10-Q

U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

x	Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the quarterly period ended March 31, 2014
o	Transition Report Pursuant to 13 or 15(d) of the Securities Exchange Act of 1934
	For the transition period of              to

Commission File Number 0-7865.

SECURITY LAND AND DEVELOPMENT CORPORATION

(Exact name of issuer as specified in its charter)

Georgia	58-1088232
(State or other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)

2816 Washington Road, #103, Augusta, Georgia 30909

(Address of Principal Executive Offices)

Issuers Telephone Number (706) 736-6334

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Year)

Check whether the Issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. 

See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in rule 12b-2 of the Exchange Act.

Large accelerated filer  o	Accelerated filer o
Non-accelerated filer o (Do not check if a smaller reporting company)	Smaller reporting company x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  YES x    NO  o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

oYes      xNo

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date.

Class	Outstanding at May 12, 2014
Common Stock, $0.10 Par Value	5,243,107 shares

Table of Contents

SECURITY LAND AND DEVELOPMENT CORPORATION

Form 10-Q

Index

Part I	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Balance Sheets as of March 31, 2014 and September 30, 2013	1
	Consolidated Statements of Income and Retained Earnings for the Three Month Periods ended and for the Six Month Periods ended March 31, 2014 and 2013	2
	Condensed Consolidated Statements of Cash Flows for the Three Month Periods ended and for the Six Month Periods ended March 31, 2014 and 2013	3
	Notes to the Consolidated Financial Statements	4-7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	8-9
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	9
Item 4.	Controls and Procedures	9-10
Part II	OTHER INFORMATION	10
Item 1.	Legal Proceedings	10
Item 1A.	Risk Factors	10
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	10
Item 3.	Defaults Upon Senior Securities	10
Item 4.	Reserved for Future Use	10
Item 5.	Other Information	10
Item 6.	Exhibits	10
	SIGNATURES	11-13

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

SECURITY LAND AND DEVELOPMENT CORPORATION
CONSOLIDATED BALANCE SHEETS
		March 31,	September 30,
		2014		2013
		(unaudited)
ASSETS
CURRENT ASSETS
Cash	$	24,014	$	24,599
Receivables from tenants, net of allowance of $19,938
at March 31, 2014 and September 30, 2013		416,908		497,324
Prepaid property taxes		-		15,003
Total current assets		440,922		536,926
INVESTMENT PROPERTIES
Investment properties for lease, net of accumulated depreciation		5,357,358		5,415,447
Land and improvements held for investment or development		3,639,598		3,639,598
		8,996,956		9,055,045
OTHER ASSETS		72,401		76,188
	$	9,510,279	$	9,668,159
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses	$	283,270	$	325,720
Income taxes payable		122,209		183,236
Current maturities of notes payable		605,470		584,491
Current maturities of deferred revenue		24,652		24,652
Total current liabilities		1,035,601		1,118,099
LONG-TERM LIABILITIES
Notes payable, less current portion		2,503,482		2,807,314
Deferred income taxes		765,199		764,645
Deferred revenue, less current portion		4,093		16,419
Note payable to stockholder		50,015		-
Total long-term liabilities		3,322,789		3,588,378
Total liabilities		4,358,390		4,706,477
STOCKHOLDERS' EQUITY
Common stock, par value $.10 per share; 30,000,000 shares authorized;
5,243,107 shares issued and outstanding		524,311		524,311
Additional paid-in capital		333,216		333,216
Retained earnings		4,294,362		4,104,155
Total Stockholders' Equity		5,151,889		4,961,682
Liabilities and Stockholders' Equity	$	9,510,279	$	9,668,159
The accompanying notes are an integral part of these consolidated financial statements.

-1-

SECURITY LAND AND DEVELOPMENT CORPORATION CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
	For the Three Month				For the Six Month
	Period Ended March 31,				Period Ended March 31,
	2014		2013		2014		2013
	(unaudited)		(unaudited)		(unaudited)		(unaudited)
OPERATING REVENUE
Rent Revenue	$	360,252	$	362,950	$	734,000	$	722,053
OPERATING EXPENSES
Depreciation and amortization		32,938		32,948		65,875		65,896
Property taxes		64,107		69,736		131,970		134,361
Payroll and related costs		19,930		21,796		40,063		44,275
Insurance and utilities		10,500		5,674		18,135		19,693
Repairs and maintenance		9,550		4,876		33,270		14,086
Professional services		28,576		31,390		40,156		49,390
Bad debt expense (recovery)		-		(1,580)		-		2,825
Other		1,969		8,907		2,573		13,634
		167,570		173,747		332,042		344,160
Operating income		192,682		189,203		401,958		377,893
OTHER EXPENSE
Interest		(47,970)		(68,039)		(95,369)		(123,651)
Income before income taxes		144,712		121,164		306,589		254,242
INCOME TAXES PROVISION (BENEFIT)
Income Tax Expense		53,897		47,603		115,828		97,096
Income Tax Deferred Expense (Benefit)		1,035		(1,610)		554		(967)
		54,932		45,993		116,382		96,129
Net income		89,780		75,171		190,207		158,113
RETAINED EARNINGS, BEGINNING OF PERIOD		4,204,582		3,804,812		4,104,155		3,721,870
RETAINED EARNINGS, END OF PERIOD	$	4,294,362	$	3,879,983	$	4,294,362	$	3,879,983
PER SHARE DATA
Net income per common share	$	0.02	$	0.01	$	0.04	$	0.03
The accompanying notes are an integral part of these consolidated financial statements.

