CONTENTS

   

			Page
INDEPENDENT AUDITOR’S REPORT			F-2
FINANCIAL STATEMENTS:
	Balance Sheets		F-3
	Statements of Operations and Changes in Partners’ Equity		F-5
	Statements of Cash Flows		F-6
	Notes to Financial Statements		F-8
SUPPLEMENTARY INFORMATION:			F-13
	Supplemental Schedule of Expenses		F-14
	Supplemental Schedule of Changes in Partners’ Equity

  

 

Partners

Blessed Rock of El Monte

Costa Mesa, California

 

INDEPENDENT AUDITOR’S REPORT

 

I have audited the accompanying balance sheet of Blessed Rock of El Monte, a California Limited Partnership as of December 31, 2003 and 2004, and the related statements of operations and changes in partners’ equity, and operating cash flows for the years then ended. These financial statements are the responsibility of the partnership’s management. My responsibility is to express an opinion on these financial statements based on my audits.

 

I conducted my audits in accordance with auditing standards generally accepted in the United States. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audits provide a reasonable basis for my opinion.

 

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Blessed Rock of El Monte as of December 31, 2003 and 2004 and the results of its operations and its operating cash flows for the years then ended in conformity with accounting principles generally accepted in the United States.

 

My audit was conducted for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplementary information shown on page 12 and 13 is presented for the purpose of additional analysis and is not a required part of the basic financial statements of Blessed Rock of El Monte. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in my opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.

 

January 19, 2005

33-0724657

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

BALANCE SHEETS, DECEMBER 31, 2003 AND 2004

 

ASSETS

 

		2004				2003
Current Assets:
Operating cash and equivalents		$	227,596			$	71,300
Security deposit cash			25,969				24,223
Tenant accounts receivable			-				109
Other accounts receivable			81,081				-
Prepaid expenses			51,897				64,397
Total current assets			386,543				160,029
Property, Building, and Equipment, At Cost:
Land			1,271,162				1,271,162
Building and improvements			7,992,586				7,992,586
Equipment			54,657				54,657
			9,318,405				9,318,405
Accumulated depreciation			(1,523,169	)			(1,316,293	)
Property, building, and equipment - net			7,795,236				8,002,112
Other Assets:
Replacement reserve			135,579				114,561
Tax and insurance restricted accounts			23,916				62,253
Total other assets			159,495				176,814
		$	8,341,274			$	8,338,955

 

See the accompanying notes to financial statements.

 

 

Blessed Rock of El Monte

Balance Sheets, December 31, 2003 and 2004

Page 2

  

LIABILITIES AND PARTNERS’ EQUITY

 

		2004				2003
Current Liabilities:
Current portion of long-term debt		$	43,214			$	40,281
Accounts payable			4,535				-
Security trust liability			23,770				23,985
Accrued interest			14,701				14,938
Accrued asset management fees			33,078				32,880
Unearned rental income			1,007				632
Total current liabilities			120,305				112,716
Long-term Debt:
Mortgage payable, less current portion included above			2,459,144				2,502,358
Notes payable			681,525				681,525
Accrued interest payable			169,654				139,312
Grant loan payable			400,000				400,000
Developer fee payable			-				7,719
Total long-term debt			3,710,323				3,730,914
Partners’ equity			4,510,646				4,495,325
		$	8,341,274			$	8,338,955

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

STATEMENTS OF OPERATIONS AND CHANGES

IN PARTNERS’ EQUITY FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2004

 

		2004				2003
Revenue:
Gross potential rents		$	722,814			$	742,761
Excess rents			129,960				101,670
Less vacancies			(5,344	)			(1,878	)
Net rental income			847,430				842,553
Laundry and vending			11,703				11,714
Tenant charges			1,942				2,109
Interest income			977				1,010
Other income			35,276				20,260
Total revenues			897,328				877,646
Expenses:
Administrative			177,881				213,168
Utilities			64,157				57,279
Operating and maintenance			103,812				65,729
Taxes and insurance			58,507				42,116
Interest			210,744				208,077
Depreciation and amortization			206,876				231,971
Total expenses			819,310				821,007
Net income (loss)			78,018				56,639
Partners’ equity - beginning			4,495,325				4,438,686
Partners’ distributions			(62,697	)			-
Partners’ equity - ending		$	4,510,646			$	4,495,325

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2004

   

		2004				2003
Cash flows from operating activities:
Rental receipts		$	835,626			$	831,341
Operating interest receipts			402				349
Other operating receipts			13,645				34,083
Payments to suppliers and employees:
Administrative expenses			(44,918	)			(56,718	)
Management fees			(41,569	)			(66,912	)
Utilities			(64,157	)			(60,562	)
Salaries and wages			(55,374	)			(59,077	)
Operating and maintenance			(87,221	)			(50,599	)
Real estate taxes			(9,675	)			-
Payroll taxes			(7,017	)			(5,515	)
Property insurance			(8,405	)			(37,701	)
Miscellaneous taxes and insurance			(21,224	)			(42,989	)
Interest on mortgage			(177,972	)			(180,704	)
Interest on other notes			-				(86,401	)
Funding security deposit account			(1,961	)			25
Net cash provided by operating activities			330,180				218,620
Cash flows from investing activities:
Net tax and insurance impounds			(36,463	)			(8,712	)
Net reserve deposits, including interest			(21,018	)			(21,086	)
Reserve interest			575				661
Capital expenditures			-				(10,050	)
Net cash used in investing activities			(56,906	)			(39,187	)
Cash flows from financing activities:
Mortgage principal payments			(40,281	)			(37,547	)
Developer fee payments			(7,719	)			(91,000	)
Advances to general partner			(6,281	)			-
Partner distributions			(62,697	)			-
Other note payments			-				(25,688	)
Net cash used in financing activities			(116,978	)			(154,235	)
Net increase (decrease) in cash			156,296				25,198
Cash at beginning of year			71,300				46,102
Cash at end of year		$	227,596			$	71,300

 

See the accompanying notes to financial statements.

