Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Jun. 30, 2016 | |
Document and Entity Information: | ||
Entity Registrant Name | COMMONWEALTH INCOME & GROWTH FUND V | |
Document Type | 10-K | |
Document Period End Date | Dec. 31, 2016 | |
Trading Symbol | cigf5 | |
Amendment Flag | false | |
Entity Central Index Key | 1,253,347 | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 0 | |
Entity Public Float | $ 0 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | No | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | FY | |
Entity Incorporation, State Country Name | Commonwealth of Pennsylvania |
Balance Sheets
Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets | ||
Cash and cash equivalents | $ 16,529 | $ 51,344 |
Lease income receivable, net of reserve of approximately $10,000 at December 31, 2016 and 2015 | 41,927 | 51,456 |
Accounts receivable, Commonwealth Capital Corp, net | 0 | 24,704 |
Other receivables | 20,754 | 8,500 |
Prepaid expenses | 309 | 165 |
Current Assets | 79,519 | 136,169 |
Net investment in finance leases | 66,789 | 98,345 |
Equipment, at cost | 6,142,862 | 7,277,433 |
Accumulated depreciation | (5,492,621) | (6,367,333) |
Technology equipment, net | 650,241 | 910,100 |
Total Assets | 796,549 | 1,144,614 |
LIABILITIES | ||
Accounts payable | 127,286 | 112,238 |
Accounts payable, CIGF, Inc. net | 104,992 | 382,664 |
Accounts Payable Commonwealth Capital Corp, net | 249,525 | 0 |
Other accrued expenses | 16,102 | 10,108 |
Unearned lease income | 27,977 | 34,378 |
Notes payable | 359,590 | 501,545 |
Total Liabilities | 885,472 | 1,040,933 |
PARTNERS' CAPITAL | ||
General Partner | 1,000 | 1,000 |
Limited Partners | (89,923) | 102,681 |
Total Partners' Capital | (88,923) | 103,681 |
Total Liabilities and Partners' Capital | $ 796,549 | $ 1,144,614 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Lease income receivable, reserve | $ 10,000 | $ 10,000 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | ||
Lease | $ 672,612 | $ 888,012 |
Interest and other | 6,276 | 8,846 |
Gain on sale of equipment | 66,052 | 1,178 |
Total revenue and gain on sale of equipment | 744,940 | 898,036 |
Expenses | ||
Operating, excluding depreciation and amortization | 368,149 | 112,487 |
Equipment management fee, General Partner | 4,633 | 22,928 |
Interest | 17,351 | 22,117 |
Depreciation | 546,422 | 944,765 |
Amortization of equipment acquisition costs and deferred expenses | 0 | 3,195 |
Bad debt expense (recovery) | 508 | (79,615) |
Total expenses | 937,063 | 1,025,877 |
Other income (loss) | ||
Net loss | (192,123) | (127,841) |
Net loss allocated to Limited Partners | $ (192,123) | $ (127,841) |
Net loss per equivalent Limited Partnership unit | $ (.16) | $ (0.10) |
Weighted average number of equivalent limited partnership units outstanding during the year | 1,236,608 | 1,236,608 |
Statements of Partners' Capital
Statements of Partners' Capital - USD ($) | General Partners | Limited Partners {1} | Total |
Partners' Capital at Dec. 31, 2014 | $ 1,000 | $ 394,005 | $ 395,005 |
Partners' Capital Account, Units at Dec. 31, 2014 | 50 | ||
Net loss | (127,841) | (127,841) | |
Distributions | (183,483) | (183,483) | |
Forgiveness of payables | $ 20,000 | 20,000 | |
Transfer of Partners' Capital | (20,000) | 20,000 | 0 |
Partners' Capital at Dec. 31, 2015 | $ 1,000 | 102,681 | 103,681 |
Partners' Capital Account, Units at Dec. 31, 2015 | 50 | ||
Net loss | (192,123) | (192,123) | |
Distributions | (481) | (481) | |
Partners' Capital at Dec. 31, 2016 | $ 1,000 | $ (89,923) | $ (88,923) |
Partners' Capital Account, Units at Dec. 31, 2016 | 50 |
Statements of Cash Flow
Statements of Cash Flow - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Net cash provided by operating activities | ||
Net loss | $ (192,123) | $ (127,841) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities | ||
Depreciation and amortization | 546,422 | 947,960 |
Gain on sale of equipment | (66,052) | (1,178) |
Bad debt expense (recovery) | 508 | (79,615) |
Other noncash activities | ||
Lease revenue net of interest expense, on notes payable, realized as a result of direct payment of principal to bank by lessee | (355,074) | (395,673) |
Earned interest on finance leases | (6,054) | (8,145) |
Changes in assets and liabilities | ||
Lease income receivable | 9,021 | 57,805 |
Other receivables | (12,254) | (372) |
Prepaid expenses | (144) | 248 |
Accounts payable | 15,048 | 5,865 |
Accounts payable, Commonwealth Capital Corp., net | 274,229 | (229,052) |
Accounts payable, CIGF, Inc., net | (277,672) | (84,501) |
Other accrued expenses | 5,994 | 7,104 |
Unearned lease income | (6,401) | (19,792) |
Net cash (used in) provided by operating activities | (64,552) | 72,813 |
Net cash used in investing activities | ||
Capital expenditures | (91,200) | (98,100) |
Purchase of finance leases | 0 | (36,795) |
Payments from finance leases | 37,610 | 36,385 |
Net proceeds from the sale of equipment | 83,808 | 41,063 |
Net cash provided by (used in) investing activities | 30,218 | (57,447) |
Net cash used in financing activities | ||
Proceeds from debt financing | 0 | 101,249 |
Distributions to partners | (481) | (183,483) |
Net cash used in financing activities | (481) | (82,234) |
Net decrease in cash and cash equivalents | (34,815) | (66,868) |
Cash and cash equivalents beginning of period | 51,344 | 118,212 |
Cash and cash equivalents end of period | $ 16,529 | $ 51,344 |
Business
Business | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Business | Commonwealth Income & Growth Fund V (“CIGFV” or “the Partnership”) is a limited partnership organized in the Commonwealth of Pennsylvania in May 2003. The Partnership offered for sale up to 1,250,000 units of limited partnership interest at the purchase price of $20 per unit (the “offering”). The Partnership reached the minimum amount in escrow and commenced operations on March 14, 2005. As of February 24, 2006, the Partnership was fully subscribed. There were no redemptions of partnership interests during the years ended December 31, 2016 and 2015. The Partnership used the proceeds of the offering to acquire, own and lease various types of information technology, medical technology, telecommunications technology, inventory management equipment and other similar capital equipment, which is leased primarily to U.S. corporations and institutions. Commonwealth Capital Corp. (“CCC”), on behalf of the Partnership and other affiliated partnerships, acquires equipment subject to associated debt obligations and lease agreements and allocates a participation in the cost, debt and lease revenue to the various partnerships based on certain risk factors. The Partnership’s investment objective is to acquire primarily high technology equipment. Information technology has developed rapidly in recent years and is expected to continue to do so. Technological advances have permitted reductions in the cost of information technology processing capacity, speed, and utility. In the future, the rate and nature of equipment development may cause equipment to become obsolete more rapidly. The Partnership also acquires high technology medical, telecommunications and inventory management equipment. The Partnership’s general partner will seek to maintain an appropriate balance and diversity in the types of equipment acquired. The market for high technology medical equipment is growing each year. Generally, this type of equipment will have a longer useful life than other types of technology equipment. This allows for increased re-marketability, if it is returned before its economic or announcement cycle is depleted. The Partnership’s General Partner is Commonwealth Income & Growth Fund, Inc. (the “General Partner”), a Pennsylvania corporation which is an indirect wholly owned subsidiary of CCC. Approximately ten years after the commencement of operations (the “operational phase”), the Partnership intended to sell or otherwise dispose of all of its equipment; make final distributions to partners, and to dissolve. The Partnership was originally scheduled to end its operational phase on February 4, 2017. During the year ended December 31, 2015, the operational phase was officially extended to December 31, 2020 through an investor proxy vote. The Partnership is expected to terminate on December 31, 2022. Allocations of income and distributions of cash are based on the Agreement. The various allocations under the Agreement prevent any limited partner’s capital account from being reduced below zero and ensure the capital accounts reflect the anticipated sharing ratios of cash distributions, as defined in the Agreement. For General Partner will reassess the funding of limited partner distributions on a quarterly basis, throughout 2017. Liquidity and Going Concern The Partnership has incurred recurring losses and has a working capital deficit at December 31, 2016. The Partnership believes it has alleviated these conditions as discussed below. The General Partner and CCC have committed to fund, either through cash contributions and/or forgiveness of indebtedness, any necessary operational cash shortfalls of the Partnership through March 31, 2018. The General Partner and CCC will also determine if related party payables owed to them by the Partnership may be deferred (if deemed necessary) in an effort to further increase the Partnership’s cash flow. During the year ended December 31, 2015, CCC forgave payables owed to it by the Partnership of approximately $20,000. The General Partner will continue to reassess the funding of limited partner distributions throughout 2017 and will continue to waive certain fees if the General Partner determines it is in the best interest of the Partnership to do so. If available cash flow or net disposition proceeds are insufficient to cover the Partnership expenses and liabilities on a short and long term basis, the Partnership may attempt to obtain additional funds by disposing of or refinancing equipment, or by borrowing within its permissible limits. Additionally, the Partnership will seek to enhance portfolio returns and maximize cash flow through the use of leveraged lease transactions: the acquisition of lease equipment through debt financing. This strategy allows the General Partner to acquire additional revenue generating leases thus maximizing overall return. For the year ended December 31, 2016, the Partnership has acquired approximately $304,000 in equipment, of which approximately $213,000 is leveraged. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Summary of Significant Accounting Policies | Use of Estimates The preparation of financial statements is in conformity with accounting principles generally accepted in the United States of America which 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 differ from those estimates and these differences could be material. Such estimates relate primarily to the determination of residual values at the end of the lease term, the expected future cash flows, and fair value used for impairment analysis purposes and determination of the allowance for doubtful accounts. Disclosure of Fair Value of Financial Instruments Fair Value Measurements The Partnership applies the provisions included in the Fair Value Measurements and Disclosures Topic to all financial and non-financial assets and liabilities. This Topic emphasizes that fair value is a market-based measurement, not an entity-specific measurement. It clarifies that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The Topic requires the use of valuation techniques to measure fair value that maximize the use of observable inputs and minimize use of unobservable inputs. These inputs are prioritized as follows: ● Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. ● Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. ● Level 3: Unobservable inputs for which there is little or no market data and which require internal development of assumptions about how market participants price the asset or liability. There were no assets or liabilities measured at fair value on a recurring basis at December 31, 2016 and 2015. There were no assets or liabilities measured on a non-recurring basis at December 31, 2016 and 2015. Fair Value disclosures of financial instruments Estimated fair value was determined by management using available market information and appropriate valuation methodologies. However, judgment was necessary to interpret market data and develop estimated fair value. Cash, receivables, accounts payable and accrued expenses and other liabilities are carried at amounts which reasonably approximate their fair values as of December 31, 2016 and 2015 due to the immediate or short-term nature of these financial instruments. The Partnership’s long-term debt consists of notes payable, which are secured by specific equipment and are nonrecourse liabilities of the Partnership. The estimated fair value of this debt at December 31, 2016 and 2015 approximates the carrying value of these instruments, due to the interest rates on this debt approximating current market interest rates. The Partnership classifies the fair value of its notes payable within Level 2 of the valuation hierarchy based on the observable inputs used to estimate fair value. Revenue Recognition For the years ended December 31, 2016 and 2015, the Partnership’s lease portfolio consisted of operating leases and finance leases. For operating leases, lease revenue is recognized on a straight-line basis in accordance with the terms of the lease agreement. Finance lease interest income is recorded over the term of the lease using the effective interest method. For finance leases, we record, at lease inception, unearned finance lease income which is calculated as follows: total lease payments, plus any residual value and initial direct costs, less the cost of the leased equipment. Upon the end of the lease term, if the lessee has not met the return conditions as set out in the lease, the Partnership is entitled in certain cases to additional compensation from the lessee. The Partnership’s accounting policy for recording such payments is to treat them as revenue. Gains or losses from sales of leased and off-lease equipment are recorded on a net basis in the Partnership’s Statement of Operations. Our leases do not contain any step-rent provisions or escalation clauses nor are lease revenues adjusted based on any index. Recently Adopted Accounting Pronouncements In August 2014, the FASB issued Accounting Standards Update No. 2014 -15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern In June 2015, the FASB issued Accounting Standards Update No. 2015-10, Technical Corrections and Improvements- In January 2015, the FASB issued Accounting Standards Update No. 2015-01, Income Statement—Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. Other Assets Equipment acquisition costs and deferred expenses are amortized on a straight-line basis over two-to-four year lives based on the original term of the lease and the loan, respectively. Unamortized acquisition costs and deferred expenses are charged to amortization expense when the associated leased equipment is sold. Long-Lived Assets Depreciation on equipment for financial statement purposes is based on the straight-line method estimated generally over useful lives of two to five years. Once an asset comes off lease or is released, the Partnership reassesses the useful life of an asset. The Partnership evaluates its long-lived assets when events or circumstances indicate that the value of the asset may not be recoverable. The Partnership determines whether impairment exists by estimating the undiscounted cash flows to be generated by each asset. If the estimated undiscounted cash flows are less than the carrying value of the asset then impairment exists. The amount of the impairment is determined based on the difference between the carrying value and the fair value. Fair value is determined based on estimated discounted cash flows to be generated by the asset, third party appraisals or comparable sales of similar assets, as applicable, based on asset type. Residual values are determined by management and are calculated using information from both internal and external sources, as well as other economic indicators. Reimbursable Expenses Reimbursable expenses are comprised of both ongoing operational expenses and fees associated with the allocation of salaries and benefits, referred to as other LP (“other LP”) expenses. For the year ended December 31, 2016, the General Partner waived certain reimbursable expenses charged to the Partnership by CCC in connection with the administration and operation of the Partnership. CCC is not reimbursed for salary and benefit costs of control persons. Reimbursable expenses, which are charged to us by CCC in connection with our administration and operation, are allocated to us based upon several factors including, but not limited to, the number of investors, leasing volume and stage of the program. For example, if one partnership has more investors than another program sponsored by CCC, then higher amounts of expenses related to investor services, mailing and printing costs will be allocated to that partnership. Also, while a partnership is in its offering stage, higher compliance costs are allocated to it than to a program not in its offering stage, as compliance resources are utilized to review incoming investor suitability and proper documentation. Finally, lease related expenses, such as due diligence, correspondence, collection efforts and analysis staff costs, increase as programs purchase more leases, and decrease as leases terminate and equipment is sold. All of these factors contribute to CCC’s determination as to the amount of expenses to allocate to us or to other sponsored programs. CCC is not reimbursed for salary and benefit costs of control persons. For the Partnership, all reimbursable items are expensed as they are incurred. Forgiveness of Related Party Payables In accordance with ASC Topic 470-50 Debt Modifications and Extinguishments Lease Income Receivable Lease income receivable includes current lease income receivable net of allowances for uncollectible accounts, if any. The Partnership monitors lease income receivable to ensure timely and accurate payment by lessees. Its Lease Relations department is responsible for monitoring lease income receivable and, as necessary, resolving outstanding invoices. Lease revenue is recognized on a monthly straight-line basis which is in accordance with the terms of the lease agreement. The Partnership reviews a customer’s credit history before extending credit. When the analysis indicates that the probability of full collection is unlikely, the Partnership may establish an allowance for uncollectible lease income receivable based upon the credit risk of specific customers, historical trends and other information. The Partnership writes off its lease income receivable when it determines that it is uncollectible and all economically sensible means of recovery have been exhausted. Cash and cash equivalents We consider cash and cash equivalents to be cash on hand and highly liquid investments with the original maturity dates of 90 days or less. At December 31, 2016, cash was held in two bank accounts maintained at one financial institution with an aggregate balance of approximately $18,000. Bank accounts are federally insured up to $250,000 by the FDIC. At December 31, 2016 and 2015, the total cash bank balance was as follows: Balance at December 31 2016 2015 Total bank balance $ 18,000 $ 54,000 FDIC insured (18,000 ) (54,000 ) Uninsured amount $ — $ — The Partnership’s bank balances are fully insured by the FDIC. The Partnership deposits its funds with a Moody's Aaa-Rated banking institution which is one of only three Aaa-Rated banks listed on the New York Stock Exchange. The Partnership has not experienced any losses in such accounts, and believes it is not exposed to any significant credit risk. The amount in such accounts will fluctuate throughout 2017 due to many factors, including cash receipts, equipment acquisitions, interest rates, and distribution to limited partners. Income Taxes Pursuant to the provisions of Section 701 of the Internal Revenue Code, the Partnership is not subject to federal or state income taxes. All income and losses of the Partnership are the liability of the individual partners and are allocated to the partners for inclusion in their individual tax returns. The Partnership does not have any entity-level uncertain tax positions. In addition, the Partnership believes its tax status as a pass-through entity would be sustained under U.S. Federal, state or local tax examination. The Partnership files U.S. federal and various state income tax returns and is generally subject to examination by federal, state and local income tax authorities for three years from the filing of a tax return. Taxable income differs from financial statement net income as a result of reporting certain income and expense items for tax purposes in periods other than those used for financial statement purposes, principally relating to depreciation, amortization, and lease revenue. Net Loss Per Equivalent Limited Partnership Unit The net loss per equivalent limited partnership unit is computed based upon net loss allocated to the limited partners and the weighted average number of equivalent units outstanding during the period. Recent Accounting Pronouncements Not Yet Adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). Various amendments to ASU No. 2014-09 have been issued, including; ● ASU