Attached files
| file | filename |
|---|---|
| EX-31.1 - CERTIFICATION - WNC HOUSING TAX CREDIT FUND VI LP SERIES 12 | exhibit311.htm |
| EX-31.2 - CERTIFICATION - WNC HOUSING TAX CREDIT FUND VI LP SERIES 12 | exhibit312.htm |
| EX-32.2 - CERTIFICATION - WNC HOUSING TAX CREDIT FUND VI LP SERIES 12 | exhibit322.htm |
| EX-32.1 - CERTIFICATION - WNC HOUSING TAX CREDIT FUND VI LP SERIES 12 | exhibit321.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
|
S QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the quarterly period ended June 30, 2010
For the quarterly period ended September 30, 2010
For the quarterly period ended December 31, 2010
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: 333-107181
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
|
California
|
72-1566910
|
|
(State or other jurisdiction of
|
(I.R.S. Employer
|
|
incorporation or organization)
|
Identification No.)
|
17782 Sky Park Circle, Irvine, CA 92614
( Address of principle executive offices )
(714) 622-5565
( Telephone Number )
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes No X
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 No X
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. (Check one):
Large accelerated filer___ Accelerated filer___Non-accelerated filer X Smaller reporting company___
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ___No X
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
INDEX TO FORM 10-Q
For the quarterly period ended June 30, 2010
For the quarterly period ended September 30, 2010
For the quarterly period ended December 31, 2010
|
PART I. FINANCIAL INFORMATION
|
|||
|
Item 1.
|
Financial Statements
|
||
|
Condensed Balance Sheets
|
|||
|
As of June 30, 2010, September 30, 2010, December 31, 2010 and March 31, 2010
|
3
|
||
|
Condensed Statements of Operations
|
|||
|
For the Three Months Ended June 30, 2010 and 2009
|
4
|
||
|
For the Three and Six Months Ended September 30, 2010 and 2009
|
5
|
||
|
For the Three and Nine Months Ended December 31, 2010 and 2009
|
6
|
||
|
Condensed Statements of Partners' Equity (Deficit)
|
|||
|
For the Three Months Ended June 30, 2010
|
7
|
||
|
For the Six Months Ended September 30, 2010
|
7
|
||
|
For the Nine Months Ended December 31, 2010
|
7
|
||
|
Condensed Statements of Cash Flows
|
|||
|
For the Three Months Ended June 30, 2010 and 2009
|
8
|
||
|
For the Six Months Ended September 30, 2010 and 2009
|
9
|
||
|
For the Nine Months Ended December 31, 2010 and 2009
|
10
|
||
|
Notes to Condensed Financial Statements
|
11
|
||
|
Item 2.
|
Management's Discussion and Analysis of Financial
|
||
|
Condition and Results of Operations
|
24
|
||
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risks
|
28
|
|
|
Item 4.
|
Controls and Procedures
|
28
|
|
|
PART II. OTHER INFORMATION
|
|||
|
Item 1.
|
Legal Proceedings
|
29
|
|
|
Item 1A.
|
Risk Factors
|
29
|
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
29
|
|
|
Item 3.
|
Defaults Upon Senior Securities
|
29
|
|
|
Item 4.
|
(Removed and Reserved)
|
29
|
|
|
Item 5.
|
Other Information
|
29
|
|
|
Item 6.
|
Exhibits
|
29
|
|
|
Signatures
|
30
|
||
2
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
CONDENSED BALANCE SHEETS
(Unaudited)
|
June 30,
2010
|
September 30, 2010
|
December 31, 2010
|
March 31, 2010
|
|||||
|
ASSETS
|
||||||||
|
Cash and cash equivalents
|
$
|
1,164,629
|
$
|
1,149,117
|
$
|
1,149,670
|
$
|
1,200,840
|
|
Investments in Local Limited Partnerships, net
(Notes 2 and 3)
|
7,626,898
|
7,457,372
|
7,287,846
|
8,026,278
|
||||
|
Total Assets
|
$
|
8,791,527
|
$
|
8,606,489
|
$
|
8,437,516
|
$
|
9,227,118
|
|
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
|
||||||||
|
Liabilities:
|
||||||||
|
Payables to Local Limited Partnerships (Note 4)
|
$
|
649,499
|
$
|
624,895
|
$
|
624,895
|
$
|
649,499
|
|
Accrued fees and expenses due to General Partner
and affiliates (Note 3)
|
574,172
|
620,327
|
668,018
|
569,970
|
||||
|
Total Liabilities
|
1,223,671
|
1,245,222
|
1,292,913
|
1,219,469
|
||||
|
Partners’ Equity (Deficit):
|
||||||||
|
General Partner
|
(5,436)
|
(5,642)
|
(5,859)
|
(4,996)
|
||||
|
Limited Partners (25,000 Partnership Units authorized; 15,019 Partnership Units issued and outstanding)
|
7,573,292
|
7,366,909
|
7,150,462
|
8,012,645
|
||||
|
|
||||||||
|
Total Partners’ Equity (Deficit)
|
7,567,856
|
7,361,267
|
7,144,603
|
8,007,649
|
||||
|
Total Liabilities and Partners’ Equity
(Deficit)
|
$
|
8,791,527
|
$
|
8,606,489
|
$
|
8,437,516
|
$
|
9,227,118
|
See accompanying notes to condensed financial statements
3
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
CONDENSED STATEMENTS OF OPERATIONS
For the Three Months Ended June 30, 2010 and 2009
(Unaudited)
|
2010
|
2009
|
||||
|
Three Months
|
Three Months
|
||||
|
Reporting fees
|
$
|
1,500
|
$
|
2,112
|
|
|
Operating expenses and loss:
|
|||||
|
Amortization (Note 2)
|
12,322
|
12,322
|
|||
|
Asset management fees (Note 3)
|
41,682
|
41,682
|
|||
| Asset management expenses |
-
|
310
|
|||
|
Accounting and legal fees
|
16
|
2,500
|
|||
|
Impairment loss (Note 2)
|
208,217
|
212,204
|
|||
|
Other
|
913
|
1,023
|
|||
|
Total operating expenses and loss
|
263,150
|
270,041
|
|||
|
Loss from operations
|
(261,650)
|
(267,929)
|
|||
|
Equity in losses of Local Limited
Partnerships (Note 2)
|
(178,841)
|
(181,223)
|
|||
|
Interest income
|
698
|
719
|
|||
|
Net loss
|
$
|
(439,793)
|
$
|
(448,433)
|
|
|
Net loss allocated to:
|
|||||
|
General Partner
|
$
|
(440)
|
$
|
(448)
|
|
|
Limited Partners
|
$
|
(439,353)
|
$
|
(447,985)
|
|
|
Net loss per Partnership Unit
|
$
|
(29)
|
$
|
(30)
|
|
|
Outstanding weighted Partnership Units
|
15,019
|
15,019
|
|||
See accompanying notes to condensed financial statements
4
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
CONDENSED STATEMENTS OF OPERATIONS
For the Three Months and Six Months Ended September 30, 2010 and 2009
(Unaudited)
|
2010
|
2009
|
|||||||||||
|
Three
|
Six
|
Three
|
Six
|
|||||||||
|
Months
|
Months
|
Months
|
Months
|
|||||||||
|
Reporting fees
|
$
|
8,550
|
$
|
10,050
|
$
|
12,250
|
$
|
14,362
|
||||
|
Operating expenses and loss:
|
||||||||||||
|
Amortization (Note 2)
|
12,322
|
24,644
|
12,322
|
24,644
|
||||||||
|
Asset management fees (Note 3)
|
41,682
|
83,364
|
41,682
|
83,364
|
||||||||
|
Asset management expenses
|
508
|
508
|
-
|
310
|
||||||||
|
Accounting and legal fees
|
3,950
|
3,966
|
9,527
|
12,027
|
||||||||
|
Impairment loss (Note 2)
|
-
|
208,217
|
-
|
212,204
|
||||||||
|
Other
|
55
|
968
|
-
|
1,023
|
||||||||
|
Total operating expenses and loss
|
58,517
|
321,667
|
63,531
|
333,572
|
||||||||
|
Loss from operations
|
(49,967)
|
(311,617)
|
(51,281)
|
(319,210)
|
||||||||
|
Equity in losses of Local Limited Partnerships (Note 2)
|
(157,204)
|
(336,045)
|
(181,223)
|
(362,446)
|
||||||||
|
|
||||||||||||
|
Interest income
|
582
|
1,280
|
706
|
1,425
|
||||||||
|
Net loss
|
$
|
(206,589)
|
$
|
(646,382)
|
$
|
(231,798)
|
$
|
(680,231)
|
||||
|
Net loss allocated to:
|
||||||||||||
|
General Partner
|
$
|
(207)
|
$
|
(646)
|
$
|
(232)
|
$
|
(680)
|
||||
|
Limited Partners
|
$
|
(206,382)
|
$
|
(645,736)
|
$
|
(231,566)
|
$
|
(679,551)
|
||||
|
Net loss per Partnership Unit
|
$
|
(14)
|
$
|
(43)
|
$
|
(15)
|
$
|
(45)
|
||||
|
Outstanding weighted Partnership Units
|
15,019
|
15,019
|
15,019
|
15,019
|
||||||||