 

 

Blessed Rock of El Monte

Statements of Cash Flows, December 31, 2003 and 2004

Page 2

  

Reconciliation of Net Income (Loss)

to Net Cash Provided by Operating Activities

   

		2004				2003
Net income (loss)		$	78,018			$	56,639
Adjustments to reconcile net income (loss) to net cash Provided by operating activities:
Depreciation and amortization			206,876				231,971
Decrease (increase) in:
Security deposit cash			(1,746	)			600
Receivables			109				1,633
Prepaids			12,500				(34,322	)
Increase (decrease) in:
Payables			4,535				(12,627	)
Security deposit liability			(215	)			(575	)
Accrued expenses			30,303				(23,481	)
Unearned rental income			375				(557	)
Reserve interest earned			(575	)			(661	)
Net cash provided by operating activities		$	330,180			$	218,620

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2004

 

1.	ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	Organization: Blessed Rock of El Monte, a California limited partnership, was formed on November 22, 1995 by and between Everland, Inc., a California Corporation, as the general partner and Tom Y. Lee as the limited partner. The Partnership Agreement was amended and restated on December 29, 2000 defining the various partners of the partnership as the General Partner, the Managing General Partner, the Limited Partners and the Special Limited Partner.
	The Partnership was formed to acquire, construct, own and operate a 137-unit elderly facility apartment complex for low income residents in El Monte, California. The Partnership also generates tax credits to the partners in accordance with the provisions of the code and applicable Treasury regulations. The Partnership has qualified for low income housing tax credits as currently allowable under Section 42 of the Internal Revenue Code.
	The Partnership received HOME funds from the City of El Monte and redevelopment funds from the El Monte Community Redevelopment Agency as part of a public program to ensure affordable housing for senior citizen tenants. In addition, the El Monte Community Redevelopment Agency paid various project impact fees to the City of El Monte associated with the construction and development of the Project on behalf of the Partnership.
	Capitalization and Depreciation: Assets are recorded at cost and depreciated for financial accounting purposes using the straight-line method over their estimated useful lives. The principal estimated useful lives used in computing the depreciation provisions are 10 to 40 years for building and improvements, and 3 to 10 years for equipment The policy of the project is to charge amounts expended for maintenance, repairs, and minor replacements to expense, and to capitalize expenditures for major replacements and betterments.
	Cash and Cash Equivalents: For purposes of reporting cash flows, cash includes unrestricted cash in bank, cash on hand, savings accounts, and all certificates of deposit with original maturities of three months or less.
	The Partnership maintains its cash in bank deposit accounts, which at times may exceed federally insured limits. The Partnership has not experienced any losses in such accounts. The Partnership believes it is not exposed to any significant credit risk on cash and cash equivalents.
	Deferred Costs: Deferred costs, comprised of tax credit fees and organization costs are being amortized over five years.

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2004

Page 2

 

	Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect: (1) the reported amounts of assets and liabilities and disclosure of contingencies at the date of the financial statements, and (2) the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
	Rental Income and Unearned Rents: The Partnership rents apartment units on a month to month basis and recognizes revenues when earned. Advance receipts of rents are classified as liabilities until earned.
	Income Taxes: No provision is made for income taxes since such taxes, if any, are the liability of the individual partners.
2.	RESTRICTED FUNDS
	The Partnership is required to make monthly impound deposits to cover insurance premiums, property taxes and to maintain a reserve for replacements. These restricted funds are held by, and expenditures are subject to supervision and approval by, GMAC Commercial Mortgage.
3.	MORTGAGE PAYABLE

 

	Mortgage payable consists of a 7.05% real estate mortgage, payable to GMAC Commercial Mortgage, collateralized by a deed of trust on the real property. The obligation is payable in aggregate monthly principal and interest installments of $18,188 beginning July 1, 1998 with a balloon payment in the amount of $2,017,000 payable June 1, 2013.		$	2,502,358
	Less current portion			(43,214	)
			$	2,459,144

 

The amounts maturing for the next five years are:

 

	2005			$	43,214
	2006				46,361
	2007				49,737
	2008				53,360
	2009				57,245

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2004

Page 3

 

4.	NOTES PAYABLE

  

	Notes payable at December 31, 2004 consist of the following:
	4% note payable with a term of 15 years, payable to El Monte Community Redevelopment Agency (RDA), secured by deed of trust and rents from Project. Note subject to prepayment in whole or in part based on events constituting default under terms of promissory note agreement. No events of default have occurred through December 31, 2004. Payments of interest and principal made annually beginning on April 1, 2003, and thereafter on April 1 until outstanding principal balance of note and all accrued interest paid in full. Payments paid from 50% of the residual rental income, as defined in the promissory note agreement.  Payments, if any, applied first to accrued interest and second to principal of note. At December 31, 2004, accrued interest on note was $21,035.		$	250,878
	1% note payable with a term of 30 years beginning April 3, 1996, payable to RDA for various development fees, secured by a deed of trust and rents from the Project. Commencing April 3, 1997, and thereafter on April 3 for the following 6 succeeding years, payment of $4,239 due each year. Payment increases to $8,478 April 3, 2004 and continues the next 7 succeeding years.  April 3, 2012, payment increases to $32,534 and continues the next 14 succeeding years, or until paid in full.  Payments to be paid from 50% of residual rental income, as defined in promissory note agreement. Payments first applied to interest. At December 31, 2004, accrued interest on note was $8,618.			430,647
			$	681,525

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2004

Page 4

 

