SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to ______________
Commission file number ____333-61217______
Atlas Futures Fund, Limited Partnership
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(Exact Name of Registrant as Specified in Its Charter)
Delaware 51-0380494
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
5916 N. 300 West, Fremont, IN 46737
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (260) 833-1505
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Former Name, Address and Fiscal Year, if Changed, Since Last Report
No such changes occurred
Indicate by check [X] 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 [ ]
Part 1 - FINANCIAL INFORMATION
Item 1. Financial Statements.
The reviewed financial statements for the Registrant for the third quarter
ended September 30, 2002, and audited results for the calendar year 2001 are
attached hereto and made a part hereof.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
During the past quarter and in the future, Registrant, did and will, pursuant
to the terms of the Limited Partnership Agreement, engage in the business of
speculative trading of commodity futures and options markets through the
services of its commodity trading advisor, Clarke Capital Management, Inc.
The Units are sold through the broker dealer selected by the General Partner,
Futures Investment Company, at the Net Asset Value per Unit as of the close
of business on the last day of the month in which subscriptions are received
by the General Partner.
The Registrant will continue to offer Units for sale to the public via its
fully amended and restated prospectus dated August 10, 2001 and Supplement
thereto dated June 21, 2002 until the total amount of registered securities,
$15,000,000, is sold or the offering terminates.
To obtain a return of invested capital or appreciation, if any, purchasers of
Units must look solely to the redemption feature of the Partnership or to the
General Partner, in its sole judgment, to elect to make distributions. There
is no current market for the Units sold and none is expected to develop nor
is the General Partner expected to make distributions.
Part II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) None
(b) None
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Form 10-Q for the
period ended September 30, 2002, to be signed on its behalf by the
undersigned, thereunto duly authorized.
Registrant: Atlas Futures Fund, Limited Partnership
By Ashley Capital Management,
Incorporated
Its General Partner
By: /s/ Shira Del Pacult
Ms. Shira Del Pacult
Sole Director, Sole Shareholder,
President, and Treasurer of the
General Partner
Date: November 15, 2002
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
FOR THE THREE AND NINE MONTHS ENDED
SEPTEMBER 30, 2002 AND 2001
(A Review)
GENERAL PARTNER:
Ashley Capital Management, Inc.
% Corporate Systems, Inc.
101 North Fairfield Drive
Dover, Kent County, Delaware 19901
Frank L. Sassetti & Co.
To The Partners
Atlas Futures Fund, Limited Partnership
Dover, Kent County, Delaware
We have reviewed the balance sheet, including the schedule of
investments, of ATLAS FUTURES FUND, LIMITED PARTNERSHIP as of September 30,
2002 and the related statements of operations, partners' equity and cash
flows for the three and nine months ended September 30, 2002 and 2001. These
financial statements are the responsibility of the Partnership's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and making inquires of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with auditing standards generally accepted in the
United States, the objective of which is the expression of an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our review we are not aware of any material modifications that
should be made to the financial statements referred to above for them to be
in conformity with accounting principles generally accepted in the United
States.
We have previously audited, in accordance with auditing standards
generally accepted in the United States, the balance sheet, including the
schedule of investments, of ATLAS FUTURES FUND, LIMITED PARTNERSHIP as of
December 31, 2001 and the related statements of operations, partner's equity
and cash flows for the year then ended (not presented herein); and in our
report dated February 16, 2002, we expressed an unqualified opinion on these
financial statements. In our opinion, the information set forth in the
accompanying balance sheet as of December 31, 2001 is fairly stated, in all
material respects, in relation to the balance sheet from which it has been
derived.
/s/ Frank L. Sassetti & Co.
