PLM EQUIPMENT GROWTH FUND V - 10-K Annual Report

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________
FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002.

[ ] 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 01-19203
_______________________

PLM EQUIPMENT GROWTH FUND V
(Exact name of registrant as specified in its charter)

CALIFORNIA 94-3104548
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

235 3RD STREET SOUTH, SUITE 200
ST. PETERSBURG, FL 33701
(Address of principal executive offices) (Zip code)

Registrant's telephone number, including area code (727) 803-1800
_______________________

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 ______
----

Aggregate market value of voting stock: N/A
---

An index of exhibits filed with this Form 10-K is located on page 27.

Total number of pages in this report: 74.

PART I

ITEM 1. BUSINESS
--------

(A) Background

In November 1989, PLM Financial Services, Inc. (FSI or the General Partner), a
wholly owned subsidiary of PLM International, Inc. (PLM International or PLMI),
filed a Registration Statement on Form S-1 with the Securities and Exchange
Commission with respect to a proposed offering of 10,000,000 limited partnership
units (the units) including 2,500,000 optional units, in PLM Equipment Growth
Fund V, a California limited partnership (the Partnership, the Registrant, or
EGF V). The Registration Statement also proposed offering an additional
1,250,000 Class B units through a reinvestment plan. The General Partner has
determined that it will not adopt this reinvestment plan for the Partnership.
The Partnership's offering became effective on April 11, 1990. FSI, as General
Partner, owns a 5% interest in the Partnership. The Partnership engages in the
business of investing in a diversified equipment portfolio consisting primarily
of used, long-lived, low-obsolescence capital equipment that is easily
transportable by and among prospective users.

The Partnership was formed to engage in the business of owning and managing a
diversified pool of used and new transportation-related equipment and certain
other items of equipment.

The Partnership's primary objectives are:

(1) to maintain a diversified portfolio of low-obsolescence equipment
with long lives and high residual values which were purchased with the net
proceeds of the initial Partnership offering, supplemented by debt financing,
and surplus operating cash during the investment phase of the Partnership;

(2) to generate sufficient net operating cash flow from lease
operations to meet liquidity requirements and to generate cash distributions to
the limited partners until such time as the General Partner commences the
orderly liquidation of the Partnership assets or unless the Partnership is
terminated earlier upon sale of all Partnership property or by certain other
events;

(3) to increase the Partnership's revenue base by reinvesting a portion
of its operating cash flow in additional equipment during the investment phase
of the Partnership's operation in order to grow the size of its portfolio.
Since net income and distributions are affected by a variety of factors,
including purchase prices, lease rates, and costs and expenses, growth in the
size of the Partnership's portfolio does not necessarily mean that in all cases
the Partnership's aggregate net income and distributions will increase upon the
reinvestment of operating cash flow; and

(4) to preserve and protect the value of the portfolio through quality
management, maintaining diversity, and constantly monitoring equipment markets.

The offering of units of the Partnership closed on December 23, 1991. As of
December 31, 2002, there were 8,478,448 units outstanding. The General Partner
contributed $100 for its 5% general partner interest in the Partnership.

The Partnership is currently in its investment phase during which the
Partnership uses cash generated from operations and proceeds from asset
dispositions to purchase additional equipment. The General Partner believes
these acquisitions may cause the Partnership to generate additional earnings and
cash flow for the Partnership.

The Partnership may reinvest its cash flow, surplus cash and equipment
disposition proceeds in additional equipment, consistent with the objectives of
the Partnership, until December 31, 2004. The Partnership will terminate on
December 31, 2010, unless terminated earlier upon the sale of all of the
equipment or by certain other events.

Table 1, below, lists the equipment and the original cost of equipment in the
Partnership's portfolio and the Partnership's proportional share of equipment
owned by unconsolidated special-purpose entities as of December 31, 2002 (in
thousands of dollars):

TABLE 1
-------

Units. Type Manufacturer Cost
- ------------------------------------------------------------------------------
Owned equipment held for operating leases:

3. . . .737-200 Stage II commercial aircraft Boeing $ 16,049
2. . . .737-200A Stage III commercial aircraft Boeing 12,920
1. . DC-9-32 Stage III commercial aircraft McDonnell Douglas 12,827
2. . . DHC-8-102 commuter aircraft DeHavilland 7,628
1. . . DHC-8-300 commuter aircraft DeHavilland 5,748
151. . Pressurized tank railcars ACF/RTC 4,022
106. . Non-pressurized tank railcars GATX 3,063
114. . Covered hopper railcars Various 2,718
43 . . .Mill gondola railcars Bethlehem Steel 1,219
289. . .Various marine containers Various 3,352
30 . . .Refrigerated marine containers Various 503
143. . .Intermodal trailers Oshkosh 2,184
--------
Total owned equipment held for operating leases $ 72,233 1
========

Equipment owned by unconsolidated special-purpose entities:

0.48 . .Product tanker Boelwerf-Temse $ 9,492 2
0.50 . Product tanker Kaldnes M/V 8,249 2
0.25 . Equipment on direct finance lease:
Two DC-9 Stage III commercial aircraft McDonnell Douglas 3,005 3
--------
Total investments in unconsolidated special-purpose entities $ 20,746 1
========

Equipment is generally leased under operating leases for a term of one to six
years except for marine vessels operating on voyage charter or time charter
which are usually leased for less than one year. The Partnership's marine
containers are leased to operators of utilization-type leasing pools, which
include equipment owned by unaffiliated parties. In such instances, revenues
received by the Partnership consist of a specified percentage of revenues
generated by leasing the pooled equipment to sublessees, after deducting certain
direct operating expenses of the pooled equipment. Lease revenues for
intermodal trailers are based on a per-diem lease in the free running
interchange with the railroads. Rents for all other equipment are based on
fixed rates.

(B) Management of Partnership Equipment

The Partnership has entered into an equipment management agreement with PLM
Investment Management, Inc. (IMI), a wholly owned subsidiary of FSI, for the
management of the Partnership's equipment. The Partnership's management
agreement with IMI is to co-terminate with the dissolution of

1. Includes equipment and investments purchased with the proceeds from
capital contributions, undistributed cash flow from operations, and Partnership
borrowings invested in equipment. Includes costs capitalized, subsequent to the
date of acquisition, and equipment acquisition fees paid to PLM Transportation
Equipment Corporation (TEC), a wholly owned subsidiary of FSI, or PLM Worldwide
Management Services (WMS), a wholly owned subsidiary of PLM International. All
equipment was used equipment at the time of purchase, except 150 piggyback
refrigerated trailers.
2 Jointly owned: EGF V and an affiliated program.
3 Jointly owned: EGF V and two affiliated programs.

the Partnership, unless the limited partners vote to terminate the agreement
prior to that date or at the discretion of the General Partner. IMI has agreed
to perform all services necessary to manage the equipment on behalf of the
Partnership and to perform or contract for the performance of all obligations of
the lessor under the Partnership's leases. In consideration for its services
and pursuant to the partnership agreement, IMI is entitled to a monthly
management fee (see Notes 1 and 2 to the financial statements).

(C) Competition

(1) Operating Leases versus Full Payout Leases

Generally, the equipment owned or invested in by the Partnership is leased out
on an operating lease basis wherein the rents received during the initial
noncancelable term of the lease are insufficient to recover the Partnership's
purchase price of the equipment. The short- to mid-term nature of operating
leases generally commands a higher rental rate than longer-term full payout
leases and offers lessees relative flexibility in their equipment commitment.
In addition, the rental obligation under an operating lease need not be
capitalized on the lessee's balance sheet.

The Partnership encounters considerable competition from lessors that utilize
full payout leases on new equipment, i.e., leases that have terms equal to the
expected economic life of the equipment. While some lessees prefer the
flexibility offered by a shorter-term operating lease, other lessees prefer the
rate advantages possible with a full payout lease. Competitors may write full
payout leases at considerably lower rates and for longer terms than the
Partnership offers, or larger competitors with a lower cost of capital may offer
operating leases at lower rates, which may put the Partnership at a competitive
disadvantage.

(2) Manufacturers and Equipment Lessors

The Partnership competes with equipment manufacturers who offer operating leases
and full payout leases. Manufacturers may provide ancillary services that the
Partnership cannot offer, such as specialized maintenance service (including
possible substitution of equipment), training, warranty services, and trade-in
privileges.

The Partnership also competes with many equipment lessors, including ACF
Industries, Inc. (Shippers Car Line Division), GATX Corp., General Electric
Railcar Services Corporation, General Electric Capital Aviation Services
Corporation, Xtra Corporation, and other investment programs that lease the same
types of equipment.

(D) Demand

The Partnership currently operates in the following operating segments: aircraft
leasing, railcar leasing, marine container leasing, product tanker leasing, and
intermodal trailer leasing. Each equipment leasing segment engages in
short-term to mid-term operating leases to a variety of customers. The
Partnership's equipment and investments are primarily used to transport
materials and commodities, except for aircraft leased to passenger air carriers.

The following section describes the international and national markets in which
the Partnership's capital equipment operates:

(1) Aircraft

(a) Commercial Aircraft

The Partnership owns 100% of six commercial, aircraft including five Boeing
737-200's of which one is currently off-lease and in storage. Two additional
Boeing 737-200's will come off-lease during March 2003. The Partnership also
owns 25% of two commercial aircraft that are on a direct finance lease. This
lease has been renegotiated and the resulting incoming cash flow has been
severely reduced.

Since the terrorist events of September 11, 2001, the commercial aviation
industry has experienced significant losses that escalated with a weakened
economy. This in turn has led to the bankruptcy filing of two of the largest
airlines in the United States, and to an excess supply of commercial aircraft.
The current state of the aircraft industry, with significant excess capacity for
both new and used aircraft continues to be extremely weak, and is expected by
the General Partner to remain weak. Most of the Partnership's aircraft are of
older vintage with limited demand, and most of the 737's do not meet certain
noise guidelines that would allow for them to fly in the US and other countries.

The decrease in value of the Partnership's aircraft since September 11, 2001
will have a negative impact on the ability of the Partnership to achieve its
original objectives as lower values will also result in significantly lower
lease rates than the Partnership has been able to achieve for these assets in
the past.

(b) Commuter Aircraft

The Partnership owns three commuter turboprops containing 37 to 50 seats each
(two DHC8-102 aircraft and one DHC8-300 aircraft.) The Partnership's aircraft
possess unique performance capabilities, compared to many other turboprops,
which allow them to readily operate at maximum payloads from unimproved
surfaces, hot-and-high runways and short runways. Notwithstanding this, regional
jets continue to outpace turboprops for market share of the regional airlines.
The already soft market for turboprops in 2001 continued to deteriorate during
2002 as the stored and available fleets grew with the deterioration of the
domestic airline industry. The General Partner believes that the availability
of a significant number of off-lease turbo-props, combined with limited demand,
will cause the market for these assets to be very weak for the foreseeable
future.

The two DHC8-102 aircraft operated in North America until October 2002 when they
were rejected by the operating lessee that was in bankruptcy. These aircraft
are currently in storage. In addition, the Partnership has filed pre-petition
claims and is currently filling administrative claims against the former lessee
to recoup the realized monetary damages as a result of loss of rent and
non-compliance with return conditions.

The Partnership's one DHC8-300 continued to be on lease with a North American
operator during 2002.

(2) Product Tankers

The Partnership has investments in two product type tankers, one manufactured in
1975 and the other in 1985, which operate in international markets carrying a
variety of commodity-type cargoes. Demand for commodity-based shipping is
closely tied to worldwide economic growth patterns, which can affect demand by
causing changes in volume on trade routes. The General Partner operates the
Partnership's product tankers in the spot chartering markets, carrying mostly
fuel oil and similar petroleum distillates, an approach that provides the
flexibility to adapt to changes in market conditions.

The marine vessel in which the Partnership owned an interest at December 31,
2002, was manufactured in 1975 and was nearing the end of its economic life.
This asset was sold during the first quarter of 2003. This marine vessel was a
single hulled vessel restricted by the ports which allowed it to enter. These
conditions severely limited the marine vessel's marketability.

The Partnership's newer product tanker, built in 1985, has continued to operate
with very little idle time between charters. Rates however, have continued to
decrease throughout the year when compared to rates in 2001. In the fourth
quarter of 2002 and into 2003, freight rates for the Partnership's marine
vessels started to increase due to an increase in oil prices caused by political
instability in the Middle East.

(3) Railcars

(a) Pressurized Tank Railcars

Pressurized tank railcars are used to transport liquefied petroleum gas (LPG)
and anhydrous ammonia (fertilizer). The North American markets for LPG include
industrial applications, residential use, electrical generation, commercial
applications, and transportation. LPG consumption is expected to grow over the
next few years as most new electricity generation capacity is expected to be gas
fired. Within any given year, consumption is particularly influenced by the
severity of winter temperatures.

Within the fertilizer industry, demand is a function of several factors,
including the level of grain prices, status of government farm subsidy programs,
amount of farming acreage and mix of crops planted, weather patterns, farming
practices, and the value of the US dollar. Population growth and dietary trends
also play an indirect role.

On an industry-wide basis, North American carloadings of the commodity group
that includes petroleum and chemicals decreased over 2% in 2002 after a 5%
decline in 2001. Even with this further decrease in industry-wide demand, the
utilization of pressurized tank railcars across the Partnership was in the 85%
range during the year. The desirability of the railcars in the Partnership is
affected by the advancing age of this fleet and related corrosion issues on foam
insulated railcars.

(b) General Purpose (Nonpressurized) Tank Railcars

General purpose tank railcars are used to transport bulk liquid commodities and
chemicals not requiring pressurization, such as certain petroleum products,
liquefied asphalt, lubricating oils, molten sulfur, vegetable oils, and corn
syrup. The overall health of the market for these types of commodities is
closely tied to both the US and global economies, as reflected in movements in
the Gross Domestic Product, personal consumption expenditures, retail sales, and
currency exchange rates. The manufacturing, automobile, and housing sectors are
the largest consumers of chemicals. Within North America, 2002 carloadings of
the commodity group that includes chemicals and petroleum products reversed
previous declines and rose 4% after a fall of 5% during 2001. Utilization of
the Partnership's nonpressurized tank railcars has been increasing reflecting
this market condition and presently stands at about 75%.

(c) Covered Hopper (Grain) Railcars

Demand for covered hopper railcars, which are specifically designed to service
the grain industry, continued to experience weakness during 2002; carloadings
were down 3% when compared to 2001 volumes. There has been a consistent pattern
of decline in the number of carloadings over the last several years.

The US agribusiness industry serves a domestic market that is relatively mature,
the future growth of which is expected to be consistent but modest. Most
domestic grain rail traffic moves to food processors, poultry breeders, and
feedlots. The more volatile export business, which accounts for approximately
30% of total grain shipments, serves emerging and developing nations. In these
countries, demand for protein-rich foods is growing more rapidly than in the
United States, due to higher population growth, a rapid industrialization pace,
and rising disposable income.

Other factors contributing to the softness in demand for covered hopper railcars
are the large number of new railcars built in the late 1990s and the more
efficient utilization of covered hoppers by the railroads. As in prior years,
any covered hopper railcars that were leased were done so at considerably lower
rental rates.

Many of the Partnership's railcars are smaller and thus less desirable than
those currently being built. Because of this factor, the lack of any prospect
for improvement in railcar demand, and the large number of idle railcars
throughout the industry, the Partnership has sold a number of these cars.
Utilization of the Partnership's covered hopper railcars remained at 96% during
2002.

(d) Mill Gondola Railcars

Mill gondola railcars are typically used to transport scrap steel for recycling
from steel processors to small steel mills called minimills. Demand for steel is
cyclical and moves in tandem with the growth or contraction of the overall
economy. Within the United States, carloadings for the commodity group that
includes scrap steel decreased over 12% in 2001, and while there has been a
small recovery this last year, it has not been sufficient to increase demand.
The Partnership's mill gondola railcars were in storage during 2002.

(4) Marine Containers

Marine containers are used to transport a variety of types of cargo. They
typically travel on marine vessels but may also travel on railroads loaded on
certain types of railcars and highways loaded on a trailer.

The Partnership's fleet of dry, refrigerated and other specialized containers is
in excess of 13 years of age, and is generally no longer suitable for use in
international commerce, either due to its specific physical condition, or the
lessees' preferences for newer equipment. As individual containers are returned
from their specific lessees, they are being marketed for sale on an "as is,
where is" basis. The market for such sales is highly dependent upon the
specific location and type of container. The Partnership has continued to
experience reduced residual values on the sale of refrigerated containers
primarily due to technological obsolescence associated with this equipment's
refrigeration machinery.

(5) Intermodal Trailers

Intermodal trailers are used to transport a variety of dry goods by rail on
flatcars, usually for distances of over 400 miles. Over the past seven years,
intermodal trailers have continued to be rapidly displaced by domestic
containers as the preferred method of transport for such goods. This
displacement occurs because railroads offer approximately 20% lower wholesale
freight rates on domestic containers compared to intermodal trailers. During
2002, demand for intermodal trailers was more depressed than historic norms.
Unusually low demand occurred over the first half of the year due to a rapidly
slowing economy and low rail freight rates for 53-foot domestic containers. Due
to the decline in demand, shipments for the year within the intermodal pool
trailer market declined approximately 10% compared to the prior year. Average
utilization of the entire US intermodal trailer pool fleet declined from 77% in
1999 to 75% in 2000 to 63% in 2001 and further declined to a record low of 50%
in 2002.

The General Partner continued its aggressive marketing program in a bid to
attract new customers for the Partnership's intermodal trailers during 2002.
The largest Fund trailer customer, Consolidated Freightways, abruptly shut down
their operations and declared bankruptcy during 2002. This situation was
largely offset by extensive efforts with other carriers to increase market
share. Even with these efforts, average utilization of the Partnership's
intermodal trailers for the year 2002 dropped 12% from 2001 to approximately
61%, still 11% above the national average.

The trend towards using domestic containers instead of intermodal trailers is
expected to accelerate in the future. Due to the anticipated continued weakness
of the overall economy, intermodal trailer shipments are forecast to decline by
10% to 15% in 2003, compared to 2002. As such, the nationwide supply of
intermodal trailers is expected to have approximately 27,000 units in surplus
for 2003. The maintenance costs have increased approximately 12% from 2001 due
to improper repair methods performed by the railroads' vendors and billed to
owners.

The General Partner will continue to seek to expand its customer base and
undertake significant efforts to reduce cartage and maintenance costs, such as
minimizing trailer downtime at repair shops and terminals.

