UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2008 ----------------------------------------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ----------------------------------------- Commission file number 0-26522 Boston Financial Tax Credit Fund VIII, A Limited Partnership - --------------------------------------------------------------- (Exact name of registrant as specified in its charter) Massachusetts 04-3205879 - ---------------------------------- ------------------------------ (State or other jurisdiction of (I.R.S.Employer incorporation or organization) Identification No.) 101 Arch Street, Boston, Massachusetts 02110-1106 - -------------------------------------------- ------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (617) 439-3911 ----------------------- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No . ---- Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b -2 of the Exchange Act. Large accelerated filer ___ Accelerated Filer ___ Non-accelerated filer ___ (Do not check if a Smaller reporting company X smaller reporting company) --- Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b -2 of the Exchange Act). Yes No X . ---- BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP TABLE OF CONTENTS PART I. FINANCIAL INFORMATION Page No. - ------------------------------ -------- Item 1. Financial Statements Balance Sheet (Unaudited) - September 30, 2008 1 Statements of Operations (Unaudited) - For the Three and Six Months Ended September 30, 2008 and 2007 2 Statement of Changes in Partners' Equity (Unaudited) - For the Six Months Ended September 30, 2008 3 Statements of Cash Flows (Unaudited) - For the Six Months Ended September 30, 2008 and 2007 4 Notes to the Financial Statements (Unaudited) 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8 Item 3. Quantitative and Qualitative Disclosures About Market Risk 12 Item 4. Controls and Procedures 12 PART II - OTHER INFORMATION Items 1-6 13 SIGNATURE 14 CERTIFICATIONS 15 BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP BALANCE SHEET September 30, 2008 (Unaudited) Assets Cash and cash equivalents $ 91,456 Investments in Local Limited Partnerships (Note 1) 5,753,566 Due from affiliate 226 ------------- Total Assets $ 5,845,248 ============= Liabilities and Partners' Equity Due to affiliate $ 510,416 Accrued expenses 31,145 ------------- Total Liabilities 541,561 General, Initial and Investor Limited Partners' Equity 5,303,687 ------------- Total Liabilities and Partners' Equity $ 5,845,248 ============= The accompanying notes are an integral part of these financial statements. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP STATEMENTS OF OPERATIONS For the Three and Six Months Ended September 30, 2008 and 2007 (Unaudited) Three Months Ended Six Months Ended September 30, September 30, September 30, September 30, 2008 2007 2008 2007 ---------------- ---------------- ---------------- -------------- Revenue Investment $ 781 $ 30,164 $ 2,376 $ 31,099 Other - 222,790 - 222,790 --------------- ---------------- ---------------- ---------------- Total Revenue 781 252,954 2,376 253,889 --------------- ---------------- ---------------- ---------------- Expenses: Asset management fees, affiliate 65,786 63,195 131,572 126,390 General and administrative (includes reimbursements to an affiliate in the amounts of $37,696 and $39,158 for the six months ended September 30, 2008 and 2007, respectively) 46,298 66,395 90,681 109,595 Amortization 2,968 3,174 5,936 6,348 --------------- ---------------- ---------------- ---------------- Total Expenses 115,052 132,764 228,189 242,333 --------------- ---------------- ---------------- ---------------- Income (Loss) before equity in income (losses) of Local Limited Partnerships (114,271) 120,190 (225,813) 11,556 Equity in income (losses) of Local Limited Partnerships (Note 1) (89,364) 137,318 (68,889) 216,836 --------------- ---------------- ---------------- ---------------- Net Income (Loss) $ (203,635) $ 257,508 $ (294,702) $ 228,392 =============== ================ ================ ================ Net Income (Loss) allocated: General Partners $ (2,036) $ 2,575 $ (2,947) $ 2,285 Limited Partners (201,599) 254,933 (291,755) 226,107 --------------- ---------------- ---------------- ---------------- $ (203,635) $ 257,508 $ (294,702) $ 228,392 =============== ================ ================ ================ Net Income (Loss) Per Limited Partner Unit (36,497 Units) $ (5.52) $ 6.98 $ (7.99) $ 6.20 ============== ================ =============== ================ The accompanying notes are an integral part of these financial statements. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP STATEMENT OF CHANGES IN PARTNERS' EQUITY For the Six Months Ended September 30, 2008 (Unaudited) Initial Investor General Limited Limited Partners Partner Partner Total Balance at March 31, 2008 $ 55,984 $ 100 $ 5,542,305 $ 5,598,389 Net Loss (2,947) - (291,755) (294,702) ----------- ----------- -------------- -------------- Balance at September 30, 2008 $ 53,037 $ 100 $ 5,250,550 $ 5,303,687 =========== =========== ============== ============== The accompanying notes are an integral part of these financial statements. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP STATEMENTS OF CASH FLOWS For the Six Months Ended September 30, 2008 and 2007 (Unaudited) 2008 2007 ------------- ------------ Net cash provided by (used for) operating activities $ (484,883) $ 190,108 Net cash provided by investing activities 106,963 91,059 ------------- ------------- Net increase (decrease) in cash and cash equivalents (377,920) 281,167 Cash and cash equivalents, beginning 469,376 857,886 ------------- ------------- Cash and cash equivalents, ending $ 91,456 $ 1,139,053 ============= ============= The accompanying notes are an integral part of these financial statements. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (Unaudited) The unaudited financial statements presented herein have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by accounting principles generally accepted in the United States of America. These statements should be read in conjunction with the financial statements and notes thereto included with the Fund's Form10-KSB for the year ended March 31, 2008. In the opinion of the Managing General Partner, these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the Fund's financial position and results of operations. The results of operations for the periods may not be indicative of the results to be expected for the year. The Managing General Partner of the Fund has elected to report results of the Local Limited Partnerships in which the Fund has a limited partnership interest on a 90 day lag basis because the Local Limited Partnerships report their results on a calendar year basis. Accordingly, the financial information about the Local Limited Partnerships that is included in the accompanying financial statements is as of June 30, 2008 and 2007. Generally, profits, losses, tax credits and cash flows from operations are allocated 99% to the Limited Partners and 1% to the General Partner. Net proceeds from a sale or refinancing will be allocated 95% to the Limited Partners and 5% to the General Partner, after certain priority payments. The General Partners may have an obligation to fund deficits in their capital accounts, subject to limits set forth in the Partnership Agreement. However, to the extent that the General Partners' capital accounts are in a deficit position, certain items of net income may be allocated to the General Partners in accordance with the Partnership Agreement. 1. Investments in Local Limited Partnerships The Fund has limited partnership interests in nine Local Limited Partnerships, which were organized for the purpose of owning and operating multi-family housing complexes, all of which are government assisted. The Fund's ownership interest in the Local Limited Partnerships is 99%, with the exception of Springwood, which is 79.20%, Hemlock Ridge, which is 77% and Pike Place and West End Place, which are 90%. The Fund may have negotiated or may negotiate options with the Local General Partners to purchase or sell the Fund's interests in the Local Limited Partnerships at the end of the Compliance Period at nominal prices. In the event that Local Limited Partnerships are sold to third parties, or upon dissolution of the Local Limited Partnerships, proceeds will be distributed according to the terms of each Local Limited Partnership agreement. The following is a summary of investments in Local Limited Partnerships at September 30, 2008: Capital contributions and advances paid to Local Limited Partnerships $ 26,647,252 Cumulative equity in losses of Local Limited Partnerships (excluding cumulative unrecognized losses of $1,985,476) (15,423,839) Cumulative cash distributions received from Local Limited Partnerships (2,283,756) --------------- Investments in Local Limited Partnerships before adjustments 8,939,657 Excess investment costs over the underlying assets acquired: Acquisition fees and expenses 1,003,989 Cumulative amortization of acquisition fees and expenses (329,012) --------------- Investments in Local Limited Partnerships before valuation allowance 9,614,634 Valuation allowance on investments in Local Limited Partnerships (3,861,068) --------------- Investments in Local Limited Partnerships $ 5,753,566 =============== BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (continued) (Unaudited) 1. Investments in Local Limited Partnerships (continued) The Fund has recorded an impairment allowance for its investments in certain Local Limited Partnerships in order to appropriately reflect the estimated net realizable value of these investments. The Fund's share of net loss of the Local Limited Partnerships for the six months ended September 30, 2008 is $431,700. For the six months ended September 30, 2008, the Fund has not recognized $362,811 of equity in losses relating to five Local Limited Partnerships where cumulative equity in losses and cumulative distributions exceeded its total investment in the Local Limited Partnership. 