November 5, 2002
Oak Park, Illinois
BALANCE SHEETS
SEPTEMBER 30, 2002 AND DECEMBER 31, 2001
ASSETS
Sep 30
2002 December 31
(A Review) 2001
Cash (Note 7) $ 1,805 $ 32,224
Cash and cash equivalents (Note 7) $ 61,473 $ 32,224
United States Treasury Obligations (Note 6) 3,187,148 3,185,359
Accrued interest receivable 9,947 10,229
Due from limited partners 89,781 124,985
Prepaid trading commissions 1,890
Equity in Commodity Futures Trading Accounts -
Cash (Note 6) 2,511,585 2,659,778
Net unrealized gains on open commodity
futures contracts (Note 8) 888,189 122,096
$6,750,013 $6,134,671
LIABILITIES AND PARTNERS' EQUITY
LIABILITIES
Accrued trading commissions payable $ $ 2,803
Accrued management fees payable 10,074
Accrued accounting and auditing fees payable 8,600 8,542
Sales commissions payable 3,000 10,794
Accrued incentive fees payable 269,367
Total Liabilities 280,967 32,213
PARTNERS' CAPITAL
Limited partners - (4,699.63 and 5,186.28 units) 6,469,046 6,102,458
General partner - (0 units) (Note 2)
Total Partners' Capital 6,469,046 6,102,458
$6,750,013 $6,134,671
The accompanying notes are an integral part
of the financial statement
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
Three Nine Three Nine
Months Months Months Months
Ended Sep Ended Sep Ended Sep Ended Sep
30, 2002 30, 2002 30, 2001 30, 2001
REVENUES
Realized gain from trading in
futures $1,313,395 $ 807,767 $ 76,134 $ 714,118
Realized gain (loss) on
exchange rate fluctuation 2,550 42,116 6,872 (3,882)
Changes in unrealized gains
(losses) on open commodity
futures contracts 158,443 766,093 10,286 (1,028,469)
Interest income 23,004 63,780 41,070 152,507
Redemption penalty 667 3,923 1,916 3,640
Total Revenues 1,498,059 1,683,679 136,278 (162,086)
EXPENSES
Commissions 232,589 432,735 105,834 319,850
Incentive fees 269,367 269,367
Management fees 30,934 85,133 27,287 81,530
Professional accounting and
legal fees 23,416 53,906 14,139 47,994
Other operating and
administrative expenses 625 963 422 2,504
Total Expenses 556,931 842,104 147,682 451,878
NET INCOME (LOSS) $ 941,128 $ 841,575 $ (11,404) $(613,964)
NET INCOME (LOSS) -
Limited partnership unit $ 203.09 $ 173.50 $ (2.41) $ (131.53)
General partnership unit $ $ $ $
The accompanying notes are an integral part
of the financial statement
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
(A Review)
2002 2001
Amount Units Amount Units
Beginning balance-
December 31 $6,102,458 5,186.28 $5,557,782 4,434.40
Partner additions 393,536 316.95 577,377 494.49
Partner withdrawals (863,273) (803.60) (202,967) (177.47)
Syndication costs paid (5,250) (24,501)
Net income 841,575 (613,964)
Ending Balance -
September 30 $6,469,046 4,699.63 $5,293,727 4,751.42
2002 2001
Value per unit $1,376.50 $1,114.14
Total partnership units 4,699.63 4,751.42
The accompanying notes are an integral part
of the financial statement
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
(A Review)
2002 2001
Amount Units Amount Units
Beginning balance-
June 30 $5,440,432 4,634.21 $5,304,295 4,740.34
Partner additions 259,358 197.62 76,779 65.75
Partner withdrawals (166,622) (132.20) (64,260) (54.67)
Syndication costs paid (5,250) (11,683)
Net Income (Loss) 941,128 (11,404)
Ending Balance -
September 30 $6,469,046 4,699.63 $5,293,727 4,751.42
2002 2001
Value per unit $1,376.50 $1,114.14
Total partnership units 4,699.63 4,751.42
The accompanying notes are an integral part
of the financial statement
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
(A Review)
Three Nine Three Nine
Months Months Months Months
Ended Ended Ended Ended
Sep 30, 2002 Sep 30, 2001
CASH FLOWS FROM OPERATING
ACTIVITIES
Net income (loss) $941,128 $841,575 $ (11,404) $(613,964)
Adjustments to reconcile net
income (loss) to net cash
provided by (used in) operating
activities
Changes in operating assets
and liabilities
Equity in Commodity Futures
Trading Accounts (1,134,766) (617,900) (280,978) 494,244
Accrued interest receivable (1,156) 282 1,578 19,962
U.S. Treasury Obligations (849) (1,789) 295,951 25,766
Prepaid expense (1,890) (1,890) 87