(E) Government Regulations

The use, maintenance, and ownership of equipment are regulated by federal,
state, local, or foreign governmental authorities. Such regulations may impose
restrictions and financial burdens on the Partnership's ownership and operation
of equipment. Changes in governmental regulations, industry standards, or
deregulation may also affect the ownership, operation, and resale of the
equipment. Substantial portions of the Partnership's equipment portfolio are
either registered or operated internationally. Such equipment may be subject to
adverse political, government, or legal actions, including the risk of
expropriation or loss arising from hostilities. Certain of the Partnership's
equipment is subject to extensive safety and operating regulations, which may
require its removal from service or extensive modification of such equipment to
meet these regulations, at considerable cost to the Partnership. Such
regulations include:

(1) In 2004, new maritime and port security laws that have already been
passed by United States (US) Congress and International Maritime Organizations
are scheduled to be implemented. The United States Coast Guard is currently
holding hearings with international shipping industry representatives to discuss
the implementation of the new code and regulations, which are to apply to all
shipping, ports and terminals both in the US and abroad. The new regulations are
aimed at improving security aboard marine vessels. These regulations may
require additional security equipment being added to marine vessels as well as
additional training being provided to the crew. The final code, which is
expected to have a significant impact on the industry, will apply to all ships
over 500 dead weight tons that include those owned by the Partnership. The
requirements of these new regulations have to be met by July 2004. The deadline
for compliance by ports is planned to be 2005. As the methodology of how these
regulations will be applied is still being determined, the General Partner is
unable to determine the impact on the Partnership at this time;

(2) the US Department of Transportation's Aircraft Capacity Act of
1990, which limits or eliminates the operation of commercial aircraft in the
United States that do not meet certain noise, aging, and corrosion criteria. In
addition, under US Federal Aviation Regulations, after December 31, 1999, no
person may operate an aircraft to or from any airport in the contiguous United
States unless that aircraft has been shown to comply with Stage III noise
levels. The cost to install a hushkit to meet quieter Stage III requirements is
approximately $1.5 million, depending on the type of aircraft. The Partnership
has Stage II aircraft that do not meet Stage III requirements. One of these
stage II aircraft is currently in storage and the other two are on leases that
expire March 2003. These Stage II aircraft are scheduled to be sold or
re-leased in countries that do not require this regulation;

(3) the Montreal Protocol on Substances that Deplete the Ozone Layer and the
U.S. Clean Air Act Amendments of 1990, which call for the control and eventual
replacement of substances that have been found to cause or contribute
significantly to harmful effects on the stratospheric ozone layer and which are
used extensively as refrigerants in refrigerated marine cargo; and

(4) the US Department of Transportation's Hazardous Materials Regulations
regulates the classification and packaging requirements of hazardous materials
that apply particularly to Partnership's tank railcars. The Federal Railroad
Administration has mandated that effective July 1, 2000 all tank railcars must
be re-qualified every ten years from the last test date stenciled on each
railcar to insure tank shell integrity. Tank shell thickness, weld seams, and
weld attachments must be inspected and repaired if necessary to re-qualify the
tank railcar for service. The average cost of this inspection is $3,600 for
jacketed tank railcars and $1,800 for non-jacketed tank railcars, not including
any necessary repairs. This inspection is to be performed at the next scheduled
tank test and every ten years thereafter. The Partnership currently owns 156
jacketed tank railcars and 106 non-jacketed tank railcars that will need
re-qualification. As of December 31, 2002, 7 jacketed tank railcars and 19
non-jacketed tank railcars of the fleet will need to be re-qualified in 2003 or
2004.

As of December 31, 2002, the Partnership was in compliance with the above
governmental regulations. Typically, costs related to extensive equipment
modifications to meet government regulations are passed on to the lessee of that
equipment.

ITEM 2. PROPERTIES
----------

The Partnership neither owns nor leases any properties other than the equipment
it has purchased and its interests in entities that own equipment for leasing
purposes. As of December 31, 2002, the Partnership owned a portfolio of
transportation and related equipment and investments in equipment owned by
unconsolidated special-purpose entities (USPEs) as described in Item 1, Table 1.
The Partnership acquired equipment with the proceeds of the Partnership offering
of $184.3 million through the first quarter of 1992, proceeds from the debt
financing of $38.0 million, and by reinvesting a portion of its operating cash
flow in additional equipment.

The Partnership maintains its principal office at 235 3rd Street South, Suite
200, St. Petersburg, FL 33701.

ITEM 3. LEGAL PROCEEDINGS
------------------

The Partnership is involved as plaintiff or defendant in various legal actions
incidental to its business. Management does not believe that any of these
actions will be material to the financial condition or results of operations of
the Partnership.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
-----------------------------------------------------------

No matters were submitted to a vote of the Partnership's limited partners during
the fourth quarter of its fiscal year ended December 31, 2002.

PART II

ITEM 5. MARKET FOR THE PARTNERSHIP'S EQUITY AND RELATED UNITHOLDER MATTERS
-------------------------------------------------------------------

Pursuant to the terms of the partnership agreement, the General Partner is
entitled to 5% of the cash distributions of the Partnership. The General
Partner is the sole holder of such interests. Net income is allocated to the
General Partner to the extent necessary to cause the General Partner's capital
account to equal zero. The remaining interests in the profits, losses, and cash
distributions of the Partnership are allocated to the limited partners. As of
December 31, 2002, there were 8,862 limited partners holding units in the
Partnership.

There are several secondary markets in which limited partnership units trade.
Secondary markets are characterized as having few buyers for limited partnership
interests and, therefore, are generally viewed as inefficient vehicles for the
sale of limited partnership units. Presently, there is no public market for the
limited partnership units and none is likely to develop.

To prevent the units from being considered publicly traded and thereby to avoid
taxation of the Partnership as an association treated as a corporation under the
Internal Revenue Code, the limited partnership units will not be transferable
without the consent of the General Partner, which may be withheld in its
absolute discretion. The General Partner intends to monitor transfers of
limited partnership units in an effort to ensure that they do not exceed the
percentage or number permitted by certain safe harbors promulgated by the
Internal Revenue Service. A transfer may be prohibited if the intended
transferee is not a United States citizen or if the transfer would cause any
portion of the units of a "Qualified Plan" as defined by the Employee Retirement
Income Security Act of 1974 and Individual Retirement Accounts to exceed the
allowable limit.

ITEM 6. SELECTED FINANCIAL DATA
-------------------------

Table 2, below, lists selected financial data for the Partnership:

TABLE 2
-------

For the Years Ended December 31,
(In thousands of dollars, except weighted-average unit amounts)

2002 2001 2000 1999 1998
---------------------------------------------

Operating results:
Total revenues. . . . . . . . . . . . $ 9,888 $12,517 $22,473 $20,768 $24,047
Gain on disposition of equipment. . . 244 1,251 1,351 269 814
Loss on disposition of equipment. . . -- 5 -- 16 82
Impairment loss on equipment. . . . . 408 -- -- 2,899 --
Equity in net income (loss) of uncon-
solidated special-purpose entities. (1,161) 186 406 2,108 294
Net income. . . . . . . . . . . . . . 638 3,268 3,994 1,302 2,370

At year-end:
Total assets. . . . . . . . . . . . . $24,548 $24,243 $30,152 $46,083 $61,376
Note payable. . . . . . . . . . . . . -- -- 5,474 15,484 23,588
Total liabilities . . . . . . . . . . 3,384 3,753 8,706 19,077 26,970

Cash distribution . . . . . . . . . . . $ -- $ 1,720 $ 9,544 $ 8,617 $12,008

Cash distribution representing
a return of capital to the limited
partners. . . . . . . . . . . . . . $ -- $ -- $ 5,550 $ 7,315 $ 9,638

Per weighted-average limited
partnership unit:

Net income. . . . . . . . . . . . . . $ 0.08 1 $ 0.35 1 $ 0.39 1 $ 0.09 1 $0.20 1

Cash distribution . . . . . . . . . . $ -- $ 0.18 $ 1.00 $ 0.90 $ 1.26

Cash distribution representing
A return of capital . . . . . . . . $ -- $ -- $ 0.61 $ 0.81 $ 1.06

1 After an increase of income necessary to cause the General Partner's
capital account to equal zero of $32,000 ($0.00 per weighted-average limited
partnership unit) in 2002, $44,000 ($0.00 per weighted-average limited
partnership unit) in 2001 and after reduction of income necessary to cause the
General Partner's capital account to equal zero of $0.3 million ($0.03 per
weighted-average limited partnership unit) in 2000, $0.4 million ($0.05 per
weighted-average limited partnership unit) in 1999, and $0.5 million ($0.05 per
weighted-average limited partnership unit) in 1998 (see Note 1 to the financial
statements).

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
-------------------------------------------------------------------
RESULTS OF OPERATIONS
-------------------

(A) Introduction

Management's discussion and analysis of financial condition and results of
operations relates to the financial statements of PLM Equipment Growth Fund V
(the Partnership). The following discussion and analysis of operations focuses
on the performance of the Partnership's equipment in the various segments in
which it operates and its effect on the Partnership's overall financial
condition.

(B) Results of Operations - Factors Affecting Performance

(1) Re-leasing Activity and Repricing Exposure to Current Economic
Conditions

The exposure of the Partnership's equipment portfolio to repricing risk occurs
whenever the leases for the equipment expire or are otherwise terminated and the
equipment must be remarketed. Major factors influencing the current market rate
for Partnership equipment include supply and demand for similar or comparable
types of transport capacity, desirability of the equipment in the leasing
market, market conditions for the particular industry segment in which the
equipment is to be leased, overall economic conditions, and various regulations
concerning the use of the equipment. Equipment that is idle or out of service
between the expiration of one lease and the assumption of a subsequent lease can
result in a reduction of contribution to the Partnership. The Partnership
experienced re-leasing or repricing activity in 2002 for its trailer, marine
vessels, railcar, aircraft, and marine container portfolios.

(a) Trailers: The Partnership's trailer portfolio operates on per diem
leases with short-line railroad systems. The relatively short duration of most
leases in these operations exposes the trailers to considerable re-leasing
activity.

(b) Marine vessels: The Partnership's investment in entities owning
marine vessels operated in the short-term leasing market. As a result of this,
the Partnership's partially owned marine vessels were remarketed during 2002
exposing it to re-leasing and repricing risk.

(c) Railcars: This equipment experienced significant re-leasing
activity. Lease rates in this market are showing signs of weakness and this has
led to lower utilization and lower lease revenues to the Partnership as existing
leases expire and renewal leases are negotiated.

(d) Aircraft: The lessee of three of the Partnership's 737-200's
defaulted on its lease in September 2001. The Partnership reached a settlement
with this lessee in 2002 which included the continued re-lease of two of the
aircraft at significantly lower rates, and for an agreed upon stream of past due
lease payments to be paid over time. Due to the credit quality of that lessee,
it is not certain that all of the amounts agreed to in the settlement will be
recovered. As of December 31, 2002, three of the Partnership's owned aircraft
were off-lease. There continues to be an excess supply of commercial aircraft
in the United States and re-leasing of these assets is expected to be difficult
and at severely lower lease rates than the Partnership has been able to earn in
the past.

(e) Marine containers: All of the Partnership's marine containers are
leased to operators of utilization-type leasing pools and, as such, are highly
exposed to repricing activity. The Partnership's marine containers are in
excess of thirteen years of age and, as such, in limited demand.

(2) Equipment Liquidations

Liquidation of Partnership owned equipment and of investments in unconsolidated
special-purpose entities (USPEs), unless accompanied by an immediate replacement
of additional equipment earning similar rates (see Reinvestment Risk, below),
represents a reduction in the size of the equipment portfolio and may result in
reductions of contributions to the Partnership. During the year, the
Partnership disposed of owned equipment that included marine containers,
railcars, and trailers for total proceeds of $0.3 million.

(3) Nonperforming Lessees

Lessees not performing under the terms of their leases, either by not paying
rent, not maintaining or operating the equipment in accordance with the
conditions of the leases, or other possible departures from the lease terms, can
result not only in reductions in contribution, but also may require the
Partnership to assume additional costs to protect its interests under the
leases, such as repossession or legal fees.

During 2001, the lessee of three Stage II Boeing 737-200 commercial aircraft
notified the General Partner of its intention to return these aircraft and
stopped making lease payments. The lessee is located in Brazil, a country
experiencing severe economic difficultly. The Partnership has a security
deposit from this lessee that could be used to pay a portion of the amount due.
During October 2001, the General Partner sent a notification of default to the
lessee. The lease, which expired in October 2002, had certain return condition
requirements for the aircraft. The General Partner recorded an allowance for
bad debts for the amount due less the security deposit. During October 2002,
the General Partner reached an agreement with the lessee of this aircraft for
the past due lease payments and agreed to re-lease two of these aircraft to this
lessee until March 2003 at a lower lease rate. In order to give the lessee an
incentive to make timely payments in accordance with the agreement, the General
Partner gave the lessee a discount on the total amount due. If the lessee fails
to comply with the payment schedule in the agreement, the discount provision
will be waived and the full amount again becomes payable. The lessee made an
initial payment during October 2002, to be followed by 23 equal monthly
installments beginning in November 2002. Unpaid outstanding amounts will accrue
interest at a rate of 5%. The balance outstanding at December 31, 2002 was $3.3
million. Due to the uncertainty of ultimate collection, the General Partner
will continue to fully reserve the unpaid outstanding balance less the security
deposit from this lessee.

As of March 26, 2003, the installment payment due from the lessee to the
Partnership during March was not received. The General Partner has not yet
placed the lessee into default, however, is currently reviewing the options
available under the agreement.

The Partnership owns two DHC-8-102 commuter aircraft that were on a lease
through February 2003 to Allegheny Airlines, Inc., a wholly owned subsidiary of
US Airways, Inc., both of which declared bankruptcy on August 11, 2002. On
October 9, 2002, the General Partner received notification that the leases for
the two aircraft had been rejected and the aircraft were returned. The aircraft
are currently in storage and are being remarketed for lease or sale. Given the
current oversupply of aircraft, these aircraft may remain off-lease for the
foreseeable future. At December 31, 2002, the Partnership has $0.1 million in
receivables due from this lessee. The General Partner recorded an allowance for
bad debts for the amount due.

(4) Reinvestment Risk

Reinvestment risk occurs when the Partnership cannot generate sufficient surplus
cash after fulfillment of operating obligations to reinvest in additional
equipment during the reinvestment phase of the Partnership; equipment is
disposed of for less than threshold amounts; proceeds from the dispositions, or
surplus cash available for reinvestment cannot be reinvested at the threshold
lease rates; or proceeds from sales or surplus cash available for reinvestment
cannot be deployed in a timely manner.

The Partnership intends to increase its equipment portfolio by investing surplus
cash in additional equipment, after fulfilling operating requirements, until
December 31, 2004.

Other non-operating funds for reinvestment are generated from the sale of
equipment prior to the Partnership's planned liquidation phase, the receipt of
funds realized from the payment of stipulated loss values on equipment lost or
disposed of while it was subject to lease agreements, or from the exercise of
purchase options in certain lease agreements. Equipment sales generally result
from evaluations by the General Partner that continued ownership of certain
equipment is either inadequate to meet Partnership performance goals, or that
market conditions, market values, and other considerations indicate it is the
appropriate time to sell certain equipment.

(5) Equipment Valuation

In accordance with Financial Accounting Standards Board (FASB) Statements of
Financial Accounting Standards (SFAS) No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of" (SFAS No. 121),
the General Partner reviewed the carrying values of the Partnership's equipment
portfolio at least quarterly and whenever circumstances indicated that the
carrying value of an asset may not be recoverable due to expected future market
conditions. If the projected undiscounted cash flows and the fair value of the
equipment are less than the carrying value of the equipment, an impairment loss
was recorded.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets" (SFAS No. 144), which replaces SFAS No. 121. In
accordance with SFAS No. 144, the Partnership evaluates long-lived assets for
impairment whenever events or circumstances indicate that the carrying values of
such assets may not be recoverable. Losses for impairment are recognized when
the undiscounted cash flows estimated to be realized from a long-lived asset are
determined to be less than the carrying value of the asset and the carrying
amount of long-lived assets exceed its fair value. The determination of fair
value for a given investment requires several considerations, including but not
limited to, income expected to be earned from the asset, estimated sales
proceeds, and holding costs excluding interest. The Partnership applied the new
rules on accounting for the impairment or disposal of long-lived assets
beginning January 1, 2002.

The estimate of the fair value for the Partnership's owned and partially owned
equipment is based on the opinion of the Partnership's equipment managers using
data, reasoning and analysis of prevailing market conditions of similar
equipment, data from recent purchases, independent third party valuations and
discounted cash flows. The events of September 11, 2001, along with the change
in general economic conditions in the United States, have continued to adversely
affect the market demand for both new and used commercial aircraft and weakened
the financial position of several airlines. Aircraft condition, age, passenger
capacity, distance capability, fuel efficiency, and other factors influence
market demand and market values for passenger jet aircraft.

The Partnership has recorded write-downs of certain owned aircraft and certain
partially owned aircraft, representing impairment to the carrying value. During
2001, a USPE trust owning two Stage III commercial aircraft on a direct finance
lease reduced its net investment in the finance lease receivable due to a series
of lease amendments. The Partnership's proportionate share of this writedown,
which is included in equity in net income (loss) of the USPE in the accompanying
statements of income, was $1.0 million. During 2002, the bankruptcy of a major
US airline and subsequent increase in off-lease aircraft indicated to the
General Partner that an impairment to the aircraft portfolio may exist. The
General Partner determined the fair value of the aircraft based on the valuation
given by its independent third party aircraft equipment manager that considered,
among other factors, expected income to be earned from the asset, estimated
sales proceeds and holding costs excluding interest. This resulted in an
impairment of $0.4 million to an aircraft owned by the Partnership. No
reductions were required to the carrying value of the owned equipment during
2001 and 2000 or partially owned equipment in 2002 and 2000.

(C) Financial Condition - Capital Resources, Liquidity, and Unit Redemption
Plan

The General Partner purchased the Partnership's initial equipment portfolio with
capital raised from its initial equity offering of $184.3 million and permanent
debt financing of $38.0 million. No further capital contributions from limited
partners are permitted under the terms of the Partnership's limited partnership
agreement. The Partnership relies on operating cash flow to meet its operating
obligations and make cash distributions to limited partners.

For the year ended December 31, 2002, the Partnership generated $4.9 million in
operating cash to meet its operating obligations and purchase limited
Partnership units for $0.2 million.

During 2002, the Partnership disposed of owned equipment for aggregate proceeds
of $0.3 million.

Accounts receivable decreased $0.3 million in 2002. This decrease was due to an
increase in the allowance for bad debts of $2.3 million due to the General
Partner's evaluation of the collectibility of accounts receivable. This
increase was partially offset by $2.0 million due to the timing of cash receipts
during 2002.

Investments in USPEs decreased $1.0 million during 2002 due a $1.2 million loss
that was recorded by the Partnership for its equity interests in the USPEs
offset, in part, by the contribution of $0.2 million made by the Partnership to
fund USPE operations.

Prepaid expenses increased $0.3 million during 2002 due to the payment of
insurance and certain administrative expenses during 2002 that relate to 2003.