5.	GRANT LOAN PAYABLE
	The Partnership received a loan of $400,000 on April 3, 1996 from the City of El Monte as part of a public program to ensure affordable housing for senior citizen tenants. Interest accrues on the principal amount at 4%, with a term of 55 years. Loan is secured by a deed of trust and rents from the Project. At maturity, the principal amount of the loan and all accrued interest shall be deemed discharged and waived by the City unless there is an occurrence of an event of default, as specified under the loan agreement. If default occurs, the City of El Monte is entitled to exercise its rights and the entire principal amount outstanding and any accrued interest could become due and payable at the option of the City of El Monte. Accrued interest at December 31, 2004 was $140,000.
6.	RELATED PARTY TRANSACTIONS
	Capital Contributions: The limited partners, WNC Housing Tax Credit Fund V, L.P. Series III and IV, 49.495% limited partners, are required to make a capital contribution of $5,162,171, which shall be made equally between them, in amounts and at times as stated in the Limited Partnership Agreement. The limited partners’ cash contributions may be reduced to account for reduced tax benefits, if any. At December 31, 2004, the limited partners have contributed $5,021,578.
	Project or Loss Allocations: All items included in the calculation of income or loss not arising from a sale or refinancing, and all tax credits, shall be allocated 98.99% equally to the limited partners, .01% to the special limited partner, .99% to the general partner, and .01% to the managing general partner.
	Developer Fee Payable and Advance Payable to General Partner: Under the terms of the Partnership Agreement, Everland, Inc., the developer, is to receive a developer fee totaling $1,050,416. This developer fee bears no interest and is payable upon additional capital contributions by the limited partners. During the periods ended December 31, 2004 and 2003, $14,000 and $91,000 of payments of the developer fees were made, respectively.
	Management Fee: A monthly property management fee in an amount computed at 5% of the collected gross revenue is payable to the management agent. Property management services to the Partnership are provided by an affiliate of the limited partners. Property management fees were $42,505 and $42,105 for the years 2004 and 2003, respectively.

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2004

Page 5

 

	Incentive Management and Other Fees: Under the terms of the Limited Partnership Agreement, incentive management fees shall be paid to the general partner for services incidental to the administration of the business and affairs of the Partnership, reporting fees to the limited partners for services performed in monitoring the operations of the Partnership, services in connection with the Partnership’s accounting matters and assisting with the preparation of tax returns. $60,442 of fees for the years 1998, 1999 and 2000 were recorded for year ended December 31, 2001. $55,013 of the fees were paid in year 2001. None were paid in prior years. The limited partners earned $12,000 in reporting fees during 2002 and 2003 and were paid $29,647 each year, resulting in $29,865 in prepaid reporting fees at December 31, 2004.
	The managing general partner earned $16,440 for 2001, 2002 and 2003 for an operational asset management fee which was accrued in 2003. $16,440 was paid in 2003 leaving an accrual balance of $32,880.
7.	CURRENT VULNERABILITY DUE TO CERTAIN CONCENTRATIONS
	The Partnership’s sole asset is a 137-unit apartment complex. The Partnership’s operations are concentrated in the multifamily real estate market In addition, the Partnership operates in a heavily regulated environment. The operations of the project are subject to the administrative directives, rules and regulations of local regulatory agencies. Such administrative directives, rules and regulations are subject to change. Such changes may occur with little notice or inadequate funding to pay for related costs, including the additional administrative burden, to comply with a change.

 

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTARY INFORMATION

 

 

 

 

 

 

 

 

 

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

SUPPLEMENTAL SCHEDULE OF EXPENSES

FOR THE YEAR ENDED DECEMBER 31, 2003 and 2004

  

		2004				2003
Site management payroll		$	38,783			$	40,848
Manager’s rent-free apartment			12,288				12,288
Management fee			42,505				42,105
Partnership asset management fees			16,440				49,320
Reporting fee			12,000				12,000
Audit fee			5,800				5,500
Legal fees			250				-
Advertising			-				256
Telephone and answering service			7,148				4,330
Office supplies			5,052				5,076
Educational and social programs			11,520				11,520
Health insurance and other employee benefits			6,381				8,552
Payroll taxes			7,017				5,515
Workers’ compensation			10,331				9,559
Other administration			2,366				6,299
Subtotal administrative expenses			177,881				213,168
Electricity			21,944				19,366
Water and sewer			20,754				19,247
Fuel			17,579				14,469
Garbage and trash removal			3,880				4,197
Subtotal utilities			64,157				57,279
Maintenance and repairs payroll			16,591				15,678
Maintenance and repairs supply			6,620				5,650
Maintenance and repairs contract			11,062				17,360
Painting and decorating			24,779				6,538
Grounds			12,640				15,055
Services			3,085				2,366
Furniture and furnishings replacement			29,035				3,082
Subtotal maintenance expenses			103,812				65,729
Property taxes			9,675				-
Other taxes and licenses			6,680				4,415
Property and liability insurance			41,505				37,701
Other insurance			647				-
Subtotal tax and insurance			58,507				42,116
Interest			208,077				210,744
Depreciation and amortization			206,876				231,971
Total expenses		$	819,310			$	821,007

 

 

  

CONTENTS

 

			Page
INDEPENDENT AUDITOR’S REPORT			F-2
FINANCIAL STATEMENTS:
	Balance Sheets		F-3
	Statements of Operations and Changes in Partners’ Equity		F-5
	Statements of Cash Flows		F-6
	Notes to Financial Statements		F-8
SUPPLEMENTARY INFORMATION:			F-13
	Supplemental Schedule of Expenses		F-14
	Supplemental Schedule of Changes in Partners’ Equity

 

 

Partners

Blessed Rock of El Monte

Costa Mesa, California

 

INDEPENDENT AUDITOR’S REPORT

 

I have audited the accompanying balance sheet of Blessed Rock of El Monte, a California Limited Partnership as of December 31, 2004 and 2005, and the related statements of operations and changes in partners’ equity, and operating cash flows for the years then ended. These financial statements are the responsibility of the partnership’s management. My responsibility is to express an opinion on these financial statements based on my audits.

 

I conducted my audits in accordance with auditing standards generally accepted in the United States. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audits provide a reasonable basis for my opinion.

 

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Blessed Rock of El Monte as of December 31, 2004 and 2005 and the results of its operations and its operating cash flows for the years then ended in conformity with accounting principles generally accepted in the United States.

 

My audit was conducted for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplementary information shown on page 12 and 13 is presented for the purpose of additional analysis and is not a required part of the basic financial statements of Blessed Rock of El Monte. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in my opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.

