63 5,050.40 The accompanying notes are an integral part of the financial statements. F-11 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005 (A Review) 2006 2005 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 177,189 $2,726,562 Adjustments to reconcile net income to net cash provided by operating activities - Changes in unrealized gains 86,114 (848,932) Changes in operating assets and liabilities - Accrued interest receivable (17,714) (10,557) Accrued/ prepaid commissions - - Accrued management and incentive fees 85,788 37,133 Prepaid incentive fees - - Other payables and accruals (50,007) (33,820) Net Cash Provided By Operating Activities 281,370 1,870,386 CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from sale of units, net of sales commissions 758,150 2,590,950 Syndication costs 11,310 47,651 Partner redemptions (929,023) (387,318) Net Cash Used In Financing Activities (159,563) 2,251,283 NET INCREASE IN CASH AND CASH EQUIVALENTS 121,807 4,121,669 CASH AND CASH EQUIVALENTS Beginning of period 16,910,682 12,298,533 End of period $17,032,489 $16,420,202 End of period cash and cash equivalents consists of: Cash and cash equivalents in broker trading accounts $16,992,456 $16,349,124 Cash 40,033 71,078 $17,032,489 $16,420,202 The accompanying notes are an integral part of the financial statements. F-12 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2006 AND 2005 AND DECEMBER 31, 2005 (A Review) 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES 'Atlas Futures Fund, Limited Partnership (the "Fund") was formed January 12, 1998 under the laws of the State of Delaware. The Fund is engaged in the speculative trading of futures contracts in commodities, which commenced in October, 1999. Ashley Capital Management, Inc.("Ashley") and Michael Pacult are the General Partners and the commodity pool operators ("CPO's") of the Fund. The commodity trading advisors ("CTA's") are Clarke Capital Management, Inc. ("Clarke") and NuWave Investment Corp. ("NuWave"), effective February, 2005, and who have the authority to trade as much of the Fund's equity as is allocated to them by the General Partner that is currently estimated to be 97% of total equity. Prior to July, 2004, the principal selling agent was Futures Investment Company ("Futures"), which is controlled by Michael Pacult and his wife. Effective July, 2004 the Fund began to sell direct on a best efforts basis with no commissions or continuing service fees. Interim Financial Statements - The balance sheet as of September 30, 2006, including the September 30, 2006 schedule of investments, and the statements of operations for the three and nine months ended September 30, 2006 and 2005, and the statements of partners' equity and cash flows for the nine months ended September 30, 2006 and 2005 are unaudited. In the opinion of management, such financial statements reflect all adjustments, which were of a normal and recurring nature, necessary for a fair presentation of financial position as of September 30, 2006 and the results of operations and cash flows for the nine months ended September 30, 2006 and 2005. Regulation - The Fund is a registrant with the Securities and Exchange Commission (SEC) pursuant to the Securities and Exchange Act of 1933 (the Act). The Fund is subject to the regulations of the SEC and the reporting requirements of the Act. The Fund is also subject to the regulations of the Commodities Futures Trading Commission (CFTC), an agency of the U.S. government which regulates most aspects of the commodity futures industry, the rules of the National Futures Association and the requirements of various commodity exchanges where the Fund executes transactions. Additionally, the Fund is subject to the requirements of futures commission merchants and interbank market makers through which the Fund trades and regulated by commodity exchanges and by exchange markets that may be traded by the advisor. Registration Costs - Costs incurred for the initial filings with the Securities and Exchange Commission, Commodity Futures Trading Commission, National Futures Association (the "NFA") and the states where the offering was made were accumulated, deferred and charged against the gross proceeds of offering at the initial closing as part of the offering expense. The Fund remains open to new partners, and incurs costs required to retain the ability to issue new units. Such costs are treated in a similar manner. Costs of recurring annual and quarterly filings with regulatory agencies are expensed as incurred. Revenue Recognition - Commodity futures contracts are recorded on the trade date and are reflected in the balance sheet at the difference between the original contract amount and the market value on the last business day of the reporting period. Market value of commodity futures contracts is based upon exchange or other applicable market best available closing quotations. F-13 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2006 AND 2005 AND DECEMBER 31, 2005 (A Review) 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Use of Accounting Estimates - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount 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 these estimates. Income Taxes - The Fund is not required to provide a provision for income taxes. Income tax attributes that arise from its operations are passed directly to the individual partners. The