Accounts payable and accrued expenses decreased $0.2 million during 2002 due to
the payment of $0.2 million to purchase partnership units that was accrued at
December 31, 2001.

Lessee deposits and reserve for repairs decreased $0.2 million during 2002
resulting from a decrease in lessee prepaid deposits of $0.2 million.

The Partnership is a participant in a $10.0 million warehouse facility. The
warehouse facility is shared by the Partnership, PLM Equipment Growth Fund VI,
PLM Equipment Growth & Income Fund VII, Professional Lease Management Income
Fund I, LLC and Acquisub LLC, a wholly owned subsidiary of PLM International,
Inc. (PLMI). In July 2002, PLMI reached an agreement with the lenders of the
$10.0 million warehouse facility to extend the expiration date of the facility
to June 30, 2003. The facility provides for financing up to 100% of the cost of
the equipment. Any borrowings by the Partnership are collateralized by
equipment purchased with the proceeds of the loan. Outstanding borrowings by
one borrower reduce the amount available to each of the other borrowers under
the facility. Individual borrowings may be outstanding for no more than 270
days, with all advances due no later than June 30, 2003. Interest accrues
either at the prime rate or LIBOR plus 2.0% at the borrower's option and is set
at the time of an advance of funds. Borrowings by the Partnership are
guaranteed by PLMI. The Partnership is not liable for the advances made to the
other borrowers.

As of March 26, 2003, the Partnership had no borrowings outstanding under this
facility and there were no other borrowings outstanding under this facility by
any other eligible borrower.

In October 2002, PLM Transportation Equipment Corp. Inc. (TEC), a wholly owned
subsidiary of FSI, arranged for the lease or purchase of a total of 1,050
pressurized tank railcars by (i) partnerships and managed programs in which FSI
serves as the general partner or manager and holds an ownership interest
(Program Affiliates) or (ii) partnerships or managed programs in which FSI
provides management services but does not hold an ownership interest
(Non-Program Affiliates). These railcars will be delivered over the next three
years. A leasing company affiliated with the manufacturer will acquire
approximately 70% of the railcars and lease them to a Non-Program Affiliate.
The remaining approximately 30% will either be purchased by other third parties
to be managed by PLMI or by the Program Affiliates. Neither TEC nor its
affiliate will be liable for these railcars. TEC estimates that the total value
of purchased railcars will not exceed $26.0 million with approximately one third
of the railcars being purchased in each of 2002, 2003, and 2004. As of December
31, 2002, FSI committed one Program Affiliate, other than the Partnership, to
purchase $11.3 million in railcars that were purchased by TEC in 2002 or will be
purchased in 2003. Although FSI has neither determined which Program Affiliates
will purchase the remaining railcars nor the timing of any purchases, it is
possible the Partnership may purchase some of the railcars.

Commitment and contingencies as of December 31, 2002 are as follows (in
thousands of dollars):

Less than 1-3 4-5 After 5
Current Obligations Total 1 Year Years Years Years
- ---------------------------------------------------------------------------

Commitment to purchase railcars $14,699 $ 6,257 $ 8,442 $ -- $ --
Line of credit -- -- -- -- --
------- ------- -------- ------ ------
$14,699 $ 6,257 $ 8,442 $ -- $ --
======= ======= ======== ====== ======

The General Partner has not planned any expenditures, nor is it aware of any
contingencies that would cause it to require any additional capital to that
mentioned above.

(D) Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires the General Partner
to make estimates and assumptions that affect the reported amounts of assets and
liabilities and the 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. On a regular basis, the General Partner reviews
these estimates including those related to asset lives and depreciation methods,
impairment of long-lived assets, allowance for doubtful accounts, reserves
related to legally mandated equipment repairs and contingencies and litigation.
These estimates are based on the General Partner's historical experience and on
various other assumptions believed to be reasonable under the circumstances.
Actual results may differ from these estimates under different assumptions or
conditions. The General Partner believes, however, that the estimates,
including those for the above-listed items, are reasonable and that actual
results will not vary significantly from the estimated amounts.

The General Partner believes the following critical accounting policies affect
the more significant judgments and estimates used in the preparation of the
Partnership's financial statements:

Asset lives and depreciation methods: The Partnership's primary business
involves the purchase and subsequent lease of long-lived transportation and
related equipment. The General Partner has chosen asset lives that it believes
correspond to the economic life of the related asset. The General Partner has
chosen a deprecation method that it believes matches the benefit to the
Partnership from the asset with the associated costs. These judgments have been
made based on the General Partner's expertise in each equipment segment that the
Partnership operates. If the asset life and depreciation method chosen does not
reduce the book value of the asset to at least the potential future cash flows
from the asset to the Partnership, the Partnership would be required to record
an impairment loss. Likewise, if the net book value of the asset was reduced by
an amount greater than the economic value has deteriorated, the Partnership may
record a gain on sale upon final disposition of the asset.

Impairment of long-lived assets: Whenever circumstances indicate an impairment
may exist, the General Partner reviews the carrying value of its equipment and
investments in USPEs to determine if the carrying value of the assets may not be
recoverable due to current economic conditions. This requires the General
Partner to make estimates related to future cash flows from each asset as well
as the determination if the deterioration is temporary or permanent. If these
estimates or the related assumptions change in the future, the Partnership may
be required to record additional impairment charges.

Allowance for doubtful accounts: The Partnership maintains allowances for
doubtful accounts for estimated losses resulting from the inability of the
lessees to make the lease payments. These estimates are primarily based on the
amount of time that has lapsed since the related payments were due as well as
specific knowledge related to the ability of the lessees to make the required
payments. If the financial condition of the Partnership's lessees were to
deteriorate, additional allowances could be required that would reduce income.
Conversely, if the financial condition of the lessees were to improve or if
legal remedies to collect past due amounts were successful, the allowance for
doubtful accounts may need to be reduced and income would be increased.

Reserves for repairs: The Partnership accrues for legally required repairs to
equipment such as dry docking for marine vessels and engine overhauls to
aircraft engines over the period prior to the required repairs. The amount that
is reserved for is based on the General Partner's expertise in each equipment
segment, the past history of such costs for that specific piece of equipment and
discussions with independent, third party equipment brokers. If the amount
reserved for is not adequate to cover the cost of such repairs or if the repairs
must be performed earlier than the General Partner estimated, the Partnership
would incur additional repair and maintenance or equipment operating expenses.

Contingencies and litigation: The Partnership is subject to legal proceedings
involving ordinary and routine claims related to its business. The ultimate
legal and financial liability with respect to such matters cannot be estimated
with certainty and requires the use of estimates in recording liabilities for
potential litigation settlements. Estimates for losses from litigation are
disclosed if considered possible and accrued if considered probable after
consultation with outside counsel. If estimates of potential losses increase or
the related facts and circumstances change in the future, the Partnership may be
required to record additional litigation expense.

(E) Recent Accounting Pronouncements

On June 29, 2001, SFAS No. 142, "Goodwill and Other Intangible Assets" (SFAS No.
142), was approved by the FASB. SFAS No. 142 changes the accounting for
goodwill and other intangible assets determined to have an indefinite useful
life from an amortization method to an impairment-only approach. Amortization
of applicable intangible assets will cease upon adoption of this statement. The
Partnership implemented SFAS No. 142 on January 1, 2002. SFAS No. 142 had no
impact on the Partnership's financial position or results of operations.

In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No.
4, 44, and 64, Amendment of FASB No. 13, and Technical Corrections" (SFAS No.
145). The provisions of SFAS No. 145 are effective for fiscal years beginning
after May 15, 2002. As permitted by the pronouncement, the Partnership has
elected early adoption of SFAS No. 145 as of January 1, 2002. SFAS No. 145 had
no impact on the Partnership's financial position or results of operations.

In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities" (SFAS No. 146), which is based on the general
principle that a liability for a cost associated with an exit or disposal
activity should be recorded when it is incurred and initially measured at fair
value. SFAS No. 146 applies to costs associated with (1) an exit activity that
does not involve an entity newly acquired in a business combination, or (2) a
disposal activity within the scope of SFAS No. 146. These costs include certain
termination benefits, costs to terminate a contract that is not a capital lease,
and other associated costs to consolidate facilities or relocate employees.
Because the provisions of this statement are to be applied prospectively to exit
or disposal activities initiated after December 31, 2002, the effect of adopting
this statement cannot be determined.

In November 2002, the FASB issued Interpretation No. 45, "Guarantor's Accounting
and Disclosure Requirements for Guarantees, Including Indirect Guarantees of
Indebtedness of Others" (FIN 45). This interpretation requires the guarantor to
recognize a liability for the fair value of the obligation at the inception of
the guarantee. The provisions of FIN 45 will be applied on a prospective basis
to guarantees issued after December 31, 2002.

In January 2003, FASB issued Interpretation No. 46, "Consolidation of Variable
Interest Entities" (FIN 46). This interpretation clarifies existing accounting
principles related to the preparation of consolidated financial statements when
the owners of an USPE do not have the characteristics of a controlling financial
interest or when the equity at risk is not sufficient for the entity to finance
its activities without additional subordinated financial support from others.
FIN 46 requires the Partnership to evaluate all existing arrangements to
identify situations where the Partnership has a "variable interest," commonly
evidenced by a guarantee arrangement or other commitment to provide financial
support, in a "variable interest entity," commonly a thinly capitalized entity,
and further determine when such variable interest requires the Partnership to
consolidate the variable interest entities' financial statements with its own.
The Partnership is required to perform this assessment by September 30, 2003 and
consolidate any variable interest entities for which the Partnership will absorb
a majority of the entities' expected losses or receive a majority of the
expected residual gains. The Partnership has determined that it is not
reasonably possible that it will be required to consolidate or disclose
information about a variable interest entity upon the effective date of FIN 46.

(F) Results of Operations - Year-to-Year Detailed Comparison

(1) Comparison of the Partnership's Operating Results for the Years Ended
December 31, 2002 and 2001

(a) Owned Equipment Operations

Lease revenues less direct expenses (defined as repairs and maintenance,
equipment operating, and asset-specific insurance expenses) on owned equipment
decreased during the year ended December 31, 2002, compared to 2001. Gains or
losses from the sale of equipment, interest and other income, and certain
expenses such as management fees to affiliate, depreciation and amortization,
impairment loss, general and administrative expenses, and provision for bad
debts relating to the operating segments (see Note 5 to the financial
statements), are not included in the owned equipment operation discussion
because they are indirect in nature and not a result of operations, but the
result of owning a portfolio of equipment. The following table presents lease
revenues less direct expenses by segment (in thousands of dollars):

For the Years
Ended December 31,
2002 2001
--------------------
Aircraft. . . . . $ 7,135 $ 8,351
Railcars. . . . . 1,005 991
Marine containers 176 311
Trailers. . . . . 127 163
Marine vessel . . -- (265)

Aircraft: Aircraft lease revenues and direct expenses were $7.2 million and
$0.1 million, respectively, for the year ended December 31, 2002, compared to
$8.5 million and $0.1 million, respectively, during 2001. Lease revenues from
aircraft decreased $1.3 million during the year ended December 31, 2002 compared
to 2001. A decrease in aircraft lease revenues of $1.1 million was due to the
reduction in the lease rate on five of the Partnership's owned aircraft and the
decrease of $0.2 million was due to three aircraft being off lease two months of
2002 compared to being on lease all of 2001.

Railcars: Railcar lease revenues and direct expenses were $1.6 million and $0.6
million, respectively, for the year ended December 31, 2002, compared to $1.8
million and $0.8 million, respectively, during 2001. A decrease in railcar
lease revenues of $0.2 million was due to certain railcars being re-leased at a
lower rate in 2002 than the rate that was in place during 2001. A decrease in
railcar direct expenses of $0.2 million during 2002 was due to fewer repairs and
maintenance of railcars compared to 2001.

Marine containers: Marine container lease revenues and direct expenses were
$0.2 million and $5,000, respectively, for the year ended December 31, 2002,
compared to $0.3 million and $1,000, respectively, during 2001. The decrease in
marine container contribution was due to the disposal of marine containers
during 2002 and 2001.

Trailers: Trailer lease revenues and direct expenses were $0.3 million and
$0.2 million, respectively, for the year ended December 31, 2002 compared to
$0.4 million and $0.2 million, respectively, during 2001. The decrease in
trailer contribution of $36,000 during the year ended December 31, 2002 was due
to a decrease in lease revenues of $32,000 caused by lower lease rates earned on
the Partnership's trailers and an increase of $4,000 in repairs and maintenance
compared to 2001.

Marine vessel: The Partnership sold the remaining owned marine vessel during
the year ended December 31, 2001. Marine vessel lease revenues and direct
expenses were $0.1 million and $0.3 million, respectively, for the year ended
December 31, 2001.

(b) Indirect Expenses Related to Owned Equipment Operations

Total indirect expenses of $7.2 million for the year ended December 31, 2002
decreased from $7.8 million in 2001. Significant variances are explained as
follows:

(i) A $2.7 million decrease in depreciation and amortization expenses
from 2001 levels reflects a decrease of $1.5 million caused by the
double-declining balance method of depreciation that results in greater
depreciation during the first years an asset is owned and a decrease of $1.2
million due to certain assets being fully depreciated during 2001;

(ii) A $0.2 million decrease in management fees was the result of a
decrease of $0.1 million due to lower lease revenues earned in the year ended
December 31, 2002 compared to 2001, a decrease of $0.1 million resulting from
the decrease in the management fee rate paid by the Partnership, and a decrease
of $0.1 million due to a higher provision for bad debts during the year ended
December 31, 2002 compared to 2001;

(iii) A $0.1 million decrease in interest expense from 2001 levels was
due to the payoff of all of the Partnership's outstanding debt during the third
quarter of 2001;

(iv) A $0.3 million increase in general and administrative expenses
during 2002 resulted from higher professional service costs;

(v) Impairment loss increased $0.4 million during 2002 and resulted
from the Partnership reducing the carrying value of a commercial aircraft to its
estimated fair value. No impairment of equipment was required during 2001; and

(vi) A $1.7 million increase in the provision for bad debts was based
on the General Partner's evaluation of the collectability of receivables
compared to 2001. The provision for bad debts recorded in the year ended
December 31, 2002 was primarily related to two aircraft lessees.

(c) Interest and Other Income

Interest and other income increased $0.1 million during 2002. An increase of
$0.2 million was caused by an insurance settlement related to a marine vessel
that was sold in a prior year. A similar event did not occur in 2001. This
increase was partially offset by the decrease of $44,000 due to a decrease in
the interest rate earned on average cash balances.

(d) Gain on Disposition of Owned Equipment

The gain on the disposition of owned equipment for the year ended December 31,
2002 totaled $0.2 million, and resulted from the sale of marine containers,
railcars and trailers with an aggregate net book value of $0.1 million for
proceeds of $0.3 million. The gain on the disposition of equipment for the year
ended December 31, 2001 totaled $1.2 million, which resulted from the sale of a
marine vessel, marine containers, trailers, and a railcar with a net book value
of $1.4 million, for $2.7 million.

(e) Equity in Net Income (Loss) of Unconsolidated Special-Purpose Entities
(USPEs)

Equity in net income (loss) of USPEs represents the Partnership's share of the
net income or loss generated from the operation of jointly owned assets
accounted for under the equity method of accounting. These entities are single
purpose and have no debt or other financial encumbrances. The following table
presents equity in net income (loss) by equipment type (in thousands of
dollars):

For the Years
Ended December 31,
2002 2001
--------------------
Aircraft . . . . . . . . . . . . . . . . $ 86 $ (725)
Marine vessels . . . . . . . . . . . . . (1,247) 911
---------- ---------
Equity in net income (loss) of USPEs $ (1,161) $ 186
========== =========

The following USPE discussion by equipment type is based on the Partnership's
proportional share of revenues, depreciation expense, impairment loss, direct
expenses, and administrative expenses in the USPEs:

Aircraft: As of December 31, 2002 and 2001, the Partnership had an interest in
a trust owning two commercial aircraft on a direct finance lease. During the
year ended December 31, 2002, revenues of $0.1 million were offset by direct
expenses and administrative expenses of $38,000. During the year ended December
31, 2001, revenues of $0.3 million were offset by impairment loss, direct
expenses, and administrative expenses of $1.1 million.

Revenues earned by the trust that owns two commercial aircraft on a direct
finance lease decreased $0.2 million due to the leases for the aircraft in the
trust being renegotiated at a lower rate in 2001.

Impairment loss, direct expenses, and administrative expenses decreased $1.0
million during the year ended December 31, 2002 compared to 2001 due to a $1.0
million impairment loss that was recorded on the trust during the year ended
December 31, 2001 which resulted from the reduction of the carrying value of the
Trust's aircraft to its estimated fair value. There were no impairments to this
partially owned trust required during 2002.

Marine vessels: As of December 31, 2002 and 2001, the Partnership owned
interests in two entities each owning a marine vessel. During the year ended
December 31, 2002, lease revenues of $4.2 million were offset by depreciation
expense, direct expenses and administrative expenses of $5.5 million. During
2001, lease revenues of $6.6 million were offset by depreciation expense, direct
expenses, and administrative expenses of $5.7 million.

Marine vessels lease revenues decreased $2.4 million during 2002 compared to
2001. A decrease of $1.9 million during 2002 was due to a decrease in voyage
charter lease rates compared to 2001 and a decrease of $0.5 million was due to
the increase in the number of days one marine vessel was off-lease during 2002
compared to 2001.

Marine vessels depreciation expense, direct expenses, and administrative
expenses decreased $0.2 million during the year ended December 31, 2002 compared
to 2001. Significant variances are explained as follows:

(i) A decrease of $0.2 million in depreciation expense caused by the
double-declining balance method of depreciation which results in greater
depreciation in the first years an asset is owned;

(ii) A decrease of $0.2 million due to the marine vessels incurring
lower repairs and maintenance during 2002 compared to 2001;

(iii) A decrease of $0.1 million in management fees due to lower lease
revenues;

(iv) A decrease of $0.1 million in administrative expenses; and

(v) An increase of $0.3 million in marine vessel operating expenses
during 2002 compared to 2001.

(f) Net Income

As a result of the foregoing, the Partnership's net income for the year ended
December 31, 2002 was $0.6 million, compared to net income of $3.3 million
during 2001. The Partnership's ability to acquire, operate, and liquidate
assets, secure leases, and re-lease those assets whose leases expire is subject
to many factors. Therefore, the Partnership's performance in the year ended
December 31, 2002 is not necessarily indicative of future periods.