No. 2016-08 (issued in March 2016) which amends principal versus agent guidance by reframing the indicators in the guidance to focus on evidence that an entity is acting as a principal rather than as an agent; ● ASU No. 2016-10 (issued in April 2016) which amends criteria around licensing and performance obligations; ● ASU No. 2016-12 (issued in May 2016); which provides guidance on assessing collectability, presentation of sales taxes, noncash consideration and completed contracts and contract modifications at transition; and ● ASU No. 2016-20 (issued in December 2016) which contains various technical corrections and improvements to ASU No. 2014-09. FASB Accounting Standards Update 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In doing so, entities will need to use more judgment and make more estimates than under current guidance. These judgments and estimates may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU 2014-09 also requires an entity to disclose sufficient qualitative and quantitative information surrounding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. This ASU supersedes the revenue recognition requirements in Topic 605, Revenue Recognition In October 2016, the FASB issued Accounting Standards Update 2016-17 — Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control. In August 2016, the FASB issued Accounting Standards Update 2016-15— Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) Section A—Leases: Amendments to the FASB Accounting Standards Codification® Section B—Conforming Amendments Related to Leases: Amendments to the FASB Accounting Standards Codification® Section C—Background Information and Basis for Conclusions In January 2016, the FASB issued Accounting Standards Update No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities |
Information Technology, Medical
Information Technology, Medical Technology, Telecommunications Technology, Inventory Management Equipment ('Equipment') | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Information Technology, Medical Technology, Telecommunications Technology, Inventory Management Equipment ('Equipment') | The Partnership is the lessor of equipment under operating leases with periods that generally will range from 12 to 48 months. In general, associated costs such as repairs and maintenance, insurance and property taxes are paid by the lessee. Remarketing fees are paid to the leasing companies from which the Partnership purchases leases. These are fees that are earned by the leasing companies when the initial terms of the lease have been met. The General Partner believes that this strategy adds value since it entices the leasing company to remain actively involved with the lessee and encourages potential extensions, remarketing or sale of equipment. This strategy is designed to minimize any conflicts the leasing company may have with a new lessee and may assist in maximizing overall portfolio performance. The remarketing fee is tied into lease performance thresholds and is a factor in the negotiation of the fee. Remarketing fees incurred in connection with lease extensions are accounted for as operating costs. Remarketing fees incurred in connection with the sale of equipment are included in the gain or loss calculations. For the years ended December 31, 2016 and 2015, there were no remarketing fees incurred and/or paid with cash or netted against receivables due from such parties. CCC, on behalf of the Partnership and on behalf of other affiliated companies and partnerships (“partnerships”), acquires equipment subject to associated debt obligations and lease agreements and allocates a participation in the cost, debt and lease revenue to the various companies based on certain risk factors. The Partnership’s share of the cost of the equipment in which it participates with other partnerships at December 31, 2016 was approximately $4,166,000 and is included in the Partnership’s equipment on its balance sheet. The total cost of the equipment shared by the Partnership with other partnerships at December 31, 2016 was approximately $10,453,000. The Partnership’s share of the outstanding debt associated with this equipment at December 31, 2016 was approximately $186,000 and is included in the Partnership’s notes payable on its balance sheet. The total outstanding debt related to the equipment shared by the Partnership at December 31, 2016 was approximately $502,000. The Partnership’s share of the cost of the equipment in which it participates with other partnerships at December 31, 2015 was approximately $4,611,000 and is included in the Partnership’s equipment on its balance sheet. The total cost of the equipment shared by the Partnership with other partnerships at December 31, 2015 was approximately $11,855,000. The Partnership’s share of the outstanding debt associated with this equipment at December 31, 2015 was approximately $231,000 and is included in the Partnership’s notes payable on its balance sheet. The total outstanding debt related to the equipment shared by the Partnership at December 31, 2015 was approximately $681,000. As the Partnership and the other programs managed by the General Partner continue to acquire new equipment for the portfolio, opportunities for shared participation are expected to continue. Sharing in the acquisition of a lease portfolio gives the fund an opportunity to acquire additional assets and revenue streams, while allowing the fund to remain diversified and reducing its overall risk with respect to one portfolio. The following is a schedule of approximate future minimum rentals on non-cancelable operating leases: Years Ended December 31, Amount Year ending December 31, 2017 $ 296,000 Year ending December 31, 2018 119,000 Year ending December 31, 2019 46,000 $ 461,000 Finance Leases The following lists the approximate components of the net investment in finance leases: At December 31, 2016 2015 Total minimum lease payments to be received $ 55,000 $ 92,000 Estimated residual value of leased equipment (unguaranteed) 17,000 17,000 Less: unearned income (5,000 ) (11,000 ) Net investment in finance leases $ 67,000 $ 98,000 We assess credit risk for all of our customers, including those that lease under finance leases. This credit risk is assessed using an internally developed model which incorporates credit scores from third party providers and our own customer risk ratings and is periodically reviewed. Our internal ratings are weighted based on the industry that the customer operates in. Factors taken into consideration when assessing risk include both general and industry specific qualitative and quantitative metrics. We separately take in to consideration payment history, open lawsuits, liens and judgments. Typically, we will not extend credit to a company that has been in business for less than 5 years or that has filed for bankruptcy within the same period. Our internally based model may classify a company as high risk based on our analysis of their audited financial statements. Additional considerations of high risk may include history of late payments, open lawsuits and liens or judgments. In an effort to mitigate risk, we typically require deposits from those in this category. A reserve for credit losses is deemed necessary when payment has not been received for one or more months of receivables due on the equipment held under finance leases. At the end of each period, management evaluates the open receivables due on this equipment and determines the need for a reserve based on payment history and any current factors that would have an impact on payments. The following table presents the credit risk profile, by creditworthiness category, of our direct finance lease receivables at December 31, 2016: Percent of Total Risk Level 2016 2015 Low -% -% Moderate-Low -% -% Moderate -% -% Moderate-High 100 % 100 % High -% -% Net Finance lease receivable 100 % 100 % As of the year ended December 31, 2016 we determined that we did not have a need for an allowance for uncollectible accounts associated with any of our finance leases, as the customer payment histories with us, associated with these leases, has been positive. The following is a schedule of approximate future minimum rentals on non-cancelable finance leases: Amount Year ending December 31, 2017 33,000 Year ending December 31, 2018 20,000 Year ending December 31, 2019 2,000 $ 55,000 The Partnership was originally scheduled to end its operational phase on February 4, 2017. During the year ended December 31, 2015, the operational phase was officially extended to December 31, 2020 through an investor proxy vote (see note 1). The Partnership is expected to terminate on December 31, 2022. If the Partnership should terminate, CCC will assume all remaining active leases at their fair market value and related remaining revenue stream and any associated debt obligation for the duration of the remaining lease term. |
Significant Customers
Significant Customers | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Significant Customers | Lessees equal to or exceeding 10% of lease revenue: Years Ended December 31, 2016 2015 Cummins, Inc. 46 % 52 % Alliant Techsystems 19 % 20 % Del Monte Foods, Inc. 11 % 11 % Lessees equal to or exceeding 10% of net lease income receivable: At December 31, 2016 2015 Cummins, Inc. 53 % 54 % Cargill, Inc. 16 % 10 % Alliant Techsystems 13 % 13 % |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Related Party Transactions | Receivables/Payables During the year ended December 31, 2016 and 2015, CCC forgave $0 and $20,000 of payables owed to it by the Partnership, respectively. As of December 31, 2016 and 2015, the Company’s related party receivables and payables are short term, unsecured and non-interest bearing. Years ended December 31, 2016 2015 Reimbursable expenses The General Partner and its affiliates are entitled to reimbursement by the Partnership for the cost of goods, supplies or services obtained and used by the General Partner in connection with the administration and operation of the Partnership from third parties unaffiliated with the General Partner. In addition, the General Partner and its affiliates are entitled to reimbursement of certain expenses incurred by the General Partner and its affiliates in connection with the administration and operation of the Partnership, not including costs of the control persons, as defined in Item 10. During the years ended December 31, 2016 and 2015, the General Partner waived certain reimbursable expenses due to it by the Partnership. For the years ended December 31, 2016 and 2015, the Partnership was charged approximately $98,000 and $0 in Other LP expense, respectively. $ 355,000 $ 110,000 Equipment acquisition fee The General Partner earned an equipment acquisition fee of 4% of the purchase price