-2-

SECURITY LAND AND DEVELOPMENT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
		For the Three Month				For the Six Month
		Period Ended March 31,				Period Ended March 31,
		2014		2013		2014		2013
		(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)
OPERATING ACTIVITIES
Net income	$	89,780	$	75,171	$	190,207	$	158,113
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization		32,938		32,948		65,875		65,896
Deferred income tax		1,035		(1,610)		554		(967)
Changes in deferred and accrued amounts:		(30,032)		37,973		(20,383)		28,565
Net cash provided by operating activities		93,721		144,482		236,253		251,607
INVESTING ACTIVITIES
Additions to investment properties and other assets for
improvements to property held for lease		(4,000)		-		(4,000)		-
Net cash used in investing activities		(4,000)		-		(4,000)		-
FINANCING ACTIVITIES
Proceeds from note payable		4,007		-		4,007		-
Repayments to stockholder		-		-		-		(30,000)
Proceeds from stockholder		50,015		-		50,015		30,000
Principal payments on notes payable		(144,710)		(139,416)		(286,860)		(270,174)
Net cash used in financing activities		(90,688)		(139,416)		(232,838)		(270,174)
Net increase (decrease) in cash		(967)		5,066		(585)		(18,567)
CASH, BEGINNING OF PERIOD		24,981		25,134		24,599		48,767
CASH, END OF PERIOD	$	24,014	$	30,200	$	24,014	$	30,200
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	$	52,733	$	60,277	$	100,132	$	115,889
Cash paid for income taxes	$	86,835	$	15,000	$	86,835	$	40,000
NON-CASH FINANCING ACTIVITIES
Refinancing of line of credit to term note	$	-	$	-	$	-	$	301,170
The accompanying notes are an integral part of these consolidated financial statements.

-3-

SECURITY LAND AND DEVELOPMENT CORPORATION

Notes to the Consolidated Financial Statements

Note  1 – Basis of Presentation

The accompanying unaudited consolidated financial statements were prepared in accordance with instructions for Form 10-Q, Article 8 of Regulation S-X and accounting principles generally accepted in the United States of America; therefore, they do not include all disclosures necessary for a complete presentation of financial condition, results of operations, and cash flows.  Such statements are unaudited but, in the opinion of management, reflect all adjustments, which are of a normal recurring nature and necessary for a fair presentation of results for the selected interim periods.  Users of financial information produced for interim periods are encouraged to refer to the footnotes contained in the audited financial statements appearing in our Form 10-K for the year ended September 30, 2013 when reviewing these interim financial statements.

The financial statements include estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from those estimates.  The consolidated financial statements include the accounts of Security Land and Development Corporation and its four wholly owned subsidiaries, Royal Palms Motel, Inc., SLDC, LLC, SLDC 2, LLC and SLDC III, LLC (described on a consolidated basis as the “Company”).  Significant intercompany transactions and accounts are eliminated in consolidation.

Critical Accounting Policies:

Estimates of Useful Lives of Investment Properties for Purposes of Depreciation

Management has estimated useful lives of investment properties, except for land, that are leased, and the Company utilizes the straight-line method to compute depreciation over the estimated useful lives of the investment properties.  Actual depreciation of investment properties will vary from management’s estimates, and the value of investment properties is more directly impacted by market conditions and the physical condition of the investment properties.

Evaluation of Long-Lived Assets for Impairment

The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of investment properties may not be recoverable.  In evaluating recoverability, the Company generally estimates future cash flows expected to result from the use of the asset and its eventual disposition.  An impairment loss is recognized when the expected future cash flows of the asset are less than the carrying amount.

Estimates of Income Tax Rates Applicable to Deferred Taxes

The Company has deferred income taxes through a series of tax-deferred like-kind exchange transactions on certain investment properties and through accelerated depreciation elections on certain other assets.  Actual income taxes that may become due when taxable gains are realized on the sale of assets may differ from management’s estimates as a result of changes in tax laws, the tax status of the Company, or the actual taxable earnings of the Company in the periods the deferred income taxes become due.

Refer to the Company’s Form 10-K for the year ended September 30, 2013 for further information regarding its critical accounting policies.

- 4 -

Note  2 – Investment Properties

Investment properties leased or held for lease to others under operating leases consisted of the following at
March 31, 2014 and September 30, 2013:

	March 31,			September 30,
	2014			2013
	(unaudited)
National Plaza building, land and improvements	$	5,142,796		$	5,138,796
Evans Ground Lease, land and improvements	2,382,673			2,382,673
Commercial land and improvements	3,639,598			3,639,598
	11,165,067			11,161,067
Less accumulated depreciation	(2,281,809		)	(2,221,077		)
	8,883,258			8,939,990
Residential rental property	145,847			145,847
Less accumulated depreciation	(32,149		)	(30,792		)
	113,698			115,055
Investment properties for lease, net of accumulated depreciation	$	8,996,956		$	9,055,045

Depreciation expense totaled approximately $31,000 for the three-month periods and $62,000 for the six-month periods ended March 31, 2014 and 2013, respectively.

The National Plaza is a retail strip center located on Washington Road in Augusta Georgia.  Approximately 81% of the rentable space at the National Plaza is leased to Publix Supermarkets, Inc., the National Plaza’s anchor tenant. 

The Company entered into a long-term ground lease with a major national tenant and its developer in May 2006 on approximately 18 acres of land in Columbia County, Georgia.  The agreement required monthly rental payments of $20,833 during the development period, which was completed in January 2007.  Following the expiration of the development period, the lease requires annual rental payments of $500,000 for the first 5 years then increasing 5% in years 6, 11, and 16.  The lessee has an option to renew at year 21 and another option every 5 years thereafter for a possible total lease term of 50 years.  The lease provides for the tenant to pay for insurance and property taxes. The Company is recognizing rents on a straight-line basis over the initial lease term.  In July 2013, the Company sold approximately .24 acres of the total Evans ground Lease tract for $156,000.  The Company recognized a gain of approximately $108,000.  The proceeds were used by the Company to pay down debt related to an outstanding note payable collateralized by the Evans Ground Lease and related land and to compensate the Evans Ground Lease tenant per the related agreement.

The Company holds several parcels of land for investment or development purposes, including 19.38 acres of land in North Augusta, South Carolina, purchased in parcels during 2007 and 2008.  The Company also owns approximately 85 acres of land in south Richmond County, Georgia and a 1.1 acre parcel along Washington Road in Augusta, Georgia that adjoins the Company’s National Plaza investment property.  The aggregate costs of these investment properties held for investment or development was $3,639,598 at March 31, 2014 and September 30, 2013.

Refer to the Company’s Form 10-K for the year ended September 30, 2013 for further information on operating lease agreements and land held for investment or development purposes.