Accrued commissions payable (9,605) (10,597) 2,708 (14,668)
Management and incentive
fees payable 269,367 259,293 207 (316,769)
Accounting and auditing
fees payable 5,600 58 6,225 4,207
Net Cash Provided By
(Used In) Operating Activities 67,829 469,032 14,374 (401,222)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from sale of units, net
of sales commissions 199,292 428,740 93,640 649,880
Syndication and registration
costs (5,250) (5,250) (11,683) (24,501)
Cash partner redemptions (202,203) (863,273) (119,574) (209,190)
Net Cash Provided By
(Used In) Financing Activities (8,161) (439,783) (37,617) 416,189
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 59,668 29,249 (23,243) 14,967
CASH AND CASH EQUIVALENTS
Beginning of period 1,805 32,224 38,770 560
End of period $ 61,473 $ 61,473 $ 15,527 $ 15,527
The accompanying notes are an integral part
of the financial statement
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
SCHEDULE OF INVESTMENTS
September 30, 2002
(A Review)
Contracts Value Percent
United States Commodity Futures Positions, Held Long
21 Dec' 02 U.S. Treasury Bond $103,523 1.57%
56 Dec' 02 10 - Year Treasury Notes 238,875 3.63
40 Dec' 02 5 - Year Treasury Notes 110,156 1.67
22 Dec' 02 2 - Year Treasury Notes 45,641 0.69
22 Dec' 02 Wheat (11,550) (0.18)
40 Dec' 02 New York Cocoa 127,190 1.93
22 Mar' 03 New York Sugar (1,736) (0.03)
21 Nov' 02 Crude Oil 13,860 0.21
23 Dec' 02 New York Gold (1,380) (0.02)
23 Dec' 02 British Pound (2,875) (0.04)
46 Dec' 02 Swiss Franc 2,013 0.03
23 Dec' 02 European Currency Unit (10,063) (0.15)
87 Mar' 03 Eurodollar 58,213 0.88
21 Dec' 02 Gas Oil 45,150 0.69
44 Nov' 02 Brent Crude (2,260) (0.03)
Total United States Commodity Futures Positions 714,757 10.85
Australian Commodity Futures Positions, Held Long
23 Dec' 02 Australian Bill 601 0.01
69 Dec' 02 3 - Year Australian Treasury Bond
Total Australian Commodity Futures Positions 601 0.01
European Commodity Futures Positions, Held Long
43 Mar' 03 Euribar 45,346 0.69
44 Dec' 02 2 - Year German Euro Schatz 26,936 0.41
22 Dec' 02 10 - Year German Euro Bund 39,535 0.60
Total European Commodity Futures Positions 111,817 1.70%
The accompanying notes are an integral part
of the financial statement
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
SCHEDULE OF INVESTMENTS
September 30, 2002
(A Review)
Contracts Value Percent
British Commodity Futures Positions, Held Long
45 Mar' 03 Short Sterling $ 10,144 0.15%
22 Dec' 02 Long Gilt 45,581 0.69
Total British Commodity Futures Positions 55,725 0.84
Japanese Commodity Futures Positions, Held Long
8 Mar' 03 KCE Chicks 2,759 0.04
Total Japanese Commodity Futures Positions 2,759 0.04
Total Commodity Futures Positions 885,659 13.44
United States Commodity Futures Positions, Sold Short
23 Dec' 02 Soybean Meal 2,530 0.04
Total Commodity Futures Positions Sold Short 2,530 0.04
Net Commodity Futures Positions 888,189 13.48%
The accompanying notes are an integral part
of the financial statement
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
SCHEDULE OF INVESTMENTS
September 30, 2002
(A Review)
Maturity
Value Value Percent
$3,200,000 United States Treasury Bills $3,187,148 48.39%
Cash in Trading Accounts
United States Markets 1,855,642 28.17
Canadian Markets (33,924) (0.52)
Euro Dollar Markets 611,301 9.28
British Pound Markets 141,330 2.15
Japanese Yen Markets (17,828) (0.27)
Australian Dollar Markets (44,936) (0.68)
Total Cash in Trading Accounts 2,511,585 38.13
Total Investments $6,586,922 100.00%
The accompanying notes are an integral part
of the financial statement
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2002 AND 2001
(A Review)
1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
Atlas Futures Fund, Limited Partnership (the Fund) was formed January
12, 1998 under the laws of the State of Delaware. The Fund is engaged in the
speculative trading of futures contracts in commodities, which commenced in
October, 1999. Ashley Capital Management, Inc. is the general partner and
commodity pool operator (CPO) of Atlas Futures Fund, Limited Partnership.
