UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB [X] Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934. For the quarterly period ended March 31, 2005 [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. For the transition period from N/A to N/A_____ Commission File Number 0-28332 BRAUVIN NET LEASE V, INC. (Name of small business issuer as specified in its charter) Maryland 36-3913066________ (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 30 North LaSalle Street, Chicago, Illinois 60602____ (Address of principal executive offices) (Zip Code) (312) 759-7660 (Issuer's telephone number, including area code) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No . As of May 15, 2005, the registrant had 1,286,163 shares of Common Stock outstanding. Transitional small business disclosure format (check one) Yes ___ No X . BRAUVIN NET LEASE V, INC. (a Maryland corporation) INDEX PART I -Financial Information Page Item 1. Consolidated Financial Statements 3 Consolidated Statement of Net Assets in Liquidation as of March 31, 2005 (Liquidation Basis) 4 Consolidated Statement of Changes in Net Assets in Liquidation for the period January 1, 2005 to March 31, 2005 (Liquidation Basis) 5 Consolidated Statement of Changes in Net Assets in Liquidation for the period January 1, 2004 to March 31, 2004 (Liquidation Basis) 6 Consolidated Statements of Operations for the three months ended March 31, 2005 and March 31, 2004 (Liquidation Basis) 7 Notes to Consolidated Financial Statements 8 Item 2. Management's Discussion and Analysis or Plan of Operation 19 Item 3. Controls and Procedures 21 PART II - OTHER INFORMATION Item 1. Legal Proceedings 23 Item 2. Changes in Securities 23 Item 3. Defaults Upon Senior Securities. 23 Item 4. Submission of Matters to a Vote of Security Holders 23 Item 5. Other Information 23 Item 6. Exhibits and Reports on Form 8-K . . . . . . .. 23 Signatures 24 BRAUVIN NET LEASE V, INC. (a Maryland corporation) PART I - FINANCIAL INFORMATION ITEM 1. Consolidated Financial Statements The following Consolidated Statement of Net Assets in Liquidation as of March 31, 2005 (Liquidation Basis), Consolidated Statement of Changes in Net Assets in Liquidation for the period January 1, 2005 to March 31, 2005 (Liquidation Basis), Consolidated Statement of Changes in Net Assets in Liquidation for the period January 1, 2004 to March 31, 2004 (Liquidation Basis), and Consolidated Statements of Operations for the three months ended March 31, 2005 and March 31, 2004 (Liquidation Basis) for Brauvin Net Lease V, Inc. (the "Fund") are unaudited but reflect, in the opinion of the management, all adjustments necessary to present fairly the information required. All such adjustments are of a normal recurring nature. These consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Fund's 2004 Annual Report on Form 10-KSB. BRAUVIN NET LEASE V, INC. (a Maryland corporation) CONSOLIDATED STATEMENT OF NET ASSETS IN LIQUIDATION AS OF MARCH 31, 2005 (LIQUIDATION BASIS) (Unaudited) ASSETS Real estate held for sale $12,050,020 Cash and cash equivalents 551,495 Tenant receivables 35,258 Prepaid expenses 2,846 ----------- Total Assets 12,639,619 ----------- LIABILITIES Accounts payable and accrued expenses 52,271 Deferred gain on sale of real estate 3,386,442 Prepaid rent 34,980 Reserve for estimated costs during the period of liquidation 205,865 Tenant security deposits 9,794 Due to affiliates 25,236 ----------- Total Liabilities 3,714,588 ----------- Net Assets in Liquidation $ 8,925,031 =========== See accompanying notes to consolidated financial statements. BRAUVIN NET LEASE V, INC. (a Maryland corporation) STATEMENT OF CHANGES IN NET ASSETS IN LIQUIDATION FOR THE PERIOD JANUARY 1, 2005 TO MARCH 31, 2005 (LIQUIDATION BASIS) (Unaudited) Net assets in liquidation at January 1, 2005 $10,353,918 Income from operations 286,762 Dividends (1,715,649) ----------- Net assets in liquidation at March 31, 2005 $ 8,925,031 =========== See accompanying notes to consolidated financial statements. BRAUVIN NET LEASE V, INC. (a Maryland corporation) STATEMENT OF CHANGES IN NET ASSETS IN LIQUIDATION FOR THE PERIOD JANUARY 1, 2004 TO MARCH 31, 2004 (LIQUIDATION BASIS) (Unaudited) Net assets in liquidation at January 1, 2004 $9,671,560 Income from operations 308,366 Dividends (259,347) ---------- Net assets in liquidation at March 31, 2004 $9,720,579 ========== See accompanying notes to consolidated financial statements. BRAUVIN NET LEASE V, INC. (a Maryland corporation) STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2005 (LIQUIDATION BASIS) AND MARCH 31, 2004 (LIQUIDATION BASIS) (Unaudited) March 31, March 31, 2005 2004 -------- -------- INCOME Rental $296,641 $323,269 Other charges to tenant 32,609 630 Interest 2,435 -- -------- -------- Total income 331,685 323,899 -------- -------- EXPENSES Management fees 3,310 3,299 Real estate taxes 30,752 -- General and administrative 10,861 12,234 -------- -------- Total expenses 44,923 15,533 -------- -------- Net income $286,762 $308,366 ======== ======== Net income per Share (Based on weighted average shares outstanding of 1,286,163) $ 0.22 $ 0.24 ======== ======== See accompanying notes to consolidated financial statements. BRAUVIN NET LEASE V, INC. (a Maryland corporation) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (1) ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Brauvin Net Lease V, Inc. (the "Fund") is a Maryland corporation formed on October 14, 1993, which operates as a real estate investment trust ("REIT") under federal tax laws. The Fund has acquired properties that are leased to creditworthy corporate operators of nationally or regionally established businesses primarily in the retail and family restaurant sectors. All of the leases are on a long-term "triple net" basis generally requiring the corporate tenant to pay both base annual rent with mandatory escalation clauses and all operating expenses. The Fund acquired properties subject to leases with a Country Harvest Buffet Restaurant during the year ended December 31, 1994; an On the Border Restaurant, a Blockbuster Video, A Chili's Restaurant, a Just for Feet and a Video Watch during the year ended December 31, 1995; a Pier 1 Imports and a Taylor Rental during the year ended December 31, 1996; a Jiffy Lube and Firestone facility during the year ended December 31, 1997; a Golden Corral Restaurant during the year ended December 31, 2002; and three Dollar General stores during the year ended December 31, 2003. The On the Border Restaurant, and the Just for Feet property were sold during the year ended December 31, 2002. The Chili's Restaurant in Birmingham, Alabama was exchanged for a similar property located in Tucker, Georgia during the year ended December 31, 2002. The Chili's Restaurant was sold during the year ended December 31, 2004. The Jiffy Lube and Firestone facility was sold in April, 2005. The advisory agreement provides for Brauvin Realty Advisors V, L.L.C. (the "Advisor"), an affiliate of the Fund, to be the advisor to the Fund. The Fund registered the sale of up to 5,000,000 shares of common stock at $10.00 per share in an initial public offering filed with the Securities and Exchange Commission ("Registration Statement") and the issuance of 500,000 shares pursuant to the Fund's dividend reinvestment plan. On August 8, 1994, the Fund sold the minimum 120,000 shares required under its Registration Statement and commenced its real estate activities. The offering period for the sale of common stock terminated on February 25, 1996. At March 31, 2005, the gross proceeds raised were $12,881,903, net of liquidations of $663,172, and includes $200,000 invested by the Advisor ("Initial Investment"), before reduction for selling commissions and other offering costs. On November 6, 2003 the Board of Directors approved the adoption of a plan of liquidation which contemplates the sale of all of the Fund's assets within a twenty-four month period. On June 30, 2004 the stockholders also approved the plan of liquidation. SIGNIFICANT ACCOUNTING POLICIES Management's Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles 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 these estimates. Basis of Presentation As a result of the November 6, 2003 Board of Directors approval of the plan of liquidation and, in accordance with generally accepted accounting principles, the Fund's financial statements for periods subsequent to November 6, 2003 have been prepared on the liquidation basis of accounting. Accordingly, the carrying values of the assets are presented at their estimated net realizable values and liabilities are presented at estimated settlement amounts, including estimated costs associated with carrying out the liquidation. Preparation of financial statements on the liquidation basis of accounting requires significant assumptions by management, including the estimate of liquidation costs and the resolution of any contingent liabilities. There may be differences between the assumptions and the actual results because events and circumstances frequently do not occur as expected. Those differences, if any, could result in a change in the net assets recorded in the statement of net assets as of March 31, 2005. Accounting Method The accompanying consolidated financial statements have been prepared using the accrual method of accounting. Rental Income Prior to the preparation of the financial statements on the liquidation basis of accounting, rental income was recognized on a straight line basis over the life of the related leases. Differences between rental income earned and amounts due per the respective lease