See accompanying notes to condensed financial statements
5
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
CONDENSED STATEMENTS OF OPERATIONS
For the Three Months and Nine Months Ended December 31, 2010 and 2009
(Unaudited)
|
2010
|
2009
|
|||||||
|
Three
|
Nine
|
Three
|
Nine
|
|||||
|
Months
|
Months
|
Months
|
Months
|
|||||
|
Reporting fees
|
$
|
-
|
$
|
10,050
|
$
|
-
|
$
|
14,362
|
|
Operating expenses and loss:
|
||||||||
|
Amortization (Note 2)
|
12,322
|
36,966
|
12,322
|
36,966
|
||||
| Asset management fees (Note 3) |
41,682
|
125,046
|
41,682
|
125,046
|
||||
|
Asset management expenses
|
392
|
900 | 267 | 577 | ||||
|
Accounting and legal fees
|
5,000
|
8,966
|
-
|
12,027
|
||||
|
Impairment loss (Note 2)
|
-
|
208,217
|
-
|
212,204
|
||||
|
Other
|
617
|
1,585
|
755
|
1,778
|
||||
|
Total operating expenses and loss
|
60,013
|
381,680
|
55,026
|
388,598
|
||||
|
Loss from operations
|
(60,013)
|
(371,630)
|
(55,026)
|
(374,236)
|
||||
|
Equity in losses of Local Limited Partnerships (Note 2)
|
(157,204)
|
(493,249)
|
(181,223)
|
(543,669)
|
||||
|
Interest income
|
553
|
1,833
|
709
|
2,134
|
||||
|
Net loss
|
$
|
(216,664)
|
$
|
(863,046)
|
$
|
(235,540)
|
$
|
(915,771)
|
|
Net loss allocated to:
|
||||||||
|
General Partner
|
$
|
(217)
|
$
|
(863)
|
$
|
(236)
|
$
|
(916)
|
|
Limited Partners
|
$
|
(216,447)
|
$
|
(862,183)
|
$
|
(235,304)
|
$
|
(914,855)
|
|
Net loss per Partnership Unit
|
$
|
(14)
|
$
|
(57)
|
$
|
(16)
|
$
|
(61)
|
|
Outstanding weighted Partnership Units
|
15,019
|
15,019
|
15,019
|
15,019
|
||||
See accompanying notes to condensed financial statements
6
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
CONDENSED STATEMENTS OF PARTNERS’ EQUITY (DEFICIT)
For the Three Months Ended June 30, 2010, Six Months Ended September 30, 2010
and Nine Months Ended December 31, 2010
(Unaudited)
|
For the Three Months Ended June 30, 2010
|
||||||
|
General
|
Limited
|
|||||
|
Partner
|
Partners
|
Total
|
||||
|
Partners’ equity (deficit) at March 31, 2010
|
$
|
(4,996)
|
$
|
8,012,645
|
$
|
8,007,649
|
|
Net loss
|
(440)
|
(439,353)
|
(439,793)
|
|||
|
Partners’ equity (deficit) at June 30, 2010
|
$
|
(5,436)
|
$
|
7,573,292
|
$
|
7,567,856
|
|
For the Six Months Ended September 30, 2010
|
||||||
|
General
|
Limited
|
|||||
|
Partner
|
Partners
|
Total
|
||||
|
Partners’ equity (deficit) at March 31, 2010
|
$
|
(4,996)
|
$
|
8,012,645
|
$
|
8,007,649
|
|
Net loss
|
(646)
|
(645,736)
|
(646,382)
|
|||
|
Partners’ equity (deficit) at September 30, 2010
|
$
|
(5,642)
|
$
|
7,366,909
|
$
|
7,361,267
|
|
For the Nine Months Ended December 31, 2010
|
||||||
|
General
|
Limited
|
|||||
|
Partner
|
Partners
|
Total
|
||||
|
Partners’ equity (deficit) at March 31, 2010
|
$
|
(4,996)
|
$
|
8,012,645
|
$
|
8,007,649
|
|
Net loss
|
(863)
|
(862,183)
|
(863,046)
|
|||
|
Partners’ equity (deficit) at December 31, 2010
|
$
|
(5,859)
|
$
|
7,150,462
|
$
|
7,144,603
|
See accompanying notes to condensed financial statements
7
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
CONDENSED STATEMENTS OF CASH FLOWS
For the Three Months Ended June 30, 2010 and 2009
(Unaudited)
|
2010
|
2009
|
|||
|
Cash flows from operating activities:
|
||||
|
Net loss
|
$
|
(439,793)
|
$
|
(448,433)
|
|
Adjustments to reconcile net loss to net
|
||||
|
cash used in operating activities:
|
||||
|
Amortization
|
12,322
|
12,322
|
||
|
Impairment loss
|
208,217
|
212,204
|
||
|
Equity in losses of Local Limited Partnerships
|
178,841
|
181,223
|
||
|
Increase in accrued fees and expenses due to
|
||||
|
General Partner and affiliates
|
4,202
|
23,515
|
||
|
Net cash used in operating activities
|
(36,211)
|
(19,169)
|
||
|
Cash flows from investing activities:
|
||||
|
Capital contributions paid to Local Limited Partnerships
|
-
|
(6,734)
|
||
|
Net cash used in investing activities
|
-
|
(6,734) | ||
|
Net decrease in cash and cash equivalents
|
(36,211)
|
(25,903) | ||
|
Cash and cash equivalents, beginning of period
|
1,200,840
|
1,228,361
|
||
|
Cash and cash equivalents, end of period
|
$
|
1,164,629
|
$
|
1,202,458
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
||||
|
Taxes paid
|
$
|
-
|
$
|
-
|
|
|
See accompanying notes to condensed financial statements
8
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
CONDENSED STATEMENTS OF CASH FLOWS
For the Six Months Ended September 30, 2010 and 2009
(Unaudited)
|
2010
|
2009
|
|||
|
Cash flows from operating activities:
|
||||
|
Net loss
|
$
|
(646,382)
|
$
|
(680,231)
|
|
Adjustments to reconcile net loss to net
|
||||
|
cash used in operating activities:
|
||||
|
Amortization
|
24,644
|
24,644
|
||
|
Impairment loss
|
208,217
|
212,204
|
||
|
Equity in losses of Local Limited Partnerships
|
336,045
|
362,446
|
||
|
Increase in accrued fees and expenses due to
|
||||
|
General Partner and affiliates
|
50,357
|
70,494
|
||
|
Net cash used in operating activities
|
(27,119)
|
(10,443)
|
||
|
Cash flows from investing activities:
|
||||
|
Capital contributions paid to Local Limited Partnerships
|
(24,604)
|
(18,482)
|
||
|
Net cash used in investing activities
|
(24,604)
|
(18,482)
|
||
|
Net decrease in cash and cash equivalents
|
(51,723) | (28,925) | ||
|
Cash and cash equivalents, beginning of period
|
1,200,840
|
1,228,361
|
||
|
Cash and cash equivalents, end of period
|
$
|
1,149,117
|
$
|
1,199,436
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
||||
|
Taxes paid
|
$
|
-
|
$
|
-
|
See accompanying notes to condensed financial statements
9
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
CONDENSED STATEMENTS OF CASH FLOWS
For the Nine Months Ended December 31, 2010 and 2009
(Unaudited)
|
2010
|
2009
|
|||
|
Cash flows from operating activities:
|
||||
|
Net loss
|
$
|
(863,046)
|
$
|
(915,771)
|
|
Adjustments to reconcile net loss to net
|
||||
|
cash used in operating activities:
|
||||
|
Amortization
|
36,966
|
36,966
|
||
|
Impairment loss
|
208,217
|
212,204
|
||
|
Equity in losses of Local Limited Partnerships
|
493,249
|
543,669
|
||
|
Increase in accrued fees and expenses due to
|
||||
|
General Partner and affiliates
|
98,048
|
113,199
|
||
|
Net cash used in operating activities
|
(26,566)
|
(9,733)
|
||
|
Cash flows from investing activities:
|
||||
|
Capital contributions paid to Local Limited Partnerships
|
(24,604)
|
(18,482)
|
||
|
Net cash used in investing activities
|
(24,604)
|
(18,482)
|
||
|
Net decrease in cash and cash equivalents
|
(51,170)
|
(28,215)
|
||
|
Cash and cash equivalents, beginning of period
|
1,200,840
|
1,228,361
|
||
|
Cash and cash equivalents, end of period
|
$
|
1,149,670
|
$
|
1,200,146
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
||||
|
Taxes paid
|
$
|
-
|
$
|
-
|
See accompanying notes to condensed financial statements
10
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General
The accompanying condensed unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q for quarterly reports under Section 13 or 15(d) of the Securities Exchange Act of 1934. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended June 30, 2010, six months ended September 30, 2010 and nine months ended December 31, 2010 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2011. For further information, refer to the financial statements and footnotes thereto included in the Partnership's annual report on Form 10-K for the fiscal year ended March 31, 2010.