(2) Comparison of the Partnership's Operating Results for the Years Ended
December 31, 2001 and 2000

(a) Owned Equipment Operations

Lease revenues less direct expenses (defined as repairs and maintenance,
equipment operating, and asset-specific insurance expenses) on owned equipment
decreased during the year ended December 31, 2001, compared to 2000. The
following table presents lease revenues less direct expenses by segment (in
thousands of dollars):

For the Years
Ended December 30,
2001 2000
-------------------
Aircraft. . . . . $ 8,351 $ 7,782
Railcars. . . . . 991 1,811
Marine containers 311 405
Trailers. . . . . 163 1,213
Marine vessels. . (265) 2,774

Aircraft: Aircraft lease revenues and direct expenses were $8.5 million and
$0.1 million, respectively, during 2001, compared to $8.1 million and $0.3
million, respectively, during 2000. The increase in aircraft lease revenues of
$0.4 million was due to one aircraft being on-lease for the entire year ended
December 31, 2001 that was off-lease for four months during 2000. Direct
expenses decreased $0.1 million during the first nine months of 2001 due to
repairs to one of the Partnership's aircraft during 2000 that wasn't required
during 2001.

Railcars: Railcar lease revenues and direct expenses were $1.8 million and $0.8
million, respectively, during 2001, compared to $2.4 million and $0.6 million,
respectively, during 2000. Lease revenues decreased $0.1 million due to lower
re-lease rates earned on railcars whose leases expired during 2001 and decreased
$0.4 million due to the increase in the number of railcars off-lease during 2001
compared to 2000. An increase in direct expenses of $0.2 million was due to
higher repairs during 2001 compared to 2000.

Marine containers: Marine container lease revenues and direct expenses were
$0.3 million and $1,000, respectively, during 2001, compared to $0.4 million and
$7,000, respectively, during 2000. The decrease in marine container
contribution was due to the disposal of marine containers during 2001 and 2000.

Trailers: Trailer lease revenues and direct expenses were $0.4 million and
$0.2 million, respectively, during 2001, compared to $1.9 million and $0.7
million, respectively, during 2000. The decrease in trailer contribution was
due to the sale of 76% of the Partnership's trailers during 2000.

Marine vessels: Marine vessel lease revenues and direct expenses were $0.1
million and $0.3 million, respectively, during 2001, compared to $8.1 million
and $5.3 million, respectively, during 2000. The decrease in marine vessel
contribution was caused by the sale of all the Partnership's wholly owned marine
vessels during 2001 and 2000.

(b) Indirect Expenses Related to Owned Equipment Operations

Total indirect expenses of $7.8 million for the year ended December 31, 2001
decreased from $12.0 million for the same period in 2000. Significant variances
are explained as follows:

(i) Depreciation and amortization expenses decreased $2.5 million
during 2001 compared to 2000. A decrease of $1.3 million was caused by the sale
of two of the Partnership's wholly owned marine vessels during 2001 and 2000 and
a decrease of $0.3 million resulted from the sale of 76% of the Partnership's
trailers during 2000. Additionally, a decrease of $0.9 million was caused by
the double-declining balance method of depreciation that results in greater
depreciation during the first years an asset is owned.

(ii) A $0.9 million decrease in interest expense was due to a lower
average outstanding debt balance during 2001 compared to 2000.

(iii) A $0.7 million decrease in general and administrative expenses
during 2001 was due to a decrease of $0.4 million in costs resulting from the
sale of 76% of the Partnership's trailers, a decrease of $0.1 million due to
lower professional services, and $0.1 million decrease in inspection costs on
owned equipment.

(iv) A $0.6 million decrease in management fees was due to lower lease
revenues of $10.0 million earned during 2001 compared to 2000 and an increase of
$0.6 million in provision for bad debts.

(v) A $0.6 million increase in the provision for bad debts was due to
the General Partner's evaluation of the collectability of receivables due from
certain lessees.

(c) Gain on Disposition of Owned Equipment, net

The net gain on the disposition of equipment for the year ended December 31,
2001 totaled $1.2 million, which resulted from the sale of a marine vessel,
marine containers, trailers, and a railcar with a net book value of $1.4
million, for $2.7 million. The gain on the disposition of owned equipment for
the year ended December 31, 2000 totaled $1.4 million, which resulted from the
sale of a marine vessel, marine containers, railcars, and trailers with a net
book value of $6.0 million, for proceeds of $7.2 million. Included in the 2000
gain on disposition of assets is the unused portion of marine vessel dry docking
reserve of $0.1 million.

(d) Equity in Net Income of Unconsolidated Special-Purpose Entities

Equity in net income of USPEs represents the Partnership's share of the net
income (loss) generated from the operation of jointly-owned assets accounted for
under the equity method of accounting. These entities are single purpose and
have no debt or other financial encumbrances. The following table presents
equity in net income (loss) by equipment type (in thousands of dollars):

For the Years
Ended December 31,
2001 2000
--------------------
Marine vessels. . . . . . . . . . $ 911 $ 22
Aircraft. . . . . . . . . . . . . (725) 384
--------- ---------
Equity in net income of USPEs $ 186 $ 406
========= =========

The following USPE discussion by equipment type is based on the Partnership's
proportional share of revenues, depreciation expense, direct expenses, and
administrative expenses in the USPEs:

Marine vessels: As of December 31, 2001 and 2000, the Partnership owned
interests in two entities each owning a marine vessel. During the year ended
December 31, 2001, lease revenues of $6.6 million were offset by depreciation
expense, direct expenses, and administrative expenses of $5.7 million. During
2000, lease revenues of $6.3 million were offset by depreciation expense, direct
expenses, and administrative expenses of 6.2 million.

Lease revenues increased $0.4 million during 2001 compared to 2000. The
increase in lease revenues was due to the following:

(i) One marine vessel was on voyage charter the entire year of 2001,
compared to being on voyage charter and fixed rate lease during 2000. During
2001, this marine vessel earned $2.4 million in higher lease revenues due to
higher lease rates earned while on voyage charter compared to 2000. Under a
voyage charter lease, the marine vessel earns a higher lease rate; however,
certain direct expenses that were paid by the lessee are paid by the owner.

(ii) This increase was partially offset by the other marine vessel
earning lower lease revenues of $2.0 million compared to 2000. During 2001,
lease revenues for this marine vessel decreased $0.5 million resulting from
being off-lease for approximately two months while completing its dry docking.
Lease revenues also decreased $0.4 million due to lower release rates while on
voyage charter, and decreased $0.8 million due to being off-lease for an
additional three months. Lease revenues for this marine vessel then decreased
$0.2 million due to being on a fixed rate lease for over one month before
returning to voyage charter when compared to the same month of 2000. During
2000, this marine vessel was on voyage charter the entire year.

Depreciation expense, direct expenses, and administrative expenses decreased
$0.5 million during 2001 compared to 2000. A decrease of $0.3 million was
caused by lower repairs and maintenance during 2001 compared to 2000. A
decrease of $0.2 million in marine vessel operating expenses was the result of
fewer voyage charters during 2001 compared to 2000. Lower depreciation expense
of $0.2 million was caused by the double-declining balance method of
depreciation that results in greater depreciation during the first years an
asset is owned. These decreases were partially offset by higher administrative
expenses of $0.1 million during 2001 compared to 2000.

Aircraft: As of December 31, 2001 and 2000, the Partnership had an interest in
a trust owning two commercial aircraft on a direct finance lease. During the
year ended December 31, 2001, revenues of $0.3 million were offset by
depreciation expense, direct expenses, and administrative expenses of $1.1
million. During the year ended December 31, 2000, revenues of $0.4 million were
offset by depreciation expense, direct expenses, and administrative expenses of
$(2,000).

Revenues for the year ended December 31, 2001, decreased $48,000 due to a lower
outstanding principal balance on the finance lease compared to 2000.

Direct expenses increased $1.1 million. During 2001, the Partnership reduced
its interest in a trust owning two Stage III commercial aircraft on a direct
finance lease $1.0 million due to a reduction in its net investment in the
finance lease receivable caused by a series of lease amendments. There were no
impairments to the trust required during 2000. Additionally, direct expenses
increased $46,000 due to the recovery of accounts receivable in 2000 that had
previously been reserved as bad debts. A similar recovery did not occur in
2001.

(e) Net Income

As a result of the foregoing, the Partnership's net income for the year ended
December 31, 2001 was $3.3 million, compared to net income of $4.0 million
during 2000. The Partnership's ability to acquire, operate, and liquidate
assets, secure leases, and re-lease those assets whose leases expire is subject
to many factors, and the Partnership's performance in the year ended December
31, 2001 is not necessarily indicative of future periods. In the year ended
December 31, 2001, the Partnership distributed $1.6 million to the limited
partners, or $0.18 per weighted-average limited partnership unit.

(F) Geographic Information

Certain of the Partnership's equipment operates in international markets.
Although these operations expose the Partnership to certain currency, political,
credit, and economic risks, the General Partner believes these risks are minimal
or has implemented strategies to control the risks. Currency risks are at a
minimum because all invoicing, with the exception of a small number of railcars
operating in Canada, is conducted in United States (US) dollars. Political
risks are minimized by avoiding operations in countries that do not have a
stable judicial system and established commercial business laws. Credit support
strategies for lessees range from letters of credit supported by US banks to
cash deposits. Although these credit support mechanisms generally allow the
Partnership to maintain its lease yield, there are risks associated with
slow-to-respond judicial systems when legal remedies are required to secure
payment or repossess equipment. Economic risks are inherent in all
international markets, and the General Partner strives to minimize this risk
with market analysis prior to committing equipment to a particular geographic
area. Refer to Note 6 to the financial statements for information on the lease
revenues, net income (loss), and net book value of equipment in various
geographic regions.

Revenues and net operating income by geographic region are impacted by the time
period the asset is owned and the useful life ascribed to the asset for
depreciation purposes. Net income (loss) from equipment is significantly
impacted by depreciation charges, which are greatest in the early years of
ownership due to the use of the double-declining balance method of depreciation.
The relationships of geographic revenues, net income (loss), and net book value
of equipment are expected to change significantly in the future, as assets come
off lease and decisions are made to either redeploy the assets in the most
advantageous geographic location or sell the assets.

The Partnership's equipment on lease to US domiciled lessees consisted of
trailers, railcars, and aircraft. During 2002, US lease revenues accounted for
11% of the total lease revenues of wholly- and jointly-owned equipment while
this region reported net income of $29,000.

The Partnership's owned equipment on lease to Canadian-domiciled lessees
consisted of railcars and aircraft. During 2002, Canadian lease revenues
accounted for 31% of the total lease revenues of wholly- and jointly-owned
equipment and this region reported net income of $2.1 million.

The Partnership's owned equipment on lease to a South American-domiciled lessee
consisted of aircraft during 2002, which accounted for 19% of the total lease
revenues of wholly- and jointly-owned equipment, and net loss of $0.1 million.

The Partnership's owned equipment and its ownership share in USPE's equipment on
lease to a Mexican-domiciled lessee consisted of aircraft during 2002, which
accounted for 6% of the total lease revenues of wholly- and jointly-owned
equipment and net income of $0.3 million.

The Partnership's owned equipment and its ownership share in USPE's equipment on
lease to lessees in the rest of the world consisted of marine vessels and marine
containers. During 2002, lease revenues for these lessees accounted for 33% of
the total lease revenues of wholly- and jointly-owned equipment and net loss of
$1.0 million.

(G) Inflation

Inflation had no significant impact on the Partnership's operations during 2002,
2001, or 2000.

(H) Forward-Looking Information

Except for historical information contained herein, the discussion in this Form
10-K contains forward-looking statements that involve risks and uncertainties,
such as statements of the Partnership's plans, objectives, expectations, and
intentions. The cautionary statements made in this Form 10-K should be read as
being applicable to all related forward-looking statements wherever they appear
in this Form 10-K. The Partnership's actual results could differ materially
from those discussed here.

(I) Outlook for the Future

The Partnership's operation of a diversified equipment portfolio in a broad base
of markets is intended to reduce its exposure to volatility in individual
equipment sectors.

The ability of the Partnership to realize acceptable lease rates on its
equipment in the different equipment markets is contingent on many factors, such
as specific market conditions and economic activity, technological obsolescence,
and government or other regulations. The unpredictability of some of these
factors, or of their occurrence, makes it difficult for the General Partner to
clearly define trends or influences that may impact the performance of the
Partnership's equipment. The General Partner continually monitors both the
equipment markets and the performance of the Partnership's equipment in these
markets. The General Partner may decide to reduce the Partnership's exposure to
equipment markets in which it determines it cannot operate equipment to achieve
acceptable rates of return. Alternatively, the General Partner may make a
determination to enter equipment markets in which it perceives opportunities to
profit from supply/demand instabilities or other market imperfections.

The Partnership may reinvest its cash flow, surplus cash, and equipment sale
proceeds in additional equipment, consistent with the objectives of the
Partnership, until December 31, 2004. The General Partner believes that these
acquisitions may cause the Partnership to generate additional earnings and cash
flow for the Partnership. Surplus funds, if any, less reasonable reserves, may
be distributed to the partners. The Partnership will terminate on December 31,
2010, unless terminated earlier upon sale of all equipment and by certain other
events.

Due to a weak economy, and specifically weakness in the transportation industry,
the General Partner has not purchased additional equipment for the Partnership
since 2000. The General Partner believes prices on certain transportation
assets, particularly rail equipment, have reached attractive levels and is
actively looking to make investments in 2003. The General Partner believes that
transportation assets purchased in today's economic environment may appreciate
when the economy returns to historical growth rates. Accordingly, the General
Partner believes that most of the cash currently held by the Partnership will be
used to purchase equipment over the next 18 months.

Factors affecting the Partnership's contribution during the year 2003 and beyond
include:

(i) The cost of new marine containers has been at historic lows for the past
several years, which has caused downward pressure on per diem lease rates for
this type of equipment. A significant number of the Partnership's marine
containers are in excess of 13 years of age and are no longer suitable for use
in international commerce either due to its specific physical condition or
lessees' preference for newer equipment. Demand for these marine containers
will continue to be weak due to their age. In addition, some of the
Partnership's refrigerated marine containers have become delaminated. This
condition lowers the demand for these marine containers and has led to declining
lease rates and lower utilization on containers with this problem;

(ii) Railcar freight loadings in the United States and Canada decreased 1%
and 3%, respectively, through most of 2002. There has been, however, a recent
increase for some of the commodities that drive demand for those types of
railcars owned by the Partnership. It will be some time, however, before this
translates into new leasing demand by shippers since most shippers have idle
railcars in their fleets;

(iii) Marine vessel freight rates are dependent upon the overall condition
of the international economy. Freight rates earned by the Partnership's
partially owned marine vessels began to decrease during the latter half of 2001
and through the first nine months of 2002. In the fourth quarter of 2002 and
into 2003, freight rates for the Partnership's marine vessels, which primarily
carry petroleum products, started to increase due to an increase in oil prices
caused by political instability in the Middle East;

In addition, one of the marine vessels in which the Partnership owns an interest
was manufactured in 1976 and is nearing the end of its economic life. This
marine vessel is also single hulled which restricts the ports which it may
enter. These conditions severely limit the marine vessel's marketability.
Therefore, the General Partner has determined it is the appropriate time to
either sell or scrap this marine vessel. While the General Partner anticipates
that the disposition of this marine vessel will be completed during the first
six months of 2003 and while it cannot accurately predict the amount of sales
proceeds, it does believe the disposition will result in a gain to the
Partnership;

(iv) Utilization of intermodal trailers owned by the Partnership decreased
12% in 2002 compared to 2001. This decline was similar to the decline in
industry-wide utilization. As the Partnership's trailers are smaller than many
shippers prefer, the General Partner expects continued declines in utilization
over the next few years. Additionally, one of the major shippers that leased
the Partnership's trailers has entered bankruptcy. While the Partnership did
not have any outstanding receivables from the company, its bankruptcy may cause
a further decline in performance of the trailer fleet in the future;

(v) The airline industry began to see lower passenger travel during 2001.
The events of September 11, 2001, along with a recession in the United States
have continued to adversely affect the market demand for both new and used
commercial aircraft and to significantly weaken the financial position of most
major domestic airlines. As a result of this, the Partnership has had to
renegotiate leases on its owned aircraft during 2002 that will result in a
decrease in revenues during 2003. The General Partner believes that there is a
significant oversupply of commercial aircraft available and that this oversupply
will continue for some time.

These events have had a negative impact on the fair value of the Partnership's
owned and partially owned aircraft which caused a write down of $0.4 million
during 2002. The General Partner does not expect these aircraft to return to
their September 11, 2001 values.

During 2001, the lessee of three Stage II Boeing 737-200 commercial aircraft
notified the General Partner of its intention to return this aircraft and
stopped making lease payments. The lessee is located in Brazil, a country
experiencing severe economic difficultly. The Partnership has a security
deposit from this lessee that could be used to pay a portion of the amount due.
During October 2001, the General Partner sent a notification of default to the
lessee. The lease, which expired in October 2002, had certain return condition
requirements for the aircraft. The General Partner recorded an allowance for
bad debts for the amount due less the security deposit.

During October 2002, the General Partner reached an agreement with the lessee of
these aircraft for the past due lease payments and agreed to re-lease two of
these aircraft to this lessee until March 2003 at a lower lease rate. The
remaining aircraft is currently off-lease and in storage. In order to give the
lessee an incentive to make timely payments in accordance with the agreement,
the General Partner gave the lessee a discount on the total amount due. If the
lessee fails to comply with the payment schedule in the agreement, the discount
provision will be waived and the full amount again becomes payable. The lessee
made an initial payment during October 2002, to be followed by 23 equal monthly
installments beginning in November 2002. Unpaid outstanding amounts will accrue
interest at a rate of 5%. The balance outstanding at December 31, 2002 was $3.3
million. Due to the uncertainty of ultimate collection, the General Partner
will continue to fully reserve the unpaid outstanding balance less the security
deposit from this lessee. As of December 31, 2002, the lessee was current with
all payments due under the agreement. As of March 26, 2003, the installment
payment due from the lessee to the Partnership during March was not received.
The General Partner has not yet placed the lessee into default, however, is
currently reviewing the options available under the agreement.

The leases on the two Stage II Boeing 737-200 commercial aircraft expire in
March 2003. Given the current oversupply of aircraft, the General Partner
cannot predict if it will be able to lease these aircraft in the foreseeable
future.

The Partnership also owns two DHC-8-102 commuter aircraft that were on a lease
through February 2003 to Allegheny Airlines, Inc., a wholly owned subsidiary of
US Airways, Inc., both of which declared bankruptcy on August 11, 2002. On
October 9, 2002, the General Partner received notification that the leases for
the two aircraft had been rejected and the aircraft were returned. The aircraft
are currently in storage and are being remarketed for lease or sale. Given the
current oversupply of aircraft, these aircraft may remain off-lease for the
foreseeable future. At December 31, 2002, the Partnership has $0.1 million in
receivables due from this lessee. The General Partner recorded an allowance for
bad debts for the amount due;

(vi) The General Partner has seen an increase in its insurance premiums on
its equipment portfolio and is finding it more difficult to find an insurance
carrier with which to place the coverage. Premiums for aircraft insurance
increased over 50% and for other types of equipment the increases have been over
25%. The increase in insurance premiums caused by the increased rate will be
partially mitigated by the reduction in the value of the Partnership's equipment
portfolio caused by the events of September 11, 2001 and other economic factors.
The General Partner has also experienced an increase in the deductible required
to obtain coverage. This may have a negative impact on the Partnership in the
event of an insurance claim; and

(vii) The management fee rate paid by the Partnership will be reduced by 25%
for the period starting January 1, 2002 and ending June 30, 2004.