 

February 8, 2006

33-0724657

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

BALANCE SHEETS, DECEMBER 31, 2004 AND 2005

 

ASSETS

 

		2005				2004
Current Assets:
Operating cash and equivalents		$	459,783			$	227,596
Security deposit cash			25,801				25,969
Tenant accounts receivable			370				-
Other accounts receivable			6,281				81,081
Prepaid expenses			61,945				51,897
Total current assets			554,180				386,543
Property, Building, and Equipment. At Cost:
Land			1,271,162				1,271,162
Building and improvements			7,992,586				7,992,586
Equipment			54,657				54,657
			9,318,405				9,318,405
Accumulated depreciation			(1,728,013	)			(1,523,169	)
Property, building, and equipment - net			7,590,392				7,795,236
Other Assets:
Replacement reserve			156,909				135,579
Tax and insurance restricted accounts			22,073				23,916
Total other assets			178,982				159,495
		$	8,323,554			$	8,341,274

 

See the accompanying notes to financial statements.

 

 

Blessed Rock of El Monte

Balance Sheets, December 31, 2004 and 2005

Page 2

 

LIABILITIES AND PARTNERS’ EQUITY

 

		2005				2004
Current Liabilities:
Current portion of long-term debt		$	46,361			$	43,214
Accounts payable			6,667				4,535
Security trust liability			23,635				23,770
Accrued interest			14,175				14,701
Accrued asset management fees			32,880				32,880
Other accruals			6,025				198
Unearned rental income			1,054				1,007
Total current liabilities			130,797				120,305
Long-term Debt:
Mortgage payable, less current portion included above			2,412,783				2,459,144
Notes payable			681,525				681,525
Accrued interest payable			199,995				169,654
Grant loan payable			400,000				400,000
Developer fee payable			-				-
Total long-term debt			3,694,303				3,710,323
Partners’ equity			4,498,454				4,510,646
		$	8,323,554			$	8,341,274

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

STATEMENTS OF OPERATIONS AND CHANGES

IN PARTNERS’ EQUITY FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2005

 

		2005				2004
Revenue:
Gross potential rents		$	745,260			$	722,814
Excess rents			117,337				129,960
Less vacancies			(1,442	)			(5,344	)
Net rental income			861,155				847,430
Laundry and vending			13,410				11,703
Tenant charges			1,482				1,942
Interest income			2,490				977
Other income			886				35,276
Total revenues			879,423				897,328
Expenses:
Administrative			200,758				177,881
Utilities			74,145				64,157
Operating and maintenance			128,436				103,812
Taxes and insurance			56,579				58,507
Interest			208,077				204,853
Depreciation and amortization			204,844				206,876
Total expenses			869,615				819,310
Net income (loss)			9,808				78,018
Partners’ equity - beginning			4,510,646				4,495,325
Partners’ distributions			(22,000	)			(62,697	)
Partners’ equity - ending		$	4,498,454			$	4,510,646

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2005

 

		2005				2004
Cash flows from operating activities:
Rental receipts		$	848,544			$	835,626
Operating interest receipts			1,704				402
Other operating receipts			90,578				13,645
Payments to suppliers and employees:
Administrative expenses			(47,918	)			(44,918	)
Management fees			(99,011	)			(41,569	)
Utilities			(71,596	)			(64,157	)
Salaries and wages			(43,358	)			(55,374	)
Operating and maintenance			(115,758	)			(87,221	)
Real estate taxes			(7,643	)			(9,675	)
Payroll taxes			(5,062	)			(7,017	)
Property insurance			(45,120	)			(8,405	)
Miscellaneous taxes and insurance			(17,907	)			(21,224	)
Interest on mortgage			(171,384	)			(177,972	)
Funding security deposit account			33				(1,961	)
Net cash provided by operating activities			316,102				330,180
Cash flows from investing activities:
Net tax and insurance impounds			1,843				(36,463	)
Net reserve deposits, including interest			(21,330	)			(21,018	)
Reserve interest			786				575
Net cash used in investing activities			(18,701	)			(56,906	)
Cash flows from financing activities:
Mortgage principal payments			(43,214	)			(40,281	)
Developer fee payments			-				(7,719	)
Advances to general partner			-				(6,281	)
Partner distributions			(22,000	)			(62,697	)
Net cash used in financing activities			(65,214	)			(116,978	)
Net increase (decrease) in cash			232,187				156,296
Cash at beginning of year			227,596				71,300
Cash at end of year		$	459,783			$	227,596

 

See the accompanying notes to financial statements.

 

 

Blessed Rock of El Monte

Statements of Cash Flows, December 31, 2004 and 2005

Page 2

 

Reconciliation of Net Income (Loss)

to Net Cash Provided by Operating Activities

 

		2005				2004
Net income (loss)		$	9,808			$	78,018
Adjustments to reconcile net income (loss) to net cash Provided by operating activities:
Depreciation and amortization			204,844				206,876
Decrease (increase) in:
Security deposit cash			168				(1,746	)
Receivables			74,430				109
Prepaids			(10,048	)			12,500
Increase (decrease) in:
Payables			(1,522	)			4,535
Security deposit liability			(135	)			(215	)
Accrued expenses			39,296				30,303
Unearned rental income			47				375
Reserve interest earned			(786	)			(575	)
Net cash provided by operating activities		$	316,102			$	330,180

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2005

 