Organization
WNC Housing Tax Credit Fund VI, L.P., Series 12 (the “Partnership”) is a California Limited Partnership formed under the laws of the State of California on July 17, 2003, and commenced operations on January 21, 2005. The Partnership was formed to acquire limited partnership interests in other limited partnerships ("Local Limited Partnerships") which own multi-family housing complexes (“Housing Complexes”) that are eligible for Federal low income housing tax credits (“Low Income Housing Tax Credits”). The local general partners (the “Local General Partners”) of each Local Limited Partnership retain responsibility for maintaining, operating and managing the Housing Complex. Each Local Limited Partnership is governed by its agreement of limited partnership (the “Local Limited Partnership Agreement”).
The general partner of the Partnership is WNC National Partners, LLC. (the “General Partner”). The general partner of the General Partner is WNC & Associates, Inc. (“Associates”). The chairman and the president of Associates own all of the outstanding stock of Associates. The business of the Partnership is conducted primarily through Associates as the General Partner and the Partnership have no employees of their own.
The Partnership shall continue in full force and effect until December 31, 2065, unless terminated prior to that date, pursuant to the partnership agreement or law.
The financial statements include only activity relating to the business of the Partnership, and do not give effect to any assets that the partners may have outside of their interests in the Partnership, or to any obligations, including income taxes, of the partners.
The Partnership Agreement authorized the sale of up to 25,000 units of limited partnership interest (“Partnership Units”) at $1,000 per Partnership Unit. The offering of Partnership Units has concluded, and 15,019 Partnership Units representing subscriptions in the amount of $15,009,365, net of dealer discounts of $5,600 and volume discounts of $4,035, had been accepted. The General Partner has a 0.1% interest in operating profits and losses, taxable income and losses, cash available for distribution from the Partnership and Low Income Housing Tax Credits of the Partnership. The investors (the “Limited Partners”) in the Partnership will be allocated the remaining 99.9% of these items in proportion to their respective investments.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
11
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
The proceeds from the disposition of any of the Housing Complexes will be used first to pay debts and other obligations per the respective Local Limited Partnership Agreement. Any remaining proceeds will then be paid to the Partnership. The sale of a Housing Complex may be subject to other restrictions and obligations. Accordingly, there can be no assurance that a Local Limited Partnership will be able to sell its Housing Complex. Even if it does so, there can be no assurance that any significant amounts of cash will be distributed to the Partnership. Should such distributions occur, the Limited Partners will be entitled to receive distributions from the proceeds remaining after payment of Partnership obligations and funding reserves, equal to their capital contributions and their return on investment (as defined in the partnership agreement). The General Partner would then be entitled to receive proceeds equal to its capital contributions from the remainder. Any additional sale or refinancing proceeds will be distributed 90% to the Limited Partners (in proportion to their respective investments) and 10% to the General Partner.
Risks and Uncertainties
An investment in the Partnership and the Partnership’s investments in Local Limited Partnerships and their Housing Complexes are subject to risks. These risks may impact the tax benefits of an investment in the Partnership, and the amount of proceeds available for distribution to the Limited Partners, if any, on liquidation of the Partnership’s investments. Some of those risks include the following:
The Low Income Housing Tax Credits rules are extremely complicated. Noncompliance with these rules results in the loss of future Low Income Housing Tax Credits and the fractional recapture of Low Income Housing Tax Credits already taken. In most cases the annual amount of Low Income Housing Tax Credits that an individual can use is limited to the tax liability due on the person’s last $25,000 of taxable income. The Local Limited Partnerships may be unable to sell the Housing Complexes at a price which would result in the Partnership realizing cash distributions or proceeds from the transaction. Accordingly, the Partnership may be unable to distribute any cash to its Limited Partners. Low Income Housing Tax Credits may be the only benefit from an investment in the Partnership.
The Partnership has invested in a limited number of Local Limited Partnerships. Such limited diversity means that the results of operation of each single Housing Complex will have a greater impact on the Partnership. With limited diversity, poor performance of one Housing Complex could impair the Partnership’s ability to satisfy its investment objectives. Each Housing Complex is subject to mortgage indebtedness. If a Local Limited Partnership failed to pay its mortgage, it could lose its Housing Complex in foreclosure. If foreclosure were to occur during the first 15 years (the “Compliance Period”), the loss of any remaining future Low Income Housing Tax Credits, a fractional recapture of prior Low Income Housing Tax Credits, and a loss of the Partnership’s investment in the Housing Complex would occur. The Partnership is a limited partner or a non-managing member of each Local Limited Partnership. Accordingly, the Partnership will have very limited rights with respect to management of the Local Limited Partnerships. The Partnership will rely totally on the Local General Partners. Neither the Partnership’s investments in Local Limited Partnerships, nor the Local Limited Partnerships’ investments in Housing Complexes, are readily marketable. To the extent the Housing Complexes receive government financing or operating subsidies, they may be subject to one or more of the following risks: difficulties in obtaining tenants for the Housing Complexes; difficulties in obtaining rent increases; limitations on cash distributions; limitations on sales or refinancing of Housing Complexes; limitations on transfers of interests in Local Limited Partnerships; limitations on removal of Local General Partners; limitations on subsidy programs; and possible changes in applicable regulations. Uninsured casualties could result in loss of property and Low Income Housing Tax Credits and recapture of Low Income Housing Tax Credits previously taken. The value of real estate is subject to risks from fluctuating economic conditions, including employment rates, inflation, tax, environmental, land use and zoning policies, supply and demand of similar properties, and neighborhood conditions, among others.
12
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
The ability of Limited Partners to claim tax losses from the Partnership is limited. The IRS may audit the Partnership or a Local Limited Partnership and challenge the tax treatment of tax items. The amount of Low Income Housing Tax Credits and tax losses allocable to the limited partners could be reduced if the IRS were successful in such a challenge. The alternative minimum tax could reduce tax benefits from an investment in the Partnership. Changes in tax laws could also impact the tax benefits from an investment in the Partnership and/or the value of the Housing Complexes.
The Partnership currently has insufficient working capital to fund its operations. Associates has agreed to continue providing advances sufficient enough to fund the operations and working capital requirements of the Partnership through August 31, 2012.
Anticipated future and existing cash resources of the Partnership are not sufficient to pay existing liabilities of the Partnership. However, substantially all of the existing liabilities of the Partnership are payable to the General Partner and/or its affiliates. Though the amounts payable to the General Partner and/or its affiliates are contractually currently payable, the Partnership anticipates that the General Partner and/or its affiliates will not require the payment of these contractual obligations until capital reserves are in excess of the aggregate of then existing contractual obligations and then anticipated future foreseeable obligations of the Partnership. The Partnership would be adversely affected should the General Partner and/or its affiliates demand current payment of the existing contractual obligations and or suspend services for this or any other reason.
No trading market for the Partnership Units exists or is expected to develop. Limited Partners may be unable to sell their Partnership Units except at a discount and should consider their Partnership Units to be a long-term investment. Individual Limited Partners will have no recourse if they disagree with actions authorized by a vote of the majority of Limited Partners.
Exit Strategy
The Compliance Period for a Housing Complex is generally 15 years following construction or rehabilitation completion. Associates was one of the first in the industry to offer syndicated investments in Low Income Housing Tax Credits. The initial programs have completed their Compliance Periods.
Upon the sale of a Local Limited Partnership interest or Housing Complex after the end of the Compliance Period, there would be no recapture of Low Income Housing Tax Credits. A sale prior to the end of the Compliance Period could result in recapture if certain conditions are not met. None of the Housing Complexes have completed their 15-year Compliance Period.