Several other factors may affect the Partnership's operating performance in the
year 2003 and beyond, including changes in the markets for the Partnership's
equipment and changes in the regulatory environment in which that equipment
operates.

(1) Repricing Risk

Certain portions of the Partnership's aircraft, railcar, marine container,
marine vessel, and trailer portfolios will be remarketed in 2003 as existing
leases expire, exposing the Partnership to considerable repricing
risk/opportunity. Additionally, the General Partner may elect to sell certain
underperforming equipment or equipment whose continued operation may become
prohibitively expensive. In either case, the General Partner intends to
re-lease or sell equipment at prevailing market rates; however, the General
Partner cannot predict these future rates with any certainty at this time and
cannot accurately assess the effect of such activity on future Partnership
performance. The proceeds from the sold or liquidated equipment will be
redeployed to purchase additional equipment, as the Partnership is in its
reinvestment phase.

(2) Impact of Government Regulations on Future Operations

The General Partner operates the Partnership's equipment in accordance with
current applicable regulations (see Item 1, Section E, Government Regulations).
However, the continuing implementation of new or modified regulations by some of
the authorities mentioned previously, or others, may adversely affect the
Partnership's ability to continue to own or operate equipment in its portfolio.
Additionally, regulatory systems vary from country to country, which may
increase the burden to the Partnership of meeting regulatory compliance for the
same equipment operated between countries. Ongoing changes in the regulatory
environment, both in the United States and internationally, cannot be predicted
with accuracy, and preclude the General Partner from determining the impact of
such changes on Partnership operations or sale of equipment.

Under US Federal Aviation Regulations, after December 31, 1999, no person may
operate an aircraft to or from any airport in the contiguous United States
unless that aircraft has been shown to comply with Stage III noise levels. The
cost to install a hushkit to meet quieter Stage III requirements is
approximately $1.5 million, depending on the type of aircraft. The Partnership
owns three Stage II aircraft that are scheduled to be sold or re-leased in
countries that do not require this regulation. One aircraft is currently
off-lease and being stored in a country that does have these regulations and the
remaining two aircraft are on leases that expire in March 2003.

The US Department of Transportation's Hazardous Materials Regulations regulates
the classification and packaging requirements of hazardous materials that apply
particularly to Partnership's tank railcars. The Federal Railroad
Administration has mandated that effective July 1, 2000 all tank railcars must
be re-qualified every ten years from the last test date stenciled on each
railcar to insure tank shell integrity. Tank shell thickness, weld seams, and
weld attachments must be inspected and repaired if necessary to re-qualify the
tank railcar for service. The average cost of this inspection is $3,600 for
jacketed tank railcars and $1,800 for non-jacketed tank railcars, not including
any necessary repairs. This inspection is to be performed at the next scheduled
tank test and every ten years thereafter. The Partnership currently owns 156
jacketed tank railcars and 106 non-jacketed tank railcars that will need
re-qualification. As of December 31, 2002, 7 jacketed tank railcars and 19
non-jacketed tank railcars of the fleet will need to be re-qualified during 2003
or 2004.

Ongoing changes in the regulatory environment, both in the United States and
internationally, cannot be predicted with accuracy, and preclude the General
Partner from determining the impact of such changes on Partnership operations,
purchases, or sale of equipment.

(3) Distributions

Pursuant to the amended limited partnership agreement, the Partnership will
cease to reinvest surplus cash in additional equipment beginning on January 1,
2005. Prior to that date, the General Partner intends to continue its strategy
of selectively redeploying equipment to achieve competitive returns, or selling
equipment that is underperforming or whose operation becomes prohibitively
expensive. During this time, the Partnership will use operating cash flow,
proceeds from the sale of equipment, and additional debt to meet its operating
obligations, make distributions to the partners, and acquire additional
equipment. In the long term, changing market conditions and used-equipment
values may preclude the General Partner from accurately determining the impact
of future re-leasing activity and equipment sales on Partnership performance and
liquidity. Consequently, the General Partner cannot establish future
distribution levels with any certainty at this time.

The General Partner believes that sufficient cash flow will be available in the
future to meet Partnership operating cash flow requirements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
----------------------------------------------------------------

The Partnership's primary market risk exposure is that of interest rate and
currency risk.

During 2002, 89% of the Partnership's total lease revenues from wholly- and
jointly-owned equipment came from non-United States-domiciled lessees. Most of
the Partnership's leases require payment in US currency. If these lessees'
currency devalues against the US dollar, the lessees could potentially encounter
difficulty in making the US dollar-denominated lease payments.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
-----------------------------------------------

The financial statements for the Partnership are listed on the Index to
Financial Statements included in Item 15(a) of this Annual Report on Form 10-K.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
-------------------------------------------------------------------
FINANCIAL DISCLOSURE
-----------------

(A) Disagreements with Accountants on Accounting and Financial Disclosures

None

(B) Changes in Accountants

In September 2001, the General Partner announced that the Partnership had
engaged Deloitte & Touche LLP as the Partnership's auditors and had dismissed
KPMG LLP. KPMG LLP issued an unqualified opinion on the 2000 financial
statements. During 2000 and the subsequent interim period preceding such
dismissal, there were no disagreements with KPMG LLP on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF PLM FINANCIAL SERVICES, INC.
------------------------------------------------------------------

As of the date of this annual report, the directors and executive officers of
PLM Financial Services, Inc. (and key executive officers of its subsidiaries)
are as follows:

Name Age Position
- -------------------------------------------------------------------------------

Gary D. Engle . 53 Director, PLM Financial Services, Inc., PLM Investment
Management, Inc., and PLM Transportation Equipment Corp.

James A. Coyne 42 Director, Secretary and President, PLM Financial Services,
Inc. and PLM Investment Management, Inc., Director and
Secretary, PLM Transportation Equipment Corp.

Richard K Brock 40 Director and Chief Financial Officer, PLM Financial
Services, Inc., PLM Investment Management, Inc. and
PLM Transportation Equipment Corp.

Gary D. Engle was appointed a Director of PLM Financial Services, Inc. in
January 2002. He was appointed a director of PLM International, Inc. in
February 2001. He is a director and President of MILPI Holdings, LLC (MILPI).
Since November 1997, Mr. Engle has been Chairman and Chief Executive Officer of
Semele Group Inc. ("Semele"), a publicly traded company. Mr. Engle is President
and Chief Executive Officer of Equis Financial Group ("EFG"), which he joined in
1990 as Executive Vice President. Mr. Engle purchased a controlling interest in
EFG in December 1994. He is also President of AFG Realty, Inc.

James A. Coyne was appointed President of PLM Financial Services, Inc. in August
2002. He was appointed a Director and Secretary of PLM Financial Services, Inc.
in April 2001. He was appointed a director of PLM International, Inc in
February 2001. He is a director, Vice President and Secretary of MILPI. Mr.
Coyne has been a director, President and Chief Operating Officer of Semele since
1997. Mr. Coyne is Executive Vice President of Equis Corporation, the general
partner of EFG. Mr. Coyne joined EFG in 1989, remained until 1993, and rejoined
in November 1994.

Richard K Brock was appointed a Director and Chief Financial Officer of PLM
Financial Services, Inc. in August 2002. From June 2001 through August 2002,
Mr. Brock was a consultant to various leasing companies including PLM Financial
Services, Inc. From October 2000 through June 2001, Mr. Brock was a Director of
PLM Financial Services, Inc. Mr. Brock was appointed Vice President and Chief
Financial Officer of PLM International, Inc. and PLM Financial Services, Inc. in
January 2000, having served as Acting Chief Financial Officer since June 1999
and as Vice President and Corporate Controller of PLM International, Inc. and
PLM Financial Services, Inc. since June 1997. Prior to June 1997, Mr. Brock
served as an accounting manager at PLM Financial Services, Inc. beginning in
September 1991 and as Director of Planning and General Accounting beginning in
February 1994.

The directors of PLM Financial Services, Inc. are elected for a one-year term or
until their successors are elected and qualified. No family relationships exist
between any director or executive officer of PLM Financial Services, Inc., PLM
Transportation Equipment Corp., or PLM Investment Management, Inc.

ITEM 11. EXECUTIVE COMPENSATION
-----------------------

The Partnership has no directors, officers, or employees. The Partnership had
no pension, profit sharing, retirement, or similar benefit plan in effect as of
December 31, 2002.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
------------------------------------------------------------------

(A) Security Ownership of Certain Beneficial Owners

The General Partner is generally entitled to a 5% interest in the profits and
losses (subject to certain allocations of income), cash available for
distributions, and net disposition proceeds of the Partnership. As of December
31, 2002, no investor was known by the General Partner to beneficially own more
than 5% of the limited partnership units of the Partnership.

(B) Security Ownership of Management

Neither the General Partner and its affiliates nor any executive officer or
director of the General Partner and its affiliates own any limited partnership
units of the Partnership as of December 31, 2002.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------------------------------------------------

(A) Transactions with Management and Others

During 2002, the Partnership paid or accrued the following fees to FSI or its
affiliates: management fees, $0.2 million; and administrative and data
processing services performed on behalf of the Partnership, $0.2 million.

During 2002, the Partnership's proportional share of ownership in USPEs paid or
accrued the following fees to FSI or its affiliates: management fees, $0.2
million; and administrative and data processing services, $0.1 million.

The balance due to affiliates as of December 31, 2002 includes $0.1 million due
to FSI and its affiliates for management fees and $0.1 million due to affiliated
USPEs.

ITEM 14. CONTROLS AND PROCEDURES
-------------------------

Based on their evaluation as of a date within 90 days of the filing of this Form
10-K, the Partnership's principal Executive Officer and Chief Financial Officer
have concluded that the Partnership's disclosure controls and procedures are
effective to ensure that information required to be disclosed in the reports
that the Partnership files or submits under the Securities Exchange Act of 1934
is recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms. There
have been no significant changes in the Partnership's internal controls or in
other factors that could significantly affect those controls subsequent to the
date of their evaluation.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
------------------------------------------------------------------

(A) 1. Financial Statements

The financial statements listed in the accompanying Index to Financial
Statements are filed as part of this Annual Report on Form 10-K.

2. Financial Statements required under Regulation S-X Rule 3-09

The following financial statements are filed as Exhibits of this Annual Report
on Form 10K:

a. Lion Partnership

(B) Financial Statement Schedules

Schedule II Valuation and Qualifying Accounts

All other financial statement schedules have been omitted, as the required
information is not pertinent to the Registrant or is not material, or because
the information required is included in the financial statements and notes
thereto.

(C) Reports on Form 8-K

None.

(D) Exhibits

4. Limited Partnership Agreement of Partnership. Incorporated by reference
to the Partnership's Registration Statement on Form S-1 (Reg. No. 33-32258),
which became effective with the Securities and Exchange Commission on April 11,
1990.

4.1 First Amendment to the Amended and Restated Limited Partnership
Agreement dated August 24, 2001, incorporated by reference to the Partnership's
Annual Report on Form 10-K dated December 31, 2001 filed with the Securities and
Exchange Commission on March 28, 2002.

10.1 Management Agreement between Partnership and PLM Investment Management,
Inc. incorporated by reference to the Partnership's Registration Statement on
Form S-1 (Reg. No. 33-32258), which became effective with the Securities and
Exchange Commission on April 11, 1990.

10.2 Warehouse Credit Agreement, dated April 13, 2001, incorporated by
reference to the Partnership's Form 10-Q dated March 31, 2002 filed with the
Securities and Exchange Commission on May 8, 2002.

10.3 First amendment to the Warehouse Credit Agreement, dated December 21,
2001, incorporated by reference to the Partnership's Form 10-Q dated March 31,
2002 filed with the Securities and Exchange Commission on May 8, 2002.

10.4 Second amendment to the Warehouse Credit Agreement, dated April 12,
2002, incorporated by reference to the Partnership's Form 10-Q dated March 31,
2002 filed with the Securities and Exchange Commission on May 8, 2002.

10.5 Third amendment to the Warehouse Credit Agreement, dated July 11, 2002,
incorporated by reference to the Partnership's Form 10-Q dated June 30, 2002
filed with the Securities and Exchange Commission on August 14, 2002.

10.6 October 2002 purchase agreement between PLM Transportation Equipment
Corp., Inc. and Trinity Tank Car, Inc. incorporated by reference to the
Partnership's Form 10-Q dated September 30, 2002 filed with the Securities and
Exchange Commission on November 13, 2002.

10.7 Settlement Agreement between PLM Worldwide Leasing Corp. and Varig S.A.
dated October 11, 2002, incorporated by reference to the Partnership's Form 10-Q
dated September 30, 2002 filed with the Securities and Exchange Commission on
November 13, 2002.

10.8 February 2003 purchase agreement between PLM Transportation Equipment
Corp., Inc. and Residual Based Finance Corporation.

Financial Statements required under Regulation S-X Rule 3-09:

99.1 Lion Partnership.

99.2 Clement Partnership.

- ------
CONTROL CERTIFICATION
- ----------------------

I, James A. Coyne, certify that:

1. I have reviewed this annual report on Form 10-K of PLM Equipment Growth
Fund V.

2. Based on my knowledge, this annual report does not contain any untrue
statement of a 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 annual
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant is made known to us by others,
particularly during the period in which this annual report is prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrant's other certifying officer and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and board of Managers:

a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and

6. The registrant's other certifying officer and I have indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: March 26, 2003 By: /s/ James A. Coyne
---------------------
James A. Coyne
President
(Principal Executive Officer)

CONTROL CERTIFICATION
- ----------------------

I, Richard K Brock, certify that:

1. I have reviewed this annual report on Form 10-K of PLM Equipment Growth
Fund V.

2. Based on my knowledge, this annual report does not contain any untrue
statement of a 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 annual
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant is made known to us by others,
particularly during the period in which this annual report is prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrant's other certifying officer and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and board of Managers:

a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and

6. The registrant's other certifying officer and I have indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: March 26, 2003 By: /s/ Richard K Brock
----------------------
Richard K Brock
Chief Financial Officer
(Principal Financial Officer)

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Partnership has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.

The Partnership has no directors or officers. The General Partner has signed on
behalf of the Partnership by duly authorized officers.

Dated: March 26, 2003 PLM EQUIPMENT GROWTH FUND V
PARTNERSHIP

By: PLM Financial Services, Inc.
General Partner

By: /s/ James A. Coyne
---------------------
James A. Coyne
President

By: /s/ Richard K Brock
----------------------
Richard K Brock
Chief Financial Officer

CERTIFICATION

The undersigned hereby certifies, in their capacity as an officer of the General
Partner of PLM Equipment Growth Fund V (the Partnership), that the Annual Report
of the Partnership on Form 10-K for the year ended December 31, 2002, fully
complies with the requirements of Section 13(a) of the Securities Exchange Act
of 1934 and that the information contained in such report fairly presents, in
all material respects, the financial condition of the Partnership at the end of
such period and the results of operations of the Partnership for such period.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following directors of the Partnership's General
Partner on the dates indicated.

Name Capacity Date
- ---- -------- ----

/s/ Gary D. Engle
- --------------------
Gary D. Engle Director, FSI March 26, 2003

/s/ James A. Coyne
- ---------------------
James A. Coyne Director, FSI March 26, 2003

/s/ Richard K Brock
- ----------------------
Richard K Brock Director, FSI March 26, 2003

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
INDEX TO FINANCIAL STATEMENTS

(Item 15(a))

Page
----

Independent auditors' reports 33-34

Balance sheets as of December 31, 2002 and 2001 35

Statements of income for the years ended
December 31, 2002, 2001, and 2000 36

Statements of changes in partners' capital for the
years ended December 31, 2002, 2001, and 2000 37

Statements of cash flows for the years ended
December 31, 2002, 2001, and 2000 38

Notes to financial statements 39-52

Independent auditors' reports on financial statement schedule 53

Schedule II valuation and qualifying accounts 54

INDEPENDENT AUDITORS' REPORT

The Partners
PLM Equipment Growth Fund V:

We have audited the accompanying balance sheets of PLM Equipment Growth Fund V,
a limited partnership (the "Partnership"), as of December 31, 2002 and 2001, and
the related statements of income, changes in partners' capital, and cash flows
for the years then ended. These financial statements are the responsibility of
the Partnership's management. Our responsibility is to express an opinion on
these financial statements based on our audits.

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

In our opinion, such financial statements present fairly, in all material
respects, the financial position of the Partnership as of December 31, 2002 and
2001, and the results of its operations and its cash flows for the years then
ended in conformity with accounting principles generally accepted in the United
States of America.

/s/ Deloitte & Touche LLP
Certified Public Accountants

Tampa, Florida
March 7, 2003
(March 21, 2003 as to note 12)

INDEPENDENT AUDITORS' REPORT

The Partners
PLM Equipment Growth Fund V:

We have audited the accompanying statements of income, changes in partners'
capital and cash flows of PLM Equipment Growth Fund V ("the Partnership") for
the year ended December 31, 2000. These financial statements are the
responsibility of the Partnership's management. Our responsibility is to
express an opinion on these financial statements based on our audit.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the results of operations and cash flows of PLM Equipment
Growth Fund V for the year ended December 31, 2000 in conformity with accounting
principles generally accepted in the United States of America.