of each item of equipment purchased as compensation for the negotiation of the acquisition of the equipment and lease thereof or sale under a conditional sales contract. For both years ended December 31, 2016 and 2015, approximately $12,000 and $11,000 of acquisition fees related to operating leases and finance leases were waived by the General Partner respectively. $ — $ — Debt placement fee As compensation for arranging term debt to finance our acquisition of equipment, we will pay the general partner a fee equal to one percent of such indebtedness; provided, however, that such fee shall be reduced to the extent we incur such fees to third parties unaffiliated with the general partner or the lender with respect to such indebtedness. No such fee will be paid with respect to borrowings from the general partner or its affiliates. We intend to initially acquire leases on an all cash basis with the proceeds of this offering, but may borrow funds after the offering proceeds have been invested. The amount we borrow, and therefore the amount of the fee, will depend upon interest rates at the time of a loan, and the amount of leverage we determine is appropriate at the time. We do not intend to use more than 30% leverage overall in our portfolio. Fees will increase as the amount of leverage we use increases, and as turnover in the portfolio increases and additional equipment is purchased using leverage. During the years ended December 31, 2016 and 2015, the General Partner earned but waived approximately $2,000 and $3,000 of debt placement fees, respectively. $ — $ — Equipment management fee The General Partner is entitled to be paid for managing the equipment portfolio a monthly fee equal to the lesser of (i) the fees which would be charged by an independent third party for similar services for similar equipment or (ii) the sum of (a) two percent of (1) the gross lease revenues attributable to equipment which is subject to full payout net leases which contain net lease provisions plus (2) the purchase price paid on conditional sales contracts as received by the Partnership and (b) 5% of the gross lease revenues attributable to equipment which is subject to operating leases. In an effort to increase future cash flow for the fund our General Partner had elected to reduce the percentage of equipment management fees paid to it from 5% to 2.5% of the gross lease revenues attributable to equipment which is subject to operating leases. The reduction was effective beginning in July 2010 and remained in effect for the years ended December 31, 2016 and 2015. $ 5,000 $ 23,000 Equipment liquidation fee With respect to each item of equipment sold by the General Partner (other than in connection with a conditional sales contract), a fee equal to the lesser of (i) 50% of the competitive equipment sale commission or (ii) three percent of the sales price for such equipment is payable to the General Partner. The payment of such fee is subordinated to the receipt by the limited partners of (i) a return of their net capital contributions and a 10% per annum cumulative return, compounded daily, on adjusted capital contributions and (ii) the net disposition proceeds from such sale in accordance with the Partnership Agreement. Such fee will be reduced to the extent any liquidation or resale fees are paid to unaffiliated parties. During the years ended December 31, 2016 and 2015, the General Partner earned but waived approximately $3,000 and $1,000 of equipment liquidation fees, respectively. $ — $ — |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Notes Payable | Notes payable consisted of the following approximate amounts: At December 31, 2016 2015 Installment note payable to bank; interest at 4.23%, due in monthly installments of $12,780, including interest, with final payment in July 2016 $ — $ 38,000 Installment note payable to bank; interest at 5.50%, due in monthly installments of $7,910, including interest, with final payment in August 2016 — 62,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $6,153, including interest, with final payment in August 2016 — 18,000 Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $152 to $1,321, including interest, with final payment in October 2016 — 10,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $2,740, including interest, with final payment in December 2016 — 11,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $478, including interest, with final payment in February 2017 1,000 5,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments ranging from $951 to $1,327, including interest, with final payment in March 2017 2,000 11,000 Installment note payable to bank; interest at 4.85%, due in monthly installments of $922, including interest, with final payment in March 2017 3,000 13,000 Installment note payable to bank; interest at 1.60%, due in monthly installments of $2,286, including interest, with final payment in May 2017 11,000 38,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $1,991, including interest, with final payment in June 2017 4,000 12,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $2,711, including interest, with final payment in May 2017 5,000 16,000 Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $132 to $663, including interest, with final payment in August 2017 4,000 12,000 Installment note payable to bank; interest at 4.85%, due in quarterly installments of $1,751, including interest, with final payment in September 2017 5,000 12,000 Installment note payable to bank; interest at 4.88%, due in quarterly installments of $1,852, including interest, with final payment in October 2017 18,000 39,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $9,663, including interest, with final payment in February 2018 47,000 82,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $278, including interest, with final payment in March 2018 3,000 5,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $278, including interest, with final payment in April 2018 5,000 8,000 Installment note payable to bank; interest at 4.23% due in quarterly installments of $2,797, including interest, with final payment in June 2018 16,000 26,000 Installment note payable to bank; interest at 4.23% due in quarterly installments of $296 to $458, including interest, with final payment in October 2018 13,000 5,000 Installment notes payable to bank; interest at 6.00% due in monthly installments ranging from $132 to $1,479, including interest, with final payment in September 2018 22,000 38,000 Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $803 to $1,216, including interest, with final payment in February 2019 29,000 41,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $458, including interest, with final payment in 3,000 — Installment note payable to bank; interest at 4.23% due in quarterly installments of $208, including interest, with final payment in November 2018 2,000 — Installment note payable to bank; interest at 1.80% due in monthly installments of $2,116, including interest, with final payment in February 2019 54,000 — Installment note payable to bank; interest at 1.80% due in monthly installments of $175, including interest, with final payment in March 2019 5,000 — Installment notes payable to bank; interest at 1.80% due in monthly installments ranging from $121 to $175, including interest, with final payment in April 2019 13,000 — Installment note payable to bank; interest at 4.98% due in monthly installments of $2,847, including interest, with final payment in December 2019 95,000 — $ 360,000 $ 502,000 The notes are secured by specific technology equipment with a carrying value of approximately $554,000 and are nonrecourse liabilities of the Partnership. As such, the notes do not contain any financial debt covenants with which we must comply on either an annual or quarterly basis. Aggregate approximate payments of notes payable for each of the periods subsequent to December 31, 2016 are as follows: Years Ended December 31, Amount 2017 $ 209,000 2018 110,000 2019 41,000 $ 360,000 The Partnership was originally scheduled to end its operational phase on February 4, 2017. During the year ended December 31, 2015, the operational phase was officially extended to December 31, 2020 through an investor proxy vote (see note 1). The Partnership is expected to terminate on December 31, 2022. If the Partnership should terminate, CCC will assume the obligation related to the remaining notes payable for the duration of the remaining lease term. During 2015, the General Partner executed a collateralized debt financing agreement on behalf of certain affiliates for a total shared loan amount of approximately $847,000, of which the Partnership’s share was approximately $101,000. The Partnership’s portion of the current loan amount at December 31, 2016 was approximately $55,000 and is secured by specific equipment under both operating and finance leases. The carrying value of the secured equipment under operating leases is approximately $12,000. The carrying value of the secured equipment under finance leases is approximately $72,000. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Supplemental Cash Flow Information | No interest or principal on notes payable was paid by the Partnership during 2016 and 2015 because direct payment was made by lessee to the bank in lieu of collection of lease income and payment of interest and principal by the Partnership. Noncash investing and financing activities approximately include the following: Years Ended December 31, 2016 2015 Debt assumed in connection with purchase of technology equipment $ 213,000 $ 163,000 Forgiveness of related party payables recorded as a capital contribution $ — $ 20,000 During the years ended December 31, 2016 and 2015, the Partnership wrote-off fully amortized acquisition and finance fees of approximately $0 and $51,000, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Commitments and Contingencies | Investor Complaint On November 10, 2015, certain investors (the “Claimants”) of Commonwealth Income & Growth Fund V (“CIGF5”) and Commonwealth Income & Growth Private Fund III (“CIGPF3”) (Collectively referred to as the “Funds”), filed an investor complaint with FINRA naming CCSC and Ms. Springsteen-Abbott (the “Respondents”). The Claimants, at the advice and recommendation of their personal financial advisors, purchased limited partnership units in CIGF5 between February 2005 and February 2006 and in CIGPF3 between April 2005 and February 2007. The Claimants allege that the Respondents did not properly perform their duties as fund manager. The Funds are not members of FINRA and/or subject to its jurisdiction. The Respondents filed a complaint on December 23, 2015, against the Claimants in the United States District Court for the District of Maryland to