Fund may be subject to state and local taxes in jurisdictions in which it operates. Reclassifications - Certain reclassifications have been made to the 2004 financial statements to conform to the 2005 presentation. Statement of Cash Flows - For purposes of the Statement of Cash Flows, the Fund considers only cash and money market funds to be cash equivalents. Net cash provided by operating activities include no cash payments for interest or income taxes for the periods ended September 30, 2006 and 2005. Foreign Currency Transactions - The Fund's functional currency is the U.S. dollar; however, it transacts business in currencies other than the U.S. dollar. Assets and liabilities denominated in currencies other than U.S. dollar are translated into U.S. dollars at the rates in effect at the date of the statement of financial condition. Income and expense items denominated in currencies other than the U.S. dollar are translated into U.S. dollars at the rates in effect at each month end. Gains and losses resulting from the translation to U.S. dollars are reported in income currently. 2. GENERAL PARTNER DUTIES The responsibilities of the General Partner, in addition to directing the trading and investment activity of the Fund, include executing and filing all necessary legal documents, statements and certificates of the Fund, retaining independent public accountants to audit the Fund, employing attorneys to represent the Fund, reviewing the brokerage commission rates to determine reasonableness, maintaining the tax status of the Fund as a limited partnership, maintaining a current list of names, addresses and numbers of units owned by each Limited Partner and taking such other actions as deemed necessary or desirable to manage the business of the Partnership. If the daily net unit value of the partnership falls to less than 50% of the highest value earned through trading at the close of any month, then the General Partner will immediately suspend all trading, provide all limited partners with notice of the reduction and give all limited partners the opportunity, for fifteen days after such notice, to redeem partnership interests. No trading will commence until after the lapse of the fifteen day period. F-14 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2006 AND 2005 AND DECEMBER 31, 2005 (A Review) 3. THE LIMITED PARTNERSHIP AGREEMENT The Limited Partnership Agreement provides, among other things, that: Capital Account - A capital account shall be established for each partner. The initial balance of each partner's capital account shall be the amount of the initial contributions to the partnership. Monthly Allocations - Any increase or decrease in the Partnership's net asset value as of the end of a month shall be credited or charged to the capital account of each Partner in the ratio that the balance of each account bears to the total balance of all accounts. Any distribution from profits or partners' capital will be made solely at the discretion of the General Partners. Federal Income Tax Allocations - As of the end of each fiscal year, the Partnership's realized capital gain or loss and ordinary income or loss shall be allocated among the Partners, after having given effect to the fees and expenses of the Fund. Subscriptions - Investors must submit subscription agreements and funds at least five business days prior to month end. Subscriptions must be accepted or rejected by the general partner within five business days. The investor also has five business days to withdraw his subscription. Funds are deposited into an interest bearing escrow account and will be transferred to the Fund's account on the first business day of the month after the subscription is accepted. Interest earned on the escrow funds will accrue to the account of the investor. Redemptions - A limited partner may request any or all of his investment be redeemed at the net asset value as of the end of a month. The written request must be received by the general partner no less than ten business days prior to a month end. Redemptions will generally be paid within twenty days of the effective month end. However, in various circumstances due to liquidity, etc. the general partner may be unable to comply with the request on a timely basis. Redemption fees are charged during the first 24 months of investment based on a sliding scale (4% - 0%). Effective January 1, 2004, redemption penalties are no longer charged. 4. FEES Prior to January 1, 2004, the Fund was charged the following fees: A monthly management fee of 2% (annual rate) of the Fund's net assets allocated to the Fund's Corporate General Partner. A quarterly incentive fee of 25% of "new net profits" was paid to each CTA. "New net profits" includes all income earned by each CTA and expense allocated to his activity. In the event that trading produced a loss, no incentive fees would be paid and all losses would be carried over to the following months until profits from trading exceeded the loss. It was possible for one CTA to be paid an incentive fee during a quarter of a year when the Fund experienced a loss. F-15 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2006 AND 2005 AND DECEMBER 31, 2005 (A Review) 4. FEES - CONTINUED The Fund pays a combination of fixed commissions and continuing service fees of 9% (annual rate) of assets assigned to be traded, payable monthly, to the Introducing Broker affiliated