/s/ KPMG LLP

SAN FRANCISCO, CALIFORNIA
March 12, 2001

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
BALANCE SHEETS
DECEMBER 31,
(in thousands of dollars, except unit amounts)

2002 2001
--------- ---------
ASSETS

Equipment held for operating leases, at cost . . . . . . . . . . . . . . . $ 72,233 $ 73,711
Less accumulated depreciation. . . . . . . . . . . . . . . . . . . . . . . (64,580) (62,572)
--------- ---------
Net equipment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,653 11,139

Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . 11,114 6,312
Restricted cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 --
Accounts and note receivable, less allowance for doubtful accounts of
$3,208 in 2002 and $664 in 2001. . . . . . . . . . . . . . . . . . . . 723 1,041
Investments in unconsolidated special-purpose entities . . . . . . . . . . 4,694 5,703
Lease negotiation fees to affiliate, less accumulated
amortization of $34 in 2002 and $33 in 2001. . . . . . . . . . . . . . 13 14
Prepaid expenses and other assets. . . . . . . . . . . . . . . . . . . . . 291 34
--------- ---------
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 24,548 $ 24,243
========= =========
LIABILITIES AND PARTNERS' CAPITAL

Liabilities
Accounts payable and accrued expenses. . . . . . . . . . . . . . . . . . . $ 277 $ 410
Due to affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 166 194
Lessee deposits and reserve for repairs. . . . . . . . . . . . . . . . . . 2,941 3,149
--------- ---------
Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,384 3,753
--------- ---------

Commitments and contingencies

Partners' capital
Limited partners (8,478,448 limited partnership units outstanding in 2002
and 8,533,465 limited partnership units outstanding in 2001) . . . . 21,164 20,490
General Partner. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- --
--------- ---------
Total partners' capital. . . . . . . . . . . . . . . . . . . . . . . . . 21,164 20,490
--------- ---------

Total liabilities and partners' capital. . . . . . . . . . . . . . . $ 24,548 $ 24,243
========= =========

See accompanying notes to financial statements.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31,
(in thousands of dollars, except weighted-average unit amounts)

2002 2001 2000
-------- -------- -------
REVENUES

Lease revenue . . . . . . . . . . . . . . . . . . $ 9,278 $11,029 $20,918
Interest and other income . . . . . . . . . . . . 366 242 204
Gain on disposition of equipment. . . . . . . . . 244 1,251 1,351
Loss on disposition of equipment. . . . . . . . . -- (5) --
-------- -------- -------
Total revenues. . . . . . . . . . . . . . . . 9,888 12,517 22,473
-------- -------- -------

EXPENSES

Depreciation and amortization . . . . . . . . . . 2,990 5,629 8,153
Repairs and maintenance . . . . . . . . . . . . . 729 1,074 1,781
Equipment operating expenses. . . . . . . . . . . 32 317 4,984
Insurance expenses. . . . . . . . . . . . . . . . 137 196 206
Management fees to affiliate. . . . . . . . . . . 211 454 1,013
Interest expense. . . . . . . . . . . . . . . . . -- 164 1,038
General and administrative expenses to affiliates 161 443 776
Other general and administrative expenses . . . . 1,084 527 879
Impairment loss on equipment. . . . . . . . . . . 408 -- --
Provision for bad debts . . . . . . . . . . . . . 2,337 631 55
-------- -------- -------
Total expenses. . . . . . . . . . . . . . . . 8,089 9,435 18,885
-------- -------- -------

Equity in net income (loss) of unconsolidated
special-purpose entities. . . . . . . . . . . . (1,161) 186 406
-------- -------- -------
Net income. . . . . . . . . . . . . . . . . . . . $ 638 $ 3,268 $ 3,994
======== ======== =======

PARTNERS' SHARE OF NET INCOME

Limited partners. . . . . . . . . . . . . . . . . $ 638 $ 3,149 $ 3,517
General Partner . . . . . . . . . . . . . . . . . -- 119 477
-------- -------- -------

Total . . . . . . . . . . . . . . . . . . . . . . $ 638 $ 3,268 $ 3,994
======== ======== =======
Limited partners' net income per
weighted-average limited partnership unit . . $ 0.08 $ 0.35 $ 0.39
======== ======== =======

See accompanying notes to financial statements.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
FOR THE YEARS ENDED DECEMBER 31, 2002, 2001, AND 2000
(in thousands of dollars)

Limited General
Partners Partner Total
------------------------------

Partners' capital as of December 31, 1999. . $ 27,006 $ -- $27,006

Net income . . . . . . . . . . . . . . . . . . 3,517 477 3,994

Purchase of limited partnership units. . . . . (10) -- (10)

Cash distribution. . . . . . . . . . . . . . . (9,067) (477) (9,544)
---------- --------- --------
Partners' capital as of December 31, 2000. . 21,446 -- 21,446

Net income . . . . . . . . . . . . . . . . . . 3,149 119 3,268

Purchase of limited partnership units. . . . . (2,504) -- (2,504)

Cash distribution. . . . . . . . . . . . . . . (1,601) (119) (1,720)
---------- --------- --------
Partners' capital as of December 31, 2001. . 20,490 -- 20,490

Net income . . . . . . . . . . . . . . . . . . 638 -- 638

Canceled purchase of limited partnership units 36 -- 36
---------- --------- --------
Partners' capital as of December 31, 2002. . $ 21,164 $ -- $21,164
========== ========= ========

See accompanying notes to financial statements.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31,
(in thousands of dollars)

2002 2001 2000
-------- -------- ---------
OPERATING ACTIVITIES
Net income . . . . . . . . . . . . . . . . . . . . . . . . $ 638 $ 3,268 $ 3,994
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization. . . . . . . . . . . . . . 2,990 5,629 8,153
Amortization of debt issuance costs. . . . . . . . . . . -- 23 25
Provision for bad debts. . . . . . . . . . . . . . . . . 2,337 631 55
Impairment loss on equipment . . . . . . . . . . . . . . 408 -- --
Net gain on disposition of equipment . . . . . . . . . . (244) (1,246) (1,351)
Equity in net (income) loss of unconsolidated
special-purpose entities . . . . . . . . . . . . . . . 1,161 (186) (406)
Changes in operating assets and liabilities:
Accounts and note receivable . . . . . . . . . . . . . (1,992) (103) 554
Prepaid expenses and other assets. . . . . . . . . . . (257) 5 15
Accounts payable and accrued expenses. . . . . . . . . 81 (49) (256)
Due to affiliates. . . . . . . . . . . . . . . . . . . (28) (65) (45)
Lessee deposits and reserve for repairs. . . . . . . . (208) 421 87
-------- -------- ---------
Net cash provided by operating activities . . . . . 4,886 8,328 10,825
-------- -------- ---------

INVESTING ACTIVITIES
Proceeds from disposition of equipment . . . . . . . . . . 306 2,679 7,183
Payments for purchase of equipment and capitalized repairs -- (4) (2,679)
(Contribution to) distribution from unconsolidated
special-purpose entities . . . . . . . . . . . . . . . (152) 2,673 1,850
Payments of acquisition fees to affiliate. . . . . . . . . -- (101) --
Payments of lease negotiation fees to affiliate. . . . . . -- (23) --
-------- -------- ---------
Net cash provided by investing activities. . . . . . 154 5,224 6,354
-------- -------- ---------

FINANCING ACTIVITIES
Payments of note payable . . . . . . . . . . . . . . . . . -- (5,474) (10,010)
Proceeds from short-term loan from affiliate . . . . . . . -- -- 4,500
Payment of short-term loan to affiliate. . . . . . . . . . -- -- (4,500)
(Increase) decrease in restricted cash . . . . . . . . . . (60) 445 (4)
Cash distribution paid to General Partner. . . . . . . . . -- (119) (477)
Cash distribution paid to limited partners . . . . . . . . -- (1,601) (9,067)
Canceled purchase of limited partnership units . . . . . . 36 -- --
Payment for limited partnership units. . . . . . . . . . . (214) (2,290) (10)
-------- -------- ---------
Net cash used in financing activities. . . . . . . . (238) (9,039) (19,568)
-------- -------- ---------

Net increase (decrease) in cash and cash equivalents . . . 4,802 4,513 (2,389)
Cash and cash equivalents at beginning of year . . . . . . 6,312 1,799 4,188
-------- -------- ---------
Cash and cash equivalents at end of year . . . . . . . . . $11,114 $ 6,312 $ 1,799
======== ======== =========

SUPPLEMENTAL INFORMATION
Interest paid. . . . . . . . . . . . . . . . . . . . . . . $ -- $ 224 $ 1,083
======== ======== =========

See accompanying notes to financial statements.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

1. Basis of Presentation
-----------------------

Organization
- ------------

PLM Equipment Growth Fund V, a California limited partnership (the Partnership),
was formed on November 14, 1989 to engage in the business of owning, leasing, or
otherwise investing in predominately used transportation and related equipment.
PLM Financial Services, Inc. (FSI) is the General Partner of the Partnership.
FSI is a wholly owned subsidiary of PLM International, Inc. (PLM International).

FSI manages the affairs of the Partnership. Cash distributions of the
Partnership are generally allocated 95% to the limited partners and 5% to the
General Partner. Net income is allocated to the General Partner to the extent
necessary to cause the General Partner's capital account to equal zero (see Net
Income and Distributions Per Limited Partnership Unit below). The General
Partner is also entitled to subordinated incentive fees equal to 5% of cash
available for distribution and 5% of net disposition proceeds (as defined in the
partnership agreement), which are distributed by the Partnership after the
limited partners have received a certain minimum rate of return.

The Partnership is currently in its investment phase during which the
Partnership uses cash generated from operations and proceeds from asset
dispositions to purchase additional equipment. The General Partner believes
these acquisitions may cause the Partnership to generate additional earnings and
cash flow for the Partnership.

The Partnership may reinvest its cash flow, surplus cash and equipment
disposition proceeds in additional equipment, consistent with the objectives of
the Partnership, until December 31, 2004. The Partnership will terminate on
December 31, 2010, unless terminated earlier upon sale of all equipment and by
certain other events.

Estimates
- ---------

These financial statements have been prepared on the accrual basis of accounting
in accordance with accounting principles generally accepted in the United States
of America. This requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, disclosures 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.

Operations
- ----------

The equipment of the Partnership is managed, under a continuing management
agreement, by PLM Investment Management, Inc. (IMI), a wholly owned subsidiary
of FSI. IMI receives a monthly management fee from the Partnership for managing
the equipment (see Note 2). FSI, in conjunction with its subsidiaries, sells
equipment to investor programs and third parties, manages pools of equipment
under agreements with the investor programs, and is a general partner of other
programs.

Accounting for Leases
- -----------------------

The Partnership's leasing operations generally consist of operating leases.
Under the operating lease method of accounting, the lessor records the leased
asset at cost and depreciates the leased asset over its estimated useful life.
Rental payments are recorded as revenue over the lease term as earned in
accordance with Statement of Financial Accounting Standards (SFAS) No. 13,
"Accounting for Leases" (SFAS No. 13). Lease origination costs are capitalized
and amortized over the term of the lease. Periodically, the Partnership leases
equipment with lease terms that qualify for direct finance lease classification,
as required by SFAS No. 13.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

1. Basis of Presentation (continued)
-----------------------

Depreciation and Amortization
- -------------------------------

Depreciation of transportation equipment held for operating leases is computed
on the double-declining balance method, taking a full month's depreciation in
the month of acquisition, based upon estimated useful lives of 15 years for
railcars and 12 years for all other equipment. The depreciation method changes
to straight-line when annual depreciation expense using the straight-line method
exceeds that calculated by the double-declining balance method. Acquisition
fees and certain other acquisition costs have been capitalized as part of the
cost of the equipment. Major expenditures that are expected to extend the
useful lives or reduce future operating expenses of equipment are capitalized
and amortized over the remaining life of the equipment. Lease negotiation fees
are amortized over the initial equipment lease term. Debt issuance costs are
amortized over the term of the related loan using the straight-line method that
approximates the effective interest method (see Note 7).

Transportation Equipment
- -------------------------

Equipment held for operating leases is stated at cost.

In accordance with SFAS No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of" (SFAS No. 121), the General
Partner reviewed the carrying values of the Partnership's equipment portfolio at
least quarterly and whenever circumstances indicated that the carrying value of
an asset may not be recoverable due to expected future market conditions. If
the projected undiscounted cash flows and the fair value of the equipment were
less than the carrying value of the equipment, an impairment loss was recorded.

In October 2001, the Financial Accounting Standards Board (FASB) issued SFAS No.
144, "Accounting for the Impairment or Disposal of Long-Lived Assets" (SFAS No.
144), which replaces SFAS No. 121. In accordance with SFAS No. 144, the
Partnership evaluates long-lived assets for impairment whenever events or
circumstances indicate that the carrying values of such assets may not be
recoverable. Losses for impairment are recognized when the undiscounted cash
flows estimated to be realized from a long-lived asset are determined to be less
than the carrying value of the asset and the carrying amount of long-lived
assets exceed its fair value. The determination of fair value for a given
investment requires several considerations, including but not limited to, income
expected to be earned from the asset, estimated sales proceeds, and holding
costs excluding interest. The Partnership applied the new rules on accounting
for the impairment or disposal of long-lived assets beginning January 1, 2002.

The estimate of the fair value for the Partnership's owned and partially owned
equipment is based on the opinion of the Partnership's equipment managers using
data, reasoning and analysis of prevailing market conditions of similar
equipment, data from recent purchases, independent third party valuations and
discounted cash flows. The events of September 11, 2001, along with the change
in general economic conditions in the United States (US), have continued to
adversely affect the market demand for both new and used commercial aircraft and
weakened the financial position of several airlines.

The Partnership has recorded write-downs of certain owned aircraft and certain
partially owned aircraft, representing impairment to the carrying value. During
2001, an unconsolidated special-purpose entity (USPE) trust owning two Stage III
commercial aircraft on a direct finance lease reduced its net investment in the
finance lease receivable due to a series of lease amendments. The Partnership's
proportionate share of this writedown, which is included in equity in net income
(loss) of the USPE in the accompanying statements of income, was $1.0 million.
During 2002, the bankruptcy of a major US airline and subsequent increase in
off-lease aircraft indicated to the General Partner that an impairment to the
aircraft portfolio may exist. The General Partner determined the fair value of
the aircraft based on the valuation given by its independent third party
aircraft equipment manager that considered, among other factors, expected income
to be earned from the asset, estimated sales proceeds and holding costs
excluding interest. This resulted in an impairment of $0.4 million to an
aircraft owned by the Partnership. No reductions were required to the carrying
value of the owned equipment during 2001 and 2000 or partially owned equipment
in 2002 and 2000.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

1. Basis of Presentation (continued)
-----------------------

Investments in Unconsolidated Special-Purpose Entities
- ----------------------------------------------------------

The Partnership has interests in USPEs that own transportation equipment. These
are single purpose entities that do not have any debt or other financial
encumbrances and are accounted for using the equity method.

The Partnership's investment in USPEs includes acquisition and lease negotiation
fees paid by the Partnership to PLM Transportation Equipment Corporation (TEC)
and PLM Worldwide Management Services (WMS). TEC is a wholly owned subsidiary
of FSI and WMS is a wholly owned subsidiary of PLM International. The
Partnership's interest in USPEs are managed by IMI. The Partnership's equity
interest in the net income (loss) of USPEs is reflected net of management fees
paid or payable to IMI and the amortization of acquisition and lease negotiation
fees paid to TEC and WMS.

Repairs and Maintenance
- -------------------------

Repairs and maintenance costs related to marine vessels, railcars, and
trailers are usually the obligation of the Partnership and are charged against
operations as incurred. Certain costs associated with marine vessel dry-docking
are estimated and accrued ratably over the period prior to such dry-docking. If
a marine vessel is sold and there is a balance in the dry-docking reserve
account for that marine vessel, the balance in the reserve account is included
as additional gain on disposition. Maintenance costs of aircraft and marine
containers are the obligation of the lessee. To meet the maintenance
requirements of aircraft airframes and engines, reserve accounts are prefunded
by the lessee over the period of the lease based on the number of hours this
equipment is used times the estimated rate to repair this equipment. If repairs
exceed the amount prefunded by the lessee, the Partnership may have the
obligation to fund and accrue the difference. In certain instances, if the
aircraft is sold and there is a balance in the reserve account for repairs to
that aircraft, the balance in the reserve account is reclassified as additional
gain on disposition. The aircraft reserve accounts are included in the
accompanying balance sheets as lessee deposits and reserve for repairs. Marine
vessel dry-docking reserve accounts are included in investments in USPE's.

Net Income and Distributions Per Limited Partnership Unit
- ----------------------------------------------------------------

Special allocations of income are made to the General Partner to the extent
necessary to cause the capital account balance of the General Partner to be zero
as of the close of such year. The limited partners' net income is allocated
among the limited partners based on the number of limited partnership units
owned by each limited partner and on the number of days of the year each limited
partner is in the Partnership.

Cash distributions of the Partnership are generally allocated 95% to the limited
partners and 5% to the General Partner and may include amounts in excess of net
income.

Cash distributions are recorded when declared. Cash distributions are generally
paid in the same quarter they are declared. Monthly unitholders received a
distribution check 15 days after the close of the previous month's business and
quarterly unitholders received a distribution check 45 days after the close of
the quarter.

For the years ended December 31, 2001 and 2000, cash distributions totaled $1.7
million and $9.5 million, respectively, or $0.18, and $1.00 per weighted-average
limited partnership unit, respectively. No cash distributions were declared or
paid during 2002.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

1. Basis of Presentation (continued)
-----------------------

Net Income and Distributions Per Limited Partnership Unit(continued)
- ----------------------------------------------------------------

Cash distributions to investors in excess of net income are considered a return
of capital. Cash distributions to the limited partners of $5.5 million in 2000
were deemed to be a return of capital. None of the cash distributions to the
limited partners during 2001 were deemed to be a return of capital.

Cash distributions related to the fourth quarter 2000 of $1.6 million were
declared and paid during the first quarter of 2001. There were no cash
distributions related to the fourth quarter 2002 or 2001 paid during the first
quarter of 2003 or 2002.

Net Income Per Weighted-Average Limited Partnership Unit
- --------------------------------------------------------------

Net income per weighted-average limited partnership unit was computed by
dividing net income attributable to limited partners by the weighted-average
number of limited partnership units deemed outstanding during the year. The
weighted-average number of limited partnership units deemed outstanding during
the years ended December 31, 2002, 2001, and 2000, was 8,498,098, 9,061,535, and
9,0661,391, respectively.

Cash and Cash Equivalents
- ----------------------------

The Partnership considers highly liquid investments that are readily convertible
to known amounts of cash with original maturities of one year or less as cash
equivalents. The carrying amount of cash equivalents approximates fair value
due to the short-term nature of the investments.

Comprehensive Income
- ---------------------

The Partnership's comprehensive income is equal to net income for the years
ended December 31, 2002, 2001, and 2000.

Restricted Cash
- ----------------

As of December 31, 2002, restricted cash consists of bank accounts and
short-term investments that are primarily subject to withdrawal restrictions per
loan agreements.

New Accounting Standards
- --------------------------

On June 29, 2001, SFAS No. 142, "Goodwill and Other Intangible Assets" (SFAS No.
142), was approved by the FASB. SFAS No. 142 changes the method of accounting
for goodwill and other intangible assets determined to have an indefinite useful
life from an amortization method to an impairment-only approach. Amortization
of applicable intangible assets will cease upon adoption of this statement. The
Partnership implemented SFAS No. 142 on January 1, 2002. SFAS No. 142 had no
impact on the Partnership's financial position or results of operations.

In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No.
4, 44, and 64, Amendment of FASB No. 13, and Technical Corrections" (SFAS No.
145). The provisions of SFAS No. 145 are effective for fiscal years beginning
after May 15, 2002. As permitted by the pronouncement, the Partnership has
elected early adoption of SFAS No. 145 as of January 1, 2002. SFAS No. 145 had
no impact on the Partnership's financial position or results of operations.