With that in mind, the General Partner is continuing its review of the Housing Complexes. The review considers many factors, including extended use requirements (such as those due to mortgage restrictions or state compliance agreements), the condition of the Housing Complexes, and the tax consequences to the Limited Partners from the sale of the Housing Complexes.
Upon identifying those Housing Complexes with the highest potential for a successful sale, refinancing or re-syndication, the Partnership expects to proceed with efforts to liquidate them. The objective is to maximize the Limited Partners’ return wherever possible and, ultimately, to wind down the Partnership as Low Income Housing Tax Credits are no longer available. Local Limited Partnership interests may be disposed of any time by the General Partner in its discretion. While liquidation of the Housing Complexes continues to be evaluated, the dissolution of the Partnership was not imminent as of December 31, 2010.
13
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
Method of Accounting for Investments in Local Limited Partnerships
The Partnership accounts for its investments in Local Limited Partnerships using the equity method of accounting, whereby the Partnership adjusts its investment balance for its share of the Local Limited Partnerships’ results of operations and for any contributions made and distributions received. The Partnership reviews the carrying amount of an individual investment in a Local Limited Partnership for possible impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount of such investment may not be recoverable. Recoverability of such investment is measured by the estimated value derived by management, generally consisting of the sum of the remaining future Low Income Housing Tax Credits estimated to be allocable to the Partnership and the estimated residual value to the Partnership. If an investment is considered to be impaired,, the Partnership reduces the carrying value of its investment in any such Local Limited Partnership. The accounting policies of the Local Limited Partnerships, generally, are expected to be consistent with those of the Partnership. Costs incurred by the Partnership in acquiring the investments were capitalized as part of the investment and are being amortized over 27.5 years (see Note 2).
“Equity in losses of Local Limited Partnerships” for each of the periods ended June 30, 2010 and 2009, September 30, 2010 and 2009 and December 31, 2010 and 2009, respectively have been recorded by the Partnership. Management’s estimate for the three, six and nine-month periods is based on actual audited results reported by the Local Limited Partnerships. Equity in losses from the Local Limited Partnerships allocated to the Partnership are not recognized to the extent that the investment balance would be adjusted below zero. If the Local Limited Partnerships report net income in future years, the Partnership will resume applying the equity method only after its share of such net income equals the share of net losses not recognized during the period(s) the equity method was suspended (see Note 2).
In accordance with the accounting guidance for the consolidation of variable interest entities, the Partnership determines when it should include the assets, liabilities, and activities of a variable interest entity (VIE) in its financial statements, and when it should disclose information about its relationship with a VIE. The analysis that must be performed to determine which entity should consolidate a VIE focuses on control and economic factors. A VIE is a legal structure used to conduct activities or hold assets, which must be consolidated by a company if it is the primary beneficiary because it has (1) the power to direct the activities of the VIE that most significantly impact the VIE's economic performance and (2) the obligation to absorb losses or receive benefits that could potentially be significant to the VIE. If multiple unrelated parties share such power, as defined, no party will be required to consolidate the VIE. Further, the guidance requires continual reconsideration of the primary beneficiary of a VIE.
Based on this guidance, the Local Limited Partnerships in which the Partnership invests meet the definition of a VIE because the owners of the equity at risk in these entities do not have the power to direct their operations. However, management does not consolidate the Partnership's interests in these VIEs, as it is not considered to be the primary beneficiary since it does not have the power to direct the activities that are considered most significant to the economic performance of these entities. The Partnership currently records the amount of its investment in these Local Limited Partnerships as an asset on its balance sheets, recognizes its share of partnership income or losses in the statements of operations, and discloses how it accounts for material types of these investments in its financial statements. The Partnership's balance in investment in Local Limited Partnerships, plus the risk of recapture of tax credits previously recognized on these investments, represents its maximum exposure to loss. The Partnership's exposure to loss on these Local Limited Partnerships is mitigated by the condition and financial performance of the underlying Housing Complexes as well as the strength of the Local General Partners and their guarantee against credit recapture to the investors in the Partnership.
Distributions received by the Partnership are accounted for as a reduction of the investment balance. Distributions received after the investment has reached zero are recognized as distribution income. As of June 30, 2010, September 30, 2010 and December 31, 2010, three investment accounts in Local Limited Partnerships had reached a zero balance.
14
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could materially differ from those estimates.
Cash and Cash Equivalents
The Partnership considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. As of June 30, 2010, September 30, 2010, December 31, 2010 and March 31, 2010, the Partnership had cash equivalents of approximately $1,099,000, $1,071,000, $1,070,000 and $1,124,000, respectively.
Concentration of Credit Risk
For all periods presented, the Partnership maintained cash and cash equivalent balances at certain financial institutions in excess of the federally insured maximum. The Partnership believes it is not exposed to any significant financial risk on cash and cash equivalents.
Reporting Comprehensive Income
The Partnership had no items of other comprehensive income for all periods presented.
Income Taxes
The Partnership has elected to be treated as a pass-through entity for income tax purposes and, as such, is not subject to income taxes. Rather, all items of taxable income, deductions and tax credits are passed through to and are reported by its owners on their respective income tax returns. The Partnership’s federal tax status as a pass-through entity is based on its legal status as a partnership. Accordingly, the Partnership is not required to take any tax positions in order to qualify as a pass-through entity. The Partnership is required to file and does file tax returns with the Internal Revenue Service and other taxing authorities. Accordingly, these financial statements do not reflect a provision for income taxes and the Partnership has no other tax positions which must be considered for disclosure.
Net Loss Per Partnership Unit
Net loss per Partnership Unit includes no dilution and is computed by dividing loss available to Limited Partners by the weighted average number of Partnership Units outstanding during the period. Calculation of diluted net loss per Partnership Unit is not required.
Revenue Recognition
The Partnership is entitled to receive reporting fees from the Local Limited Partnerships. The intent of the reporting fees is to offset (in part) administrative costs incurred by the Partnership in corresponding with the Local Limited Partnerships. Due to the uncertainty of the collection of these fees, the Partnership recognizes reporting fees as collections are made.
15
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
Amortization
Acquisition fees and costs are being amortized over 27.5 years using the straight-line method. Amortization expense for each of the three months ended June 30, 2010 and 2009 was $12,322. For each of the six months ended September 30, 2010 and 2009, amortization expense was $24,644, and for each of the nine months ended December 31, 2010 and 2009, amortization expense was $36,966.
Impairment
The Partnership reviews its investments in Local Limited Partnership for impairment at least annually or whenever events or changes in circumstances indicate that the carrying value of such investments may not be recoverable. Recoverability is measured by a comparison of the carrying amount of the investment to the sum of the total amount of the remaining Low Income Housing Tax Credits allocated to the Partnership and any estimated residual value of the investment. For the three months ended June 30, 2010 and 2009, impairment loss related to investments in Local Limited Partnerships was $208,217 and $212,204, respectively. During each of the six months ended September 30, 2010 and 2009, the impairment loss was $208,217 and $212,204, respectively, and during each of the nine months ended December 31, 2010 and 2009, the impairment loss was $208,217 and $212,204, respectively.
The Partnership also evaluates its intangibles for impairment in connection with its investments in Local Limited Partnerships. Impairment on the intangibles is measured by comparing the Partnership’s total investment balance after impairment of investments in Local Limited Partnerships to the sum of the total of the remaining Low Income Housing Tax Credits allocated to the Partnership and any estimated residual value of the investments. For each of the three months ended June 30, 2010 and 2009, each of the six months ended September 30, 2010 and 2009 and each of the nine months ended December 31, 2010 and 2009, the impairment loss was $0.
NOTE 2 - INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS
As of all periods presented, the Partnership had acquired limited partnership interests in 10 Local Limited Partnerships, each of which owns one Housing Complex, consisting of an aggregate of 550 apartment units. The respective Local General Partners of the Local Limited Partnerships manage the day to day operations of the entities. Significant Local Limited Partnership business decisions, as defined, require approval from the Partnership. The Partnership, as a Limited Partner, is generally entitled to 99.98%, as specified in the Local Limited Partnership Agreements, of the operating profits and losses, taxable income and losses, and tax credits of the Local Limited Partnerships.