1.	ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	Organization: Blessed Rock of El Monte, a California limited partnership, was formed on November 22, 1995 by and between Everland, Inc., a California Corporation, as the general partner and Tom Y. Lee as the limited partner. The Partnership Agreement was amended and restated on December 29, 2000 defining the various partners of the partnership as the General Partner, the Managing General Partner, the Limited Partners and the Special Limited Partner.
	The Partnership was formed to acquire, construct, own and operate a 137-unit elderly facility apartment complex for low income residents in El Monte, California. The Partnership also generates tax credits to the partners in accordance with the provisions of the code and applicable Treasury regulations. The Partnership has qualified for low income housing tax credits as currently allowable under Section 42 of the Internal Revenue Code.
	The Partnership received HOME funds from the City of El Monte and redevelopment funds from the El Monte Community Redevelopment Agency as part of a public program to ensure affordable housing for senior citizen tenants. In addition, the El Monte Community Redevelopment Agency paid various project impact fees to the City of El Monte associated with the construction and development of the Project on behalf of the Partnership.
	Capitalization and Depreciation: Assets are recorded at cost and depreciated for financial accounting purposes using the straight-line method over their estimated useful lives. The principal estimated useful lives used in computing the depreciation provisions are 10 to 40 years for building and improvements, and 3 to 10 years for equipment The policy of the project is to charge amounts expended for maintenance, repairs, and minor replacements to expense, and to capitalize expenditures for major replacements and betterments.
	Cash and Cash Equivalents: For purposes of reporting cash flows, cash includes unrestricted cash in bank, cash on hand, savings accounts, and all certificates of deposit with original maturities of three months or less.
	The Partnership maintains its cash in bank deposit accounts, which at times may exceed federally insured limits. The Partnership has not experienced any losses in such accounts. The Partnership believes it is not exposed to any significant credit risk on cash and cash equivalents.
	Deferred Costs: Deferred costs, comprised of tax credit fees and organization costs are being amortized over five years.

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2005

Page 2

 

	Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect: (1) the reported amounts of assets and liabilities and disclosure of contingencies at the date of the financial statements, and (2) the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
	Rental Income and Unearned Rents: The Partnership rents apartment units on a month to month basis and recognizes revenues when earned. Advance receipts of rents are classified as liabilities until earned.
	Income Taxes: No provision is made for income taxes since such taxes, if any, are the liability of the individual partners.
2.	RESTRICTED FUNDS
	The Partnership is required to make monthly impound deposits to cover insurance premiums, property taxes and to maintain a reserve for replacements. These restricted funds are held by, and expenditures are subject to supervision and approval by, GMAC Commercial Mortgage.
3.	MORTGAGE PAYABLE

 

	Mortgage payable consists of a 7.05% real estate mortgage, payable to GMAC Commercial Mortgage, collateralized by a deed of trust on the real property. The obligation is payable in aggregate monthly principal and interest installments of $18,188 beginning July 1, 1998 with a balloon payment in the amount of $2,017,000 payable June 1, 2013.		$	2,459,144
	Less current portion			(46,361	)
			$	2,412,783

 

The amounts maturing for the next five years are:

 

	2006			$	46,361
	2007				49,737
	2008				53,360
	2009				57,245
	2010				61,414

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2005

Page 3

 

4.

NOTES PAYABLE

 

	Notes payable at December 31, 2005 consist of the following:
	4% note payable with a term of 15 years, payable to El Monte Community Redevelopment Agency (RDA), secured by deed of trust and rents from Project. Note subject to prepayment in whole or in part based on events constituting default under terms of promissory note agreement. No events of default have occurred through December 31, 2005. Payments of interest and principal made annually beginning on April 1, 2003, and thereafter on April 1 until outstanding principal balance of note and all accrued interest paid in full. Payments paid from 50% of the residual rental income, as defined in the promissory note agreement. Payments, if any, applied first to accrued interest and second to principal of note. At December 31, 2005, accrued interest on note was $31,070.		$	250,878
	1% note payable with a term of 30 years beginning April 3, 1996, payable to RDA for various development fees, secured by a deed of trust and rents from the Project. Commencing April 3, 1997, and thereafter on April 3 for the following 6 succeeding years, payment of $4,239 due each year. Payment increases to $8,478 April 3, 2004 and continues the next 7 succeeding years. April 3, 2012, payment increases to $32,534 and continues the next 14 succeeding years, or until paid in full. Payments to be paid from 50% of residual rental income, as defined in promissory note agreement. Payments first applied to interest. At December 31, 2005, accrued interest on note was $12,924.			430,647
			$	681,525

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2005

Page 4

 

5.	GRANT LOAN PAYABLE
	The Partnership received a loan of $400,000 on April 3, 1996 from the City of El Monte as part of a public program to ensure affordable housing for senior citizen tenants. Interest accrues on the principal amount at 4%, with a term of 55 years. Loan is secured by a deed of trust and rents from the Project. At maturity, the principal amount of the loan and all accrued interest shall be deemed discharged and waived by the City unless there is an occurrence of an event of default, as specified under the loan agreement. If default occurs, the City of El Monte is entitled to exercise its rights and the entire principal amount outstanding and any accrued interest could become due and payable at the option of the City of El Monte. Accrued interest at December 31, 2005 was $156,000.
6.	RELATED PARTY TRANSACTIONS
	Project or Loss Allocations: All items included in the calculation of income or loss not arising from a sale or refinancing, and all tax credits, shall be allocated 98.99% equally to the limited partners, .01% to the special limited partner, .99% to the general partner, and .01% to the managing general partner.
	Developer Fee Payable and Advance Payable to General Partner: Under the terms of the Partnership Agreement, Everland, Inc., the developer, is to receive a developer fee totaling $1,050,416. This developer fee bears no interest and is payable upon additional capital contributions by the limited partners. For 2004, $14,000 was paid. No payments were made in 2005.
	Management Fee: A monthly property management fee in an amount computed at 5% of the collected gross revenue is payable to the management agent. Property management services to the Partnership are provided by an affiliate of the limited partners. Property management fees were $42,505 and $43,206 for the years 2004 and 2005, respectively.
	Incentive Management and Other Fees: Under the terms of the Limited Partnership Agreement, incentive management fees shall be paid to the general partner for services incidental to the administration of the business and affairs of the Partnership. Reporting fees shall be paid to the limited partners for services performed in monitoring the operations of the Partnership, services in connection with the Partnership’s accounting matters and assisting with the preparation of tax returns. The limited partners earned $12,000 in reporting fees for 2004 and $46,889 for 2005. Payments of $12,000 and $11,000 were made for 2004 and 2005, respectively, leaving a balance in accrued reporting fees of $6,024.