2. New Accounting Principle In September 2006, the Financial Accounting Standards Board ("FASB") issued SFAS No. 157, "Fair Value Measurements" ("SFAS No. 157"), which provides enhanced guidance for using fair value to measure assets and liabilities. SFAS No. 157 establishes a common definition of fair value, provides a framework for measuring fair value under U.S. generally accepted accounting principles and expands disclosure requirements about fair value measurements. SFAS No. 157 is effective for financial statements issued in fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. In February 2008, the FASB issued FASB Staff Position 157-2, "Effective Date of FASB Statement No. 157", which delays the effective date of SFAS No. 157 for all nonfinancial assets and liabilities except those that are recognized or disclosed at fair value in the financial statements on at least an annual basis until November 15, 2008. The Fund adopted the provisions of SFAS No. 157 for financial assets and liabilities recognized at fair value on a recurring basis effective April 1, 2008. The partial adoption of SFAS No. 157 did not have a material impact on the Fund's Financial Statements. The Fund does not expect the adoption of the remaining provisions of SFAS No. 157 to have a material effect on the Fund's financial position, operations or cash flow. This standard requires that a Fund measure its financial assets and liabilities using inputs from the three levels of the fair value hierarchy. A financial asset or liability classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The three levels are as follows: Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access at the measurement date. Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3 - Unobservable inputs reflect the Fund's judgments about the assumptions market participants would use in pricing the asset or liability since limited market data exists. The Fund develops these inputs based on the best information available, including the Fund's own data. Financial assets accounted for at fair value on a recurring basis at September 30, 2008 include cash equivalents of $91,456. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (continued) (Unaudited) 3 Significant Subsidiaries The following Local Limited Partnerships invested in by the Fund represent more than 20% of the Fund's total assets or equity as of September 30, 2008 or 2007 or net losses for the three months ended either September 30, 2008 or 2007. The following financial information represents the performance of these Local Limited Partnerships for the three months ended June 30, 2008 and 2007: Beaverdam Creek Associates, a Limited Partnership 2008 2007 - ------------------------------------------------- --------------- ------------- Revenue $ 321,217 $ 302,361 Net Income $ 51,851 $ 54,115 Oak Knoll Renaissance, Limited Partnership Revenue $ 513,571 $ 671,078 Net Income (Loss) $ (36,365) $ 124,996 Pike Place, A Limited Partnership Revenue $ 165,586 $ 172,796 Net Loss $ (74,372) $ (10,021) BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Certain matters discussed herein constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The use of words like "anticipate, "estimate," "intend," "project," "plan," "expect," "believe," "could," and similar expressions are intended to identify such forward-looking statements. The Fund intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements and is including this statement for purposes of complying with these safe harbor provisions. Although the Fund believes the forward-looking statements are based on reasonable assumptions, the Fund can give no assurance that its expectations will be attained. Actual results and timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors, including, without limitation, general economic and real estate conditions and interest rates. Critical Accounting Policies The Fund's accounting polices include those that relate to its recognition of investments in Local Limited Partnerships using the equity method of accounting. The Fund's policy is as follows: The Local Limited Partnerships in which the Fund invests are Variable Interest Entities ("VIE"s). The Fund is involved with the VIEs as a non-controlling limited partner equity holder. Because the Fund is not the primary beneficiary of these VIEs, it accounts for its investments in the Local Limited Partnerships using the equity method of accounting. As a result of its involvement with the VIEs, the Fund's exposure to economic and financial statement losses is limited to its investments in the VIEs ($5,753,566 at September 30, 2008). The Fund may be subject to additional losses to the extent of any financial support that the Fund voluntarily provides in the future. Under the equity method, the investment is carried at cost, adjusted for the Fund's share of net income or loss and for cash distributions from the Local Limited Partnerships; equity in income or loss of the Local Limited Partnerships is included currently in the Fund's operations. A liability is recorded for delayed equity capital contributions to Local Limited Partnerships. Under the equity method, a Local Limited Partnership investment will not be carried below zero. To the extent that equity in losses are incurred when the Fund's carrying value of the respective Local Limited Partnership has been reduced to a zero balance, the