agreements were credited or charged, as applicable, to deferred rent receivable. Federal Income Taxes The Fund intends to be treated as a REIT under Internal Revenue Code Sections 856-860. A REIT will generally not be subject to federal income taxation to the extent that it distributes at least 90% of its taxable income to its shareholders and meets certain asset and income tests as well as other requirements. The Fund continues to qualify as a real estate investment trust and, accordingly, no provision has been made for Federal income taxes in the financial statements. Consolidation of Subsidiary The Fund owns a 100% interest in one qualified REIT subsidiary, Germantown Associates, Inc., which owns one Firestone/JiffyLube property. The accompanying financial statements have consolidated 100% of the assets, liabilities, operations and stockholder's equity of Germantown Associates, Inc. All significant intercompany accounts have been eliminated. In April, 2005, the Firestone/Jiffy Lube property was sold to an unaffiliated third party. Investment in Real Estate Prior to the preparation of the financial statements on the liquidation basis of accounting, the rental properties were stated at cost including acquisition costs. Depreciation was recorded on a straight-line basis over the estimated economic lives of the properties, which approximated 40 years. Subsequent to the adoption of the liquidation basis of accounting, the Fund adjusted its investment in real estate to estimated net realizable value, which is recorded as real estate held for sale. Additionally, recording of depreciation was suspended. The Fund has performed an analysis of its long-lived assets, and the Fund's management determined that there were no events or changes in circumstances that indicated that the carrying amount of the assets may not be recoverable at March 31, 2005. Accordingly, no impairment loss has been recorded in the accompanying financial statements for the period ended March 31, 2005. In July 2001, the FASB issued Statement of Financial Accounting Standards No. 141, "Business Combinations" ("SFAS 141"). SFAS 141 requires the purchase method of accounting for business combinations initiated after June 30, 2001 and eliminates the pooling-of-interests method. In July 2001, the FASB issued Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"), which was effective January 1, 2002. SFAS 142 requires, among other things, the discontinuance of goodwill amortization. In addition, the standard includes provisions for the reclassification of certain existing intangibles, reassessment of the useful lives of existing intangibles, reclassification of certain intangibles out of previously reported goodwill and the identification of reporting units for purposes of assessing potential future impairments of goodwill. Implementation of SFAS 141 and 142 to the Company's acquisition during year 2002 has resulted in the recognition of additional intangible assets (acquired in place lease origination costs aggregating $125,000 and an above market lease in the amount of $141,000). The intangible assets were being amortized over the remaining term of the acquired lease (7.3 years). Application of SFAS 141 and 142 to future acquisitions, if any, could result in the recognition, upon acquisition, of additional intangible assets (acquired in place lease origination costs and acquired above market leases) and liabilities (acquired below market leases) which would be amortized over the remaining term of the leases. Cash and Cash Equivalents Cash and cash equivalents include all highly liquid instruments with an original maturity within three months from date of purchase and approximate their fair value. The Fund maintains its cash in bank deposit accounts, which at times, may exceed federally insured limits. The Fund has not experienced any losses in such accounts. Management believes the Fund is not exposed to any significant credit risk related to cash and cash equivalents. Tenant Receivable Rent receivables are comprised of (a) billed but uncollected amounts due for monthly rents and other charges and (b) estimated unbilled amounts due for tenant reimbursement of common area maintenance charges and property taxes. Receivables are recorded at management's estimate of the amounts that will ultimately be collected. An allowance for doubtful accounts is based on specific identification of uncollectible accounts (if any) and the Fund's historical collection experience. Estimated Fair Value of Financial Instruments Disclosure of the estimated fair value of financial instruments is made in accordance with the requirements of Statement of Financial Accounting Standards No. 107, "Disclosure About Fair Value of Financial Instruments." The estimated fair value amounts have been determined by using available