- 5 -

Note  3 – Notes Payable

Notes payable consisted of the following at:

	March 31,    2014		September 30,    2013
	(unaudited)
A line of credit with a regional financial institution for up to $251,934 procured in March 2008 with a floating interest rate based on prime and originally payable in full in April 2009. In April 2009 the Company refinanced the $243,019 line of credit with a regional financial institution. The Company entered into an agreement with the same regional financial institution to borrow the outstanding balance of $243,019, bearing interest based on the greater of prime or 6% with interest payments due monthly, maturing in April 2010.  In January 2010 the Company renewed this line of credit and increased the open balance to $300,250. This agreement originally matured in February 2011. In December 2010, the Company renewed the line of credit to December 5, 2011, at the greater of prime plus 1% or 6%.  In December 2011, the Company renewed the line of credit to December 12, 2012, at the greater of prime plus 1% or 6%.  In November of 2012, the Company converted the line of credit to a fixed rate loan due December 2017. The new term loan accrues interest at a 5.5% annually with monthly installments of $3,287. The current balance relates to the purchase of the 1 acre adjoining the North Augusta, South Carolina property in May 2008 and is collateralized by the residential property on Stanley Drive in Augusta, Georgia.	$	272,532	$	284,531
A note payable to an insurance company, secured with a mortgage interest in National Plaza and an assignment of rents. The note is payable in monthly installments of $35,633, including interest, through June 2015, and bears interest at a fixed rate of 7.875%.	507,449		696,892
A note payable to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The note is payable in monthly installments of $7,563, including principal and interest, through July 2018, and bears interest at a fixed rate of 5%.	356,530		392,945
A note payable to an insurance company collateralized with approximately 18 acres of land in Columbia County, Georgia, and an assignment of the long-term ground lease. The note is payable in monthly installments of $17,896, including interest, through May 1, 2027, and bears interest at a fixed rate of 5.85%.	1,968,434		2,017,437
A construction loan to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The loan was procured to finance tenant improvements for the lease of in-line space at National Plaza executed on January 17, 2014. Subsequent to March 31, 2014 construction of the tenant improvements was completed and with total principal borrowed of $186,000. Once all related construction payments have been made the loan will convert to a note payable with monthly installments of $3,727 including interest over a 60 month term with fixed interest of 4.5%. The related lease agreement calls for monthly payments of this amount to be paid to the Company in addition to monthly minimum rental payments. The tenant opened for business on April 16, 2014.	4,007		-
An unsecured and uncollateralized note payable to a stockholder, who is also a member of the Flanagin Family, to meet the cash flow needs of the Company.  The note matures in July of 2015 and accrues interest at 5%.	50,015		-
	3,158,967		3,391,805
Less current maturities	(605,470)		(584,491)
	$	2,553,497	$	2,807,314

-6-

Management of the Company expects future liquidity needs of the Company to be funded from rent revenues, refinancing and the appreciation in investment properties (which can be sold or mortgaged, if necessary).  Additionally, funding can be obtained from members of the Company’s Board of Directors.

Current maturities of notes payable will require the Company to make payments over the next 12 months totaling $605,470.  The Company projects that it will be able to fund the payment of its current maturities of notes payable through cash flows generated from its operations and cash on hand, but there can be no assurance that this will occur.

If the Company is unsuccessful in their efforts described above, the Company intends to seek additional financing or sell certain of its assets.

Note  4 – Income Taxes

The Company has a total outstanding income tax payable in the amount of $122,209 at March 31, 2014.  Of this amount, $115,828 is related to the fiscal year 2014 tax liability and $6,381 is related to 2013 tax expense. At September 30, 2013 the Company had a total of $183,236 in income tax payable.

Note  5 – Concentrations

Substantially all of the Company’s assets consist of real estate located in Richmond and Columbia Counties in the state of Georgia and in North Augusta, South Carolina.  Approximately 99% of the Company’s revenues are earned from two of the Company’s investment properties, National Plaza and the Evans Ground Lease, which comprise approximately 52% and 47% of the Company’s revenues, respectively.   The anchor tenant for National Plaza, Publix Supermarkets, Inc. (“Publix”), a regional food supermarket chain, leases approximately 81% of the space at National Plaza.  The Company generates approximately 37% of its revenues though its lease with Publix.

Note  6 –  Related Party Transactions

The Company hired an attorney who sits on the Company’s Board of Directors and who also serves a Vice President of the Company, to represent the Company in a legal matter regarding a tenant’s claim for reimbursement of certain expenses charged.  It is the opinion of the Company’s management that the Company is not liable for this claim.

During the second quarter of fiscal 2014, the Company borrowed $50,015 from a stockholder, who is also a member of the Flanagin family, to meet cash flow needs.  The amount matures in July 2015 and accrues interest at a rate of 5%.

- 7 -

Item  2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Results of Operations:

The Company’s results of operations for the six months ended March 31, 2014, and a comparative analysis of the same period for 2013 are presented below:

					Increase (Decrease)
					2014 compared to 2013
	2014		2013		Amount		Percent
Rent revenue	$	734,000	$	722,053	$	11,947	2	%
Operating expenses	332,042		344,160		(12,118)		-4	%
Interest expense	95,369		123,651		(28,282)		-23	%
Income tax expense	116,382		96,129		20,253		21	%
Net income	190,207		158,113		(32,094)		20	%

Rent revenue consists primarily of rent revenue from the Company’s National Plaza, a strip center on Washington Road in Augusta, Georgia, and the Evans Ground Lease in Evans, Georgia.  The Company also earned rent revenue from a ground lease with an auto-repair service operation on an out parcel of National Plaza. 

Refer to the Company’s Form 10-K for the year ended September 30, 2013 for further information regarding the properties owned and their lease terms.

Total operating expenses for the six months ended March 31, 2014 decreased slightly compared to the same period for 2013 due primarily to decreased professional fees.  Professional fees decreased due to decreased legal fees compared to the prior year related to an ongoing dispute over a tenant’s claim for reimbursement of certain expenses charged.  This dispute is unresolved as of March 31, 2014. It is the opinion of the Company’s management that the Company does not owe any reimbursement.  Management expects operating expenses for the remainder of the current fiscal year to be comparable to the current operating period.

Interest expense for the six month period ended March 31, 2014 decreased compared to 2013 due to the decrease in debt resulting from scheduled principle payments. Management expects interest expense for the remainder of the current fiscal year to increase compared with the first six months due to new notes payable.

Income tax expense for the six month period ended March 31, 2014 increased compared to the same period for 2013 due mainly to lower interest and operating expenses as noted above.  Management expects income tax expense for the remainder of the current fiscal year to be comparable to the current operating period.

- 8 -

Liquidity and Sources of Capital:

The Company’s ratio of current assets to current liabilities at March 31, 2014 was 43%.  The ratio was 48% at September 30, 2013. 