16
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 2 - INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS, continued
The following is a summary of the equity method activity of the investments in Local Limited Partnerships for the periods presented below:
|
For the Three
Months Ended
June 30, 2010
|
For the Year Ended
March 31, 2010
|
||||
|
Investments per balance sheet, beginning of period
|
$
|
8,026,278
|
$
|
9,012,662
|
|
|
Impairment loss
|
(208,217)
|
(212,204)
|
|||
|
Equity in losses of Local Limited Partnerships
|
(178,841)
|
(724,892)
|
|||
|
Amortization of paid acquisition fees and costs
|
(12,287)
|
(49,148)
|
|||
|
Amortization of warehouse interest and costs
|
(35)
|
(140)
|
|||
|
Investments per balance sheet, end of period
|
$
|
7,626,898
|
$
|
8,026,278
|
|
For the Six
Months Ended
September 30, 2010
|
For the Year Ended
March 31, 2010
|
||||
|
Investments per balance sheet, beginning of period
|
$
|
8,026,278
|
$
|
9,012,662
|
|
|
Impairment loss
|
(208,217)
|
(212,204)
|
|||
|
Equity in losses of Local Limited Partnerships
|
(336,045)
|
(724,892)
|
|||
|
Amortization of paid acquisition fees and costs
|
(24,574)
|
(49,148)
|
|||
|
Amortization of warehouse interest and costs
|
(70)
|
(140)
|
|||
|
Investments per balance sheet, end of period
|
$
|
7,457,372
|
$
|
8,026,278
|
|
For the Nine
Months Ended
December 31, 2010
|
For the Year Ended
March 31, 2010
|
||||
|
Investments per balance sheet, beginning of period
|
$
|
8,026,278
|
$
|
9,012,662
|
|
|
Impairment loss
|
(208,217)
|
(212,204)
|
|||
|
Equity in losses of Local Limited Partnerships
|
(493,249)
|
(724,892)
|
|||
|
Amortization of paid acquisition fees and costs
|
(36,861)
|
(49,148)
|
|||
|
Amortization of warehouse interest and costs
|
(105)
|
(140)
|
|||
|
Investments per balance sheet, end of period
|
$
|
7,287,846
|
$
|
8,026,278
|
17
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 2 - INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS, continued
|
For the Three Months Ended
June 30, 2010
|
For the Year Ended
March 31, 2010
|
|||
|
Investments in Local Limited Partnerships, net
|
$
|
6,507,947
|
$
|
6,895,005
|
|
Acquisition fees and costs, net of accumulated amortization of $236,542 and $224,220
|
1,118,951
|
1,131,273
|
||
|
Investments per balance sheet, end of period
|
$
|
7,626,898
|
$
|
8,026,278
|
|
For the Six Months Ended
September 30, 2010
|
For the Year Ended
March 31, 2010
|
|||
|
Investments in Local Limited Partnerships, net
|
$
|
6,350,743
|
$
|
6,895,005
|
|
Acquisition fees and costs, net of accumulated amortization of $248,864 and $224,220
|
1,106,629
|
1,131,273
|
||
|
Investments per balance sheet, end of period
|
$
|
7,457,372
|
$
|
8,026,278
|
|
For the Nine Months Ended
December 31, 2010
|
For the Year Ended
March 31, 2010
|
|||
|
Investments in Local Limited Partnerships, net
|
$
|
6,193,539
|
$
|
6,895,005
|
|
Acquisition fees and costs, net of accumulated amortization of $261,186 and $224,220
|
1,094,307
|
1,131,273
|
||
|
Investments per balance sheet, end of period
|
$
|
7,287,846
|
$
|
8,026,278
|
18
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 2 - INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS, continued
Selected financial information for the three months ended June 30, 2010 and 2009 from the unaudited combined condensed financial statements of the Local Limited Partnerships in which the Partnership has invested is as follows:
|
COMBINED CONDENSED STATEMENTS OF OPERATIONS
|
||||||
|
2010
|
2009
|
|||||
|
Revenues
|
$
|
841,000
|
$
|
816,000
|
||
|
Expenses:
|
||||||
|
|
Interest expense
|
232,000
|
224,000
|
|||
|
Depreciation and amortization
|
283,000
|
285,000
|
||||
|
Operating expenses
|
525,000
|
515,000
|
||||
|
Total expenses
|
1,040,000
|
1,024,000
|
||||
|
Net loss
|
$
|
(199,000)
|
$
|
(208,000)
|
||
|
Net loss allocable to the Partnership
|
$
|
(198,000)
|
$
|
(207,000)
|
||
|
Net loss recorded by the Partnership
|
$
|
(179,000)
|
$
|
(181,000)
|
||
Selected financial information for the six months ended September 30, 2010 and 2009 from the unaudited combined condensed financial statements of the Local Limited Partnerships in which the Partnership has invested is as follows:
|
COMBINED CONDENSED STATEMENTS OF OPERATIONS
|
|||||||
|
2010
|
2009
|
||||||
|
Revenues
|
$
|
1,682,000
|
$
|
1,632,000
|
|||
|
Expenses:
|
|||||||
|
|
Interest expense
|
463,000
|
447,000
|
||||
|
Depreciation and amortization
|
566,000
|
570,000
|
|||||
|
Operating expenses
|
1,050,000
|
1,031,000
|
|||||
|
Total expenses
|
2,079,000
|
2,048,000
|
|||||
|
Net loss
|
$
|
(397,000)
|
$
|
(416,000)
|
|||
|
Net loss allocable to the Partnership
|
$
|
(396,000)
|
$
|
(415,000)
|
|||
|
Net loss recorded by the Partnership
|
$
|
(336,000)
|
$
|
(362,000)
|
|||
19
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 2 - INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS, continued
Selected financial information for the nine months ended December 31, 2010 and 2009 from the unaudited combined condensed financial statements of the Local Limited Partnerships in which the Partnership has invested is as follows:
|
COMBINED CONDENSED STATEMENTS OF OPERATIONS
|
||||||
|
2010
|
2009
|
|||||
|
Revenues
|
$
|
2,523,000
|
$
|
2,449,000
|
||
|
Expenses:
|
||||||
|
|
Interest expense
|
694,000
|
672,000
|
|||
|
Depreciation and amortization
|
850,000
|
854,000
|
||||
|
Operating expenses
|
1,575,000
|
1,547,000
|
||||
|
Total expenses
|
3,119,000
|
3,073,000
|
||||
|
Net loss
|
$
|
(596,000)
|
$
|
(624,000)
|
||
|
Net loss allocable to the Partnership
|
$
|
(595,000)
|
$
|
(622,000)
|
||
|
Net loss recorded by the Partnership
|
$
|
(493,000)
|
$
|
(544,000)
|
||
Certain Local Limited Partnerships incurred operating losses and/or have working capital deficiencies. In the event these Local Limited Partnerships continue to incur significant operating losses, additional capital contributions by the Partnership and/or the Local General Partners may be required to sustain the operations of such Local Limited Partnerships. If additional capital contributions are not made when they are required, the Partnership's investment in certain of such Local Limited Partnerships could be impaired, and the loss and recapture of the related Low Income Housing Tax Credits could occur.
Troubled Housing Complexes
During the period from January 21, 2005 (date operations commenced) through March 31, 2005, the Partnership acquired a Local Limited Partnership Interest in Marfa Villa, LTD (“Marfa”). During the year ended March 31, 2006, the Partnership acquired a Local Limited Partnership Interest in Saltgrass Landing Apartments, LTD (“Saltgrass”). The Partnership acquired the Local Limited Partnership Interests in Marfa and Saltgrass for $246,409 and $733,552, respectively. Upon acquisition, it was expected that Marfa and Saltgrass would generate Low Income Housing Tax Credits amounting to $324,320 and $940,640, respectively. Marfa and Saltgrass are managed by the same third party management company and have the same Local General Partner. Both Housing Complexes were acquisition rehabilitation projects. Additionally, both Housing Complexes have not delivered any Low Income Housing Tax Credits to date due to the fact that the rehabilitation work on the Housing Complexes was not completed within the allowable timeframe required by the Texas Department of Housing Community Affairs (“TDHCA”).
20
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 2 - INVESTMENTS IN LOCAL LIMITED PARTNERSHIPS, continued
During 2010 TDHCA notified the Local General Partner and the Partnership that the Low Income Housing Tax Credits for both of these Housing Complexes were forfeited and could not be claimed. TDHCA has stated that the proper paperwork was not filed with the agency as proof that the rehabilitation work was completed on the Housing Complexes, and therefore Form 8609’s were not and will not be issued for either Housing Complex. After multiple conversations between the Local General Partner and the Partnership, a draft settlement structure was agreed to by all parties. Upon the settlement agreement being routed for signatures, the Local General Partner decided that he did not agree to the terms of the agreement and accordingly, refused to sign the agreement. The Partnership called for an all partners meeting, which took place on July 12, 2011. At the meeting, a vote was taken to remove the Local General Partner. In accordance with the Local Limited Partnership Agreements, the limited partner has the right to remove the Local General Partner for nonperformance. The limited partner voted in favor of removing the Local General Partner, with that vote making up 99.98% of the total votes. The Local General Partner has challenged such removal. Even though a majority was in favor of removal, since the Local General Partner is contesting the removal, he is still legally the Local General Partner. While the Local General Partner challenges this proposed removal, he remains the active Local General Partner and his management company continues to manage the Housing Complexes. Currently, the Partnership is consulting with legal counsel in regards to further actions that will be taken.