market information and appropriate valuation methodologies. However, considerable judgement is necessarily required in interpreting market data to develop estimates of fair value. The fair value estimates presented herein are based on information available to management as of March 31, 2005, but may not necessarily be indicative of the amounts that the Fund could realize in a current market exchange. The use of different assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. In connection with the adoption of the liquidation basis of accounting, assets were adjusted to their net realizable values and liabilities were adjusted to estimated settlement amounts, which approximate fair value at March 31, 2005. Derivatives and Hedging Instruments In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"), which requires that all derivatives be recognized as assets and liabilities in the balance sheet and be measured at fair value. SFAS 133 also requires changes in fair value of derivatives to be recorded each period in current earnings or comprehensive income depending on the intended use of the derivatives. In June, 2000, the FASB issued SFAS 138, which amends the accounting and reporting standards of SFAS 133 for certain derivatives and certain hedging activities. SFAS 133 and SFAS 138 were adopted by the Fund effective January 1, 2001. The Fund has no derivatives in 2005 and 2004. Recent Accounting Pronouncements In January 2003, FASB issued interpretation No. 46, "Consolidation of Variable Interest Entities" (FIN 46). FIN 46 addresses consolidation by business enterprises of certain variable interest entities in which the equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. This interpretation was revised in December 2003 and for calendar year end entities, is effective as of December 31, 2003. The Fund does not own any "special purpose entities" as defined. In May 2003, FASB issued Statement of Financial Accounting Standards No. 150, "Accounting for Certain Financial Instruments with the Characteristics of both Liabilities and Equity" ("SFAS 150"), which is effective for all financial instruments entered into or modified after May 31, 2003, and is otherwise effective beginning July 1, 2003. SFAS 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. The adoption of SFAS 145 and 150 and FIN 46 has not had a significant impact on the Fund's financial statements. (2) ADJUSTMENT TO LIQUIDATION BASIS On November 7, 2003, in accordance with the liquidation basis of accounting, assets were adjusted to their estimated net realizable values and liabilities were adjusted to their estimated settlement amounts, including estimated costs associated with carrying out the liquidation. (3) RELATED PARTY TRANSACTIONS The Fund is required to pay certain fees to the Advisor or its affiliates pursuant to various agreements set forth in the Prospectus and described below. Pursuant to the terms of the Selling Agreement, Brauvin Securities, Inc. ("BSI"), an affiliate of the Advisor, was entitled to placement charges of 5.50% of the gross proceeds of the Fund's offering, all of which were reallowed to placement agents. In addition, BSI was entitled to a marketing and due diligence expense allowance fee equal to 0.50% of the gross proceeds to reimburse marketing and due diligence expenses, some portion of which may be reallowed to placement agents. Pursuant to the terms of the Advisory Agreement, the Advisor was entitled to a non-accountable expense allowance in an amount equal to 2.5% of the cumulative gross proceeds of the offering. Pursuant to the terms of the Advisory Agreement, the Advisor is entitled to receive acquisition fees for services rendered in connection with the selection or acquisition of any property however designated as real estate commissions, selection fees, development fees, or any fees of a similar nature. Such acquisition fees may not exceed the lesser of (a) such compensation as is customarily charged in arm's-length transactions by others rendering similar services as an ongoing business in the same geographic locale and for comparable properties or (b) 3.5% of the gross proceeds of the Fund's offering. The Fund will also reimburse the Advisor an amount estimated to be 0.75% of the gross proceeds of the offering in connection with any expenses attendant to the acquisition of properties whether or not acquired. Pursuant to the terms of the Advisory Agreement, the Advisor is entitled to an annual advisory fee until the fifth anniversary of the termination of the offering, payable monthly, in an amount equal to 0.60% of the gross proceeds during the offering. Following the termination of the offering, the annual advisory fee is an amount equal to the greater of: (i) .60% of gross proceeds, or (ii) $175,000. In February 2001, the independent directors