enjoin the Claimants from proceeding with the arbitration and requiring its dismissal. The Claimants withdrew its complaint with FINRA on July 27, 2016. On August 1, 2016, the Respondents were granted voluntary dismissal in Federal court given the withdrawal of the FINRA claim. On September 28, 2016, 23 investors, in addition to the original Claimants (the “Florida Claimants”) filed a complaint in the United States District Court for the Middle District of Florida, Albers et al. v. Commonwealth Capital Corp. et al., Case No. 6:16-cv-01713-Orl-37DCI, against the Partnership, Commonwealth Income & Growth Private Fund I, Commonwealth Income & Growth Private Fund II, CIGPF3 and CIGF5. The allegation consists of breach of contract, securities fraud, misstatement in the prospectus, fraudulent concealment, negligence, common law fraud (the “Original Complaint”). On October 18, 2016, the judge dismissed the Original Complaint without prejudice with leave to refile. The judge dismissed the Original Complaint for procedural failures. On October 28, 2016, the Florida Claimants filed an amended complaint that included the original claims with the addition of claims for negligent supervision and breach of industry standards (“Amended Complaint”). The Respondents’ counsel believes the allegations in the Amended Complaint fail to meet procedural requirements and are without merit, including the lapse of the statute of limitations on certain claims. On January 6, 2017, the Respondents filed a motion to dismiss, which is pending at this time. Management believes that resolution of the matter will not result in any adverse financial impact to the Partnership. Allied Health Care Services As previously disclosed in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2014, management wrote off the fully reserved accounts receivable and fully impaired assets related to the lease to Allied Health Care Services, Inc. (“Allied”), due to the bankruptcy of Allied and the criminal conviction of its founder, Mr. Schwartz, for fraud. There have been no material changes in the status of Allied’s bankruptcy or in the likelihood of recovering available assets since the date of the Partnership’s annual report. The deadline for the bankruptcy trustee to pursue adversary claims against certain creditors has expired, including extensions. The bankruptcy trustee cannot seek to claim the Partnership's payments received from Allied; therefore the Partnership has no exposure to such potential claims. Commonwealth continues to pursue all of our rights against both Allied and Mr. Schwartz to recover any available assets to the greatest extent possible. During 2015, Commonwealth received an Allied bankruptcy settlement of approximately $448,000. The Partnership’s portion was approximately $90,000, which is included as a bad debt recovery in the 2015 fourth quarter statement of financial operations. The bankruptcy proceedings have been finalized and no further recovery is expected. FINRA On May 3, 2013, the FINRA Department of Enforcement filed a complaint naming Commonwealth Capital Securities Corp. (“CCSC”) and the owner of the firm, Kimberly Springsteen-Abbott, as respondents; however on October 22, 2013, FINRA filed an amended complaint that dropped the allegations against CCSC and reduced the scope of the allegations against Ms. Springsteen-Abbott. The sole remaining charge was that Ms. Springsteen-Abbott had approved the misallocation of some expenses to certain Funds. Management believes that the expenses at issue include amounts that were proper and that were properly allocated to Funds, and also identified a smaller number of expenses that had been allocated in error, but were adjusted and repaid to the affected Funds when they were identified in 2012. During the period in question, Commonwealth Capital Corp. (“CCC”) and Ms. Springsteen-Abbott provided important financial support to the Funds, voluntarily absorbed expenses and voluntarily waived fees in amounts aggregating in excess of any questioned allocations. That Panel ruled on March 30, 2015, that Ms. Springsteen-Abbott should be barred from the securities industry because the Panel concluded that she allegedly misallocated approximately $208,000 of expenses involving certain Funds over the course of three years. As such, management has allocated approximately $87,000 of the $208,000 in allegedly misallocated expenses back to the affected funds as a contingency accrual in CCC’s financial statements and a good faith payment for the benefit of those Income Funds. Decisions issued by FINRA's Office of Hearing Officers may be appealed to FINRA's National Adjudicatory Council (NAC) pursuant to FINRA Rule 9311. The NAC Decision upheld the Panel’s ruling. Ms. Springsteen-Abbott has appealed the NAC Decision to the SEC. While a decision is on appeal with the SEC, the sanctions for disgorgement and fines are not enforced against the individual. The bar took effect on August 23, 2016. Management believes that resolution of the appeal will not result in any material adverse financial impact on the Funds, but no assurance can be provided until the FINRA matter is resolved. As of March 31, 2017, the results of appeal are pending. |
Reconciliation of Amounts Repor
Reconciliation of Amounts Reported For Financial Reporting Purposes To Amounts On The Federal Partnership Return (unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Reconciliation of Amounts Reported For Financial Reporting Purposes To Amounts On The Federal Partnership Return (unaudited) | The tax basis of the Partnership’s net assets and liabilities vary from the amounts presented in these financial statements at December 31, 2016 and 2015 as follows: Years Ended December 31, 2016 2015 Financial statement basis of net assets $ (88,923 ) $ 103,681 Tax basis of net assets (unaudited) 180,646 197,077 Difference (unaudited) $ 269,569 $ (93,396 ) The primary differences between the tax basis of net assets and the amounts recorded in the financial statements are the result of differences in accounting for impairment losses, syndication costs and differences between the depreciation methods used in the financial statements and the Partnership’s tax returns (unaudited). Years Ended December 31, 2016 2015 Net loss for financial reporting purposes to taxable income $ (192,123 ) $ (127,841 ) Adjustments (unaudited) (Loss) Gain on sale of equipment (56,096 ) 8,280 Depreciation 213,994 477,119 Amortization — 2,902 Unearned lease income 25,304 8,259 Penalties 1,104 434 Bad Debt 10,000 — Other (13,617 ) 20,182 Taxable income on the Federal Partnership return (unaudited) $ (11,434 ) $ 389,335 The “Adjustments – Other” includes financial statement adjustments that will be reflected on the tax return in the subsequent year. Adjustment or loss on sale of equipment is due to longer useful lives for tax reporting purposes. |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policy Text Block [Abstract] | |
Use of Estimates | The preparation of financial statements is in conformity with accounting principles generally accepted in the United States of America which 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 differ from those estimates and these differences could be material. Such estimates relate primarily to the determination of residual values at the end of the lease term, the expected future cash flows, and fair value used for impairment analysis purposes and determination of the allowance for doubtful accounts. |
Fair Value Measurement | The Partnership applies the provisions included in the Fair Value Measurements and Disclosures Topic to all financial and non-financial assets and liabilities. This Topic emphasizes that fair value is a market-based measurement, not an entity-specific measurement. It clarifies that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The Topic requires the use of valuation techniques to measure fair value that maximize the use of observable inputs and minimize use of unobservable inputs. These inputs are prioritized as follows: ● Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. ● Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. ● Level 3: Unobservable inputs for which there is little or no market data and which require internal development of assumptions about how market participants price the asset or liability. There were no assets or liabilities measured at fair value on a recurring basis at December 31, 2016 and 2015. There were no assets or liabilities measured on a non-recurring basis at December 31, 2016 and 2015. |
Fair Value Disclosures of Financial Instruments | Estimated fair value was determined by management using available market information and appropriate valuation methodologies. However, judgment was necessary to interpret market data and develop estimated fair value. Cash, receivables, accounts payable and accrued expenses and other liabilities are carried at amounts which reasonably approximate their fair values as of December 31, 2016 and 2015 due to the immediate or short-term nature of these financial instruments. The Partnership’s long-term debt consists of notes payable, which are secured by specific equipment and are nonrecourse liabilities of the Partnership. The estimated fair value of this debt at December 31, 2016 and 2015 approximates the carrying value of these instruments, due to the interest rates on this debt approximating current market interest rates. The Partnership classifies the fair value of its notes payable within Level 2 of the valuation hierarchy based on the observable inputs used to estimate fair value. |
Revenue Recognition | For the years ended December 31, 2016 and 2015, the Partnership’s lease portfolio consisted of operating leases and finance leases. For operating leases, lease revenue is recognized on a straight-line basis in accordance with the terms of the lease agreement. Finance lease interest income is recorded over the term of the lease using the effective interest method. For finance leases, we record, at lease inception, unearned finance lease income which is calculated as follows: total lease payments, plus any residual value and initial direct costs, less the cost of the leased equipment. Upon the end of the lease term, if the lessee has not met the return conditions as set out in the lease, the Partnership is entitled in certain cases to additional compensation from the lessee. The Partnership’s accounting policy for recording such payments is to treat them as revenue. Gains or losses from sales of leased and off-lease equipment are recorded on a net basis in the Partnership’s Statement of Operations. Our leases do not contain any step-rent provisions or escalation clauses nor are lease revenues adjusted based on any index. |