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2005

Page 5

 

	The managing general partner earned $16,440 for an operational asset management fee for the years 2001 through 2005. Payments of $16,440 were made each of the years from 2003 through 2005, leaving an accrued balance of $32,880 at December 31, 2005.
7.	CURRENT VULNERABILITY DUE TO CERTAIN CONCENTRATIONS
	The Partnership’s sole asset is a 137-unit apartment complex. The Partnership’s operations are concentrated in the multifamily real estate market. In addition, the Partnership operates in a heavily regulated environment. The operations of the project are subject to the administrative directives, rules and regulations of local regulatory agencies. Such administrative directives, rules and regulations are subject to change. Such changes may occur with little notice or inadequate funding to pay for related costs, including the additional administrative burden, to comply with a change.

 

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTARY INFORMATION

 

 

 

 

 

 

 

 

 

 

  

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

SUPPLEMENTAL SCHEDULE OF EXPENSES

FOR THE YEAR ENDED DECEMBER 31, 2004 and 2005

 

		2005				2004
Site management payroll		$	30,830			$	38,783
Manager’s rent-free apartment			12,288				12,288
Management fee			43,206				42,505
Partnership asset management fees			16,440				16,440
Reporting fee			46,889				12,000
Audit fee			6,000				5,800
Legal fees			424				250
Telephone and answering service			4,731				7,148
Office supplies			4,528				5,052
Educational and social programs			11,520				11,520
Health insurance and other employee benefits			4,349				6,381
Payroll taxes			5,062				7,017
Workers’ compensation			8,536				10,331
Other administration			5,955				2,366
Subtotal administrative expenses			200,758				177,881
Electricity			22,412				21,944
Water and sewer			23,294				20,754
Fuel			24,196				17,579
Garbage and trash removal			4,243				3,880
Subtotal utilities			74,145				64,157
Maintenance and repairs payroll			12,528				16,591
Maintenance and repairs supply			7,472				6,620
Maintenance and repairs contract			19,337				11,062
Painting and decorating			25,216				24,779
Grounds			10,519				12,640
Services			2,195				3,085
Furniture and furnishings replacement			51,169				29,035
Subtotal maintenance expenses			128,436				103,812
Property taxes			7,644				9,675
Other taxes and licenses			3,995				6,680
Property and liability insurance			43,913				41,505
Other insurance			1,027				647
Subtotal tax and insurance			56,579				58,507
Interest			204,853				208,077
Depreciation and amortization			204,844				206,876
Total expenses		$	869,615			$	819,310

 

 

CONTENTS

 

			Page
INDEPENDENT AUDITOR’S REPORT			F-2
FINANCIAL STATEMENTS:
	Balance Sheets		F-3
	Statements of Operations and Changes in Partners’ Equity		F-5
	Statements of Cash Flows		F-6
	Notes to Financial Statements		F-8
SUPPLEMENTARY INFORMATION:			F-13
	Supplemental Schedule of Expenses		F-14
	Supplemental Schedule of Changes in Partners’ Equity

 

 

Partners

Blessed Rock of El Monte

Costa Mesa, California

 

INDEPENDENT AUDITOR’S REPORT

 

I have audited the accompanying balance sheet of Blessed Rock of El Monte, a California Limited Partnership as of December 31, 2005 and 2006, and the related statements of operations and changes in partners’ equity, and operating cash flows for the years then ended. These financial statements are the responsibility of the partnership’s management. My responsibility is to express an opinion on these financial statements based on my audits.

 

I conducted my audits in accordance with auditing standards generally accepted in the United States. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audits provide a reasonable basis for my opinion.

 

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Blessed Rock of El Monte as of December 31, 2005 and 2006 and the results of its operations and its operating cash flows for the years then ended in conformity with accounting principles generally accepted in the United States.

 

My audit was conducted for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplementary information shown on page 12 and 13 is presented for the purpose of additional analysis and is not a required part of the basic financial statements of Blessed Rock of El Monte. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in my opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.

 

March 7, 2007

33-0724657

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

BALANCE SHEETS, DECEMBER 31, 2005 AND 2006

 

ASSETS

 

		2006				2005
Current Assets:
Operating cash and equivalents		$	584,149			$	459,783
Security deposit cash			25,522				25,801
Tenant accounts receivable			1,625				370
Other accounts receivable			6,281				6,281
Prepaid expenses			51,682				61,945
Total current assets			669,259				554,180
Property, Building, and Equipment, At Cost:
Land			1,271,162				1,271,162
Building and improvements			8,030,159				7,992,586
Equipment			54,657				54,657
			9,355,978				9,318,405
Accumulated depreciation			(1,933,378	)			(1,728,013	)
Property, building, and equipment - net			7,422,600				7,590,392
Other Assets:
Replacement reserve			134,830				156,909
Tax and insurance restricted accounts			33,152				22,073
Total other assets			167,982				178,982
		$	8,259,841			$	8,323,554

 

See the accompanying notes to financial statements.

 

 

Blessed Rock of El Monte

Balance Sheets, December 31, 2005 and 2006

Page 2

 

LIABILITIES AND PARTNERS’ EQUITY

  

		2006				2005
Current Liabilities:
Current portion of long-term debt		$	49,737			$	46,361
Accounts payable			11,556				6,667
Security trust liability			23,635				23,635
Accrued interest			14,175				14,175
Accrued asset management fees			17,810				32,880
Other accruals			37,712				6,025
Unearned rental income			696				1,054
Total current liabilities			155,321				130,797
Long-term Debt:
Mortgage payable, less current portion included above			2,363,046				2,412,783
Notes payable			681,525				681,525
Accrued interest payable			230,335				199,995
Grant loan payable			400,000				400,000
Total long-term debt			3,674,906				3,694,303
Partners’ equity			4,429,614				4,498,454
		$	8,259,841			$	8,323,554

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

STATEMENTS OF OPERATIONS AND CHANGES

IN PARTNERS’ EQUITY FOR THE YEARS ENDED DECEMBER 31, 2005 AND 2006

  