In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities" (SFAS No. 146), which is based on the general
principle that a liability for a cost associated with an exit or disposal
activity should be recorded when it is incurred and initially measured at fair
value. SFAS No. 146 applies to costs associated with (1) an exit activity that
does not involve an entity newly acquired in a business combination, or (2) a
disposal activity within the scope of SFAS No. 146. These

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

New Accounting Standards (continued)
- --------------------------

costs include certain termination benefits, costs to terminate a contract that
is not a capital lease, and other associated costs to consolidate facilities or
relocate employees. Because the provisions of this statement are to be applied
prospectively to exit or disposal activities initiated after December 31, 2002,
the effect of adopting this statement cannot be determined.

In November 2002, the FASB issued Interpretation No. 45, "Guarantor's Accounting
and Disclosure Requirements for Guarantees, Including Indirect Guarantees of
Indebtedness of Others" (FIN 45). This interpretation requires the guarantor to
recognize a liability for the fair value of the obligation at the inception of
the guarantee. The provisions of FIN 45 will be applied on a prospective basis
to guarantees issued after December 31, 2002.

In January 2003, FASB issued Interpretation No. 46, "Consolidation of Variable
Interest Entities" ("FIN 46"). This interpretation clarifies existing
accounting principles related to the preparation of consolidated financial
statements when the owners of an USPE do not have the characteristics of a
controlling financial interest or when the equity at risk is not sufficient for
the entity to finance its activities without additional subordinated financial
support from others. FIN 46 requires the Partnership to evaluate all existing
arrangements to identify situations where the Partnership has a "variable
interest," commonly evidenced by a guarantee arrangement or other commitment to
provide financial support, in a "variable interest entity," commonly a thinly
capitalized entity, and further determine when such variable interest requires
the Partnership to consolidate the variable interest entities' financial
statements with its own. The Partnership is required to perform this assessment
by September 30, 2003 and consolidate any variable interest entities for which
the Partnership will absorb a majority of the entities' expected losses or
receive a majority of the expected residual gains. The Partnership has
determined that it is not reasonably possible that it will be required to
consolidate or disclose information about a variable interest entity upon the
effective date of FIN 46.

Reclassifications
- -----------------

Certain amounts in the 2001 and 2000 financial statements have been reclassified
to conform to the 2002 presentations.

2. Transactions with General Partner and Affiliates
-----------------------------------------------------

An officer of FSI contributed $100 of the Partnership's initial capital. The
equipment management agreement, subject to certain reductions, requires the
payment of a monthly management fee attributable either to owned equipment or
interests in equipment owned by the USPEs to be paid to IMI in an amount equal
to the lesser of (i) the fees that would be charged by an independent third
party for similar services for similar equipment or (ii) the sum of (a) 5% of
the gross lease revenues attributable to equipment that is subject to operating
leases, (b) 2% of the gross lease revenues, as defined in the agreement, that is
subject to full payout net leases, or (c) 7% of the gross lease revenues
attributable to equipment, if any, that is subject to per diem leasing
arrangements and thus is operated by the Partnership. The Partnership
management fee in 2002, 2001 and 2000 was $0.2 million, $0.5 million and $1.0
million, respectively. Partnership management fees will be reduced 25% for the
period January 1, 2002 through June 30, 2004 as part of the settlement of
litigation in a prior year. The Partnership reimbursed FSI and its affiliates
for data processing and administrative expenses directly attributable to the
Partnership in the amount of $0.2 million, $0.4 million, and $0.8 million during
2002, 2001, and 2000, respectively.

The Partnership's proportional share of USPEs' management fees to affiliate were
$0.2 million during 2002 and $0.3 million during 2001 and 2000, and the
Partnership's proportional share of administrative and data processing expenses
to affiliate was $0.1 million, $0.2 million and $0.1 million during 2002, 2001
and 2000, respectively. Both of these affiliate expenses reduced the
Partnership's proportional share of the equity interest in income in USPEs.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

2. Transactions with General Partner and Affiliates (continued)
-----------------------------------------------------

During 2001 the Partnership paid additional acquisition and lease negotiation
fees of $0.1 million to FSI on equipment purchased in 1999. Depreciation and
amortization of $22,000, which represents the cumulative effect of depreciation
and amortization that should have been recorded from the purchase of equipment
in 1999, was recorded during 2001.

The Partnership and the USPEs paid or accrued equipment acquisition and lease
negotiation fees of $-0- to TEC in 2002 and 2000, and $0.1 million, in 2000.

The Partnership owned certain equipment in conjunction with affiliated programs
during 2002, 2001, and 2000 (see Note 4).

The Partnership borrowed a total $4.5 million from the General Partner for a
period of time during 2000. The General Partner charged the Partnership market
interest rates for the time the loan was outstanding. Total interest paid to
the General Partner was $0.1 million during 2000. There were no similar
borrowings during 2002 or 2001.

The balance due to affiliates as of December 31, 2002 and 2001 includes $0.1
million due to FSI and its affiliates for management fees and $0.1 million due
to affiliated USPEs.

3. Equipment
---------

Owned equipment held for operating leases is stated at cost. The components of
owned equipment as of December 31 were as follows (in thousands of dollars):

Equipment Held for Operating Leases 2002 2001
- ---------------------------------------------------------
Aircraft. . . . . . . . . . . . . $ 55,172 $ 55,172
Rail equipment. . . . . . . . . . 11,022 11,265
Marine containers . . . . . . . . 3,855 5,059
Trailers. . . . . . . . . . . . . 2,184 2,215
--------- ---------
72,233 73,711
Less accumulated depreciation . . (64,580) (62,572)
--------- ---------
Net equipment . . . . . . . . . $ 7,653 $ 11,139
========= =========

Revenues are earned under operating leases. In most cases, lessees are invoiced
for equipment leases on a monthly basis. All equipment rentals invoiced monthly
are based on a fixed rate. The Partnership's marine containers are leased to
operators of utilization-type leasing pools that include equipment owned by
unaffiliated parties. In such instances, revenues received by the Partnership
consist of a specified percentage of revenues generated by leasing the pooled
equipment to sublessees, after deducting certain direct operating expenses of
the pooled equipment. Rental revenues for trailers are based on a per-diem
lease in the free running interchange with the railroads.

As of December 31, 2002, all owned equipment was on lease except for three
aircraft and 79 railcars with a net book value of $1.6 million. As of December
31, 2001, all owned equipment was on lease except for 87 railcars with a net
book value of $0.5 million.

Equipment held for operating leases is stated at cost less any reductions to the
carrying value as required by SFAS No. 144. In 2002, the Partnership recorded a
write-down of certain owned aircraft representing impairment to the carrying
value. During 2002, the bankruptcy of a major US airline and subsequent
increase in off-lease aircraft indicated to the General Partner that an
impairment to the aircraft portfolio may exist. The General Partner determined
the fair value of the aircraft based on the valuation given by its independent
third party aircraft equipment manager that considered, among other factors,
expected income to be earned from the asset, estimated sales proceeds and
holding costs excluding interest. This resulted in an impairment of $0.4
million to an aircraft owned by the Partnership. No reductions were required to
the carrying value of the owned equipment during 2001 and 2000.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

3. Equipment (continued)
---------

During 2002, the Partnership disposed of marine containers, railcars, and
trailers with an aggregate net book value of $0.1 million for proceeds of $0.3
million. During 2001, the Partnership disposed of a marine vessel, marine
containers, trailers, and a railcar with an aggregate net book value of $1.4
million, for $2.7 million.

All owned equipment on lease is accounted for as operating leases. Future
minimum rentals under noncancelable operating leases, as of December 31, 2002,
for owned equipment during each of the next five years are approximately $4.7
million in 2003; $3.6 million in 2004; $1.5 million in 2005; $1.3 million in
2006; $0.4 million in 2007; and $0.7 million thereafter. Per diem and
short-term rentals consisting of utilization rate lease payments included in
lease revenues amounted to approximately $0.5 million, $0.7 million, and $9.9
million in 2002, 2001, and 2000, respectively.

4. Investments in Unconsolidated Special-Purpose Entities
----------------------------------------------------------

The Partnership owns equipment jointly with affiliated programs. These are
single purpose entities that do not have any debt or other financial
encumbrances.

Ownership interest is based on the Partnership's contribution towards the cost
of the equipment in the USPEs. The Partnership's proportional share of equity
and income (loss) in each entity is not necessarily the same as its ownership
interest. The primary reason for this difference has to do with certain fees
such as management and acquisition and lease negotiation fees varying among the
owners of the USPEs.

The tables below set forth 100% of the assets, liabilities, and equity of the
entities in which the Partnership has an interest and the Partnership's
proportional share of equity in each entity as of December 31, 2002 and 2001 (in
thousands of dollars):

Aero
Clement California Lion
As of December 31, 2002 . . . . . . . . . Partnership1 Trust2 Partnership3 Total
- --------------------------------------------------------------------------------------------
Assets
Equipment less accumulated depreciation $ 546 $ -- $ 7,356
Receivables . . . . . . . . . . . . . . 745 420 716
Finance lease receivable. . . . . . . . -- 2,425 --
Other assets. . . . . . . . . . . . . . -- 137 10
------------- ----------- -------------
Total assets. . . . . . . . . . . . . $ 1,291 $ 2,982 $ 8,082
============= =========== =============

Liabilities
Accounts payable. . . . . . . . . . . . $ 173 $ 1 $ 548
Due to affiliates . . . . . . . . . . . 11 2 44
Lessee deposits and reserve for repairs -- 420 97
------------- ----------- -------------
Total liabilities . . . . . . . . . . 184 423 689
------------- ----------- -------------

Equity. . . . . . . . . . . . . . . . . . 1,107 2,559 7,393
------------- ----------- -------------
Total liabilities and equity. . . . . $ 1,291 $ 2,982 $ 8,082
============= =========== =============

Partnership's share of equity . . . . . . $ 529 $ 640 $ 3,525 $4,694
============= =========== ============= ======

1 The Partnership owns a 50% interest in the Clement Partnership that owns a
product tanker.
2 The Partnership owns a 25% interest in the Aero California Trust that owns
two stage III commercial aircraft on a direct finance lease.
3 The Partnership owns a 48% interest in the Lion Partnership that owns a
product tanker.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

4. Investments in Unconsolidated Special-Purpose Entities (continued)
----------------------------------------------------------

Aero
Clement California Lion
As of December 31, 2001 . . . . . . . . . Partnership1 Trust2 Partnership3 Total
- --------------------------------------------------------------------------------------------
Assets
Equipment less accumulated depreciation $ 1,239 $ -- $ 8,827
Receivables . . . . . . . . . . . . . . 302 420 776
Finance lease receivable. . . . . . . . -- 3,234 --
Other assets. . . . . . . . . . . . . . -- 225 --
------------- ----------- -------------
Total assets. . . . . . . . . . . . . $ 1,541 $ 3,879 $ 9,603
============= =========== =============

Liabilities
Accounts payable. . . . . . . . . . . . $ 263 $ -- $ 111
Due to affiliates . . . . . . . . . . . 48 39 51
Lessee deposits and reserve for repairs -- 420 514
------------- ----------- -------------
Total liabilities . . . . . . . . . . 311 459 676
------------- ----------- -------------

Equity. . . . . . . . . . . . . . . . . . 1,230 3,420 8,927
------------- ----------- -------------
Total liabilities and equity. . . . . $ 1,541 $ 3,879 $ 9,603
============= =========== =============

Partnership's share of equity . . . . . . $ 600 $ 855 $ 4,248 $5,703
============= =========== ============= ======

The tables below set forth 100% of the revenues, direct and indirect expenses,
impairment loss and net income (loss) of the entities in which the Partnership
has an interest, and the Partnership's proportional share of income (loss) in
each entity for the years ended December 31, 2002, 2001, and 2001 (in thousands
of dollars):

Aero
For the year ended Clement California Lion
December 31, 2002 Partnership1 Trust2 Partnership3 Total
- ---------------------------------------------------------------------------------------------

Revenues . . . . . . . . . . . . . . . $ 3,335 $ 496 $ 5,390
Less: Direct expenses. . . . . . . . . 4,034 24 4,471
Indirect expenses. . . . . . 781 129 1,878
-------------- ----------- --------------
Net income (loss). . . . . . . . . . $ (1,480) $ 343 $ (959)
============== =========== ==============

Partnership's share of net income (loss) $ (808) $ 86 $ (439) $(1,161)
============== =========== ============== ========

Aero
For the year ended Clement California Lion Montgomery
December 31, 2001 Partnership1 Trust2 Partnership3 Partnership4 Total
- ------------------------------------------------------------------------------------------------------------

Revenues . . . . . . . . . . . . . . . $ 4,100 $ 1,336 $ 9,651 $ --
Less: Direct expenses. . . . . . . . . 3,509 16 4,586 68
Indirect expenses. . . . . . 1,046 149 2,503 --
Impairment loss. . . . . . . -- 4,069 -- --
-------------- ------------ ------------- --------------
Net income (loss). . . . . . . . . . $ (455) $ (2,898) $ 2,562 $ (68)
============== ============ ============= ==============

Partnership's share of net income (loss) $ (272) $ (725) $ 1,217 $ (34) $ 186
============== ============ ============= ============== ======

Aero
For the year ended Clement California Lion Montgomery
December 31, 2000 Partnership1 Trust2 Partnership3 Partnership4 Total
- -----------------------------------------------------------------------------------------------------------

Revenues . . . . . . . . . . . . . . . $ 8,073 $ 1,528 $ 4,417 $ 237
Less: Direct expenses. . . . . . . . . 6,428 19 2,583 (60)
Indirect expenses. . . . . . 1,150 158 2,454 26
------------- ----------- -------------- --------------
Net income (loss). . . . . . . . . . $ 495 $ 1,351 $ (620) $ 271
============= =========== ============== ==============

Partnership's share of net income (loss) $ 197 $ 384 $ (297) $ 122 $ 406
============= =========== ============== ============== ======

1 The Partnership owns a 50% interest in the Clement Partnership that owns a
product tanker.
2 The Partnership owns a 25% interest in the Aero California Trust that owns
two stage III commercial aircraft on a direct finance lease.
3 The Partnership owns a 48% interest in the Lion Partnership that owns a
product tanker.
4 The Partnership owned a 50% interest in the Montgomery Partnership that
owned a bulk carrier.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

4. Investments in Unconsolidated Special-Purpose Entities (continued)
----------------------------------------------------------

As of December 31, 2002 and 2001, all jointly-owned equipment in the
Partnership's USPE portfolio was on lease.

The Partnership recorded a write-down of certain partially owned aircraft,
representing impairment to the carrying value. During 2001, a USPE trust owning
two Stage III commercial aircraft on a direct finance lease reduced its net
investment in the finance lease receivable due to a series of lease amendments.
The Partnership's proportionate share of this writedown, which is included in
equity in net income (loss) of the USPE in the accompanying statement of income,
was $1.0 million.

All jointly owned equipment on lease is accounted for as operating leases,
except for two jointly owned commercial aircraft on a direct finance lease. The
Partnership's proportionate share of future minimum rentals under noncancelable
operating leases as of December 31, 2002, for jointly owned equipment during
each of the next five years are approximately $0.6 million in 2003 and $0.6
million in 2004. The Partnership's proportionate share of per diem and
short-term rentals consisting of utilization rate lease payments included in
jointly owned lease revenues amounted to $4.2 million in 2002, $6.6 million in
2001, and $4.0 million in 2000.

5. Operating Segments
-------------------

The Partnership operates primarily in five operating segments: aircraft leasing,
marine container leasing, marine vessel leasing, trailer leasing, and railcar
leasing. Each equipment leasing segment engages in short-term to mid-term
operating leases to a variety of customers.

The General Partner evaluates the performance of each segment based on profit or
loss from operations before allocation of interest expense, general and
administrative expenses, and certain other expenses. The segments are managed
separately due to different business strategies for each operation. The
accounting policies of the Partnership's operating segments are the same as
described in Note 1, Basis of Presentation. There were no intersegment revenues
for the years ended December 31, 2002, 2001 and 2000.