Recently Adopted Accounting Pronouncements | In August 2014, the FASB issued Accounting Standards Update No. 2014 -15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern In June 2015, the FASB issued Accounting Standards Update No. 2015-10, Technical Corrections and Improvements- In January 2015, the FASB issued Accounting Standards Update No. 2015-01, Income Statement—Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. |
Other Assets | Equipment acquisition costs and deferred expenses are amortized on a straight-line basis over two-to-four year lives based on the original term of the lease and the loan, respectively. Unamortized acquisition costs and deferred expenses are charged to amortization expense when the associated leased equipment is sold. |
Long-lived Assets | Depreciation on equipment for financial statement purposes is based on the straight-line method estimated generally over useful lives of two to five years. Once an asset comes off lease or is released, the Partnership reassesses the useful life of an asset. The Partnership evaluates its long-lived assets when events or circumstances indicate that the value of the asset may not be recoverable. The Partnership determines whether impairment exists by estimating the undiscounted cash flows to be generated by each asset. If the estimated undiscounted cash flows are less than the carrying value of the asset then impairment exists. The amount of the impairment is determined based on the difference between the carrying value and the fair value. Fair value is determined based on estimated discounted cash flows to be generated by the asset, third party appraisals or comparable sales of similar assets, as applicable, based on asset type. Residual values are determined by management and are calculated using information from both internal and external sources, as well as other economic indicators. |
Reimbursable Expenses | Reimbursable expenses are comprised of both ongoing operational expenses and fees associated with the allocation of salaries and benefits, referred to as other LP (“other LP”) expenses. For the year ended December 31, 2016, the General Partner waived certain reimbursable expenses charged to the Partnership by CCC in connection with the administration and operation of the Partnership. CCC is not reimbursed for salary and benefit costs of control persons. Reimbursable expenses, which are charged to us by CCC in connection with our administration and operation, are allocated to us based upon several factors including, but not limited to, the number of investors, leasing volume and stage of the program. For example, if one partnership has more investors than another program sponsored by CCC, then higher amounts of expenses related to investor services, mailing and printing costs will be allocated to that partnership. Also, while a partnership is in its offering stage, higher compliance costs are allocated to it than to a program not in its offering stage, as compliance resources are utilized to review incoming investor suitability and proper documentation. Finally, lease related expenses, such as due diligence, correspondence, collection efforts and analysis staff costs, increase as programs purchase more leases, and decrease as leases terminate and equipment is sold. All of these factors contribute to CCC’s determination as to the amount of expenses to allocate to us or to other sponsored programs. CCC is not reimbursed for salary and benefit costs of control persons. For the Partnership, all reimbursable items are expensed as they are incurred. |
Forgiveness of Related Party Payables | In accordance with ASC Topic 470-50 Debt Modifications and Extinguishments |
Lease Income Receivable | Lease income receivable includes current lease income receivable net of allowances for uncollectible accounts, if any. The Partnership monitors lease income receivable to ensure timely and accurate payment by lessees. Its Lease Relations department is responsible for monitoring lease income receivable and, as necessary, resolving outstanding invoices. Lease revenue is recognized on a monthly straight-line basis which is in accordance with the terms of the lease agreement. The Partnership reviews a customer’s credit history before extending credit. When the analysis indicates that the probability of full collection is unlikely, the Partnership may establish an allowance for uncollectible lease income receivable based upon the credit risk of specific customers, historical trends and other information. The Partnership writes off its lease income receivable when it determines that it is uncollectible and all economically sensible means of recovery have been exhausted. |
Cash and Cash Equivalents | We consider cash and cash equivalents to be cash on hand and highly liquid investments with the original maturity dates of 90 days or less. At December 31, 2016, cash was held in two bank accounts maintained at one financial institution with an aggregate balance of approximately $18,000. Bank accounts are federally insured up to $250,000 by the FDIC. At December 31, 2016 and 2015, the total cash bank balance was as follows: Balance at December 31 2016 2015 Total bank balance $ 18,000 $ 54,000 FDIC insured (18,000 ) (54,000 ) Uninsured amount $ — $ — The Partnership’s bank balances are fully insured by the FDIC. The Partnership deposits its funds with a Moody's Aaa-Rated banking institution which is one of only three Aaa-Rated banks listed on the New York Stock Exchange. The Partnership has not experienced any losses in such accounts, and believes it is not exposed to any significant credit risk. The amount in such accounts will fluctuate throughout 2017 due to many factors, including cash receipts, equipment acquisitions, interest rates, and distribution to limited partners. |
Income Taxes | Pursuant to the provisions of Section 701 of the Internal Revenue Code, the Partnership is not subject to federal or state income taxes. All income and losses of the Partnership are the liability of the individual partners and are allocated to the partners for inclusion in their individual tax returns. The Partnership does not have any entity-level uncertain tax positions. In addition, the Partnership believes its tax status as a pass-through entity would be sustained under U.S. Federal, state or local tax examination. The Partnership files U.S. federal and various state income tax returns and is generally subject to examination by federal, state and local income tax authorities for three years from the filing of a tax return. Taxable income differs from financial statement net income as a result of reporting certain income and expense items for tax purposes in periods other than those used for financial statement purposes, principally relating to depreciation, amortization, and lease revenue. |
Net Loss Per Equivalent Limited Partnership Unit | The net loss per equivalent limited partnership unit is computed based upon net loss allocated to the limited partners and the weighted average number of equivalent units outstanding during the period. |
Recent Accounting Pronouncements Not Yet Adopted | In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). Various amendments to ASU No. 2014-09 have been issued, including; ● ASU No. 2016-08 (issued in March 2016) which amends principal versus agent guidance by reframing the indicators in the guidance to focus on evidence that an entity is acting as a principal rather than as an agent; ● ASU No. 2016-10 (issued in April 2016) which amends criteria around licensing and performance obligations; ● ASU No. 2016-12 (issued in May 2016); which provides guidance on assessing collectability, presentation of sales taxes, noncash consideration and completed contracts and contract modifications at transition; and ● ASU No. 2016-20 (issued in December 2016) which contains various technical corrections and improvements to ASU No. 2014-09. FASB Accounting Standards Update 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In doing so, entities will need to use more judgment and make more estimates than under current guidance. These judgments and estimates may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU 2014-09 also requires an entity to disclose sufficient qualitative and quantitative information surrounding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. This ASU supersedes the revenue recognition requirements in Topic 605, Revenue Recognition In October 2016, the FASB issued Accounting Standards Update 2016-17 — Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control. In August 2016, the FASB issued Accounting Standards Update 2016-15— Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) Section A—Leases: Amendments to the FASB Accounting Standards Codification® Section B—Conforming Amendments Related to Leases: Amendments to the FASB Accounting Standards Codification® Section C—Background Information and Basis for Conclusions In January 2016, the FASB issued Accounting Standards Update No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities |
Summary of Significant Accoun17
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Table Text Block Supplement [Abstract] | |
Schedule of Cash and Cash Equivalents | Balance at December 31 2016 2015 Total bank balance $ 18,000 $ 54,000 FDIC insured (18,000 ) (54,000 ) Uninsured amount $ — $ — |
Information Technology, Medic18
Information Technology, Medical Technology, Telecommunications Technology, Inventory Management Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Table Text Block Supplement [Abstract] | |
Schedule of future minimum rentals on non-cancellable operating leases | Years Ended December 31, Amount Year ending December 31, 2017 $ 296,000 Year ending December 31, 2018 119,000 Year ending December 31, 2019 46,000 $ 461,000 |
Net investment in direct financing leases | At December 31, 2016 2015 Total minimum lease payments to be received $ 55,000 $ 92,000 Estimated residual value of leased equipment (unguaranteed) 17,000 17,000 Less: unearned income (5,000 ) (11,000 ) Net investment in finance leases $ 67,000 $ 98,000 |
Finance lease risk level | Percent of Total Risk Level 2016 2015 Low -% -% Moderate-Low -% -% Moderate -% -% Moderate-High 100 % 100 % High -% -% Net Finance lease receivable 100 % 100 % |
Schedule of future minimum rentals on non-cancelable direct financing leases | Amount Year ending December 31, 2017 33,000 Year ending December 31, 2018 20,000 Year ending December 31, 2019 2,000 $ 55,000 |
Significant Customers (Tables)
Significant Customers (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Table Text Block Supplement [Abstract] | |
Schedule of Lessees equal to or exceeding 10% of lease revenue | Years Ended December 31, 2016 2015 Cummins, Inc. 46 % 52 % Alliant Techsystems 19 % 20 % Del Monte Foods, Inc. 11 % 11 % |