reviewed the Advisory Agreement, and modified the annual amount of the advisory fee to $145,000. The $145,000 represents approximately 1.4% of invested assets. In 2002, the independent directors again reviewed the Advisory Agreement, and the advisory fee was renewed for a one year period at an annual amount of $145,000. The independent directors reviewed the terms of the agreement in May of 2004 and February 2005, and renewed it on the same terms for one year. Pursuant to the terms of the Management Agreement, Brauvin Management Company ("BMC"), an affiliate of the Advisor, provides leasing and re-leasing services to the Fund in connection with the management of Fund's properties. The property management fee payable to an affiliate of the Advisor shall not exceed the lesser of: (a) fees that are competitive for similar services in the geographical area where the properties are located; or (b) 1% of the gross revenues of each property. Fees, commissions and other expenses incurred and payable to the Advisor or its affiliates for the three months ended March 31, 2005 and 2004 were as follows: 2005 2004 ------ ------- Advisory fees $36,249 $36,249 Reimbursable office expenses 4,050 4,050 Management fees 3,310 3,299 ------- ------- $43,609 $43,598 ======= ======= As of March 31, 2005 the Fund made all payments to affiliates except for $1,070 for management fees and $24,166 for advisor's fees. (4) DIVIDENDS Below is a table summarizing the dividends declared since January 1, 2003: Annualized Declaration Record Payment Dividend Date Dates Date(a) Rate Amount - --------- ---------------- --------- ------- -------- 1/23/03 10/1/02-12/31/02 1/30/03 6.94% $225,000 5/8/03 1/1/03-3/31/03 5/15/03 8.00% 253,708 8/7/03 4/1/03-6/30/03 8/15/03 7.46% 245,000 11/06/03 7/1/03-9/30/03 11/15/03 7.46% 245,000 1/29/04 10/1/03-12/31/03 2/15/04 8.00% 259,347 5/6/04 1/1/04-3/31/04 5/15/04 8.00% 255,827 8/05/04 4/1/04-6/30/04 8/15/04 8.00% 255,657 11/04/04 7/1/04-9/30/04 11/15/04 8.00% 258,639 1/27/05 10/1/04-12/31/04 1/31/05 53.00% 1,715,649 5/4/05 1/1/05-3/31/05 5/15/05 81.15% 2,573,700 (a) An $80,000 payment was made on 1/30/03 and a $145,000 payment was made on 1/31/03 for a total payment of $225,000. On January 31, 2005 checks were issued in the amount of $266,437 and $1,449,212 for a total of $1,715,649. On May 15, 2005, checks were issued in the amount of $253,700 and $2,320,000 for a total of $2,573,700. Included in the 2005 dividend figures was return of capital distributions totaling $3,846,000 ($1,526,000 distributed in January and $2,320,000 in May). A dividend reinvestment plan ("Reinvestment Plan") was available to the stockholders so that stockholders, if they so elected, may have their distributions from the Fund invested in shares. Until the third anniversary of the termination of the offering, the price per share purchased through the Reinvestment Plan shall equal $10 per share with the purchase of partial shares allowed. The Fund had registered 200,000 shares for distribution solely in connection with the Reinvestment Plan. At March 31, 2005 there were approximately 68,797 shares purchased through the Reinvestment Plan. Effective February 13, 2001, the Board of Directors discontinued the Dividend Reinvestment Plan. Subsequently, dividends have been paid in cash. In accordance with the Fund's original investment objective, during the first quarter of 2000, the Board of Directors approved a plan to have the Fund's shares listed on the OTC Bulletin Board under the symbol "yyBNL". In order to qualify as a REIT, the Fund is required to distribute dividends to its stockholders in an amount at least equal to 90% of REIT taxable income of the Fund. The Fund intends to make annual distributions to satisfy all annual distribution requirements. (5) PROPERTY SALE On December 17, 2004 the Fund sold the Chili's Restaurant property to an unaffiliated third party for a sales price of $1,535,000. The net proceeds received were approximately $1,526,000. (6) SUBSEQUENT EVENT In January 2005, the Fund entered into an agreement to sell the Jiffy Lube and Firestone property to an unaffiliated buyer. The property was sold for $2,405,000 on April 22, 2005, net proceeds received from the Fund at closing was approximately $2,320,000. In the first quarter of 2005, the Fund entered into an agreement to sell the Lynwood, Washington property now leased to Oriental Buffet restaurant. Subsequent to the end of the quarter, the purchaser completed its due diligence investigation and its earnest money is now at risk. It is anticipated that the sale of this property will be completed in the second quarter of 2005. BRAUVIN NET LEASE V, INC. (a Maryland corporation) Item 2. Management's Discussion and Analysis or Plan of Operation. General Certain statements in this Quarterly Report that are not historical