The following tables present a summary of the operating segments (in thousands
of dollars):

Marine Marine
Aircraft Container Vessel Trailer Railcar All
For the Year Ended December 31, 2002 Leasing Leasing Leasing Leasing Leasing Other 1 Total
- ----------------------------------------------------------------------------------------------------------------

REVENUES
Lease revenue. . . . . . . . . . . . $ 7,187 $ 181 $ -- $ 334 $ 1,576 $ -- $ 9,278
Interest and other income. . . . . . 29 -- 168 -- 18 151 366
Gain on disposition of equipment . . -- 143 -- 9 92 -- 244
--------- ---------- --------- --------- -------- --------- --------
Total revenues. . . . . . . . . . 7,216 324 168 343 1,686 151 9,888
--------- ---------- --------- --------- -------- --------- --------

EXPENSES
Operations support . . . . . . . . . 52 5 -- 207 571 63 898
Depreciation and amortization. . . . 2,129 210 -- 125 525 1 2,990
Management fees to affiliates. . . . 99 7 -- 13 92 -- 211
General and administrative expenses. 297 -- -- 64 111 773 1,245
Impairment loss. . . . . . . . . . . 408 -- -- -- -- -- 408
Provision for bad debts. . . . . . . 2,329 -- -- 6 2 -- 2,337
--------- ---------- --------- --------- -------- --------- --------
Total expenses. . . . . . . . . . 5,314 222 -- 415 1,301 837 8,089
--------- ---------- --------- --------- -------- --------- --------
Equity in net income (loss) of USPEs . 86 -- (1,247) -- -- -- (1,161)
--------- ---------- --------- --------- -------- --------- --------
Net income (loss). . . . . . . . . . . $ 1,988 $ 102 $ (1,079) $ (72) $ 385 $ (686) $ 638
========= ========== ========= ========= ======== ========= ========

Total assets as of Dcember 31, 2002. . $ 6,460 $ 123 $ 4,222 $ 445 $ 1,820 $ 11,478 $24,548
========= ========== ========= ========= ======== ========= ========

Includes certain assets not identifiable to a specific segment such as cash,
restricted cash, lease negotiation fees and prepaid expenses. Also includes
certain interest income and costs not identifiable to a particular segment, such
as interest expense and certain amortization, general and administrative and
operations support expenses.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

5. Operating Segments (continued)
-------------------

Marine Marine
Aircraft Container Vessel Trailer Railcar All
For the Year Ended December 31, 2001 Leasing Leasing Leasing Leasing Leasing Other 1 Total
- ---------------------------------------------------------------------------------------------------------------------

REVENUES
Lease revenue. . . . . . . . . . . . . . $ 8,486 $ 312 $ 66 $ 366 $ 1,799 $ -- $11,029
Interest and other income. . . . . . . . 34 -- 1 -- 6 201 242
Gain (loss) on disposition of equipment. (1) 130 1,116 5 (4) -- 1,246
---------- ---------- -------- --------- --------- --------- -------
Total revenues. . . . . . . . . . . . 8,519 442 1,183 371 1,801 201 12,517
---------- ---------- -------- --------- --------- --------- -------

EXPENSES
Operations support . . . . . . . . . . . 135 1 331 203 808 109 1,587
Depreciation and amortization. . . . . . 4,619 320 -- 127 551 35 5,652
Interest expense . . . . . . . . . . . . -- -- -- -- -- 141 141
Management fees to affiliate . . . . . . 290 15 3 19 127 -- 454
General and administrative expenses. . . 38 -- 24 64 61 783 970
Provision for (recovery of) bad debts. . 654 -- -- (10) (13) -- 631
---------- ---------- -------- --------- --------- --------- -------
Total expenses. . . . . . . . . . . . 5,736 336 358 403 1,534 1,068 9,435
---------- ---------- -------- --------- --------- --------- -------
Equity in net income (loss) of USPEs . . . (725) -- 911 -- -- -- 186
---------- ---------- -------- --------- --------- --------- -------
Net income (loss). . . . . . . . . . . . . $ 2,058 $ 106 $ 1,736 $ (32) $ 267 $ (867) $ 3,268
========== ========== ======== ========= ========= ========= =======

Total assets as of Dcember 31, 2001. . . . $ 9,662 $ 408 $ 4,914 $ 582 $ 2,317 $ 6,360 $24,243
========== ========== ======== ========= ========= ========= =======

Includes certain assets not identifiable to a specific segment such as
cash, restricted cash, lease negotiation fees and prepaid expenses. Also
includes certain interest income and costs not identifiable to a particular
segment, such as interest expense and certain amortization, general and
administrative and operations support expenses.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

5. Operating Segments (continued)
-------------------

Marine Marine
Aircraft Container Vessel Trailer Railcar All
For the Year Ended December 31, 2000 Leasing Leasing Leasing Leasing Leasing Other 2 Total
- --------------------------------------------------------------------------------------------------------------

REVENUES
Lease revenue. . . . . . . . . . . . $ 8,063 $ 412 $ 8,123 $ 1,944 $ 2,376 $ -- $20,918
Interest income and other. . . . . . 9 -- 15 -- -- 180 204
Gain on disposition of equipment . . -- 189 79 1,054 29 -- 1,351
--------- ---------- -------- -------- -------- --------- -------
Total revenues. . . . . . . . . . 8,072 601 8,217 2,998 2,405 180 22,473
--------- ---------- -------- -------- -------- --------- -------

EXPENSES
Operations support . . . . . . . . . 281 7 5,349 731 565 38 6,971
Depreciation and amortization. . . . 5,377 451 1,283 464 542 61 8,178
Interest expense . . . . . . . . . . -- -- -- -- -- 1,013 1,013
Management fees to affiliate . . . . 279 20 406 117 191 -- 1,013
General and administrative expenses. 165 -- 48 452 70 920 1,655
Provision for bad debts. . . . . . . -- -- -- 51 4 -- 55
--------- ---------- -------- -------- -------- --------- -------
Total expenses. . . . . . . . . . 6,102 478 7,086 1,815 1,372 2,032 18,885
--------- ---------- -------- -------- -------- --------- -------
Equity in net income of USPEs. . . . . 384 -- 22 -- -- -- 406
--------- ---------- -------- -------- -------- --------- -------
Net income (loss). . . . . . . . . . . $ 2,354 $ 123 $ 1,153 $ 1,183 $ 1,033 $ (1,852) $ 3,994
========= ========== ======== ======== ======== ========= =======

6. Geographic Information
-----------------------

The Partnership owns certain equipment that is leased and operated
internationally. A limited number of the Partnership's transactions are
denominated in a foreign currency. Gains or losses resulting from foreign
currency transactions are included in the results of operations and are not
material.

The Partnership leases or leased its aircraft, railcars, and trailers to lessees
domiciled in five geographic regions: United States, Canada, South America,
Caribbean, and Mexico. Marine vessels and marine containers are leased to
multiple lessees in different regions that operate worldwide.

- -----------------------------
2 Includes certain interest income and costs not identifiable to a
particular segment, such as interest expense and certain amortization, general
and administrative and operations support expenses.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

6. Geographic Information (continued)
-----------------------

The table below sets forth lease revenues by geographic region for the
Partnership's owned equipment and investments in USPEs, grouped by domicile of
the lessee as of and for the years ended December 31 (in thousands of dollars):

Owned Equipment Investments in USPEs
---------------- --------------------
Region 2002 2001 2000 2002 2001 2000
- ----------------------------------------------------------------------

United States . . $ 1,543 $ 2,201 $ 4,390 $ -- $ -- $ --
Canada. . . . . . 4,178 4,272 4,223 -- -- --
South America . . 2,628 3,011 3,011 -- -- --
Caribbean . . . . -- -- 444 -- -- --
Mexico. . . . . . 748 1,167 315 -- -- --
Rest of the world 181 378 8,535 4,216 6,568 6,107
------- ------- ------- ------ ------- -------
Lease revenues $ 9,278 $11,029 $20,918 $4,216 $ 6,568 $ 6,107
======= ======= ======= ====== ======= =======

The following table sets forth net income (loss) information by region for the
owned equipment and investments in USPEs for the years ended December 31 (in
thousands of dollars):

Owned Equipment Investments in USPEs
---------------- --------------------
Region 2002 2001 2000 2002 2001 2000
- -------------------------------------------------------------------------------

United States . . . . . . $ 29 $ 466 $ 2,089 $ -- $ -- $ --
Canada. . . . . . . . . . 2,051 2,457 2,504 -- -- --
South America . . . . . . (106) 651 639 -- -- --
Caribbean . . . . . . . . -- -- (606) -- -- --
Mexico. . . . . . . . . . 240 (555) (439) 86 (725) 384
Rest of the world . . . . 271 930 1,255 (1,247) 911 22
------- ------- -------- ------- ------- -------
Regional income (loss) 2,485 3,949 5,442 (1,161) 186 406

Administrative and other. (686) (867) (1,854) -- -- --
------- ------- -------- ------- ------- -------
Net income (loss). . . $ 1,799 $ 3,082 $ 3,588 $(1,161) $ 186 $ 406
======= ======= ======== ======= ======= =======

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

6. Geographic Information (continued)
-----------------------

The net book value of these assets as of December 31 are as follows (in
thousands of dollars):

Owned Equipment Investments in USPEs
--------------- --------------------
Region 2002 2001 2002 2001
- ---------------------------------------------------------

United States . . $ 2,586 $ 3,613 $ -- $ --
Canada. . . . . . 3,375 4,929 -- --
South America . . 1,266 1,546 -- --
Mexico. . . . . . 384 760 640 855
Rest of the world 42 291 4,054 4,848
------- -------- ------- -------
Net book value $ 7,653 $ 11,139 $ 4,694 $ 5,703
======= ======== ======= =======

7. Debt
----

The Partnership is a participant in a $10.0 million warehouse facility. The
warehouse facility is shared by the Partnership, PLM Equipment Growth Fund VI,
PLM Equipment Growth & Income Fund VII, Professional Lease Management Income
Fund I, LLC and Acquisub LLC, a wholly owned subsidiary of PLMI. In July 2002,
PLMI reached an agreement with the lenders of the $10.0 million warehouse
facility to extend the expiration date of the facility to June 30, 2003. The
facility provides for financing up to 100% of the cost of the equipment. Any
borrowings by the Partnership are collateralized by equipment purchased with the
proceeds of the loan. Outstanding borrowings by one borrower reduce the amount
available to each of the other borrowers under the facility. Individual
borrowings may be outstanding for no more than 270 days, with all advances due
no later than June 30, 2003. Interest accrues either at the prime rate or LIBOR
plus 2.0% at the borrower's option and is set at the time of an advance of
funds. Borrowings by the Partnership are guaranteed by PLMI. The Partnership
is not liable for the advances made to the other borrowers.

As of December 31, 2002, there were no outstanding borrowings on this facility
by any of the eligible borrowers.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

8. Concentrations of Credit Risk
--------------------------------

For the years ended December 31, 2002, 2001, and 2000, the Partnership's
customers that accounted for 10% or more of the total consolidated revenues for
the owned equipment and jointly owned equipment were Air Canada (21% in 2002)
and Varig South America ("Varig") (18%, in 2002, 14% in 2001, and 10% in 2000).

During 2001, Varig notified the General Partner of its intention to return the
three aircraft under lease and stopped making lease payments. The Partnership
has a security deposit from Varig that could be used to pay a portion of the
amount due. During October 2001, the General Partner sent a notification of
default to Varig. The lease, which expired in October 2002, had certain return
condition requirements for the aircraft. The General Partner recorded an
allowance for bad debts for the amount due less the security deposit. During
October 2002, the General Partner reached an agreement with Varig for the past
due lease payments and agreed to re-lease two of these aircraft to them until
March 2003 at a lower lease rate. In order to give Varig an incentive to make
timely payments in accordance with the agreement, the General Partner gave a
discount on the total amount due. If Varig fails to comply with the payment
schedule in the agreement, the discount provision will be waived and the full
amount again becomes payable. Varig made an initial payment during October
2002, to be followed by 23 equal monthly installments beginning in November
2002. Unpaid outstanding amounts will accrue interest at a rate of 5%. At
December 31, 2001, the balance due from Varig was $3.3 million. Due to the
uncertainty of ultimate collection, the Manager will continue to fully reserve
the unpaid outstanding balance less the security deposit from this lessee. As
of December 31, 2002, Varig was current with all payments due under the
agreement.

As of December 31, 2002, 2001, and 2000, the General Partner believes the
Partnership had no other significant concentrations of credit risk that could
have a material adverse effect on the Partnership.

9. Income Taxes
-------------

The Partnership is not subject to income taxes, as any income or loss is
included in the tax returns of the individual partners. Accordingly, no
provision for income taxes has been made in the financial statements of the
Partnership.

As of December 31, 2002, the financial statement carrying amount of assets and
liabilities was approximately $40.4 million lower than the federal income tax
basis of such assets and liabilities, primarily due to differences in
depreciation methods, equipment reserves, provisions for bad debts, lessees'
prepaid deposits, and the tax treatment of underwriting commissions and
syndication costs.

10. Commitments and Contingencies
-------------------------------

TEC arranged for the lease or purchase of a total of 1,050 pressurized tank
railcars by (i) partnerships and managed programs in which FSI serves as the
general partner or manager and holds an ownership interest (Program Affiliates)
or (ii) managed programs in which FSI provides management services but does not
hold an ownership interest or third parties (Non-Program Affiliates). These
railcars will be delivered over the next three years. A leasing company
affiliated with the manufacturer will acquire approximately 70% of the railcars
and lease them to a Non-Program Affiliate. The remaining 30% will either be
purchased by other third parties to be managed by PLMI, or by the Program
Affiliates. An affiliate of TEC will manage the leased and purchased railcars.
Neither TEC nor its affiliate will be liable for these railcars. TEC estimates
that the total value of purchased railcars will not exceed $26.0 million with
approximately one third of the railcars being purchased in each of 2002, 2003,
and 2004. As of December 31, 2002, FSI committed one Program Affiliate, other
than the Partnership, to purchase $11.3 million in railcars that were purchased
by TEC in 2002 or will be purchased in 2003. Although FSI has neither
determined which Program Affiliates will purchase the remaining railcars nor the
timing of any purchases, it is possible the Partnership may purchase some of the
railcars.

Warehouse Credit Facility
- ---------------------------

See Note 7 for discussion of the Partnership's debt facility.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

10. Commitments and Contingencies (continued)
-------------------------------

Commitment and contingencies as of December 31, 2002 are as follows (in
thousands of dollars):

Less than 1-3 4-5 After 5
Current Obligations Total 1 Year Years Years Years
- ----------------------------------------------------------------------------

Commitment to purchase railcars $14,699 $ 6,257 $ 8,442 $ -- $ --
Line of credit -- -- -- -- --
------- ------- -------- ------ ------
$14,699 $ 6,257 $ 8,442 $ -- $ --
======= ======= ======== ====== ======

11. Quarterly Results of Operations (unaudited)
----------------------------------

The following is a summary of the quarterly results of operations for the year
ended December 31, 2002 (in thousands of dollars, except weighted-average unit
amounts):

March June September December
31, 30, 30, 31, Total
- -----------------------------------------------------------------------------------------------

Operating results:
Total revenues. . . . . . . . . . . . . . . . $2,687 $2,431 $ 2,496 $ 2,274 $9,888
Net income (loss) . . . . . . . . . . . . . . 438 223 (92) 69 638

Per weighted-average limited partnership unit:

Net income (loss) . . . . . . . . . . . . . . . $ 0.05 $ 0.03 $ (0.01) $ 0.01 $ 0.08

The following is a list of the major events that affected the Partnership's
performance during 2002:

(i) In the second quarter of 2002, lease revenues decreased $0.2
million due to certain of the Partnership's aircraft being re-leased at a lower
rate;

(ii) In the third quarter of 2002, the loss from USPEs increased
$0.3 million due to the partially owned marine vessels earning a lower lease
rate; and

(iii) In the fourth quarter of 2002, lease revenues decreased $0.2
million due to certain of the Partnership's aircraft being re-leased at a lower
rate. The decrease in income caused by the decrease in lease revenues of $0.2
million and an increase in the impairment loss of $0.4 million was partially
offset by a decrease in the provision for bad debts of $0.7 million.

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS

11. Quarterly Results of Operations (unaudited) (continued)
----------------------------------

The following is a summary of the quarterly results of operations for the year
ended December 31, 2001 (in thousands of dollars, except weighted-average unit
amounts):

March June September December
31, 30, 30, 31, Total
- ------------------------------------------------------------------------------------------------

Operating results:
Total revenues. . . . . . . . . . . . . . . . $4,096 $2,897 $ 2,796 $ 2,728 $12,517
Net income (loss) . . . . . . . . . . . . . . 1,748 996 655 (131) 3,268

Per weighted-average limited partnership unit:

Net income (loss) . . . . . . . . . . . . . . . $ 0.18 $ 0.11 $ 0.07 $ (0.01) $ 0.35

The following is a list of the major events that affected the Partnership's
performance during 2001:

(i) In the first quarter of 2001, the Partnership sold a marine
vessel, marine containers, and a railcar for a gain of $1.2 million;

(ii) In the second quarter of 2001, operating expenses decreased
$0.2 million due to the sale of a marine vessel during the first quarter;

(iii) In the third quarter of 2001, the Partnership's investment
in USPEs generated a loss resulting from lower lease revenues of $0.2 million
and higher repair expenses of $0.1 million; and

(iv) In the fourth quarter of 2001, the Partnership's investment
in a USPE trust that owned two commercial aircraft on a direct finance lease,
recorded a $1.0 million impairment loss.

12. Subsequent Events
------------------

In the first quarter of 2003, the General Partner sold the marine vessel owned
by an entity in which the Partnership has an interest. The marine vessel was
sold for net proceeds of approximately $2.3 million, of which the Partnership's
share is approximately $1.1 million. The equity in income of the USPE that will
be recognized by the Partnership related to this transaction in the first
quarter of 2003 is approximately $0.9 million.

Additionally, during February 2003, the Partnership agreed to purchase a fleet
of railcars for $1.2 million, including a $0.2 million deposit and the
assumption of a $1.0 million note payable.

On March 21, 2003, the Partnership signed a letter of intent with a
potential buyer to purchase one of the Partnership's owned Boeing 737-200A stage
II commercial aircraft for proceeds of approximately $1.1 million. The General
Partner expects the sale of this aircraft to close during May 2003. As a result
of this sale, the General Partner will record an impairment of $0.2 million
during the first quarter of 2003.

INDEPENDENT AUDITORS' REPORT

The Partners
PLM Equipment Growth Fund V:

We have audited the financial statements of PLM Equipment Growth Fund V, a
limited partnership (the "Partnership"), as of December 31, 2002 and 2001, and
for each of the two years in the period ended December 31, 2002, and have issued
our report thereon dated March 7, 2003 (March 21, 2003 as to note 12); such
report is included elsewhere in this Form 10-K. Our audits also included the
financial statement schedules of PLM Equipment Growth Fund V, listed in Item
15(B). These financial statement schedules are the responsibility of the
Partnership's management. Our responsibility is to express an opinion based on
our audits. In our opinion, such 2002 and 2001 financial statement schedules,
when considered in relation to the basic financial statements taken as a whole,
present fairly in all material respects the information set forth therein.

/s/ Deloitte & Touche LLP
Certified Public Accountants

Tampa, Florida
March 7, 2003
(March 21, 2003 as to note 12)

PLM EQUIPMENT GROWTH FUND V
(A LIMITED PARTNERSHIP)
VALUATION AND QUALIFYING ACCOUNTS

YEARS ENDED DECEMBER 31, 2002, 2001, AND 2000
(in thousands of dollars)

Balance at Additions Balance at
Beginning of Charged to Increases End of
Year Expense (Deductions) Year
- ----------------------------------------------------------------------------------------

Year Ended December 31, 2002
Allowance for doubtful accounts $ 664 $ 2,337 $ 207 $ 3,208
Aircraft engine reserves. . . . 2,300 -- -- 2,300

Year Ended December 31, 2001
Allowance for doubtful accounts $ 34 $ 631 $ (1) $ 664
Aircraft engine reserves. . . . 1,955 -- 345 2,300

Year Ended December 31, 2000
Allowance for doubtful accounts $ 47 $ 55 $ (68) $ 34
Aircraft engine reserves. . . . 1,888 -- 67 1,955

PLM EQUIPMENT GROWTH FUND V

INDEX OF EXHIBITS

Exhibit Page
- ------- ----

4.. . .Limited Partnership Agreement of Partnership. *

4.1 First Amendment to the Amended and Restated Limited Partnership
Agreement *

10.1 Management Agreement between the Partnership and
PLM Investment Management, Inc. *

10.2 Warehouse Credit Agreement, dated as of April 13, 2001. *

10.3 First Amendment to Warehousing Credit Agreement, dated as of
December 21, 2001. *

10.4 Second amendment to the Warehouse Credit Agreement, dated as of
April 12, 2002. *

10.5 Third amendment to the Warehouse Credit Agreement, dated July 11, 2002. *

10.6 October 2002 purchase agreement between PLM Transportation
Equipment Corp., Inc. and Trinity Tank Car, Inc. *

10.7 Settlement Agreement between PLM Worldwide Leasing Corp. and Varig
S.A. dated October 11, 2002. *

10.8 February 2003 purchase agreement between PLM Transportation
Equipment Corp., Inc. and Residual Based Finance Corporation. 57-64

Financial Statements required under Regulation S-X Rule 3-09:

99.1 Lion Partnership. 65-74

99.2 Clement Partnership. 75-84

* Incorporated by reference. See page 27 of this report.