		2006				2005
Revenue:
Gross potential rents		$	723,570			$	745,260
Excess rents			149,429				117,337
Less vacancies			(918	)			(1,442	)
Net rental income			872,081				861,155
Laundry and vending			9,684				13,410
Tenant charges			2,040				1,482
Interest income			3,488				2,490
Other income			-				886
Total revenues			887,293				879,423
Expenses:
Administrative			211,138				200,758
Utilities			80,904				74,145
Operating and maintenance			106,694				128,436
Taxes and insurance			53,138				56,579
Interest			204,853				202,230
Depreciation and amortization			205,365				204,844
Total expenses			859,469				869,615
Net income (loss)			27,824				9,808
Partners’ equity - beginning			4,498,454				4,510,646
Partners’ distributions			(96,664	)			(22,000	)
Partners’ equity - ending		$	4,429,614			$	4,498,454

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2005 AND 2006

  

		2006				2005
Cash flows from operating activities:
Rental receipts		$	858,180			$	848,544
Operating interest receipts			2,261				1,704
Other operating receipts			11,724				90,578
Payments to suppliers and employees:
Administrative expenses			(91,469	)			(47,918	)
Management fees			(37,407	)			(99,011	)
Utilities			(79,498	)			(71,596	)
Salaries and wages			(35,402	)			(43,358	)
Operating and maintenance			(94,059	)			(115,758	)
Real estate taxes			(7,371	)			(7,643	)
Payroll taxes			(5,371	)			(5,062	)
Property insurance			(36,328	)			(45,120	)
Miscellaneous taxes and insurance			(17,257	)			(17,907	)
Interest on mortgage			(175,545	)			(171,384	)
Funding security deposit account			279				33
Net cash provided by operating activities			292,737				316,102
Cash flows from investing activities:
Net tax and insurance impounds			(11,079	)			1,843
Net reserve activity, including interest			22,079				(21,330	)
Reserve interest			1,227				786
Capital expenditures			(37,573	)			-
Net cash used in investing activities			(25,346	)			(18,701	)
Cash flows from financing activities:
Mortgage principal payments			(46,361	)			(43,214	)
Partner distributions			(96,664	)			(22,000	)
Net cash used in financing activities			(143,025	)			(65,214	)
Net increase (decrease) in cash			124,366				232,187
Cash at beginning of year			459,783				227,596
Cash at end of year		$	584,149			$	459,783

 

See the accompanying notes to financial statements.

 

 

Blessed Rock of El Monte

Statements of Cash Flows, December 31, 2005 and 2006

Page 2

 

Reconciliation of Net Income (Loss)

to Net Cash Provided by Operating Activities

 

		2006				2005
Net income (loss)		$	27,824			$	9,808
Adjustments to reconcile net income (loss) to net cash Provided by operating activities:
Depreciation and amortization			205,365				204,844
Decrease (increase) in:
Security deposit cash			279				168
Receivables			(1,255	)			74,430
Prepaids			10,263				(10,048	)
Increase (decrease) in:
Payables			8,543				(1,522	)
Security deposit liability			-				(135	)
Accrued expenses			43,303				39,296
Unearned rental income			(358	)			47
Reserve interest earned			(1,227	)			(786	)
Net cash provided by operating activities		$	292,737			$	316,102

 

See the accompanying notes to financial statements.

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2006

 

1.	ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	Organization: Blessed Rock of El Monte, a California limited partnership, was formed on November 22, 1995 by and between Everland, Inc., a California Corporation, as the general partner and Tom Y. Lee as the limited partner. The Partnership Agreement was amended and restated on December 29, 2000 defining the various partners of the partnership as the General Partner, the Managing General Partner, the Limited Partners and the Special Limited Partner.
	The Partnership was formed to acquire, construct, own and operate a 137-unit elderly facility apartment complex for low income residents in El Monte, California. The Partnership also generates tax credits to the partners in accordance with the provisions of the code and applicable Treasury regulations. The Partnership has qualified for low income housing tax credits as currently allowable under Section 42 of the Internal Revenue Code.
	The Partnership received HOME funds from the City of El Monte and redevelopment funds from the El Monte Community Redevelopment Agency as part of a public program to ensure affordable housing for senior citizen tenants. In addition, the El Monte Community Redevelopment Agency paid various project impact fees to the City of El Monte associated with the construction and development of the Project on behalf of the Partnership.
	Capitalization and Depreciation: Assets are recorded at cost and depreciated for financial accounting purposes using the straight-line method over their estimated useful lives. The principal estimated useful lives used in computing the depreciation provisions are 10 to 40 years for building and improvements, and 3 to 10 years for equipment The policy of the project is to charge amounts expended for maintenance, repairs, and minor replacements to expense, and to capitalize expenditures for major replacements and betterments.
	Cash and Cash Equivalents: For purposes of reporting cash flows, cash includes unrestricted cash in bank, cash on hand, savings accounts, and all certificates of deposit with original maturities of three months or less.
	The Partnership maintains its cash in bank deposit accounts, which at times may exceed federally insured limits. The Partnership has not experienced any losses in such accounts. The Partnership believes it is not exposed to any significant credit risk on cash and cash equivalents.
	Deferred Costs: Deferred costs, comprised of tax credit fees and organization costs are being amortized over five years.