Management of the Company expects future liquidity needs of the Company to be funded from rent revenues, refinancing and the appreciation in investment properties (which can be sold or mortgaged, if necessary).  Additionally, funding can be obtained from members of the Board of Directors.

Current maturities of notes payable will require the Company to make payments over the next 12 months totaling $605,470.  The Company projects that it will be able to fund the payment of its current maturities of notes payable through cash flows generated from its operations and cash on hand, but there can be no assurance that this will occur.

If the Company is unsuccessful in their efforts described above, the Company intends to seek additional financing, sell certain of its fully owned and un-collateralized assets or borrow money from certain stockholders.

Cautionary Note Regarding Forward-Looking Statements:

The results of operations for the six-month period ended March 31, 2014 are not necessarily indicative of the results that may be expected for the entire fiscal year.  The Company may, from time to time, make written or oral forward-looking statements, including statements contained in the Company’s filings with the Securities and Exchange Commission (the “Commission”) and its reports to stockholders.  Such forward-looking statements are made based on management’s belief as well as assumptions made by, and information currently available to, management pursuant to “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.  The Company’s actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, but not limited to, competition from other real estate companies, the ability of the Company to obtain financing for projects, and the continuing operations of tenants.

Item  3. Quantitative and Qualitative Disclosures About Market Risks

   Not applicable to smaller reporting companies

Item  4. Controls and Procedures

(a)      Within the 90 days prior to the filing date of this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934.  Based upon that evaluation, the Company’s Chief Executive Officer concluded that the Company’s disclosure controls and procedures were ineffective.

(b)      There were no significant changes in the Company’s internal controls over financial reporting or in other factors that could significantly affect these controls subsequent to the date the Chief Executive Officer carried out the evaluation.

           As of September 30, 2013, the Company’s management evaluated the effectiveness of its internal control.  Based on the evaluation, the Company’s management concluded that the Company’s internal control over financial reporting was ineffective as of September 30, 2013 and identified a material weakness related to the lack of segregation of duties, accounting personnel with the requisite knowledge of GAAP and the lack of written policies and procedures over financial reporting.

- 9 -

           Notwithstanding the existence of this material weakness in our internal control over financial reporting, our management believes that the consolidated financial statements included in its reports fairly present in all material respects the Company’s financial condition, results of operations and cash flows for the periods presented.

There has been no change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item  1. Legal Proceedings

During 2011, the Company was notified by a tenant of a claim for reimbursement of certain expenses charged.  It is the opinion of the Company's management that the Company is not liable for this claim.  The Company has accrued approximately $100,000 for professional fees and other expenses to defend its position.

Item  1A. Risk Factors

The Company, as a smaller reporting company, is not required to provide the information required by this item.

Item  2. Unregistered Sales of Equity Securities and Use of Proceeds

None

Item  3. Defaults Upon Senior Securities

None

Item  4. Reserved for Future Use

Item  5. Other Information

Management of the Company notes that no Forms 8-K were filed during the period and Management is not aware of any un-reported matters occurring during the period that would require disclosure in a Form 8-K. 

Item  6. Exhibits

(a)	Exhibit No.	Description
	31.1	Certification Pursuant to Section 302 of Sarbanes-Oxley Act of 2002
	32.1	Certification Pursuant to Section 906 of Sarbanes-Oxley Act of 2002
	101	The following financial information from Security Land and Development Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014 is  formatted in Extensible Business Reporting Language (XBRL):  (i) The Consolidated Balance Sheets, (ii) the Consolidated Statements of Income and Retained Earnings, (iii) the condensed Consolidated Statements of Cash Flows and (iv) Notes to Consolidated Financial Statements.

- 10 -

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

SECURITY LAND AND DEVELOPMENT CORPORATION

(Registrant)

By:	/s/ T. Greenlee Flanagin	May 12, 2014
	T. Greenlee Flanagin	Date
	President
	Chief Executive Officer and Chief Financial Officer

- 11 -

EX-31

EXHIBIT 31.1

CERTIFICATIONS

I, T. Greenlee Flanagin, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Security Land and Development Corporation;

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 officers 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) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and  have:

a)  Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under 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)  Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)  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

d)  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 that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.  The registrant’s other certifying officers 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 registrant's board of directors.

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.

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.

Date: May 12, 2014

/s/ T. Greenlee Flanagin

T. Greenlee Flanagin

President and Chief Executive Officer and
Chief Financial Officer

EX-32

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Security Land and Development Corporation (the “Company”) on Form 10-Q for the quarter ended March 31, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, T. Greenlee Flanagin, President and Chief Executive Officer of the Company, does hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

	(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
	(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
By:
	/s/ T. Greenlee Flanagin
	T. Greenlee Flanagin
	President
	Chief Executive Officer and Chief
	Financial Officer
	May 12, 2014

A signed original of this written statement required by Section 906 has been provided to Security Land and Development Corporation and will be retained by Security Land and Development Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Income Taxes

6 Months Ended

Mar. 31, 2014

Income Taxes

Income Taxes

Note  4 – Income Taxes

The Company has a total outstanding income tax payable in the amount of $122,209 at March 31, 2014.  Of this amount, $115,828 is related to the fiscal year 2014 tax liability and $6,381 is related to 2013 tax expense. At September 30, 2013 the Company had a total of $183,236 in income tax payable.

XML

Notes Payable

6 Months Ended

Mar. 31, 2014

Notes Payable {1}

Notes Payable

Note  3 – Notes Payable

Notes payable consisted of the following at:

	March 31,   2014		September 30,   2013
	(unaudited)
A line of credit with a regional financial institution for up to $251,934 procured in March 2008 with a floating interest rate based on prime and originally payable in full in April 2009. In April 2009 the Company refinanced the $243,019 line of credit with a regional financial institution. The Company entered into an agreement with the same regional financial institution to borrow the outstanding balance of $243,019, bearing interest based on the greater of prime or 6% with interest payments due monthly, maturing in April 2010.  In January 2010 the Company renewed this line of credit and increased the open balance to $300,250. This agreement originally matured in February 2011. In December 2010, the Company renewed the line of credit to December 5, 2011, at the greater of prime plus 1% or 6%.  In December 2011, the Company renewed the line of credit to December 12, 2012, at the greater of prime plus 1% or 6%.  In November of 2012, the Company converted the line of credit to a fixed rate loan due December 2017. The new term loan accrues interest at a 5.5% annually with monthly installments of $3,287. The current balance relates to the purchase of the 1 acre adjoining the North Augusta, South Carolina property in May 2008 and is collateralized by the residential property on Stanley Drive in Augusta, Georgia.	$	272,532	$	284,531
A note payable to an insurance company, secured with a mortgage interest in National Plaza and an assignment of rents. The note is payable in monthly installments of $35,633, including interest, through June 2015, and bears interest at a fixed rate of 7.875%.	507,449		696,892
A note payable to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The note is payable in monthly installments of $7,563, including principal and interest, through July 2018, and bears interest at a fixed rate of 5%.	356,530		392,945
A note payable to an insurance company collateralized with approximately 18 acres of land in Columbia County, Georgia, and an assignment of the long-term ground lease. The note is payable in monthly installments of $17,896, including interest, through May 1, 2027, and bears interest at a fixed rate of 5.85%.	1,968,434		2,017,437
A construction loan to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The loan was procured to finance tenant improvements for the lease of in-line space at National Plaza executed on January 17, 2014. Subsequent to March 31, 2014 construction of the tenant improvements was completed and with total principal borrowed of $186,000. Once all related construction payments have been made the loan will convert to a note payable with monthly installments of $3,727 including interest over a 60 month term with fixed interest of 4.5%. The related lease agreement calls for monthly payments of this amount to be paid to the Company in addition to monthly minimum rental payments. The tenant opened for business on April 16, 2014.	4,007		-
An unsecured and uncollateralized note payable to a stockholder, who is also a member of the Flanagin Family, to meet the cash flow needs of the Company.  The note matures in July of 2015 and accrues interest at 5%.	50,015		-
	3,158,967		3,391,805
Less current maturities	(605,470)		(584,491)
	$	2,553,497	$	2,807,314

Management of the Company expects future liquidity needs of the Company to be funded from rent revenues, refinancing and the appreciation in investment properties (which can be sold or mortgaged, if necessary).  Additionally, funding can be obtained from members of the Company’s Board of Directors.

Current maturities of notes payable will require the Company to make payments over the next 12 months totaling $605,470.  The Company projects that it will be able to fund the payment of its current maturities of notes payable through cash flows generated from its operations and cash on hand, but there can be no assurance that this will occur.

If the Company is unsuccessful in their efforts described above, the Company intends to seek additional financing or sell certain of its assets.

XML

CONSOLIDATED BALANCE SHEETS (USD $)	Mar. 31, 2014	Sep. 30, 2013
CURRENT ASSETS
Cash and cash equivalents	$ 24,014	$ 24,599
Receivables from tenants, net of allowance of $19,938 at March 31, 2014 and September 30, 2013	416,908	497,324
Prepaid property taxes	0	15,003
Total current assets	440,922	536,926
INVESTMENT PROPERTIES
Investment properties for lease, net of accumulated depreciation	5,357,358	5,415,447
Land and improvements held for investment or development	3,639,598	3,639,598
Total Investment Properties	8,996,956	9,055,045
OTHER ASSETS	72,401	76,188
Total Assets	9,510,279	9,668,159
CURRENT LIABILITIES
Accounts payable and accrued expenses	283,270	325,720
Income taxes payable	122,209	183,236
Current maturities of notes payable	605,470	584,491
Current maturities of deferred revenue	24,652	24,652
Total current liabilities	1,035,601	1,118,099
LONG-TERM LIABILITIES
Notes payable, less current portion	2,503,482	2,807,314
Deferred income taxes	765,199	764,645
Deferred revenue, less current portion	4,093	16,419
Note payable to stockholder	50,015	0
Total long-term liabilities	3,322,789	3,588,378
Total liabilities	4,358,390	4,706,477
STOCKHOLDERS' EQUITY
Common stock, par value $.10 per share; 30,000,000 shares authorized; 5,243,107 shares issued and outstanding.	524,311	524,311
Additional paid-in capital	333,216	333,216
Retained earnings	4,294,362	4,104,155
Total shareholders' equity	5,151,889	4,961,682
Total Liabilities and Stockholders' Equity	$ 9,510,279	$ 9,668,159

XML

Basis of Presentation

6 Months Ended

Mar. 31, 2014

Basis of Presentation

Basis of Presentation

Note  1 – Basis of Presentation

The accompanying unaudited consolidated financial statements were prepared in accordance with instructions for Form 10-Q, Article 8 of Regulation S-X and accounting principles generally accepted in the United States of America; therefore, they do not include all disclosures necessary for a complete presentation of financial condition, results of operations, and cash flows.  Such statements are unaudited but, in the opinion of management, reflect all adjustments, which are of a normal recurring nature and necessary for a fair presentation of results for the selected interim periods.  Users of financial information produced for interim periods are encouraged to refer to the footnotes contained in the audited financial statements appearing in our Form 10-K for the year ended September 30, 2013 when reviewing these interim financial statements.

The financial statements include estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from those estimates.  The consolidated financial statements include the accounts of Security Land and Development Corporation and its four wholly owned subsidiaries, Royal Palms Motel, Inc., SLDC, LLC, SLDC 2, LLC and SLDC III, LLC (described on a consolidated basis as the “Company”).  Significant intercompany transactions and accounts are eliminated in consolidation.

Critical Accounting Policies:

Estimates of Useful Lives of Investment Properties for Purposes of Depreciation

Management has estimated useful lives of investment properties, except for land, that are leased, and the Company utilizes the straight-line method to compute depreciation over the estimated useful lives of the investment properties.  Actual depreciation of investment properties will vary from management’s estimates, and the value of investment properties is more directly impacted by market conditions and the physical condition of the investment properties.

Evaluation of Long-Lived Assets for Impairment

The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of investment properties may not be recoverable.  In evaluating recoverability, the Company generally estimates future cash flows expected to result from the use of the asset and its eventual disposition.  An impairment loss is recognized when the expected future cash flows of the asset are less than the carrying amount.

Estimates of Income Tax Rates Applicable to Deferred Taxes

The Company has deferred income taxes through a series of tax-deferred like-kind exchange transactions on certain investment properties and through accelerated depreciation elections on certain other assets.  Actual income taxes that may become due when taxable gains are realized on the sale of assets may differ from management’s estimates as a result of changes in tax laws, the tax status of the Company, or the actual taxable earnings of the Company in the periods the deferred income taxes become due.