The commodity trading advisor (CTA) is Clarke Capital Management, who has the
authority to trade so much of the Fund's equity as is allocated to it by the
General Partner.
Income Taxes - In accordance with the generally accepted method of
presenting partnership financial statements, the financial statements do not
include assets and liabilities of the partners, including their obligation
for income taxes on their distributive shares of the net income of the Fund
or their rights to refunds on its net loss.
Registration Costs - Costs incurred for the initial filings with the
Securities and Exchange Commission, Commodity Futures Trading Commission,
National Futures Association (the "NFA") and the states where the offering
was made were accumulated, deferred and charged against the gross proceeds of
offering at the initial closing as part of the offering expenses. Recurring
registration costs, if any, will be charged to expense as incurred.
Revenue Recognition - Commodity futures contracts are recorded on the
trade date and are reflected in the balance sheet at the difference between
the original contract amount and the market value on the last business day of
the reporting period.
Market value of commodity futures contracts is based upon exchange or
other applicable market best available closing quotations.
Use of Accounting Estimates - The preparation of financial statements
in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and reported amounts of revenues and
expenses during the reporting period. Actual results could differ from these
estimates.
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2002 AND 2001
(A Review)
1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Statement of Cash Flows - For purposes of the Statement of Cash Flows,
the Fund considers only cash and money market funds to be cash equivalents.
Net cash used in operating activities includes no cash payments for interest
or income taxes for the three and nine months ended September 30, 2002 and
2001.
2. GENERAL PARTNER DUTIES
The responsibilities of the General Partner, in addition to directing
the trading and investment activity of the Fund, including suspending all
trading, includes executing and filing all necessary legal documents,
statements and certificates of the Fund, retaining independent public
accountants to audit the Fund, employing attorneys to represent the Fund,
reviewing the brokerage commission rates to determine reasonableness,
maintaining the tax status of the Fund as a limited partnership, maintaining
a current list of the names, addresses and numbers of units owned by each
Limited Partner and taking such other actions as deemed necessary or
desirable to manage the business of the Partnership.
In addition, the general partners held a financial interest in the
partnership until June 30, 2000, at which time the investment was redeemed.
3. THE LIMITED PARTNERSHIP AGREEMENT
The Limited Partnership Agreement provides, among other things, the
following:
Capital Account - A capital account shall be established for each
partner. The initial balance of each partner's capital account shall be the
amount of the initial contributions to the partnership.
Monthly Allocations - Any increase or decrease in the Partnership's net
asset value as of the end of a month shall be credited or charged to the
capital account of each Partner in the ratio that the balance of each account
bears to the total balance of all accounts.
Any distribution from profits or partners' capital will be made solely
at the discretion of the General Partners.