Management of the Partnership deems the Partnership’s investments in Marfa and Saltgrass to be impaired due to the loss of all Low Income Housing Tax Credit associated with these Housing Complexes. As of March 31, 2006, the Partnership had paid $147,875 of the $246,409 of capital contributions to be paid to Marfa per the Local Limited Partnership Agreement, with the balance of $98,534 being fully paid to the Local Limited Partnership as of March 31, 2011. As of March 31, 2006, the Partnership had recorded $14,898 of equity in losses of Marfa, and therefore an impairment loss of $231,511 was recorded against the Partnership’s investment in Marfa during the year ended March 31, 2006, thus reducing the Partnership’s investment in this Local Limited Partnership to $0. As of March 31, 2006, the Partnership had paid $550,247 of the $733,552 of capital contributions to be paid to Saltgrass per the Local Limited Partnership Agreement. As a result of the Low Income Housing Tax Credits not being delivered for this Housing Complex, management of the Partnership had deemed that the Partnership is not liable to fund, and will not fund, the remaining capital contributions of $183,305. As of March 31, 2006, the Partnership had recorded $43,980 of equity in losses of Saltgrass, and therefore an impairment loss of $506,267 was recorded against the Partnership’s investment in Saltgrass during the year ended March 31, 2006, thus reducing the Partnership’s investment in this Local Limited Partnership to $0.
NOTE 3 - RELATED PARTY TRANSACTIONS
Under the terms of the partnership agreement, the Partnership has paid or is obligated to the General Partner or its affiliates for the following fees:
|
(a)
|
Acquisition fees of 7% of the gross proceeds from the sale of Partnership Units as compensation for services rendered in connection with the acquisition of Local Limited Partnerships. As of all periods presented, the Partnership incurred cumulative acquisition fees of $1,051,330, which have been included in investments in Local Limited Partnerships. Accumulated amortization of these capitalized costs was $183,227, $192,783, $202,339 and $173,671 as of June 30, 2010, September 30, 2010, December 31, 2010 and March 31, 2010, respectively.
|
21
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 3 - RELATED PARTY TRANSACTIONS, continued
|
(b)
|
Acquisition costs of 2% of the gross proceeds from the sale of Partnership Units as reimbursement of costs incurred by of the General Partner or by an affiliate of Associates in connection with the acquisition of Local Limited Partnerships. As of all periods presented, the Partnership incurred cumulative acquisition costs of $300,380, which have been included in investments in Local Limited Partnerships. Accumulated amortization of these capitalized costs was $52,569, $55,300, $58,031 and $49,838 as of June 30, 2010, September 30, 2010, December 31, 2010 and March 31, 2010, respectively.
|
|
(c)
|
An annual asset management fee not to exceed 0.5% of the invested assets of the Partnership, as defined. “Invested Assets” means the sum of the Partnership’s investment in Local Limited Partnership interests and the Partnership’s allocable share of mortgage loans on and other debts related to the Housing Complexes owned by such Local Limited Partnerships. Asset management fees of $41,682 were incurred during each of the three months ended June 30, 2010 and 2009. For each of the six months ended September 30, 2010 and 2009, the Partnership incurred asset management fees of $83,364. Asset management fees of $125,046 were incurred during each of the nine months ended December 31, 2010 and 2009, respectively. The Partnership paid the General Partner or its affiliates $25,000 and $22,000 of those fees during the three months ended June 30, 2010 and 2009, respectively, $25,000 and $22,000 during the six months ended September 30, 2010 and 2009, respectively, and $25,000 and $22,000 during the nine months ended December 31, 2010 and 2009, respectively.
|
|
(d)
|
A subordinated disposition fee in an amount equal to 1% of the sale price of real estate sold by the Local Limited Partnerships. Payment of this fee is subordinated to the Limited Partners receiving distributions equal to their capital contributions and their return on investment (as defined in the Partnership Agreement) and is payable only if services are rendered in the sales effort. No such fee was incurred for all periods presented.
|
|
(e)
|
The Partnership reimburses the General Partner or its affiliates for operating expenses incurred on behalf of the Partnership. Operating expense reimbursements were $13,409 and $0 during the three months ended June 30, 2010 and 2009, respectively, $13,409 and $4,230 during the six months ended September 30, 2010 and 2009, respectively, and $13,409 and $4,230 during the nine months ended December 31, 2010 and 2009, respectively.
|
|
(f)
|
WNC Holding, LLC (“Holding”), a wholly owned subsidiary of Associates, acquires investments in Local Limited Partnerships using funds from a secured warehouse line of credit. Such investments are warehoused by Holding until transferred to syndicated partnerships as investors are identified. The transfer of the warehoused investments is typically achieved through the admittance of the syndicated partnership as the Limited Partner of the Local Limited Partnership and the removal of Holding as the Limited Partner. Consideration paid to Holding for the transfer of its interest in the Local Limited Partnership generally consists of cash reimbursement of capital contribution installment(s) paid to the Local Limited Partnerships by Holding, assumption of the remaining capital contributions payable due to the Local Limited Partnership and financing costs and interest charged by Holding. As of the end of all periods presented, the Partnership incurred financing costs of $2,511 and interest of $1,272 which are included in investments in Local Limited Partnerships. The accumulated amortization of these financing costs and interest was $746, $781, $816 and $711 as of June 30, 2010, September 30, 2010, December 31, 2010 and March 31, 2010, respectively.
|
22
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
(A California Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
For the Quarterly Periods Ended June 30, 2010, September 30, 2010 and
December 31, 2010
(Unaudited)
NOTE 3 - RELATED PARTY TRANSACTIONS, continued
The accrued fees and expenses due to General Partner and affiliates consisted of the following at:
|
June 30,
2010
|
September 30, 2010
|
December 31, 2010
|
March 31, 2010
|
||||||
|
Asset management fee payable
|
$
|
574,138
|
$
|
615,820
|
$
|
657,502
|
$
|
557,456
|
|
|
Expenses paid by the General
Partner or an affiliate on
behalf of the Partnership
|
34
|
4,507
|
10,516
|
12,514
|
|||||
|
Total
|
$
|
574,172
|
$
|
620,327
|
$
|
668,018
|
$
|
569,970
|
The General Partner and/or its affiliates do not anticipate that these accrued fees will be paid in full until such time as capital reserves are in excess of future foreseeable working capital requirements of the Partnership.
NOTE 4 – PAYABLES TO LOCAL LIMITED PARTNERSHIPS
Payables to Local Limited Partnerships amounting to $649,499, $624,895, $624,895 and $649,499 at June 30, 2010, September 30, 2010, December 31, 2010 and March 31, 2010, respectively, represent amounts which are due at various times based on conditions specified in the respective Local Limited Partnership Agreements. These contributions are payable in installments and are generally due upon the Local Limited Partnerships achieving certain development and operating benchmarks (generally within two years of the Partnership's initial investment). The payables to Local Limited Partnerships are subject to adjustment in certain circumstances.
NOTE 5 – SUBSEQUENT EVENTS
Subsequent to all periods presented, the Partnership called for an all partners meetings to vote on the removal of the Local General Partner of two of the Partnership’s Local Limited Partnership Interests, Marfa and Saltgrass. At this meeting, a majority of votes were cast in favor of removing the Local General Partner. The Local General Partner has challenged the removal. Currently, the Partnership is consulting with legal counsel in regards to further actions to be taken. See Note 2 to the audited financial statements for more information on Marfa and Saltgrass.
23
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Forward Looking Statements
With the exception of the discussion regarding historical information, this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other discussions elsewhere in this Form 10-Q contain forward looking statements. Such statements are based on current expectations subject to uncertainties and other factors which may involve known and unknown risks that could cause actual results of operations to differ materially from those projected or implied. Further, certain forward-looking statements are based upon assumptions about future events which may not prove to be accurate.
Risks and uncertainties inherent in forward looking statements include, but are not limited to, the Partnership’s future cash flows and ability to obtain sufficient financing, level of operating expenses, conditions in the Low Income Housing Tax Credit property market and the economy in general, as well as legal proceedings. Historical results are not necessarily indicative of the operating results for any future period.