Refer to the Company’s Form 10-K for the year ended September 30, 2013 for further information regarding its critical accounting policies.

XML

Concentrations (Details)	6 Months Ended
	Mar. 31, 2014
Revenues
Revenue earned from customers	99.00%
Number of investment properties	2
National Plaza, Publix Supermarkets, Inc.
Percentage of lease space	81.00%
Percentage of lease revenue	37.00%
Customer Concentration Risk National Plaza Revenues
Revenue earned from customers	52.00%
Customer Concentration Risk Evans Ground Lease Revenues
Revenue earned from customers	47.00%

XML

Investment Properties

6 Months Ended

Mar. 31, 2014

Investment Properties

Investment Properties

Note  2 – Investment Properties

Investment properties leased or held for lease to others under operating leases consisted of the following at March 31, 2014 and September 30, 2013:

	March 31,			September 30,
	2014			2013
	(unaudited)
National Plaza building, land and improvements	$	5,142,796		$	5,138,796
Evans Ground Lease, land and improvements	2,382,673			2,382,673
Commercial land and improvements	3,639,598			3,639,598
	11,165,067			11,161,067
Less accumulated depreciation	(2,281,809		)	(2,221,077		)
	8,883,258			8,939,990
Residential rental property	145,847			145,847
Less accumulated depreciation	(32,149		)	(30,792		)
	113,698			115,055
Investment properties for lease, net of accumulated depreciation	$	8,996,956		$	9,055,045

Depreciation expense totaled approximately $31,000 for the three-month periods and $62,000 for the six-month periods ended March 31, 2014 and 2013, respectively.

The National Plaza is a retail strip center located on Washington Road in Augusta Georgia.  Approximately 81% of the rentable space at the National Plaza is leased to Publix Supermarkets, Inc., the National Plaza’s anchor tenant. 

The Company entered into a long-term ground lease with a major national tenant and its developer in May 2006 on approximately 18 acres of land in Columbia County, Georgia.  The agreement required monthly rental payments of $20,833 during the development period, which was completed in January 2007.  Following the expiration of the development period, the lease requires annual rental payments of $500,000 for the first 5 years then increasing 5% in years 6, 11, and 16.  The lessee has an option to renew at year 21 and another option every 5 years thereafter for a possible total lease term of 50 years.  The lease provides for the tenant to pay for insurance and property taxes. The Company is recognizing rents on a straight-line basis over the initial lease term.  In July 2013, the Company sold approximately .24 acres of the total Evans ground Lease tract for $156,000.  The Company recognized a gain of approximately $108,000.  The proceeds were used by the Company to pay down debt related to an outstanding note payable collateralized by the Evans Ground Lease and related land and to compensate the Evans Ground Lease tenant per the related agreement.

The Company holds several parcels of land for investment or development purposes, including 19.38 acres of land in North Augusta, South Carolina, purchased in parcels during 2007 and 2008.  The Company also owns approximately 85 acres of land in south Richmond County, Georgia and a 1.1 acre parcel along Washington Road in Augusta, Georgia that adjoins the Company’s National Plaza investment property.  The aggregate costs of these investment properties held for investment or development was $3,639,598 at March 31, 2014 and September 30, 2013.

Refer to the Company’s Form 10-K for the year ended September 30, 2013 for further information on operating lease agreements and land held for investment or development purposes.

XML

CONSOLIDATED BALANCE SHEETS PARENTHETICALS (USD $)	Mar. 31, 2014	Sep. 30, 2013
Parentheticals
Net of Allowance from tenants	$ 19,938	$ 19,938
Common Stock, Par Value	$ 0.10	$ 0.10
Common Stock, Shares Authorized	30,000,000	30,000,000
Common Stock, shares issued	5,243,107	5,243,107
Common Stock, shares outstanding	5,243,107	5,243,107

XML

Investment Properties (Details Textuals 2)	6 Months Ended
	Mar. 31, 2014
Real Estate:
Percentage of National Plaza space leased to Publix Supermarkets, Inc	81.00%

XML

Document and Entity Information	6 Months Ended
	Mar. 31, 2014	May 12, 2014
Document and Entity Information:
Entity Registrant Name	SECURITY LAND & DEVELOPMENT CORP
Document Type	10-Q
Document Period End Date	Mar. 31, 2014
Amendment Flag	false
Entity Central Index Key	0000088572
Current Fiscal Year End Date	--09-30
Entity Common Stock, Shares Outstanding		5,243,107
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2

XML

Investment Properties (Long-term ground lease) (Details Textuals 3) (USD $)	Mar. 31, 2014	Sep. 30, 2013	Jul. 31, 2013	May 31, 2006
Investment Properties Long-term ground lease:
Area of land for long-term ground lease				18
Monthly rental payments, development period				$ 20,833
Annual rental payments				500,000
Annual rental payments description				first 5 years
Percentage of rent increasing in years 6, 11, and 16				5.00%
Renewal period				21 years
Renewal period description				every 5 years thereafter
Total lease term				50 years
Area of land sold (in acers)			0.24
Value of land sold			156,000
Recognized a gain			108,000
Principal pay down of debt			144,000
Amount paid to lessee			12,000
Aggregate cost of land and improvements held for investment or development	$ 3,639,598	$ 3,639,598
North Augusta, South Carolina Area of land	19.38
South Richmond County, Georgia Area of land	85
Washington Road in Augusta, Georgia Area of land	1.1

XML

CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Revenues:
Rent Revenue	$ 360,252	$ 362,950	$ 734,000	$ 722,053
Depreciation and amortization	32,938	32,948	65,875	65,896
Property taxes	64,107	69,736	131,970	134,361
Payroll and related costs	19,930	21,796	40,063	44,275
Insurance and utilities	10,500	5,674	18,135	19,693
Repairs and maintenance	9,550	4,876	33,270	14,086
Professional services	28,576	31,390	40,156	49,390
Bad debt expense (recovery)	0	(1,580)	0	2,825
Other	1,969	8,907	2,573	13,634
Total Operating Expenses	167,570	173,747	332,042	344,160
Operating income	192,682	189,203	401,958	377,893
Interest	(47,970)	(68,039)	(95,369)	(123,651)
Income before income taxes	144,712	121,164	306,589	254,242
Income Tax Expense	53,897	47,603	115,828	97,096
Income Tax Deferred Expense (Benefit)	1,035	(1,610)	554	(967)
TOTAL INCOME TAX PROVISION	54,932	45,993	116,382	96,129
Net income	89,780	75,171	190,207	158,113
RETAINED EARNINGS, BEGINNING OF PERIOD	4,204,582	3,804,812	4,104,155	3,721,870
RETAINED EARNINGS, END OF PERIOD	$ 4,294,362	$ 3,879,983	$ 4,294,362	$ 3,879,983
Net income per common share	$ 0.02	$ 0.01	$ 0.04	$ 0.03