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2002 AND 2001
(A Review)
3. THE LIMITED PARTNERSHIP AGREEMENT - CONTINUED
Allocation of Profit and Loss for Federal Income Tax Purposes - As of
the end of each fiscal year, the Partnership's capital gain or loss and
ordinary income or loss shall be allocated among the Partners, after having
given effect to the fees of the General Partner and the Commodity Trading
Advisors and each Partner's share of such items are includable in the
Partner's personal income tax return.
Redemption - No partner may redeem or liquidate any units until after
the lapse of six months from the date of the investment. Thereafter, a
Limited Partner may withdraw, subject to certain restrictions, any part or
all of his units from the partnership at the Net Asset Value per Unit on the
last day of any month with ten days prior written request to the General
Partner. A redemption fee payable to the Partnership of a percentage of the
value of the redemption request is charged during the first 24 months of
investment pursuant to the following schedule:
4% if such request is received ten days prior to the last trading day
of the sixth month after the date of the partner's investment in the Fund.
3% if such request is received during the seventh to twelfth month
after the investment
2% if such request is received during the thirteenth to eighteenth
month.
1% if such request is received during the nineteenth to twenty-fourth
month.
0% thereafter.
4. FEES
The Fund is charged the following fees on a monthly basis since the
commencement of trading.
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2002 AND 2001
(A Review)
4. FEES - CONTINUED
A management fee of 3% (annual rate) of the Fund's net assets allocated
to each CTA to trade will be paid to each CTA and 1% of equity to the Fund's
General Partner. Effective November 1, 2000, the management fee allocated to
each CTA was decreased to 0% (annual rate) and the management fee allocated
to the Fund's General Partner was increased to 2% (annual rate) of the Fund's
net assets.
An incentive fee of 20% of "new trading profits" will be paid to each
CTA. "New trading profits" includes all income earned by each CTA and
expense allocated to his activity. In the event that trading produces a
loss, no incentive fees will be paid and all losses will be carried over to
the following months until profits from trading exceed the loss. It is
possible for one CTA to be paid an incentive fee during a quarter of a year
when the Fund experienced a loss. Effective November 1, 2000, the incentive
fee increased to 25% of "new trading profits."
The Fund will pay fixed commissions of 9% (annual rate) of assets
assigned to be traded, payable monthly, to the Introducing Broker affiliated
with the General Partner. The Affiliated Introducing Broker will pay the
costs to clear the trades to the futures commission merchant and all PIT
Brokerage costs which shall include the NFA and exchange fees.
5. REALIZED GAIN ON EXCHANGE RATE FLUCTUATIONS
Certain trades executed by the Fund are denominated in foreign
currencies. Gains and losses on these transactions are recorded as futures
trading gains or losses at the U. S. dollar equivalent on the date the trade
is settled. Exchange rate fluctuation gain or loss is reflected when
residual amounts of foreign currencies are reconverted to U. S. dollars.
6. PLEDGED ASSETS
The U. S. Treasury Obligations and Cash in trading accounts are pledged
as collateral for commodities trading on margin.
ATLAS FUTURES FUND, LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2002 AND 2001
(A Review)
7. CONCENTRATIONS
The Fund maintains its cash balances at a high credit quality financial
institution. The balances may, at times, exceed federally insured credit
limits.
8. OFF BALANCE SHEET RISK
As discussed in Note 1, the Fund is engaged in speculative trading of
futures contracts in commodities. The carrying amounts of the Fund's
financial instruments and commodity contracts generally approximate their
fair values at September 30. Open commodity contracts had gross contract
value of $93,764,073 on long positions and $396,060 on short positions at
September 30, 2002. Open commodity contracts had gross contract value of
$2,586,066 on long positions and $4,031,682 on short positions at December
31, 2001.
Although the gross contract values of open commodity contracts
represent market risk, they do not represent exposure to credit risk, which
is limited to the current cost of replacing those contracts in a gain
position. The unrealized gain on open commodity futures contracts at
September 30, 2002 and December 31, 2001 was $888,189 and $122,096,
respectively.