Schedule of Lessees equal to or exceeding 10% of lease income receivable | At December 31, 2016 2015 Cummins, Inc. 53 % 54 % Cargill, Inc. 16 % 10 % Alliant Techsystems 13 % 13 % |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Table Text Block Supplement [Abstract] | |
Schedule of Related Party Transactions | Years ended December 31, 2016 2015 Reimbursable expenses The General Partner and its affiliates are entitled to reimbursement by the Partnership for the cost of goods, supplies or services obtained and used by the General Partner in connection with the administration and operation of the Partnership from third parties unaffiliated with the General Partner. In addition, the General Partner and its affiliates are entitled to reimbursement of certain expenses incurred by the General Partner and its affiliates in connection with the administration and operation of the Partnership, not including costs of the control persons, as defined in Item 10. During the years ended December 31, 2016 and 2015, the General Partner waived certain reimbursable expenses due to it by the Partnership. For the years ended December 31, 2016 and 2015, the Partnership was charged approximately $98,000 and $0 in Other LP expense, respectively. $ 355,000 $ 110,000 Equipment acquisition fee The General Partner earned an equipment acquisition fee of 4% of the purchase price of each item of equipment purchased as compensation for the negotiation of the acquisition of the equipment and lease thereof or sale under a conditional sales contract. For both years ended December 31, 2016 and 2015, approximately $12,000 and $11,000 of acquisition fees related to operating leases and finance leases were waived by the General Partner respectively. $ — $ — Debt placement fee As compensation for arranging term debt to finance our acquisition of equipment, we will pay the general partner a fee equal to one percent of such indebtedness; provided, however, that such fee shall be reduced to the extent we incur such fees to third parties unaffiliated with the general partner or the lender with respect to such indebtedness. No such fee will be paid with respect to borrowings from the general partner or its affiliates. We intend to initially acquire leases on an all cash basis with the proceeds of this offering, but may borrow funds after the offering proceeds have been invested. The amount we borrow, and therefore the amount of the fee, will depend upon interest rates at the time of a loan, and the amount of leverage we determine is appropriate at the time. We do not intend to use more than 30% leverage overall in our portfolio. Fees will increase as the amount of leverage we use increases, and as turnover in the portfolio increases and additional equipment is purchased using leverage. During the years ended December 31, 2016 and 2015, the General Partner earned but waived approximately $2,000 and $3,000 of debt placement fees, respectively. $ — $ — Equipment management fee The General Partner is entitled to be paid for managing the equipment portfolio a monthly fee equal to the lesser of (i) the fees which would be charged by an independent third party for similar services for similar equipment or (ii) the sum of (a) two percent of (1) the gross lease revenues attributable to equipment which is subject to full payout net leases which contain net lease provisions plus (2) the purchase price paid on conditional sales contracts as received by the Partnership and (b) 5% of the gross lease revenues attributable to equipment which is subject to operating leases. In an effort to increase future cash flow for the fund our General Partner had elected to reduce the percentage of equipment management fees paid to it from 5% to 2.5% of the gross lease revenues attributable to equipment which is subject to operating leases. The reduction was effective beginning in July 2010 and remained in effect for the years ended December 31, 2016 and 2015. $ 5,000 $ 23,000 Equipment liquidation fee With respect to each item of equipment sold by the General Partner (other than in connection with a conditional sales contract), a fee equal to the lesser of (i) 50% of the competitive equipment sale commission or (ii) three percent of the sales price for such equipment is payable to the General Partner. The payment of such fee is subordinated to the receipt by the limited partners of (i) a return of their net capital contributions and a 10% per annum cumulative return, compounded daily, on adjusted capital contributions and (ii) the net disposition proceeds from such sale in accordance with the Partnership Agreement. Such fee will be reduced to the extent any liquidation or resale fees are paid to unaffiliated parties. During the years ended December 31, 2016 and 2015, the General Partner earned but waived approximately $3,000 and $1,000 of equipment liquidation fees, respectively. $ — $ — |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Table Text Block Supplement [Abstract] | |
Schedule of Notes Payable | At December 31, 2016 2015 Installment note payable to bank; interest at 4.23%, due in monthly installments of $12,780, including interest, with final payment in July 2016 $ — $ 38,000 Installment note payable to bank; interest at 5.50%, due in monthly installments of $7,910, including interest, with final payment in August 2016 — 62,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $6,153, including interest, with final payment in August 2016 — 18,000 Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $152 to $1,321, including interest, with final payment in October 2016 — 10,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $2,740, including interest, with final payment in December 2016 — 11,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $478, including interest, with final payment in February 2017 1,000 5,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments ranging from $951 to $1,327, including interest, with final payment in March 2017 2,000 11,000 Installment note payable to bank; interest at 4.85%, due in monthly installments of $922, including interest, with final payment in March 2017 3,000 13,000 Installment note payable to bank; interest at 1.60%, due in monthly installments of $2,286, including interest, with final payment in May 2017 11,000 38,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $1,991, including interest, with final payment in June 2017 4,000 12,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $2,711, including interest, with final payment in May 2017 5,000 16,000 Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $132 to $663, including interest, with final payment in August 2017 4,000 12,000 Installment note payable to bank; interest at 4.85%, due in quarterly installments of $1,751, including interest, with final payment in September 2017 5,000 12,000 Installment note payable to bank; interest at 4.88%, due in quarterly installments of $1,852, including interest, with final payment in October 2017 18,000 39,000 Installment note payable to bank; interest at 4.23%, due in quarterly installments of $9,663, including interest, with final payment in February 2018 47,000 82,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $278, including interest, with final payment in March 2018 3,000 5,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $278, including interest, with final payment in April 2018 5,000 8,000 Installment note payable to bank; interest at 4.23% due in quarterly installments of $2,797, including interest, with final payment in June 2018 16,000 26,000 Installment note payable to bank; interest at 4.23% due in quarterly installments of $296 to $458, including interest, with final payment in October 2018 13,000 5,000 Installment notes payable to bank; interest at 6.00% due in monthly installments ranging from $132 to $1,479, including interest, with final payment in September 2018 22,000 38,000 Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $803 to $1,216, including interest, with final payment in February 2019 29,000 41,000 Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $458, including interest, with final payment in 3,000 — Installment note payable to bank; interest at 4.23% due in quarterly installments of $208, including interest, with final payment in November 2018 2,000 — Installment note payable to bank; interest at 1.80% due in monthly installments of $2,116, including interest, with final payment in February 2019 54,000 — Installment note payable to bank; interest at 1.80% due in monthly installments of $175, including interest, with final payment in March 2019 5,000 — Installment notes payable to bank; interest at 1.80% due in monthly installments ranging from $121 to $175, including interest, with final payment in April 2019 13,000 — Installment note payable to bank; interest at 4.98% due in monthly installments of $2,847, including interest, with final payment in December 2019 95,000 — $ 360,000 $ 502,000 |
Schedule of future aggregate payments of notes payable | Years Ended December 31, Amount 2017 $ 209,000 2018 110,000 2019 41,000 $ 360,000 |
Supplemental Cash Flow Inform22
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Table Text Block Supplement [Abstract] | |
Schedule of non-cash investing and financing activities | Years Ended December 31, 2016 2015 Debt assumed in connection with purchase of technology equipment $ 213,000 $ 163,000 Forgiveness of related party payables recorded as a capital contribution $ — $ 20,000 |
Reconciliation of Amounts Rep23
Reconciliation of Amounts Reported For Financial Reporting Purposes To Amounts On The Federal Partnership Return (unaudited): Schedule of The tax bases of the Partnership's net assets and liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Table Text Block Supplement [Abstract] | |
Tax Basis of the Partnership's Net Assets and Liabilities | Years Ended December 31, 2016 2015 Financial statement basis of net assets $ (88,923 ) $ 103,681 Tax basis of net assets (unaudited) 180,646 197,077 Difference (unaudited) $ 269,569 $ (93,396 ) |
Schedule of Effective Income Tax Reconciliation | Years Ended December 31, 2016 2015 Net loss for financial reporting purposes to taxable income $ (192,123 ) $ (127,841 ) Adjustments (unaudited) (Loss) Gain on sale of equipment (56,096 ) 8,280 Depreciation 213,994 477,119 Amortization — 2,902 Unearned lease income 25,304 8,259 Penalties 1,104 434 Bad Debt 10,000 — Other (13,617 ) 20,182 Taxable income on the Federal Partnership return (unaudited) $ (11,434 ) $ 389,335 |
Business (Details)
Business (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Text Block [Abstract] | ||
Entity Incorporation, State Country Name | Commonwealth of Pennsylvania | |
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | $ 0 | $ 0 |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Text Block [Abstract] | ||