losses will be suspended and offset against future income. Income from Local Limited Partnerships, where cumulative equity in losses plus cumulative distributions have exceeded the total investment in Local Limited Partnerships, will not be recorded until all of the related unrecorded losses have been offset. To the extent that a Local Limited Partnership with a carrying value of zero distributes cash to the Fund, that distribution is recorded as income on the books of the Fund and is included in "other revenue" in the accompanying financial statements. The Fund has implemented policies and practices for assessing other-than-temporary declines in values of its investments in Local Limited Partnerships. Periodically, the carrying values of the investments are compared to their respective fair values. If an other-than-temporary decline in carrying value exists, a provision to reduce the asset to fair value, as calculated based primarily on remaining tax benefits, will be recorded in the Fund's financial statements. Generally, the carrying values of most Local Limited Partnerships will decline through losses and distributions in amounts sufficient to prevent other-than-temporary impairments. However, the Fund may record similar impairment losses in the future if the expiration of tax credits outpaces losses and distributions from any of the Local Limited Partnerships. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Liquidity and Capital Resources At September 30, 2008, the Fund had cash and cash equivalents of $91,456, as compared to $469,376 at March 31, 2008. The decrease is primarily attributable to cash used for operating activities partially offset by cash distributions received from Local Limited Partnerships. The General Partner initially designated 5% of the Gross Proceeds as Reserves, as defined in the Partnership Agreement. The Reserves were established to be used for working capital of the Fund and contingencies related to the ownership of Local Limited Partnership interests. The General Partner may increase or decrease such Reserves from time to time, as it deems appropriate. At September 30, 2008, $91,456 has been designated as Reserves. To date, professional fees relating to various Property issues totaling approximately $64,000 have been paid from Reserves. In the event a Local Limited Partnership encounters operating difficulties requiring additional funds, the Fund's management might deem it in its best interest to voluntarily provide such funds in order to protect its investment. As of September 30, 2008, the Fund has advanced approximately $1,208,000 to Local Limited Partnerships to fund operating deficits. The General Partner believes that the investment income earned on the Reserves, along with cash distributions received from Local Limited Partnerships, to the extent available, will be sufficient to fund the Fund's ongoing operations. Reserves may be used to fund operating deficits, if the General Partner deems funding appropriate. To date, the Fund has used approximately $461,000 of Reserves to fund operations. If Reserves are not adequate to cover the Fund's operations, the Fund will seek other financing sources including, but not limited to, the deferral of Asset Management Fees paid to an affiliate of the General Partner or working with Local Limited Partnerships to increase cash distributions. Since the Fund invests as a limited partner, the Fund has no contractual duty to provide additional funds to Local Limited Partnerships beyond its specified investment. Thus, as of September 30, 2008, the Fund had no contractual or other obligation to any Local Limited Partnership which had not been paid or provided for. Cash Distributions No cash distributions were made during the six months ended September 30, 2008. Results of Operations Three Month Period For the three months ended September 30, 2008, the Fund's operations resulted in a net loss of $203,635 as compared to a net income of $257,508 for the three months ended September 30, 2007. The decrease in net income is primarily attributable to a decrease in equity in income of Local Limited Partnerships, a decrease in other income, a decrease in investment revenue and partially offset by a decrease in general and administrative expenses. The decrease in equity in income of Local Limited Partnerships is primarily due to an increase in equity in losses for the three months ended September 30, 2008 as compared to the three months ended September 30, 2007. The decrease in other income is due to a decrease in distributions from Local Limited Partnerships that were written off and distributions from Local Limited Partnerships with carrying values of zero. The Fund had a decrease in investment revenue during the period ended September 30, 2008 related to a reimbursement of interest that the Fund had received in the prior year. General and administrative costs decreased primarily due to decreased charges due to an affiliate of the Managing General Partner for operations and administrative expenses necessary for the operation of the Fund. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Results of Operations (continued) Six Month Period For the six months ended September 30, 2008, the Fund's operations resulted in a net loss of $294,702 as compared to a net income of $228,392 for the six months ended September 30, 2007. The decrease in net income is primarily attributable to a decrease in equity in income of Local Limited Partnerships, a decrease in other income, and a decrease in investment revenue, and partially offset by a decrease in general and administrative expenses. The decrease in equity in income of Local Limited Partnerships is primarily due to an increase in equity in losses for the six months ended September 30, 2008 as compared to the six months ended September 30, 2007. The decrease in other income is due to a decrease in distributions from Local Limited Partnerships that were written off and distributions from Local Limited Partnerships with carrying values of zero. The Fund had a decrease in investment revenue during the period ended September 30, 2008 related to a reimbursement of interest that the Partnership had received in the prior year. General and administrative costs decreased primarily due to decreased charges due to an affiliate of the Managing General Partner for operations and administrative expenses necessary for the operation of the Fund. Portfolio Update The Fund is a Massachusetts limited partnership organized to invest in Local Limited Partnerships which own and operate apartment complexes which are eligible for low income housing tax credits that may be applied against the federal income tax liability of an investor. The Fund's objectives are to: (i) provide investors with annual tax credits which they may use to reduce their federal income tax liability; (ii) provide limited cash distributions from the operations of apartment complexes; and (iii) preserve and protect the Fund's capital. Arch Street VIII Limited Partnership ("Arch Street L.P."), a Massachusetts limited partnership consisting of Arch Street VIII, Inc., a Massachusetts corporation ("Arch Street, Inc.") as the sole general partner and MMA as the sole limited partner, is the sole General Partner of the Fund. Arch Street L.P. and Arch Street, Inc. are affiliates of MMA. The fiscal year of the Fund ends on March 31. As of September 30, 2008, the Fund's investment portfolio consists of limited partnership interests in nine Local Limited Partnerships, each of which owns and operates a multi-family apartment complex and each of which has generated Tax Credits. Since inception, the Fund generated Tax Credits of approximately $1,429 per Limited Partner Unit. The aggregate amount of Tax Credits generated by the Fund was consistent with the objective specified in the Fund's prospectus. Properties that receive low income housing Tax Credits must remain in compliance with rent restriction and set-aside requirements for at least 15 calendar years from the date the property is placed in service (the "Compliance Period"). Failure to do so would result in the recapture of a portion of the property's Tax Credits. Between December 31, 2008 and December 31, 2010 the Compliance Period of the nine Properties in which the Fund has an interest will expire. It is unlikely that the General Partner will be able to dispose of the Fund's Local Limited Partnership interests concurrently with the expiration of each Property's Compliance Period. The Fund shall dissolve and its affairs shall be wound up upon the disposition of the final Local Limited Partnership interest and other assets of the Fund. Investors will continue to be Limited Partners, receiving K-1s and quarterly and annual reports, until the Fund is dissolved. The General Partner has negotiated an agreement that will ultimately allow the Fund to dispose of its interest in one Local Limited Partnership. The Fund has not disposed of any Local Limited Partnership interests during the six months ended September 30, 2008. The Fund is not a party to any pending legal or administrative proceeding, and to the best of its knowledge, no legal or administrative proceeding is threatened or contemplated against it. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Property Discussions Six of the Properties in which the Fund has an interest had stabilized operations and operated above break-even at June 30, 2008. Three Properties have generated cash flow deficits in prior periods that the Local General Partners of those Properties funded through project expense loans, subordinated loans or operating escrows. However, a few Properties have previously experienced operating difficulties that could either: (i) have an adverse impact on the Fund's liquidity; (ii) result in their foreclosure; or (iii) result in the General Partner deeming it appropriate for the Fund to dispose of its interest in the Local Limited Partnership prior to the expiration of the Compliance Period, in the event below breakeven operations recur. Also, the General Partner, in the normal course of the Fund's business, may arrange for the future disposition of its interest in certain Local Limited Partnerships. The following Property discussions focus only on such Properties. As previously reported, the Managing General Partner anticipated the