fact constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Without limiting the foregoing, words such as "anticipates," "expects," "intends," "plans" and similar expressions are intended to identify forward-looking statements. These statements are subject to a number of risks and uncertainties, including, without limitation, tenant defaults which could materially decrease the Fund's rental income. Actual results could differ materially from those projected in the forward-looking statements. The Fund undertakes no obligation to update these forward-looking statements to reflect future events or circumstances. Liquidity and Capital Resources As of March 31, 2005, the Fund had received $11,539,065 in connection with the sale of shares, net of selling commissions and other offering costs, including $200,000 paid by the Advisor for a share of stock as disclosed in the Prospectus and liquidations of $663,172. Compliance with 90% REIT taxable income test The Fund is required, under the Internal Revenue Code, to make distributions of an amount not less than 90% of its REIT taxable income during the year. Property sale On December 17, 2004 the Fund sold the Chili's Restaurant property to an unaffiliated third party for a sales price of $1,535,000. The net proceeds received were approximately $1,526,000. On April 22, 2005, the Fund sold the Jiffy Lube and Firestone property to an unaffiliated party for a sales price of $2,405,000, net proceeds received from the Fund at closing was approximately $2,320,000. Adoption of a Plan of Liquidation The Fund is a finite-life REIT and, in accordance with the investment objectives and policies detailed in the Fund's Prospectus and the Fund's organizational documents, the Fund expected to sell all of its assets and liquidate after a period of ownership from 7 to 9 years. Accordingly, on November 6, 2003, the Board of Directors unanimously approved a Plan of Liquidation and voted to recommend that the stockholders approve the Plan of Liquidation. The stockholders voted to approve the plan of liquidation at the Annual Meeting on June 30, 2004. The Plan of Liquidation provides that the Fund will seek to sell all of its assets within a twenty-four month period to an unaffiliated third party or parties and, subject to payment of the Fund's liabilities, distribute the net proceeds thereof to the stockholders, wind down the Fund's business and dissolve. As a result of the Board of Directors' approval of the Plan of Liquidation, and in accordance with generally accepted accounting principles, the Fund's financial statements for periods subsequent to November 6, 2003 have been prepared on the liquidation basis of accounting. Accordingly, the carrying values of the assets are presented at net realizable values and liabilities are presented at estimated settlement amounts, including estimated costs associated with carrying out the liquidation. Preparation of the financial statements on the liquidation basis of accounting requires significant assumptions by management, including the estimate of liquidation costs and the resolution of any contingent liabilities. There may be differences between the assumptions and the actual results because events and circumstances frequently do not occur as expected. Those differences, if any, could result in a change in the net assets recorded in the consolidated statement of net assets as of March 31, 2005. For the purpose of the following analysis, 2003 information is presented on the going concern basis before reclassification of discontinued operations. Results of Operations - 3 months - 2005 Compared to 2004 Total income for the period ended March 31, 2005 was approximately $332,000. Total expenses were approximately $45,000 and net income was approximately $287,000. Total income was approximately $332,000 in 2005 compared to approximately $324,000 in 2004, an increase of approximately $8,000. This increase was due to an increase in other charges to tenants of approximately $33,000 partially offset by a decrease in rental income of $25,000. The increase in other charges to tenants of $33,000 corresponds to an increase in real estate tax expense of $33,000. Rental income decreased as a result of the sale of the Chili's property. Total expenses incurred in 2005 were approximately $45,000, compared to approximately $16,000 in 2004, an increase of approximately $29,000. The increase was due primarily to a $31,000 increase in real estate tax expense. Results of Operations - 2004 Compared to 2003 Total income for the period ended March 31, 2004 was approximately $324,000. Total expenses were approximately $16,000 and net income was approximately $308,000. Total income was approximately $324,000 in 2004 compared to approximately $305,000 in 2003, an increase of approximately $19,000. This increase was