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EXHIBIT 99.1
THE CHUCK YEAGER BUILDING
STATEMENT OF REVENUES
AND DIRECT OPERATING EXPENSES
Year Ended December 31, 1996
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Independent Auditors' Report
To the Board of Trustees
Income Opportunity Realty Investors, Inc.
We have audited the accompanying statement of revenues and direct operating
expenses of The Chuck Yeager Building for the year ended December 31, 1996.
This statement of revenues and direct operating expenses is the responsibility
of the Property's management. Our responsibility is to express an opinion on
this statement of revenues and direct operating expenses based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the statement of revenues and direct
operating expenses is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the statement of revenues and direct operating expenses. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall statement of revenues and direct
operating expenses presentation. We believe that our audit provides a
reasonable basis for our opinion.
The accompanying financial statement is prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission (for
inclusion in Form 8-K of Income Opportunity Realty Investors, Inc.) and, as
described in Note 1, is not intended to be a complete presentation of the
results of operations.
In our opinion, the statement of revenues and direct operating expenses
referred to above presents fairly, in all material respects, the revenues and
direct operating expenses of The Chuck Yeager Building for the year ended
December 31, 1996, in conformity with generally accepted accounting principles.
FARMER, FUQUA, HUNT & MUNSELLE, P.C.
Dallas, Texas
April 17, 1997
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THE CHUCK YEAGER BUILDING
STATEMENT OF REVENUES
AND DIRECT OPERATING EXPENSES
Year Ended December 31, 1996
REVENUES
Net rental revenues $767,670
Other revenues 110,995
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Total revenues 878,665
OPERATING EXPENSES
Property taxes 47,644
Repairs and maintenance 44,097
Utilities 10,145
Salaries and benefits 8,688
Insurance 7,996
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Total direct operating expenses 118,570
REVENUES IN EXCESS OF DIRECT OPERATING EXPENSES $760,095
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The accompanying notes are an integral part of this statement.
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THE CHUCK YEAGER BUILDING
NOTES TO STATEMENT OF REVENUES
AND DIRECT OPERATING EXPENSES
December 31, 1996
NOTE 1: ORGANIZATION AND BASIS OF PRESENTATION
The Chuck Yeager Building is a 60,060 square foot office building,
located in Chantilly, Virginia. During 1996, the property was owned
by Orange Nassau Property Services.
The accompanying financial statement does not include a provision for
depreciation and amortization, bad debt expense, interest expense or
income taxes. Accordingly, this statement is not intended to be a
complete presentation of the results of operations.
NOTE 2: ACCOUNTING 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 revenues and
expenses during the reporting period. Actual results could differ
from those estimates.
NOTE 3: OTHER REVENUES
Other revenues consist of the following:
Common area maintenance charges $ 82,709
Real estate tax reimbursement 24,336
Late fees and interest 3,950
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Total $110,995
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NOTE 4: SUBSEQUENT EVENT
The property was sold to Income Opportunity Realty Investors, Inc., a
Nevada corporation, on January 8, 1997.
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