Subsequent written and oral forward looking statements attributable to the Partnership or persons acting on its behalf are expressly qualified in their entirety by cautionary statements in this Form 10-Q and in other reports filed with the Securities and Exchange Commission.
The following discussion and analysis compares the results of operations for the three months ended June 30, 2010 and 2009, the three and six months ended September 30, 2010 and 2009, and the three and nine months ended December 31, 2010 and 2009, and should be read in conjunction with the condensed financial statements and accompanying notes included within this report.
Financial Condition
The Partnership’s assets at June 30, 2010 consisted of $1,165,000 in cash and cash equivalents and aggregate investments in ten Local Limited Partnerships of $7,627,000. Liabilities at June 30, 2010 consisted of $574,000 of accrued fees and expenses due to General Partner and affiliates and $649,000 of payables to Local Limited Partnerships.
The Partnership’s assets at September 30, 2010 consisted of $1,149,000 in cash and cash equivalents and aggregate investments in ten Local Limited Partnerships of $7,457,000. Liabilities at September 30, 2010 consisted of $620,000 of accrued fees and expenses due to General Partner and affiliates and $625,000 of payables to Local Limited Partnerships.
The Partnership’s assets at December 31, 2010 consisted of $1,150,000 in cash and cash equivalents and aggregate investments in ten Local Limited Partnerships of $7,288,000. Liabilities at December 31, 2010 consisted of $668,000 of accrued fees and expenses due to General Partner and affiliates and $625,000 of payables to Local Limited Partnerships.
24
Results of Operations
Three Months Ended June 30, 2010 Compared to Three Months Ended June 30, 2009 The Partnership's net loss for the three months ended June 30, 2010 was $(440,000), reflecting a decrease of approximately $8,000 from the net loss of $(448,000) for the three months ended June 30, 2009. The impairment loss decreased by $4,000 for the three months ended June 30, 2010. The impairment loss can vary each year depending on the annual decrease in Low Income Housing Tax Credits allocated to the Partnership and the current estimated residual value to the Partnership compared to the current carrying value of each of the investments to the Partnership. Equity in losses of Local Limited Partnerships decreased by $2,000 from the three months ended June 30, 2009 due to the operations of the underlying Housing Complexes fluctuating from period to period. The accounting and legal fees also decreased by $2,000 due to the timing of the accounting work performed.
Three Months Ended September 30, 2010 Compared to Three Months Ended September 30, 2009 The Partnership's net loss for the three months ended September 30, 2010 was $(207,000), reflecting a decrease of approximately $25,000 from the net loss of $(232,000) for the three months ended September 30, 2009. The reporting fees decreased by $(4,000) for the three months ended September 30, 2010 compared to the three months ended September 30, 2009. Local Limited Partnerships pay reporting fees to the Partnership when the Local Limited Partnerships’ cash flow will allow for the payment. Equity in losses of Local Limited Partnerships decreased by $24,000 from the three months ended September 30, 2009 due to the operations of the underlying Housing Complexes fluctuating from period to period. Also, one Local Limited Partnership reached a zero investment balance during the quarter ended June 30, 2010, therefore no further losses could be recorded. The accounting and legal fees also decreased by $5,000 due to the timing of the accounting work performed.
Six Months Ended September 30, 2010 Compared to Six Months Ended September 30, 2009 The Partnership's net loss for the six months ended September 30, 2010 was $(646,000), reflecting a decrease of approximately $34,000 from the net loss of $(680,000) for the six months ended September 30, 2009. The impairment loss decreased by $4,000 for the six months ended September 30, 2010. The loss can vary each year depending on the annual decrease in Low Income Housing Tax Credits allocated to the Partnership and the current estimated residual value to the Partnership compared to the current carrying value of each of the investments to the Partnership. The reporting fees decreased by $(4,000) for the six months ended September 30, 2010 compared to the six months ended September 30, 2009. Local Limited Partnerships pay the reporting fees to the Partnership when the Local Limited Partnerships’ cash flow will allow for the payment. Equity in losses of Local Limited Partnerships decreased by $26,000 from the six months ended September 30, 2009 due to the operations of the underlying Housing Complexes fluctuating from period to period. Also, one Local Limited Partnership reached a zero investment balance during the quarter ended June 30, 2010, therefore no further losses could be recorded. The accounting and legal fees also decreased by $8,000 for the six months ended September 30, 2010 due to the timing of the accounting work performed.
Three Months Ended December 31, 2010 Compared to Three Months Ended December 31, 2009 The Partnership's net loss for the three months ended December 31, 2010 was $(217,000), reflecting a decrease of approximately $19,000 from the net loss of $(236,000) for the three months ended December 31, 2009. Equity in losses of Local Limited Partnerships decreased by $24,000 from the three months ended December 31, 2009 due to the operations of the underlying Housing Complexes fluctuating from period to period. Also, one Local Limited Partnership reached a zero investment balance during the quarter ended June 30, 2010, therefore no further losses could be recorded. The accounting and legal fees increased by $(5,000) due to the timing of the accounting work performed.
Nine Months Ended December 31, 2010 Compared to Nine Months Ended December 31, 2009 The Partnership's net loss for the nine months ended December 31, 2010 was $(863,000), reflecting a decrease of approximately $53,000 from the net loss of $(916,000) for the nine months ended December 31, 2009. Equity in losses of Local Limited Partnerships decreased by $50,000 from the nine months ended December 31, 2009 due to the operations of the underlying Housing Complexes fluctuating from year to year. Also, one Local Limited Partnership reached a zero investment balance during the quarter ended June 30, 2010, therefore no further losses could be recorded. The impairment loss decreased by $4,000 for the nine months ended December 31, 2010. The loss can vary each year depending on the annual decrease in Low Income Housing Tax Credits allocated to the Partnership and the current estimated residual value to the Partnership compared to the
25
current carrying value of each of the investments to the Partnership. The reporting fees decreased by $(4,000) for the nine months ended December 31, 2010. Local Limited Partnerships pay the reporting fees to the Partnership when the Local Limited Partnerships’ cash flow will allow for the payment. The accounting and legal fees also decreased by $3,000 for the nine months ended December 31, 2010 due to the timing of the accounting work performed.
Capital Resources and Liquidity
Three Months Ended June 30, 2010 Compared to Three Months Ended June 30, 2009 Net cash and cash equivalents used during the three months ended June 30, 2010 was $(36,000), compared to net cash and cash equivalents used during the three months ended June 30, 2009 of $(26,000). The change was largely due to the Partnership reimbursing no operating advances to the General Partner or an affiliate during the three months ended June 30, 2009 compared to $13,000 reimbursed during the three months ended June 30, 2010. Additionally, during the three months ended June 30, 2010, the Partnership paid $25,000 in accrued asset management fees compared to $22,000 paid during the three months ended June 30, 2009. Each quarter the Partnership evaluates the cash position and determines how much of the accrued asset management fees will be paid to the General Partner or affiliate. During the three months ended June 30, 2009, the Partnership paid $(7,000) of capital contributions to Local Limited Partnerships compared to no such payments made during the three months ended June 30, 2010. The capital contributions are paid when certain benchmarks are met.
Six Months Ended September 30, 2010 Compared to Six Months Ended September 30, 2009 Net cash and cash equivalents used during the six months ended September 30, 2010 was $(52,000) compared to net cash and cash equivalents used during the six months ended September 30, 2009 of $(29,000). The change was partially due to the Partnership reimbursing $4,000 of operating advances to the General Partner or an affiliate during the six months ended September 30, 2009 compared to $13,000 reimbursed during the six months ended September 30, 2010. Additionally, during the six months ended September 30, 2010, the Partnership paid $25,000 in accrued asset management fees compared to $22,000 paid during the six months ended September 30, 2009. Each quarter the Partnership evaluates the cash position and determines how much of the accrued asset management fee and operating expense reimbursements will be paid to the General Partner or affiliate. During the six months ended September 30, 2009, the Partnership paid $(18,000) of capital contributions to Local Limited Partnerships compared to $(25,000) contributed during the six months ended September 30, 2010. The capital contributions are paid when certain benchmarks are met. The Partnership received $(4,000) less in reporting fees during the six months ended September 30, 2010 compared to the six months ended September 30, 2009. The reporting fees are paid to the Partnership when the Local Limited Partnerships’ cash flow will allow for the payment.