XML

Accounting Policies (Policies)

6 Months Ended

Mar. 31, 2014

Accounting Policies:

Estimates of Useful Lives of Investment Properties for Purposes of Depreciation

Estimates of Useful Lives of Investment Properties for Purposes of Depreciation

Management has estimated useful lives of investment properties, except for land, that are leased, and the Company utilizes the straight-line method to compute depreciation over the estimated useful lives of the investment properties.  Actual depreciation of investment properties will vary from management’s estimates, and the value of investment properties is more directly impacted by market conditions and the physical condition of the investment properties.

Evaluation of Long-Lived Assets for Impairment Policy

Evaluation of Long-Lived Assets for Impairment

The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of investment properties may not be recoverable.  In evaluating recoverability, the Company generally estimates future cash flows expected to result from the use of the asset and its eventual disposition.  An impairment loss is recognized when the expected future cash flows of the asset are less than the carrying amount.

Estimates of Income Tax Rates Applicable to Deferred Taxes

Estimates of Income Tax Rates Applicable to Deferred Taxes

The Company has deferred income taxes through a series of tax-deferred like-kind exchange transactions on certain investment properties and through accelerated depreciation elections on certain other assets.  Actual income taxes that may become due when taxable gains are realized on the sale of assets may differ from management’s estimates as a result of changes in tax laws, the tax status of the Company, or the actual taxable earnings of the Company in the periods the deferred income taxes become due.

XML

Related Party Disclosures

6 Months Ended

Mar. 31, 2014

Related Party Disclosures:

Related Party Transactions

Note  6 –  Related Party Transactions

The Company hired an attorney who sits on the Company’s Board of Directors and who also serves a Vice President of the Company, to represent the Company in a legal matter regarding a tenant’s claim for reimbursement of certain expenses charged.  It is the opinion of the Company’s management that the Company is not liable for this claim.

During the second quarter of fiscal 2014, the Company borrowed $50,015 from a stockholder, who is also a member of the Flanagin family, to meet cash flow needs.  The amount matures in July 2015 and accrues interest at a rate of 5%.

XML

Related Party Transactions (Details) (USD $)	6 Months Ended
	Mar. 31, 2014
Related Party Transaction as follows:
Proceeds from stockholder	$ 50,015
Interest rate for repayments	5.00%

XML

Notes Payable And Line Of Credit (Details) (USD $)	Mar. 31, 2014	Sep. 30, 2013
Notes Payable And Line Of Credit:
Long-term debt Secured Debt 5.5% Interest on Note Payable.	$ 272,532	$ 284,531
Long-term debt Secured Debt 7.875% Interest on Note Payable	507,449	696,892
Long-term debt Secured Debt 5% Interest on Note Payable	356,530	392,945
Long-term debt Secured Debt 5.85% Interest on Note Payable	1,968,434	2,017,437
Long-term debt Secured Debt 5.85% Interest on Note Payable 4.5%	4,007	0
Unsecured and uncollateralized note payable to a stockholder	50,015	0
Long-term debt	3,158,967	3,391,805
Less current maturities	(605,470)	(584,491)
Long-term debt	$ 2,553,497	$ 2,807,314

XML

Investment properties leased (Details) (USD $)	Mar. 31, 2014	Sep. 30, 2013
Investment properties leased:
National Plaza building, land and improvements	$ 5,142,796	$ 5,138,796
Evans Ground Lease, land and improvements	2,382,673	2,382,673
Commercial land and improvements	3,639,598	3,639,598
Investment property gross	11,165,067	11,161,067
Less accumulated depreciation	(2,281,809)	(2,221,077)
Investment property, net	8,883,258	8,939,990
Residential rental property	145,847	145,847
Less accumulated depreciation	(32,149)	(30,792)
Residential rental property, net	113,698	115,055
Investment properties for lease, net of accumulated depreciation	$ 8,996,956	$ 9,055,045

XML

Investment properties (Tables)

6 Months Ended

Mar. 31, 2014

Schedule of Investment properties leased or held for lease

Schedule of Investment properties leased or held for lease

Investment properties leased or held for lease to others under operating leases consisted of the following at March 31, 2014 and September 30, 2013:

	March 31,			September 30,
	2014			2013
	(unaudited)
National Plaza building, land and improvements	$	5,142,796		$	5,138,796
Evans Ground Lease, land and improvements	2,382,673			2,382,673
Commercial land and improvements	3,639,598			3,639,598
	11,165,067			11,161,067
Less accumulated depreciation	(2,281,809		)	(2,221,077		)
	8,883,258			8,939,990
Residential rental property	145,847			145,847
Less accumulated depreciation	(32,149		)	(30,792		)
	113,698			115,055
Investment properties for lease, net of accumulated depreciation	$	8,996,956		$	9,055,045

XML

Schedule Of Notes Payable And Line Of Credit (Tables)

6 Months Ended

Mar. 31, 2014

Schedule Of Notes Payable And Line Of Credit

Schedule Of Notes Payable And Line Of Credit

Notes payable consisted of the following at:

	March 31,   2014		September 30,   2013
	(unaudited)
A line of credit with a regional financial institution for up to $251,934 procured in March 2008 with a floating interest rate based on prime and originally payable in full in April 2009. In April 2009 the Company refinanced the $243,019 line of credit with a regional financial institution. The Company entered into an agreement with the same regional financial institution to borrow the outstanding balance of $243,019, bearing interest based on the greater of prime or 6% with interest payments due monthly, maturing in April 2010.  In January 2010 the Company renewed this line of credit and increased the open balance to $300,250. This agreement originally matured in February 2011. In December 2010, the Company renewed the line of credit to December 5, 2011, at the greater of prime plus 1% or 6%.  In December 2011, the Company renewed the line of credit to December 12, 2012, at the greater of prime plus 1% or 6%.  In November of 2012, the Company converted the line of credit to a fixed rate loan due December 2017. The new term loan accrues interest at a 5.5% annually with monthly installments of $3,287. The current balance relates to the purchase of the 1 acre adjoining the North Augusta, South Carolina property in May 2008 and is collateralized by the residential property on Stanley Drive in Augusta, Georgia.	$	272,532	$	284,531
A note payable to an insurance company, secured with a mortgage interest in National Plaza and an assignment of rents. The note is payable in monthly installments of $35,633, including interest, through June 2015, and bears interest at a fixed rate of 7.875%.	507,449		696,892
A note payable to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The note is payable in monthly installments of $7,563, including principal and interest, through July 2018, and bears interest at a fixed rate of 5%.	356,530		392,945
A note payable to an insurance company collateralized with approximately 18 acres of land in Columbia County, Georgia, and an assignment of the long-term ground lease. The note is payable in monthly installments of $17,896, including interest, through May 1, 2027, and bears interest at a fixed rate of 5.85%.	1,968,434		2,017,437
A construction loan to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The loan was procured to finance tenant improvements for the lease of in-line space at National Plaza executed on January 17, 2014. Subsequent to March 31, 2014 construction of the tenant improvements was completed and with total principal borrowed of $186,000. Once all related construction payments have been made the loan will convert to a note payable with monthly installments of $3,727 including interest over a 60 month term with fixed interest of 4.5%. The related lease agreement calls for monthly payments of this amount to be paid to the Company in addition to monthly minimum rental payments. The tenant opened for business on April 16, 2014.	4,007		-
An unsecured and uncollateralized note payable to a stockholder, who is also a member of the Flanagin Family, to meet the cash flow needs of the Company.  The note matures in July of 2015 and accrues interest at 5%.	50,015		-
	3,158,967		3,391,805
Less current maturities	(605,470)		(584,491)
	$	2,553,497	$	2,807,314

XML

Investment properties leased Depreciation expense (Details) (USD $)	6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Investment properties leased Depreciation expense:
Depreciation expense	$ 31,000	$ 62,000

XML

INCOME TAXES EXPENSE BENEFIT (Details) (USD $)	Mar. 31, 2014
INCOME TAXES PROVISION
Total outstanding income tax payable	$ 122,209
Tax Payable related to fiscal year 2014 tax liability	115,828
Amount related to 2013 tax expense	6,381
Total income tax payable	$ 183,236

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
CASH FLOWS OPERATING ACTIVITIES:
Net income	$ 89,780	$ 75,171	$ 190,207	$ 158,113
Depreciation and amortization	32,938	32,948	65,875	65,896
Deferred income tax	1,035	(1,610)	554	(967)
Changes in deferred and accrued amounts:	(30,032)	37,973	(20,383)	28,565
Net cash provided by operating activities	93,721	144,482	236,253	251,607
Additions to investment properties and other assets for improvements to property held for lease	(4,000)	0	(4,000)	0
Net cash used in investing activities	(4,000)	0	(4,000)	0
Proceeds from note payable	4,007	0	4,007	0
Repayments to stockholder	0	0	0	(30,000)
Proceeds from stockholder	50,015	0	50,015	30,000
Principal payments on notes payable	(144,710)	(139,416)	(286,860)	(270,174)
Net cash used in financing activities	(90,688)	(139,416)	(232,838)	(270,174)
Net increase (decrease) in cash	(967)	5,066	(585)	(18,567)
CASH, BEGINNING OF PERIOD	24,981	25,134	24,599	48,767
CASH, END OF PERIOD	24,014	30,200	24,014	30,200
Cash paid for interest	52,733	60,277	100,132	115,889
Cash paid for income taxes	86,835	15,000	86,835	40,000
Refinancing of line of credit to term note	$ 0	$ 0	$ 0	$ 301,170

XML

Concentrations

6 Months Ended

Mar. 31, 2014

Concentrations

Concentrations

Note  5 – Concentrations

Substantially all of the Company’s assets consist of real estate located in Richmond and Columbia Counties in the state of Georgia and in North Augusta, South Carolina.  Approximately 99% of the Company’s revenues are earned from two of the Company’s investment properties, National Plaza and the Evans Ground Lease, which comprise approximately 52% and 47% of the Company’s revenues, respectively.   The anchor tenant for National Plaza, Publix Supermarkets, Inc. (“Publix”), a regional food supermarket chain, leases approximately 81% of the space at National Plaza.  The Company generates approximately 37% of its revenues though its lease with Publix.

XML

Notes payable consisted of the following parentheticals (Details) (USD $)	Mar. 31, 2014	Jan. 17, 2014	Dec. 31, 2013	Nov. 30, 2012	Dec. 31, 2010	Jan. 31, 2010	Apr. 30, 2009
Notes payable consisted of the following parentheticals:
Line of credit with a regional financial institution							$ 251,934
Refinanced line of credit with a regional financial institution							243,019
The Company entered into an agreement with the same regional financial institution to borrow the outstanding balance of							243,019
Interest rate based on the greater of prime							6.00%
Renewed this line of credit and increased the open balance to						300,250
Renewed the line of credit rate the greater of prime plus minimum					1.00%
Renewed the line of credit rate at the greater of prime plus maximum					6.00%
New term loan accrues interest at				5.50%
New term loan accrues interest annually with monthly installments				3,287
Note is payable in monthly installments			35,633
Note is payable in monthly installments at a fixed rate			7.88%
Note payable to a regional financial institution collateralized with land in North Augusta, South Carolina in acres			17.54
The note is payable in monthly installments including principal and interest			7,563
The note is payable in monthly installments and bears interest at a fixed rate of			5.00%
A note payable to an insurance company collateralized with approximately land in Columbia County, Georgia in acres			18
A note payable to an insurance company collateralized with approximately land in Columbia County, Georgia in monthly installments			17,896
A note payable to an insurance company collateralized with approximately land in Columbia County, Georgia and bears interest at a fixed rate of			5.85%
A construction loan to a regional financial institution collateralized with acres of land in North Augusta		17.54
Tenant improvements was completed with total principal borrowed amount	186,000
Loan will convert to a note payable with monthly installments	$ 3,727
Note payable with monthly installments including interest over a 60 month term with fixed interest of	4.50%
Unsecured and uncollateralized note payable to a stockholder matures in July of 2015 and accrues interest at	5.00%