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2006

Page 2

  

	Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect: (1) the reported amounts of assets and liabilities and disclosure of contingencies at the date of the financial statements, and (2) the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
	Rental Income and Unearned Rents: The Partnership rents apartment units on a month to month basis and recognizes revenues when earned. Advance receipts of rents are classified as liabilities until earned.
	Income Taxes: No provision is made for income taxes since such taxes, if any, are the liability of the individual partners.
2.	RESTRICTED FUNDS
	The Partnership is required to make monthly impound deposits to cover insurance premiums, property taxes and to maintain a reserve for replacements. These restricted funds are held by, and expenditures are subject to supervision and approval by, GMAC Commercial Mortgage.
3.	MORTGAGE PAYABLE

 

	Mortgage payable consists of a 7.05% real estate mortgage, payable to GMAC Commercial Mortgage, collateralized by a deed of trust on the real property. The obligation is payable in aggregate monthly principal and interest installments of $18,188 beginning July 1, 1998 with a balloon payment in the amount of $2,017,000 payable June 1, 2013.		$	2,412,783
	Less current portion			(49,737	)
			$	2,363,046

 

The amounts maturing for the next five years are:

 

	2007			$	49,737
	2008				53,360
	2009				57,245
	2010				61,414
	2011				65,887

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2006

Page 3

 

4.	NOTES PAYABLE

 

	Notes payable at December 31, 2005 consist of the following:
	4% note payable with a term of 15 years, payable to El Monte Community Redevelopment Agency (RDA), secured by deed of trust and rents from Project. Note subject to prepayment in whole or in part based on events constituting default under terms of promissory note agreement. Payments of interest and principal made annually beginning on April 1, 2003, and thereafter on April 1 until outstanding principal balance of note and all accrued interest paid in full. Payments paid from 50% of the residual rental income, as defined in the promissory note agreement. Payments, if any, applied first to accrued interest and second to principal of note. At December 31, 2006, accrued interest on note was $41,105.		$	250,878
	1% note payable with a term of 30 years beginning April 3, 1996, payable to RDA for various development fees, secured by a deed of trust and rents from the Project. Commencing April 3, 1997, and thereafter on April 3 for the following 6 succeeding years, payment of $4,239 due each year. Payment increases to $8,478 April 3, 2004 and continues the next 7 succeeding years. April 3, 2012, payment increases to $32,534 and continues the next 14 succeeding years, or until paid in full. Payments to be paid from 50% of residual rental income, as defined in promissory note agreement. Payments first applied to interest. At December 31, 2006, accrued interest on note was $17,230.			430,647
			$	681,525

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2006

Page 4

 

5.	GRANT LOAN PAYABLE
	The Partnership received a loan of $400,000 on April 3, 1996 from the City of El Monte as part of a public program to ensure affordable housing for senior citizen tenants. Interest accrues on the principal amount at 4%, with a term of 55 years. Loan is secured by a deed of trust and rents from the Project. At maturity, the principal amount of the loan and all accrued interest shall be deemed discharged and waived by the City unless there is an occurrence of an event of default, as specified under the loan agreement. If default occurs, the City of El Monte is entitled to exercise its rights and the entire principal amount outstanding and any accrued interest could become due and payable at the option of the City of El Monte. Accrued interest at December 31, 2006 was $172,000.
6.	RELATED PARTY TRANSACTIONS
	Project or Loss Allocations: All items included in the calculation of income or loss not arising from a sale or refinancing, and all tax credits, shall be allocated 98.99% equally to the limited partners, .01% to the special limited partner, .99% to the general partner, and .01% to the managing general partner.
	Management Fee: A monthly property management fee in an amount computed at 5% of the collected gross revenue is payable to the management agent. Property management services to the Partnership are provided by an affiliate of the limited partners. Property management fees were $43,206 and $43,333 for the years 2005 and 2006, respectively.
	Incentive Management and Other Fees: Under the terms of the Limited Partnership Agreement, incentive management fees shall be paid to the general partner for services incidental to the administration of the business and affairs of the Partnership. Reporting fees shall be paid to the limited partners for services performed in monitoring the operations of the Partnership, services in connection with the Partnership’s accounting matters and assisting with the preparation of tax returns. The limited partners earned $46,889 in reporting fees for 2005 and $68,279 for 2006.
	The managing general partner earned $16,440 annually for an operational asset management fee for the years 2001 through 2006. Balance of accrued operational asset management fee at December 31, 2006 is $17,810.

 

 

Blessed Rock of El Monte

Notes to Financial Statements, December 31, 2006

Page 5

 

7.	CURRENT VULNERABILITY DUE TO CERTAIN CONCENTRATIONS

 

The Partnership’s sole asset is a 137-unit apartment complex. The Partnership’s operations are concentrated in the multifamily real estate market. In addition, the Partnership operates in a heavily regulated environment. The operations of the project are subject to the administrative directives, rules and regulations of local regulatory agencies. Such administrative directives, rules and regulations are subject to change. Such changes may occur with little notice or inadequate funding to pay for related costs, including the additional administrative burden, to comply with a change.

 

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTARY INFORMATION

 

 

 

 

 

 

 

 

 

 

 

BLESSED ROCK OF EL MONTE

(A California Limited Partnership)

SUPPLEMENTAL SCHEDULE OF EXPENSES

FOR THE YEAR ENDED DECEMBER 31, 2005 and 2006

 

		2006				2005
Site management payroll		$	34,027			$	30,830
Manager's rent-free apartment			12,288				12,288
Management fee			43,333				43,206
Reporting/asset management fee			68,823				63,329
Audit fee			6,700				6,000
Legal fees			-				424
Telephone and answering service			5,675				4,731
Office supplies			4,050				4,528
Educational and social programs			8,640				11,520
Health insurance and other employee benefits			4,226				4,349
Payroll taxes			5,371				5,062
Workers' compensation			8,029				8,536
Other administration			9,976				5,955
Subtotal administrative expenses			211,138				200,758
Electricity			30,475				22,412
Water and sewer			23,862				23,294
Fuel			20,816				24,196
Garbage and trash removal			5,751				4,243
Subtotal utilities			80,904				74,145
Maintenance and repairs payroll			12,785				12,528
Maintenance and repairs supply			8,715				7,472
Maintenance and repairs contract			29,582				19,337
Painting and decorating			17,753				25,216
Grounds			8,693				10,519
Services			1,430				2,195
Furniture and furnishings replacement			27,736				51,169
Subtotal maintenance expenses			106,694				128,436
Property taxes			7,371				7,644
Other taxes and licenses			3,930				3,995
Property and liability insurance			40,765				43,913
Other insurance			1,072				1,027
Subtotal tax and insurance			53,138				56,579
Interest			202,230				204,853
Depreciation and amortization			205,365				204,844
Total expenses		$	859,469			$	869,615