Nine Months Ended December 31, 2010 Compared to Nine Months Ended December 31, 2009 Net cash and cash equivalents used during the nine months ended December 31, 2010 was $(51,000) compared to net cash and cash equivalents used during the nine months ended December 31, 2009 of $(28,000). The change was partially due to the Partnership paying accrued asset management fees of $25,000 during the nine months ended December 31, 2010 compared to $22,000 paid during the nine months ended December 31, 2009. During the nine months ended December 31, 2010, the Partnership reimbursed the General Partner or an affiliate $13,000 for operating expenses paid on its behalf compared to $4,000 paid during the nine months ended December 31, 2009. The accrued asset management fees and reimbursement of operating expenses are paid after management reviews the cash position of the Partnership. The Partnership received $(4,000) less in reporting fees during the nine months ended December 31, 2010 compared to the nine months ended December 31, 2009. The reporting fees are paid to the Partnership when the Local Limited Partnerships’ cash flow will allow for the payment. During the nine months ended December 31, 2009, the Partnership paid $(18,000) in capital contributions to Local Limited Partnerships compared to $(25,000) contributed during the three months ended December 31, 2010. The capital contributions are paid when certain benchmarks are met.
During the three, six and nine months ended June 30, 2010, September 30, 2010 and December 31, 2010, accrued payables, which consist primarily of related party asset management fees and advances due to the General Partner or affiliates, increased by $4,000, $50,000 and $98,000, respectively, as compared to March 31, 2010. The General Partner does not anticipate that these accrued fees and advances will be paid until such time as capital reserves are in excess of foreseeable working capital requirements of the Partnership.
26
The Partnership expects its future cash flows, together with its net available assets as of December 31, 2010, to be insufficient to meet all currently foreseeable future cash requirements. Associates has agreed to continue providing advances sufficient enough to fund the operations and working capital requirements of the Partnership through August 31, 2012.
Recent Accounting Changes
In September 2006, the Financial Accounting Standards Board (the "FASB") issued accounting guidance for Fair Value Measurements, which defines fair value, establishes a framework for measuring fair value and expands disclosure about fair value measurements. This guidance is effective for financial statements issued for fiscal years beginning after November 15, 2007 and shall be applied prospectively except for very limited transactions. In February 2008, the FASB delayed for one year implementation of the guidance as it pertains to certain non-financial assets and liabilities. The Partnership adopted U.S. generally accepted accounting principles ("GAAP") for Fair Value Measurements effective April 1, 2008, except as it applies to those non-financial assets and liabilities, for which the effective date was April 1, 2009. The Partnership has determined that adoption of this guidance had no material impact on the Partnership’s financial statements.
In November 2008, the FASB issued accounting guidance on Equity Method Investment Accounting Considerations that addresses how the initial carrying value of an equity method investment should be determined, how an impairment assessment of an underlying indefinite-lived intangible asset of an equity method investment should be performed, how an equity method investee’s issuance of shares should be accounted for, and how to account for a change in an investment from the equity method to the cost method. This guidance is effective in fiscal years beginning on or after December 15, 2008, and interim periods within those fiscal years. The Partnership adopted the guidance for the interim quarterly period beginning April 1, 2009. The impact of adopting it did not have a material impact on the Partnership’s financial condition or results of operations.
In April 2009, the FASB issued accounting guidance for Interim Disclosures about Fair Value of Financial Instruments. This requires disclosure about the method and significant assumptions used to establish the fair value of financial instruments for interim reporting periods as well as annual statements. It became effective for as of and for the interim period ended June 30, 2009 and had no impact on the Partnership’s financial condition or results of operations.
In May 2009, the FASB issued guidance regarding subsequent events, which was subsequently updated in February 2010. This guidance established general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In particular, this guidance sets forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements, and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. This guidance was effective for financial statements issued for fiscal years and interim periods ending after June 15, 2009, and was therefore adopted by the Partnership for the quarter ended June 30, 2009. The adoption did not have a significant impact on the subsequent events that the Partnership reports, either through recognition or disclosure, in the financial statements. In February 2010, the FASB amended its guidance on subsequent events to remove the requirement to disclose the date through which an entity has evaluated subsequent events, alleviating conflicts with current SEC guidance. This amendment was effective immediately and therefore the Partnership did not include the disclosure in this Form 10-Q.
In June 2009, the FASB issued an amendment to the accounting and disclosure requirements for the consolidation of variable interest entities (VIEs). The amended guidance modified the consolidation model to one based on control and economics, and replaced quantitative primary beneficiary analysis with a qualitative analysis. The primary beneficiary of a VIE will be the entity that has (1) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (2) the obligation to absorb losses or receive benefits that could potentially be significant to the VIE. If multiple unrelated parties share such power, as defined, no party will be required to consolidate the VIE. Further, the amended guidance requires continual reconsideration of the primary beneficiary of a VIE and adds an additional reconsideration event for determination of whether an entity is a VIE. Additionally, the amendment requires enhanced and expanded disclosures around VIEs. This amendment is effective for fiscal years beginning after November 15, 2009. The adoption of this guidance on April 1, 2010 did not have a material effect on the Partnership’s financial statements.
27
In June 2009, the FASB issued the Accounting Standards Codification (Codification). Effective July 1, 2009, the Codification is the single source of authoritative accounting principles recognized by the FASB to be applied by non-governmental entities in the preparation of financial statements in conformity with GAAP. The Codification is intended to reorganize, rather than change, existing GAAP. Accordingly, all references to currently existing GAAP have been removed and have been replaced with plain English explanations of the Partnership’s accounting policies. The adoption of the Codification did not have a material impact on the Partnership’s financial position or results of operations.
Item 3. Quantitative and Qualitative Disclosures About Market Risks
NOT APPLICABLE
Item 4. Controls and Procedures
(a) Disclosure controls and procedures
As of the end of the periods covered by this report, the Partnership’s General Partner, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer of Associates, carried out an evaluation of the effectiveness of the Partnership’s “disclosure controls and procedures” as defined in Securities Exchange Act of 1934 Rule 13a-15 and 15d-15. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, the Partnership’s disclosure controls and procedures were not effective to ensure that material information required to be disclosed in the Partnership’s periodic report filings with SEC is recorded, processed, summarized and reported within the time period specified by the SEC’s rules and forms, consistent with the definition of “disclosure controls and procedures” under the Securities Exchange Act of 1934.
The Partnership must rely on the Local Limited Partnerships to provide the Partnership with certain information necessary to the timely filing of the Partnership’s periodic reports. Factors in the accounting at the Local Limited Partnerships have caused delays in the provision of such information during past reporting periods, and resulted in the Partnership’s inability to file its periodic reports in a timely manner.
Once the Partnership has received the necessary information from the Local Limited Partnerships, the Chief Executive Officer and the Chief Financial Officer of Associates believe that the material information required to be disclosed in the Partnership’s periodic report filings with SEC is effectively recorded, processed, summarized and reported, albeit not in a timely manner. Going forward, the Partnership will use the means reasonably within its power to impose procedures designed to obtain from the Local Limited Partnerships the information necessary to the timely filing of the Partnership’s periodic reports.
(b) Changes in internal controls
There were no changes in the Partnership’s internal control over financial reporting that occurred during the quarters ended June 30, 2010, September 30, 2010 and December 31, 2010 that materially affected, or are reasonably likely to materially affect, the Partnership’s internal control over financial reporting.
28
|
Part II.
|
Other Information
|
|
Item 1.
|
Legal Proceedings
|
|
NONE
|
|
|
Item 1A.
|
Risk Factors
|
|
No material changes in risk factors as previously disclosed in the Partnership’s Form 10-K.
|
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
|
NONE
|
|
|
Item 3.
|
Defaults Upon Senior Securities
|
|
NONE
|
|
|
Item 4.
|
(Removed and Reserved)
|
|
Item 5.
|
Other Information
|
|
NONE
|
|
|
Item 6.
|
Exhibits
|
|
31.1 Certification of the Chief Executive Officer pursuant to Rule 13a-14 or 15d-14, as adopted pursuant to section 302 of the Sarbanes-Oxley Act of 2002. (filed herewith)
|
|
31.2 Certification of the Chief Financial Officer pursuant to Rule 13a-14 or 15d-14, as adopted pursuant to section 302 of the Sarbanes-Oxley Act of 2002. (filed herewith)
|
32.1 Section 1350 Certification of the Chief Executive Officer. (filed herewith)
32.2 Section 1350 Certification of the Chief Financial Officer. (filed herewith)
29
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
WNC HOUSING TAX CREDIT FUND VI, L.P., SERIES 12
By: WNC National Partners, LLC. General Partner
By: /s/ Wilfred N. Cooper, Jr.
Wilfred N. Cooper, Jr.
President and Chief Executive Officer of WNC & Associates, Inc.
Date: August 26, 2011
By: /s/ Melanie R. Wenk
Melanie R. Wenk
Vice-President - Chief Financial Officer of WNC & Associates, Inc.
Date: August 26, 2011
30