Total bank balance | $ 18,000 | $ 54,000 |
FDIC Insured | (18,000) | (54,000) |
Uninsured Amount | $ 0 | $ 0 |
Information Technology, Medic26
Information Technology, Medical Technology, Telecommunications Technology, Inventory Management Equipment (Details) | Dec. 31, 2016USD ($) |
Text Block [Abstract] | |
Year Ended December 31, 2017 | $ 296,000 |
Year Ended December 31, 2018 | 119,000 |
Year Ended December 31, 2019 | 46,000 |
Total | $ 461,000 |
Information Technology, Medic27
Information Technology, Medical Technology, Telecommunications Technology, Inventory Management Equipment (Details 1) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Text Block [Abstract] | ||
Total minimum lease payments to be received | $ 55,000 | $ 92,000 |
Estimated residual value of leased equipment (unguaranteed) | 17,000 | 17,000 |
Less: unearned income | (5,000) | (11,000) |
Net investment in finance leases | $ 67,000 | $ 98,000 |
Information Technology, Medic28
Information Technology, Medical Technology, Telecommunications Technology, Inventory Management Equipment (Details 2) | Dec. 31, 2016 | Dec. 31, 2015 |
Text Block [Abstract] | ||
Low | 0.00% | 0.00% |
Moderate-Low | 0.00% | 0.00% |
Moderate | 0.00% | 0.00% |
Moderate-High | 100.00% | 100.00% |
High | 0.00% | 0.00% |
Net finance lease receivable | 100.00% | 100.00% |
Information Technology, Medic29
Information Technology, Medical Technology, Telecommunications Technology, Inventory Management Equipment (Details 3) | Dec. 31, 2016USD ($) |
Text Block [Abstract] | |
2,017 | $ 33,000 |
2,018 | 20,000 |
2,019 | 2,000 |
Total | $ 55,000 |
Information Technology, Medic30
Information Technology, Medical Technology, Telecommunications Technology, Inventory Management Equipment (Details Narrative) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Text Block [Abstract] | ||
Equipment Shared | $ 4,166,000 | $ 4,611,000 |
Debt Shared | 186,000 | 231,000 |
Total Shared Equipment | 10,453,000 | 11,855,000 |
Outstanding Debt Total | $ 502,000 | $ 681,000 |
Significant Customers (Details)
Significant Customers (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cummins, Inc. | ||
Percent Lease Revenue | 46.00% | 52.00% |
Alliant Techsystems | ||
Percent Lease Revenue | 19.00% | 20.00% |
Del Monte Foods, Inc. | ||
Percent Lease Revenue | 11.00% | 11.00% |
Significant Customers (Details
Significant Customers (Details 1) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cummins, Inc. | ||
Percent Lease Income Receivable | 53.00% | 54.00% |
Cargill, Inc. | ||
Percent Lease Income Receivable | 16.00% | 10.00% |
Alliant Techsystems | ||
Percent Lease Income Receivable | 13.00% | 13.00% |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Text Block [Abstract] | ||
Reimbursable Expenses | $ 355,000 | $ 110,000 |
Other LP expense | 98,000 | 0 |
Acquisition Fees waived related to operating leases, Affiliate | 12,000 | 11,000 |
Equipment Acquisition Fees | 0 | 0 |
Debt placement fees waived | 2,000 | 3,000 |
Debt placement fees | 0 | 0 |
Equipment Management Fee | 5,000 | 23,000 |
Equipment liquidation fees waived | 3,000 | 1,000 |
Equipment liquidation fee | $ 0 | $ 0 |
Related Party Transactions (D34
Related Party Transactions (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Text Block [Abstract] | ||
Debt Instrument, Decrease, Forgiveness | $ 0 | $ 20,000 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Long-term Debt, Gross | $ 360,000 | $ 502,000 |
Note 1 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23%, due in monthly installments of $12,780, including interest, with final payment in July 2016 | |
Long-term Debt, Gross | $ 0 | 38,000 |
Note 2 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 5.50%, due in monthly installments of $7,910, including interest, with final payment in August 2016 | |
Long-term Debt, Gross | $ 0 | 62,000 |
Note 3 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23%, due in quarterly installments of $6,153, including interest, with final payment in August 2016 | |
Long-term Debt, Gross | $ 0 | 18,000 |
Note 4 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $152 to $1,321, including interest, with final payment in October 2016 | |
Long-term Debt, Gross | $ 0 | 10,000 |
Note 5 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23%, due in quarterly installments of $2,740, including interest, with final payment in December 2016 | |
Long-term Debt, Gross | $ 0 | 11,000 |
Note 6 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $478, including interest, with final payment in February 2017 | |
Long-term Debt, Gross | $ 1,000 | 5,000 |
Note 7 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 4.23%, due in quarterly installments ranging from $951 to $1,327, including interest, with final payment in March 2017 | |
Long-term Debt, Gross | $ 2,000 | 11,000 |
Note 8 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.85%, due in monthly installments of $922, including interest, with final payment in March 2017 | |
Long-term Debt, Gross | $ 3,000 | 13,000 |
Note 9 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 1.60%, due in monthly installments of $2,286, including interest, with final payment in May 2017 | |
Long-term Debt, Gross | $ 11,000 | 38,000 |
Note 10 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23%, due in quarterly installments of $1,991, including interest, with final payment in June 2017 | |
Long-term Debt, Gross | $ 4,000 | 12,000 |
Note 11 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23%, due in quarterly installments of $2,711, including interest, with final payment in May 2017 | |
Long-term Debt, Gross | $ 5,000 | 16,000 |
Note 12 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $132 to $663, including interest, with final payment in August 2017 | |
Long-term Debt, Gross | $ 4,000 | 12,000 |
Note 13 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.85%, due in quarterly installments of $1,751, including interest, with final payment in September 2017 | |
Long-term Debt, Gross | $ 5,000 | 12,000 |
Note 14 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.88%, due in quarterly installments of $1,852, including interest, with final payment in October 2017 | |
Long-term Debt, Gross | $ 18,000 | 39,000 |
Note 15 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23%, due in quarterly installments of $9,663, including interest, with final payment in February 2018 | |
Long-term Debt, Gross | $ 47,000 | 82,000 |
Note 16 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $278, including interest, with final payment in March 2018 | |
Long-term Debt, Gross | $ 3,000 | 5,000 |
Note 17 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $278, including interest, with final payment in April 2018 | |
Long-term Debt, Gross | $ 5,000 | 8,000 |
Note 18 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23% due in quarterly installments of $2,797, including interest, with final payment in June 2018 | |
Long-term Debt, Gross | $ 16,000 | 26,000 |
Note 19 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23% due in quarterly installments of $296 to $458, including interest, with final payment in October 2018 | |
Long-term Debt, Gross | $ 13,000 | 5,000 |
Note 20 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 6.00% due in monthly installments ranging from $132 to $1,479, including interest, with final payment in September 2018 | |
Long-term Debt, Gross | $ 22,000 | 38,000 |
Note 21 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 6.00%, due in monthly installments ranging from $803 to $1,216, including interest, with final payment in February 2019 | |
Long-term Debt, Gross | $ 29,000 | 41,000 |
Note 22 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 4.23%, due in quarterly installments of $458, including interest, with final payment in | |
Long-term Debt, Gross | $ 3,000 | 0 |
Note 23 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.23% due in quarterly installments of $208, including interest, with final payment in November 2018 | |
Long-term Debt, Gross | $ 2,000 | 0 |
Note 24 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 1.80% due in monthly installments of $2,116, including interest, with final payment in February 2019 | |
Long-term Debt, Gross | $ 54,000 | 0 |
Note 25 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 1.80% due in monthly installments of $175, including interest, with final payment in March 2019 | |
Long-term Debt, Gross | $ 5,000 | 0 |
Note 26 | ||
Debt Instrument, Description | Installment notes payable to bank; interest at 1.80% due in monthly installments ranging from $121 to $175, including interest, with final payment in April 2019 | |
Long-term Debt, Gross | $ 13,000 | 0 |
Note 27 | ||
Debt Instrument, Description | Installment note payable to bank; interest at 4.98% due in monthly installments of $2,847, including interest, with final payment in December 2019 | |
Long-term Debt, Gross | $ 95,000 | $ 0 |
Notes Payable (Details 1)
Notes Payable (Details 1) | Dec. 31, 2016USD ($) |
Text Block [Abstract] | |
Year ended December 31, 2017 | $ 209,000 |
Year ended December 31, 2018 | 110,000 |
Year ended December 31, 2019 | 41,000 |
Long-term Debt | $ 360,000 |
Supplemental Cash Flow Inform37
Supplemental Cash Flow Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Text Block [Abstract] | ||
Debt assumed in connection with purchase of technology equipment | $ 213,000 | $ 163,000 |
Forgiveness of related party payables recorded as a capital contribution | $ 0 | $ 20,000 |
Supplemental Cash Flow Inform38
Supplemental Cash Flow Information (Details Narrative) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Text Block [Abstract] | ||
Fully Amortized Fees Written Off | 0 | 51,000 |
Reconciliation of Amounts Rep39
Reconciliation of Amounts Reported For Financial Reporting Purposes To Amounts On The Federal Partnership Return (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Text Block [Abstract] | |||
Financial statement basis of net assets | $ (88,923) | $ 103,681 | $ 395,005 |
Tax basis of net assets (unaudited) | 180,646 | 197,077 | |
Difference (unaudited) | $ 269,569 | $ (93,396) |
Reconciliation of Amounts Rep40
Reconciliation of Amounts Reported For Financial Reporting Purposes To Amounts On The Federal Partnership Return (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Text Block [Abstract] | ||
Net loss for financial reporting purposes to taxable income | $ (192,123) | $ (127,841) |
Adjustments (unaudited) | ||
(Loss) Gain on sale of equipment | (56,096) | 8,280 |
Depreciation | 213,994 | 477,119 |
Amortization | 0 | 2,902 |
Unearned Lease Income | 25,304 | 8,259 |
Penalties | 1,104 | 434 |
Bad Debt | 10,000 | 0 |
Other | (13,617) | 20,182 |
Taxable income on the Federal Partnership return (unaudited) | $ (11,434) | $ 389,335 |