Fund's interest in the Local Limited Partnership that owns Spring Wood Apartments, located in Tallahassee, Florida, would be terminated upon the sale of the Property in the third quarter of 2008, a transaction that could have resulted in net sales proceeds to the Fund of approximately $1,600,000, or $44.20 per Unit. In July 2008, the potential buyer withdrew their interest in the purchase of this Property. The Managing General Partner will continue to explore an exit strategy for the Fund's interest in the Local Limited Partnership that owns Spring Wood. As previously reported, in 2004 the Local General Partner of Beaverdam Creek located in Mechanicsville, Virginia, requested approval for a refinancing on the Property's first mortgage. As part of the agreement to provide the General Partner's approval of the refinancing, a put agreement was entered into whereby the Fund has the right to transfer its interest in the Local Limited Partnership for a nominal price at any time after December 31, 2009, the end of the Property's Compliance Period. As a result of the refinancing, which closed on May 4, 2005, the Fund received Sale or Refinancing Proceeds, as defined in the Local Limited Partnership Agreement, of $890,727. The General Partner, in accordance with and as permitted by the Partnership Agreement, retained the entire amount of the net proceeds in Reserves. As previously reported, turnover at Green Wood Apartments, located in Gallatin, Tennessee, as a result of few employment opportunities in the immediate area, was the main cause for below breakeven operations at the Property. Rental concessions, provided in an effort to alleviate the turnover issue, had proven successful, at least in the short term, as rental revenue increased to a level sufficient to result in above breakeven operations at June 30, 2006. Occupancy averaged 92% throughout the six-month period ending June 30, 2006 while debt service coverage and working capital were at acceptable levels as of June 30, 2006. As a result of a prior agreement, Green Wood Apartments was sold on November 30, 2006. This sale resulted in net proceeds to the Fund of $528,320 or $14.60 per Unit and resulted in 2006 taxable income of $459,116, or $12.68 per Unit. For financial reporting purposes, $176,323 represented repayment of prior advances made to the Local Limited Partnership and $351,997 represents gain on sale. Upon a reconciliation of cash balances after disposition, the Fund received additional proceeds of $194,970, or $5.38 per Unit, in September 2007. As a result of these additional proceeds, the Fund incurred 2007 taxable income equivalent to the additional proceeds. The Managing General Partner, in accordance with and as permitted by the Partnership Agreement, retained the entire amount of net proceeds in Reserves. The Fund no longer has an interest in this Local Limited Partnership. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Non Applicable CONTROLS AND PROCEDURES Disclosure Controls and Procedures We conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities Exchange Commission's rules and forms, including to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is accumulated and communicated to management to allow timely decisions regarding required disclosure. Based on that evaluation, management has concluded that as of September 30, 2008, our disclosure controls and procedures were effective. Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Our management conducted an assessment of the effectiveness of our internal control over financial reporting. This assessment was based upon the criteria for effective internal control over financial reporting established in Internal Control - Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Fund's internal control over financial reporting involves a process designed 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. Internal control over financial reporting includes the controls themselves, as well as monitoring of the controls and internal auditing practices and actions to correct deficiencies identified. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Management assessed the effectiveness of the Fund's internal control over financial reporting as of September 30, 2008. Based on this assessment, management concluded that, as of September 30, 2008, the Fund's internal control over financial reporting was effective. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP PART II OTHER INFORMATION Items 1-5 Not applicable Item 6 Exhibits and reports on Form 8-K (a)Exhibits 31.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 31.2 Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2 Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (b)Reports on Form 8-K - No reports on Form 8-K were filed during the quarter ended September 30, 2008 BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP SIGNATURE 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. Date: November 14, 2008 BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP By: Arch Street VIII Limited Partnership, its General Partner /s/Greg Judge -------------- Greg Judge President Arch Street VIII Limited Partnership