with the General Partner. The Affiliated Introducing Broker will pay the costs to clear the trades to the futures commission merchant and all PIT Brokerage costs which shall include the NFA and exchange fees. Effective January 1, 2004, the Fund is charged the following fees: A monthly commission of 7% (annual rate) of the Fund's assets on deposit with the futures commission merchant. The Corporate General Partner is responsible for payments of brokerage commission and fees to the futures commission merchant. The quarterly incentive fee of 25% of "new trading profits" is paid to Clarke Trading for assets traded in their account. A monthly continuing service fee of 4% (annual rate) of the investment in the Fund (as defined) will be paid to the selling agent. Effective June 1, 2004, the monthly commission was changed from 7% to 11% and the continuing service fee was eliminated. Effective February 1, 2005, the Fund added a new CTA, NuWave. Nu Wave's quarterly incentive fee is 20% of "new net profits" and also receives a monthly management fee of 2% (annualized) on the first $2,000,000 in allocated equity and 1% on the allocated equity above $2,000,000. NuWave was allocated $2,000,000 in equity on February 1, 2005. The Corporate General Partner reserves the right to change the fee structure at its sole-discretion. See the Subsequent Events note for an additional change to the Fund fee structure. 5. RELATED PARTY TRANSACTIONS The Fund paid the following expenses to related parties during the nine months ended September 30, 2006 and 2005 2006 2005 Commission/Management Fee - Ashley $432,958 $1,046,158 Commission/Management Fee - FIC 815,535 - Total $1,248,492 $1,046,158 F-16 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2006 AND 2005 AND DECEMBER 31, 2005 (A Review) 5. RELATED PARTY TRANSACTIONS- CONTINUED Financial Accounting Standards Board Interpretation No. 45, Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others, identifies certain disclosures to be made by a guarantor in its financial statements about its obligations under certain guarantees that it has issued. In the normal course of business, the Fund has provided general indemnifications to the General Partner, its CTA and others when they act, in good faith, in the best interests of the Fund. The Fund is unable to develop an estimate for future payments resulting from unasserted and unknown claims, but expects the risk of having to make any payments under these indemnifications to be remote. 6. TRADING ACTIVITIES AND RELATED RISKS The Fund is engaged in speculative trading of U.S. and foreign futures contracts in commodities. The Fund is exposed to both market risk, the risk arising from changes in market value of the contracts, and credit risk, the risk of failure by another party to perform according to the terms of a contract. A certain portion of cash and Treasury Bills in trading accounts are pledged as collateral for commodities trading on margin. Additional deposits may be necessary for any loss on contract value. The Commodity Exchange Act requires a broker to segregate all customer transactions and assets from such broker's proprietary activities. Each U.S. commodity exchange, with the approval of the CFTC, and the futures commission merchant establish minimum margin requirements for each traded contract. The futures commission merchant may increase the margin requirements above these minimums for any or all contracts. In general, the amount of required margin should never fall below 10% of the Net Asset Value. The cash deposited in trading accounts at September 30, 2006 and December 31, 2005 was $2,074,924 and $1,986,606, respectively, which equals approximately 12% and 12% of Net Asset Value, respectively. The Fund also purchases United States Treasury bills as a form of margin. At September 30, 2006 and December 31, 2005, $14,969,320 and $14,917,532 respectively, was invested in U.S. Treasury Bills, which approximates 88% and 88% of Net Asset Value, respectively. F-17 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2006 AND 2005 AND DECEMBER 31, 2005 (A Review) 6. TRADING ACTIVITIES AND RELATED RISKS- CONTINUED Trading in futures contracts involves entering into contractual commitments to purchase or sell a particular commodity at a specified date and price. The gross or face amount of the contract, which is typically many times that of the Fund's net assets being traded, significantly exceeds the Fund's future cash requirements since the Fund intends to close out its open positions prior to settlement. As a result, the Fund is generally subject only to the risk of loss arising from the change in the value of the contracts. The market risk is limited to the gross or face amount of the contracts held of $26,177,110 and $44,907,000 on long positions at September 30, 2006 and December 31, 2005, respectively. However, when the Fund enters into a contractual commitment to sell commodities, it must make delivery of the underlying commodity at the contract price and then repurchase the contract at prevailing market prices or settle in cash. Since the repurchase price to which a commodity can rise is unlimited, entering into commitments to sell commodities exposes the Fund to unlimited potential risk. Market risk is influenced by a wide variety of factors including government programs and policies, political and economic events, the level and volatility of interest