due to an increase in rental income of $22,000 offset by a decrease in interest and other income of $3,000. Rental income increased as a result of the June 18, 2003 acquisition of the three Dollar General stores. Total expenses incurred in 2004 were approximately $16,000, compared to approximately $106,000 in 2003, a decrease of approximately $90,000. The decrease was due primarily to a $44,000 decrease in depreciation and amortization as a result of the liquidation basis of accounting. In addition advisory fees decreased $36,000, directors fees decreased $3,000 and general and administrative expense decreased $7,000 all as a result of the expenses being reclassed against the reserve for liquidation. Item 3. Controls and Procedures Within 90 days prior to the date of this 2005 Quarterly Report, we completed an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-14 of the Securities Exchange Act of 1934. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the evaluation date. No significant changes were made to our internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation. PART II OTHER INFORMATION Item 1. Legal Proceedings. None. Item 2. Changes in Securities. None. Item 3. Defaults upon Senior Securities. None. Item 4. Submission of Matters to a Vote of Security Holders. None. Item 5. Other Information None. Item 6. Exhibits and Reports On Form 8-K Exhibit 99. Certification of Officers. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. BRAUVIN NET LEASE V, INC. By: /s/ James L. Brault James L. Brault Executive Vice President and Secretary DATE: May 23, 2005 By: /s/ Thomas E. Murphy Thomas E. Murphy Chief Financial Officer DATE: May 23, 2005 CERTIFICATE OF THE CHIEF EXECUTIVE OFFICER OF BRAUVIN NET LEASE V, INC. I, Jerome J. Brault, Chief Executive Officer of the Fund, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of BRAUVIN NET LEASE V, INC; 2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the consolidated financial condition, results of operations and statement of changes in net assets in liquidation of the small business issuer as of, and for, the periods presented in this report; 4. The small business issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)for the small business issue and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles c) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. The small business issuer's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of small business issuer's board of directors (or persons performing the equivalent function): a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to aversely affect the small business issuer's ability to record, process, summarize and report financial information; and b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal controls over financial reporting. BY: /s/Jerome J. Brault Jerome J. Brault Chief Executive Officer DATE: May 23, 2005 CERTIFICATE OF THE CHIEF FINANCIAL OFFICER OF BRAUVIN NET LEASE V, INC. I, Thomas E. Murphy, Chief Financial Officer of the Fund, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of Brauvin Net Lease V, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the consolidated financial condition, results of operations and statement of changes in net assets in liquidation of the small business issuer as of, and for, the periods presented in this report; 4. The small business issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)for the small business issue and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. The small business issuer's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of small business issuer's board of directors (or persons performing the equivalent function): a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to aversely affect the small business issuer's ability to record, process, summarize and report financial information; and b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal controls over financial reporting. BY: /s/ Thomas E. Murphy Thomas E. Murphy Chief Financial Officer DATE: May 23, 2005 Exhibit 99 SECTION 906 CERTIFICATION The following statement is provided by the undersigned to accompany the Quarterly Report on Form 10-QSB for the quarter ended March 31, 2005, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed pursuant to any provisions of the Securities Exchange Act of 1934 or any other securities law: Each of the undersigned certifies that the foregoing Report on Form 10-QSB fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m) and that the information contained in the Form 10-QSB fairly presents, in all material respects, the financial condition and results of operations of Brauvin Net Lease V, Inc. /s/ Jerome J. Brault Jerome J. Brault Chief Executive Officer DATE: May 23, 2005 /s/ Thomas E. Murphy Thomas E. Murphy Chief Financial Officer DATE: May 23, 2005