rates, foreign currency exchange rates, the diversification effects among the derivative instruments the Fund holds and the liquidity and inherent volatility of the markets in which the Fund trades. The unrealized gains on open commodity futures contracts at September 30, 2006 and December 31, 2005 were $164,788 and $250,092, respectively. Open contracts generally mature within three months. As of September 30, 2006, the latest maturity date for open futures contracts is June, 2007. However, the Fund intends to close all contracts prior to maturity. Credit risk is the possibility that a loss may occur due to the failure of a counter party to perform according to the terms of a contract. The Fund has a substantial portion of its assets on deposit with financial institutions. In the event of a financial institution's insolvency, recovery of Fund deposits may be limited to account insurance or other protection afforded deposits. The Fund has established procedures to actively monitor market risk and minimize credit risk although there can be no assurance that it will succeed. The basic market risk control procedures consist of continuously monitoring open positions, diversification of the portfolio and maintenance of a desirable margin-to-equity ratio. The Fund seeks to minimize credit risk primarily by depositing and maintaining its assets at financial institutions and brokers which it believes to be creditworthy. F-18 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2006 AND 2005 AND DECEMBER 31, 2005 (A Review) 7. FINANCIAL HIGHLIGHTS Three months ended Nine months ended September 30, September 30, 2006 2005 2006 2005 Performance per Unit (5) Net unit value, beginning of period $3,290.67 $3,128.46 $3,357.08 $2,731.41 Net realized and unrealized gains/losses on commodity transactions 198.69 342.43 282.91 1,061.63 Investment and other income 37.40 23.46 102.32 55.05 Expenses (1) (124.69) (174.06) (340.24) (527.80) Net increase (decrease) for the period 111.40 191.83 44.99 588.88 Net unit value, end of period $3,402.07 $3,320.29 $3,402.07 $3,320.29 Net assets, end of period (000) $16,859 $16,769 $16,859 $16,769 Total return (3) 3.39% 6.13% 1.34% 21.56% Ratio to average net assets (4) Investment and other income 4.68% 2.89% 4.20% 2.39% Expenses (2) (7.41)% (10.74)% (3.71)% (12.08)% (1) Includes brokerage commissions (2) Excludes brokerage commissions (3) Not annualized (4) Annualized for all periods (5) Investment and other income and expenses is calculated using average number of units outstanding during the year. Net realized and unrealized gains/losses on commodity transactions is a balancing amount necessary to reconcile the change in net unit value. F-19 ATLAS FUTURES FUND, LIMITED PARTNERSHIP (A Delaware Limited Partnership) NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2006 AND 2005 AND DECEMBER 31, 2005 (A Review) 8. SUBSEQUENT EVENTS Effective October 2006, we changed the auditor of the Fund from Frank L. Sassetti & Co., 6611 West North Avenue, Oak Park, Illinois 60302-1043 to the CPA firm of Jordan, Patke & Associates, Ltd., 300 Village Green Drive, Suite 210, Lincolnshire, Illinois 60069. Effective December 1, 2006, the management fee to NuWave Investment Corporation will be increased from 2% annually on the first $2,000,000 of equity assigned and 1% annually on the equity over $2,000,000 to a percentage based on the rate of trading assigned by NuWave and approved by the General Partner of up to 3% annually on the first $2,000,000 of equity and up to 2% annually on all equity over $2,000,000. The bookkeeping will be transferred from Michael Liccar & Company, Certified Public Accountants, 200 West Adams Street, Suite 2211, Chicago, Illinois 60606-5208 to Shoup Accounting Services, Certified Public Accountants, 306 South West Street, Angola, Indiana 46703. Shoup is an accounting expert that will maintain a duplicate set of the Fund's books and records and handle the Fund's accounting. F-20 EX-31 2 a10q0906ex3101.txt Exhibit 31.01 CERTIFICATION I, Michael Pacult, chief executive office and chief financial officer of Ashley Capital Management, Inc., the general partner of Atlas Futures Fund, Limited Partnership (the "Fund" or the "Registrant"), do hereby certify that: 1. I have reviewed this quarterly report on Form 10-Q of the Fund; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (c) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonable likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. By: /s/ Michael Pacult Michael Pacult Date: November 15, 2006 EX-32 3 a10q0906ex3201.txt EXHIBIT 32.01 CERTIFICATION BY CHIEF EXECUTIVE OFFICER & CHIEF FINANCIAL OFFICER I, Michael Pacult, the Chief Executive Officer and Chief Financial Officer of Ashley Capital Management, Inc. as general partner of Atlas Futures Fund, L.P., certify that (i) the Form 10Q for the period ended September 30, 2006 of Atlas Futures Fund, L.P. fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (ii) the information contained in the Form 10Q for the period ended September 30, 2006 fairly presents, in all material respects, the financial condition and results of operations of Atlas Futures Fund, L.P. ATLAS FUTURES FUND, LIMITED PARTNERSHIP By: Ashley Capital Management, Inc., General Partner By: /s/ Michael Pacult Michael Pacult Chief Executive Officer & Chief Financial Officer Date: November 15, 2006 -----END PRIVACY-ENHANCED MESSAGE-----